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Civil Appeal No.2877 of 1977.
From the Judgment and Decree dated 19.8.1977 of the Punjab and Haryana High Court in R.S.A. No. 334 of 1975.
R. Bana for the Appellants.
Harbans Lal and G.K. Bansal for the Respondents.
The following Order of the Court was delivered: Kehar Singh had two wives, Basant Kaur and Sahib Devi.
Sahib Devi died during Kehar Singh 's life time.
Sahib Devi 's son was Niranjan Singh who also died during Kehar Singh 's life time.
Niranjan Singh had four sons and one daughter.
On 26th April, 1947 Kehar Singh in lieu of maintenance made three oral gifts of properties situated in three different villages in favour of his wife Basant Kaur.
The question which arose for consideration before the lower Court was whether Basant Kaur got an absolute estate in the gifted properties as result of the passing of the .
In regard to the land in village Ballowal the lower Courts have held that she got an absolute estate.
The High Court was concerned in the second Appeal with the lands in village Dhaipai and Chominda, and it held the gift having been without any power of alienation would fall under Section 14(2).
The Exhibit D I was the report of the Patwari in connection with the mutation proceedings and it said: "Today Kehar Singh owner of Khewat came alongwith Narain Singh Lambardar and stated that he had on 14th April, 1947, made an oral gift of land half of total land measuring 8 bighas Pukhta, 3 Biswas and 3 Biswani, which is 4 Bighas Pukhta, 12 Biswas and 1 Biswani as detailed in favour of his wife Mst.
Basant Kaur, and given possession of the same.
I had only one son who is dead and he had four sons and no other male issue.
There is no certainty of life.
She served me.
Lambardar attests so the mutation is entered.
" 387 On 30th July, 1947, the Assistant Collector made the following orders: "In the gathering, Kehar Singh donor and Basant Kaur donee, identified by Kishan Singh Lambardar are present.
The change of possession of this case is admitted and verified by the donor and the donee.
Donor stated that he has got no son.
I had got two wives.
My grand sons, it is possible may not gift maintenance to my wife.
With this view I make the gift.
Gift is for maintenance.
After gift there would be no powers of mortgage or sale.
After the death of Basant Kaur Malkiat Singh, Amar Singh, Gurdeep Singh and Mohan Singh, children would be heirs.
This gift is of 1/2 share or Khasra No.4658/2468 measuring 4 Bighas, 12 Biswas 1 Biswani, Khewat Nos. 324 to 326, which is attested in favour of Mst.
Basant Kaur donee.
" The High Court on interpretation of the Assistant Collector 's report came into conclusion that Basant Kaur derived only a limited estate inasmuch as such a gift, according to the high Court, would fall directly under section 14(2) of the and as such the limited estate of Basant Kaur would not stand enlarged into an absolute estate.
The challenge was to the gift made by Basant Kaur in favour of two step grand sons ignoring the other two.
There is no doubt that Basant Kaur had the right of maintenance and the gift was explicitly in lieu of maintenance.
As such we are of the view that it was not a case of her acquiring any new property by virtue of the gift but it was a case of her right of maintenance being given to her by way of a gift.
It was a property acquired by gift in lieu of maintenance.
This acquisition on 26th April, 1947 having been prior to the , we are of the view that she having acquired this property by way of gift in lieu of her antecedent right to maintenance, it would fall under sub section (1) and not under sub section (2) of section 14 of the .
In this view we are in consonance with the decisions in Bai Vijia (Dead) by Lrs.
vs Thakorbhai Chelabhai & Ors., ; ; Gulwant Kaur & Anr.
vs Mohinder Singh & Ors., [19871 3 SCC 674; Maharaja Pillai Lakshmi Ammal vs Maharaja Pillai Thillanayakom Pillai & Anr., ; and Jaswant Kaur vs Major Harpal Singh, In view of the facts and circumstances, we are of the view that the decisions of Mst.
Karmi vs Amru & Ors., [ and Kothi Satyanarayana vs Galla Sithayya & Ors.
, [ ; are distinguishable on facts.
388 In the result, the Judgment and decree of the High Court are set aside, this appeal is allowed and the suit is dismissed.
However, under the facts and circumstances of the case, we make no orders as to costs.
G.N. Appeal allowed.
| IN-Abs | The grandfather of the appellants and respondents had two wives.
The first wife and her only son died during his life time.
The pre deceased son left behind four sons and a daughter.
In 1947, the grand father made three oral gifts of certain properties in favour of his second wife, in lieu of maintenance.
Later, the grandmother gifted some of these properties to two step grandsons.
The gift was challenged by the other two grandsons.
The lower court held that she had the absolute estate in the properties after the possing of the .
In Second Appeal, the High Court held that she derived only a limited estate inasmuch as the gift in her favour would fall directly under section 14(2) of the and as such her limited estate would not stand enlarged into an absolute estate.
This appeal is against the said judgment of the High Court.
Allowing the appeal, this Court, HELD: 1.
There is no doubt that the donee had the right of maintenance and the gift was explicitly in lieu of maintenance.
It was a case of her acquiring any new property by virtue of the gift but it was a case of her right of maintenance being given to her by way of a gift.
It was a property acquired by gift in lieu of maintenance.
The acquisition made on 26th April, 1947 having been prior to the , and she having acquired the property by way of gift in lieu of her antecedent right to maintenance, it would fail under sub section (1) and not under sub section (2) of section 14 of the and she derived absolute estate in the properties.
[387E F] Bai Vajia (Dead) by Lrs.
vs Thakorbhai Chelabhai & Ors. ; ; Gulwant Kaur & Anr.
vs Mohinder Singh & Ors., ; ; Maharaja Pillai Lakshmi Ammal vs Maharaja Pillai Thillanayakom Pillai & Anr.
, ; ; Jaswant Kaur V. Major 386 Harpal Singh, ; relied on.
Karmi vs Amru & Ors., ; Kothi Satyanarayana vs Galla Sithayya & Ors.
, ; ; distinguished.
|
Civil Appeal No. 739 of 1991.
From the Judgment and Order dated 16.3.1990 of the Punjab and Haryana High Court in Regular Second Appeal No. 405 of 1990.
G.B. Pai, and P.N. Gupta for the Appellant.
Ashok K. Mahajan for the Respondent.
The Judgment of the Court was delivered by KANIA, J.
Leave granted.
Counsel heard.
This is an appeal by Special Leave against the decision of a learned Single Judge of the Punjab and Haryana High Court, dismissing summarily Regular Second appeal No. 405 of 1990 in that Court.
The relevant facts can be stated very shortly.
At the relevant time respondent No. 1 was an officer being the Manager in the Hardwar Branch of the appellant Bank, a Government of India Undertaking.
On April 2, 1982 a show cause notice was served on respondent No. 1 in respect of several irregularities, lapses, acts, omissions and so on.
On May 4,1982 respondent No. I submitted his reply to the said show cause notice denying the charges made against him and asking for the holding of an enquiry into the allegations.
On July 17, 1984 respondent No. 1 was promoted from Scale II to Scale Ill by the appellant.
It appears from the record that disciplinary action was contemplated against respondent No. I but in November 1984, the disciplinary proceedings contemplated against respondent No. 1 were kept in abeyance as some of the allegations against him were under investigation by the Central Bureau of Investigation (CBI) On March 11, 1988 interviews for promotion from Scale III to Scale IV were conducted and respondent No. 1 was one of the officers interviewed for promotion.
On April 27, 1988 a charge sheet was served on respondent No. 1.
On May 27, 1988 an enquiry was ordered against him and the Commissioner of Departmental Enquiries, Government of India, was appointed as the Enquiry Officer.
On June 30, 1988, respondent No. 1 filed a suit in the Court of Sub Judge, Second Class, Jallandhar 476 for a declaration that the Order dated April 27,1988 by which respondent No. I was served with charge sheet was illegal and in violation of the Service Regulations and unsustainable in law and prayed for permanent injunction restraining the appellant and others from proceeding with the enquiry on the basis of the said charge sheet.
One of the main contentions urged on behalf of respondent No. 1 in the said suit was that by reason of the promotion granted to him from Scale II to Scale Ill on July 17, 1984 as aforestated, which was after the irregularities and misconduct aileged against him had been committed and in view of the said promotion the appellant must be deemed to have condoned the earlier misconduct, if any, of respondent No. 1 and thereafter it was not open to the appellant to take any action against respondent No. I in respect of the said misconduct.
This contention found favour with learned Trial Judge who gave a declaration that the order, serving the charge sheet on respondent No. 1 was illegal and restrained the appellant and others from proceeding with the enquiry on the basis of the said charge sheet.
An appeal was preferred by the appellant against the said order in the court of learned Additional District Judge, Jallandhar but it was dismissed as learned Additional District Judge accepted the reasoning and conclusions of the learned Trial Judge.
The second appeal against the decision of learned Additional District Judge was dismissed by the High Court and this is an appeal directed against the judgment of the High Court.
It was submitted before us by Mr. Pai, learned Counsel for the appellant that the promotion granted to respondent No. 1 from Scale II to Scale Ill on July 17, 1984, could not be regarded in law as condonation of the earlier acts of misconduct committed by respondent No. 1.
It was urged by him that at that time no disciplinary proceedings had been initiated against respondent No. I and in view of this, the appellant had no option but to consider respondent No. 1 for promotion for which he was entitled to be considered and to promote him if he was found fit for promotion.
It was, on the other hand, contended by Mr.Rao, learned counsel for the respondent that the earlier acts of respondent No. 1, even if they constituted misconduct, could not be relied upon to take any disciplinary action against respondent No. I because they were condoned by reason of the aforesaid promotion.
In considering the submissions of the respective parties, we have to bear in mind that it is accepted before us that in law the mere fact that disciplinary proceedings are contemplated or under consideration against an employee does not constitute a good ground for not considering the employee concerned for promotion if he is in the zone of 477 consideration nor would it constitute a good ground for denying the promotion if the employee is considered otherwise fit for promotion.
In the present case, we find that this legal position is reinforced by clause (9) of the Promotion Policy of the appellant Bank.
Clause (9) reads as follows: "Clause 9.
Officers in respect of whom disciplinary action is in process will be permitted to take part in the promotion process, subject to the condition that the promotions (if they are selected) will be withheld until the Officer is exonerated from the charges.
In such an event the promotion will be given effect to from the date on which it would have been otherwise effective but for the disciplinary action.
The officer will not be eligible for promotion if punishment, except censure, was awarded as a result of the disciplinary action.
" On a plain reading of this clause it is clear that even if disciplinary action is in process against an officer of the appellant Bank, that would not entitle the appellant Bank to exclude from consideration for promotion the officer concerned if he is otherwise entitled to be so considered.
The only right given to the appellant in such cases is that, in case such an officer is otherwise found fit for promotion and selected for promotion, that promotion can be withheld until the officer is exonerated from the charges.
It is significant that the said clause goes to state that in case such an officer is exonerated from the charges, promotion will have to be given effect to from the date on which it would have been otherwise effective but for the disciplinary action.
This rule gives rise to the implication that till disciplinary action is in process or initiated, the officer concerned, against whom allegations of misconduct might be made, can neither be excluded from consideration for promotion if he is entitled to be considered otherwise nor can the promotion be denied to him.
In these circumstances, when the promotion from Scale II to Scale Ill was granted to respondent No. 1 on July 17, 1984, there could be no question of condonation of the earlier acts of misconduct by reason of this promotion because in law and in view of the said Regulation (9) the appellant had no option but to consider respondent No. 1 for promotion and if he was otherwise found fit for promotion to promote him.
In view of this conclusion, it must follow that the charge sheet submitted against respondent No. 1 and the disciplinary proceedings pursuant to the said charge sheet cannot be said to be bad in law and cannot be interfered with on the ground of condonation.
In our view, the courts below were 478 in error in holding that the earlier alleged acts of misconduct of respondent No. I had been condoned by the appellant and basing their conclusions thereon.
In support of his submissions relating to the question of condonation, Mr. Rao relied upon the decision of a Division Bench of the Calcutta High Court in L. W. Middleton vs
Horry Playfair, AIR (1925) Calcutta 87 and the decision of a learned Single Judge of the Nagpur High Court in District Council, Amraoti through Secretary vs Vithal, Vinayak Bapat, AIR (1941) Nagpur 125.
Both these cases lay down that once a master has condoned any misconduct on the part of servant which would have justified dismissal or a fine, he cannot, after such condonation, go back upon his election to condone and claim a right to dismiss him or impose a fine or any other punishment in respect of the offence which has been condoned.
In our view, these decisions are of no relevance in the present case.
At the time these decisions were rendered under the general law of master and servant it was open to the master to dismiss his servant or fine him on the ground of misconduct.
On the facts of both these cases the master had the option of dismissing the servant or finding him on the ground of misconduct but voluntarily did not take the action of dismissing or fining him on the ground of misconduct and it was held that thereby the master had condoned the earlier misconduct and could not thereafter rely on the said misconduct for punishing the servant.
In the case before us, however, at the time when the promotion was granted to respondent No. I on July 17, 1984, the appellant had no option but to consider respondent No. I for promotion and to promote him if he was found fit as no disciplinary proceedings had been initiated against him or could be said to be in process against him, as we have set out earlier.
In such a case, no question of condonation could arise.
The ratio of decision in Lal Audhraj Singh vs State of Madhya Pradesh, AIR 1967 M.P. 284 is also of no application to the case before us as that again was a case where the employer, namely, the State, had the option of punishing the employee and voluntarily refrained from doing so.
It was next contended by Mr. Rao that even if the disciplinary proceedings against respondent No. 1 were liable to be continued that constitutes no ground for holding up the promotion of respondent No. 1 from Scale III to Scale IV if he was otherwise found fit for promotion, as, on the date when the selections for that promotion were made, no charge sheet had been served on respondent No. I and it is the accepted position here that till the charge sheet was submitted it could not be said that disciplinary proceedings were in process or 479 had been initiated.
It was submitted by Mr. Rao that this contention was fortified by the provisions of Clause (9) of the Promotional Policy of the appellant, which we have discussed earlier.
It was urged by him that it was on this ground that the appellant had based its case regarding the validity of the disciplinary proceedings against respondent No. 1 and on the same basis respondent No. I was entitled to be promoted from Scale Ill to Scale IV as from March 1988 if he was found fit.
It was submitted by him that since the charge sheet was served on respondent No. 1 over a month after he was considered for promotion from Scale Ill to Scale IV, it was not open to the appellant to hold back the consideration of the case of respondent No. I for promotion from Scale III to Scale IV or to deny him the promotion if he was found fit.
It appears to us prima facie that the submissions of Mr. Rao in connection with promotion of respondent No. 1 from Scale Ill to Scale IV are not without substance.
However, it is unnecessary for us to decide this question because Mr. Pai, learned counsel for the appellant has agreed that without creating a precedent, the appellant will grant promotion to respondent No. 1 from Scale Ill to Scale IV if it is found that the Departmental Promotion Committee found him fit for promotion and that this promotion will be granted from the date on which he would have been promoted but for the departmental enquiry being contemplated against him.
In the result, the appeal is allowed to the extent aforestated and the impugned order of the High Court quashing the departmental proceedings is set aside.
The departmental enquiry shall be proceeded with and completed within a period of six months according to law.
As far as question of promotion of respondent No. 1 from Scale III to Scale IV is concerned, that question will be considered in the light what has been agreed to by Mr. Pai, as set out earlier.
Parties shall bear and pay their own costs throughout.
T. N. A. Appeal allowed.
| IN-Abs | Clause 9 of the promotion policy of the Appellant Bank provides that an officer in respect of whom disciplinary action is in process will be permitted to take Part in the promotion process, subject to the condition that his promotion will be withheld until the officer is exonerated from the charges and in case such an officer is exonerated from the charges, the promotion shall take effect from the date on which it would have been otherwise effective but for the disciplinary action.
Respondent 1, a Bank Manager, was Promoted from Scale II to Scale Ill under the aforesaid clause while disciplinary proceedings were contemplated against him.
Later he was also interviewed for promotion from Scale IlI to Scale IV.
thereafter the appellant Bank charge sheeted him and initiated a departmental inquiry against him.
He challenged the legality of the bank 's action by filing a declartory suit contending that in view of the promotion granted to him, the appellant Bank must be deemed to have condoned the earner misconduct and subsequent to his promotion it was not open to the Bank to take any action against himn.
The Trial Court allowed the suit and restraied the appellant bank from Proceeding with the inquiry by holding the charge sheet illegal.
The order of the trial court was affirmed by the first appellate court and the second appeal filed by the bank was also dismissed by the High Court.
In appeal to this court, it was contended on behalf of the bank that the grant of promotion to the appellant under clause 9 cannot be regarded in law as condonation of pre promotion misconduct.
On behalf of the respondent, it was contended that even if the continuation of 474 disciplinary proceedings was valid, it was not a ground for holding up of his promotion from Scale Ill to Scale IV because on the date of interview no charge sheet was served on him.
Allowing the appeal and setting aside the order of the High Court, this Court, HELD: 1.
The mere fact that disciplinary proceedings are contemplated or under consideration against an employee does not constitute a good ground for not considering the employee concerned for promotion if he is in the zone of consideration nor would it constitute a good ground for denying the promotion if the employee is considered otherwise fit for promotion.
Clause 9 of the Promotion Policy of the Bank gives rise to the implication that the disciplinary action is in process or initiated, the officer concerned, against whom allegations of misconduct might be made, can neither be excluded from consideration for promotion if he is entitled to be considered for promotion otherwise nor can the promotion be denied to him.
In these circumstances, when the promotion from Scale II to Scale III was granted to respondent, there could be no question of condonation of the earlier acts of misconduct by reason of this promotion because in law and in view of clause 9 of the Promotion policy appellant had no option but to consider respondent for promotion and if he was otherwise found fit for promotion to promote him.
Hence the charge sheet submitted against respondent and the disciplinary proceedings pursuant to the said charge sheet cannot be said to be bad in law and cannot be interfered with on the ground of condonation.
Therefore, the courts below were in error in holding that the earlier alleged acts of misconduct of respondent had been condoned by the appellant and basing their conclusions thereon.
[476G H; 477F H; 488A] L.W. Middleton vs Horry Play Fair, AIR 1925 Cal. 87; District Council, Amraoti through Secretary vs Vithal Vinayak Bapat, AER 1941 Nagpur 125 and Audhraj Singh vs State of Madhya Pradesh, AIR.
M.P. 284; held inapplicable.
In view of the fact that the appellant bank has agreed that without creating a precedent it will grant promotion to respondent from Scale Ill to Scale IV, if the departmental promotion Committee finds him fit for promotion and that this promotion will be granted from the date on which he would have been promoted but for the departmentl inquiry being contemplated against him, it is unnecessary to express any opinion on the submission that since on the date of selection for promotion from Scale III to Scale IV, no charge sheet was served on the 475 respondent it was not open to the bank to hold back the respondent 's promotion from Scale IH to Scale IV.
[479C D]
|
ivil Appeal No. 822 of 1978.
From the Judgment and Order dated 23.3.1977 of the Andhra Pradesh High Court in Case Referred (Estate Duty Case) No. 6 of 1975.
450 T.A. Ramachandran and Ms. Janki Ramachandran for the Appellant.
S.C. Manchanda, Ms. A. Subhashini (NP) and K.P. Bhatnagar for the Respondent.
The Judgment of the Court was delivered by THOMMEN, J.
This appeal by certificate arises from the judgment of the Andhra Pradesh High Court dated 23.3.1977 in Estate Duty Case No. 6 of 1975.
Answering the questions referred to it against the appellant and in favour of the Revenue, the High Court held that, in computing the net principal value of the estate for the purpose of the ("the Act"), the appellant was not entitled to deduct either the estate duty payable on the estate or the amount attributable to the maintenance of the wife of the deceased.
The appellant 's counsel, Mr. T.A. Ramachandran, submits that the duty payable on the estate of the deceased is an encumbrance on the estate, being a first charge on the property passing on the death, and is, therefore, deductible in terms of Section 44 of the Act.
According to counsel, all properties passing on the death of the deceased are encumbered to the extent of the duty payable by reason of the charge created by section 74 of the Act and that duty has to be deducted from the total value of the estate which is subjected to the levy of duty in terms of section 5.
Counsel further submits that the amount attributable to the maintenance of the wife during the life of her husband must also be treated as a debt deductible under section 44.
Mr. S.C. Manchanda, appearing for the Revenue, submits that the claim of the appellant has no warrant in the law and is totally unsupported by any judicial decision.
He submits that estate duty falls upon the property passing upon the death.
The property at the time of the passing was not encumbered by the duty, for duty became payable only upon its passing and was, therefore, not a liability to which the estate was subjected during the life of the deceased.
It becomes so encumbered only subsequent to and consequent on the death.
He futher submits that there is not the smallest foundation for the claim for deduction in respect of the maintenance of the wife during the life of the husband, as contended by the appellant 's counsel, for the estate was never charged with the amount attributable to the maintenance of the wife.
A wife 's claim for maintenance either during the life her 451 husband, or subsequent to the death of her husband, is not a charge on the property and is not a deductible amount in terms of the Act.
We shall first deal with the claim for deduction of estate duty.
Section of the 5 of the Act, insofar as it is material, reads: "Levy of estate duty.
In the case of every person dying after the commencement of this Act, there shall, save as hereinafter expressly provided, be levied and paid upon the principal value ascertained as hereinafter provided of all peroperty, settled or not settled, includng agricultral land. . which passes on the death of such person, a duty called "estate duty" at the rats fixed in accordance wth section 35.
(2). . . . ." Sub section (1) of section 5 imposes a duty upon the net principal value ascertained of 'all property" which passes on the death of a person.
All properties passing on a death, other than those which are exempted from duty (See section 21 to 33), are, for the purpose of levy under the Act, aggregated into one estate, which is the "property" on which duty is levied at the rates applicable in respect of its principal value (Section 34 and 35), but subject to the deductions permitted under of the Act.
The properties are valued, for the purpose of levy under the Act, in accordance with the provisions of Section 36 says that the principal value of any property shall be estimated to be price which, in the opinion of the Controller, such property would fetch if sold in the open market at the time of the death of the deceased.
of the Act contains section 44 to 50B dealing with deductions in determining the chargeable value of the estate.
Section 44 says that, in determining the value of an estate, allowance has to be made for funeral expenses not exceeding rupees one thousand and for debts and incumbrances.
The section, however, provides that no allowance shall be made in respect of matters enumerated under clauses (a) to (d) of the section.
The "debts and encumbrances" mentioned in section 44 are, as a 452 general rule, debts and encumbrances incurred before the death of the deceased.
Certain exceptions are, specifically provided in section 44 and the other provisions of Reasonable funeral expenses, cost of realising or administering foreign property, allowance for duty paid in a non reciprocating country, relief from estate duty where court fees have been paid in any State for obtaining probate, letters of administration or a succession certificate, and, relief from estate duty where tax has been paid on capital gains are, in the specified curcumstances, allowable deductions in the determination of the value of the estate for the purpose of estate duty, notwithstanding that such liabilities arose subsequent to the death.
In no other case does the Act postulate deduction or allowance for any debt or encumbrance incurred subsequent to the passing of the property upon the death.
Singinficantly, estate duty payable on the estate of the deceased is not one of those exceptions to the general rule.
Section 53 makes certain persons accountable for the whole of the estate duty on the property passing on the death.
These are the legal representatives, trustees, guardians, committees or other persons in whom any interest in the property or the management thereof at the any time vested.
They are accountable for the whole of the estate duty on the property passing on the death of the deceased, but their liability is limited to the assest of the deceased which they have actually received or which, but for their own neglect or default, they might have received.
Any default or concealment on their part in the discharge of their duties will make them liable for the penalty provided under section 60.
Section 74 says that duty payable in respect of property, passing on the death of the deceased, is a first charge on the property so passing.
Any claim in respect of such duty is not liable to be defeated by any private transfer or delivery of such property.
Any such private transfer or delivery is void against such a claim.
Section 74 reads: "Estate duty a first charge on property liable thereto.
74(1).
Subject to the provisions of section 19, the estate duty payable in respect of property, movable or immovable, passing on the death of the deceased, shall be a first charge on the immovable property so passing (including agricultural land) in whomsoever it may vest on his death after the debts and incumbrances allowable under of this Act; and any private transfer or delivery of such property shall void against any claim in respect of such estate duty.
(2) A rateable part of the estate duty on an estate, in proportion to the value of any beneficial interest in possession in movable property which passes to any person (other than the legal representative of the deceased) on the death of the deceased shall be a first charge on such interest: Provided that the property shall not be so chargeable as against a bona fide purchasr thereof for valuable consideration without notice.
3. . . . " The sechme of the Act, as the above provisions indicate, is to levy estate duty upon the net principal value of all property,as aggregated and ascertained under the Act, and which passes on the death of the person who was competent to dispose of such property at the time of his death (section 6) or which is deemed to pass on his death (section 7 to 17).
The expression "passes on the death" denotes change in the title or possession of the whole property taking place at the death.
It is immaterial to whom the property passes.
"The question. is not to whom has the property passed, the question is whether it has passed at all".
Per Lord Blanesburgh, Inland revenue Commissioners vs
Crossman, , 'Estate duty falls upon the property passing upon a death. " Per Lord Loreburn, L.C., Winans & Another vs Attorney General, ,30.
the levy is upon the principal value of such property ascertained as provided under the Act.
Property changes hands at the time of the death, by reason of the death, and, therefore, subsequent of the death.
The imposition of the charge under the Act does not arise until the death has actually occurred and the property has, thereupon, passed.
The liability to pay estate duty is fastened on the persons accountable.
But their liability is limited to, and will not exceed, the assets of the deceased actually received by them, or which, but for their neglect or default, they might have received.
Apart from the personal liability cast on the persons accountable, and their liability to penalty in the event of default or cocealment, the duty payable is charged on the property itself and any private transfer or delivery is void against any claim in respect of such duty.
Essentially and basi 454 cally, therefore, the duty is a burden on the estate and that burden is fastened on the estate upon the death of the deceased.
During his life, no liability under the Act arose or could arise.
Subject to the limitations and exceptions statutorily specified, the allowable deductions in the determination of the changeable value of the estate are the debts and encumbrances incurred before the death of the deceased.
Esate duty falling upon property passing upon the death had not become a debt or encumbrance utill the death of the deceased, and is, therefore, not deductible.
The view is consistent with the conclusion reached on the point by various High Courts, , [1978] 111 ITR 365 ( Gujarat), [1981] 127 ITR 642 (Allahabad), [1981] 132 ITR 871 (Madras), [1982] 137 ITR 801 (Gauhati), [1990] 186 ITR 29 (Bombay).
This conclusion was adopted by the Andhra Pradesh High Court in Controller of Estate Duty vs Estate of Late Omprakash Bajaj, and it was that decision which was followed by the High Court on this point in the judgment under appeal.
The High Court, in our view, rightly disallowed the claim for deduction of the estate duty in the computation of the net principal value of the estate.
As regards the claim for deduction of the amount attributable to the maintenance of the wife of the deceased during his life, there is no evidence or any finding to show that the estate had been burdened with any such debt or encumbrance by reason of the husband 's failure to act upto his statutory obligation to maintain his wife (see Section 18(1) of the ).
The wife is of course a sharer of the assets left behind by her husband (see Section 8 of the ).
This claim was also, in our view, rightly disallowed by the High Court.
In the curcumstance, for the reasons we have stated, the appeal is dismissed.
Howerver, we do not make any order as to costs.
V.R.R. Appeal dismissed.
| IN-Abs | The High Court in a reference under the held that in computing the net principal value of the estate for the purpose of the Act, the appellant was not entitled to deduct either the estate duty payable on the estate or the amount attributable to the maintenance of the wife of the deceased.
The question was answered accordingly in favour of the Revenue.
The appellant contended in the appeal by certificate that estate duty being a first charge on the estate passing on the death was an encumbrance and, therefore, deductible and the amount of the maintenance of the wife during her husband 's life was also deductible.
The Respondent contended that estate duty being payable only upon the estate passing on the death, it was not a liability which was deductible.
Deduction in respect of the maintenance of the wife during the life of her husband also was not permissible.
Dismissing the appeal, this Court, HELD: 1.
The levy is upon the principal value of the property ascertained as provided under the Act.
Property changes hands at the time of the death, by reason of the death, and, therefore, subsequent to the death.
The imposition of the charge under the Act does not arise until the death has actually occurred and the property has, thereupon, passed.
[453E G] 449 2.
The liability to pay estate duty is fastened on the persons accountable.
But their liability is limited to, and will not exceed, the assets of the deceased actually received by them, or which, but for their neglect or default, they might have received.
Apart from the Personal liability cast on the persons accountable, and their liability to penalty in the event of default or concealment, the duty payable is charged On the property itself and any private transfer or delivery is void against any claim in respect of such duty.
Essentially and basically, therefore, the duty is a burden on the estate and that burden is fastened on the estate upon the death of the deceased.
During his life, no liability under the Act arose or could arise.
[453G 454A] 3.
Subject to the limitations and exceptions statutorily specified, the allowable deductions in the determination of the chargeable value of the estate are the debts and encumbrances incurred before the death of the deceased.
Estate duty falling upon property passing upon the death had not become a debt or encumbrance until the death of the deceased, and is, therefore, not deductible.
[454B C] 4.
As regards the claim for deduction of the amount attributable to the maintenance of the wife of the deceased during his life, there is no evidence or any finding to show that the estate had been burdened with any such debt or encumbrance by reason of the husband 's failure to act upto his statutory obligation to maintain his wife.
[454E F] 5.
The expression "passes on the death" denotes change in the title or possession of the whole property taking place at the death.
It is immaterial to whom the property passes.
[453D E] Inland Revenue Commissioner vs Crossman, ; Winans & Another vs Attorney General, , referred to ; [1978] Ill ITR 365 (Gujarat); [1981] 127 ITR 642 (Allahabad); [1981] 132 ITR 871 (Madras); [1982] 137 ITR 801 (Gauhati); [1990]186 ITR 29 (Bombay); Controller of Estate Duty vs Estate of Late Omprakash Bajaj, approved.
|
N: Criminal Appeal No. 480 of 1979.
From the Judgment and Order dated 3.4.1979 of the Madhya Pradesh High Court in Criminal Appeal No. 239 of 1974.
R.C. Kohli for the Appellant.
U.N. Bachawat and Uma Nath Sing with him for the Respondent.
457 The Judgement of the Court was delivered by AHMADI,J. The appellant has been convicted under Section 302/34, IPC, for causing the murder of one Negji, son of the Parthesingh, of village Melakhedi.
The prosecution case was that the family of the appellant and the family of the deceased were at loggerheads since quite sometime and there was bad blood between them.
In 1967, Bhowansingh, a member of the complainant 's family is stated to have been murdered by the appellant 's party.
Thereupon, the deceased along with others is stated to have fatally assaulted Bhagwansingh and Bahadursingh and inflicted grievous injuries of Govardhansingh.
These three are none other than the sons of the appellant.
The deceased and his companions were, however, acquitted.
It is said the appellant, Daryao Singh was, therefore, keen to avenge the deaths of his sons.
As a sequel to the earlier incident, it is said that the incident in question occurred on 25th September, 1970 at about 4.00 p.m.
The fact that relations between the two families were strained is, therefore, not in dispute.
On 25th September, 1970, the deceased, Negji, was working in his field along with his son PW 4 Bhanwar Singh.
At that time the appellant went there in the company of Nagusingh Govardhansingh and Bapusingh.
Nagusingh was armed with a gun and a stick with dharia like blade, Govardhansingh was armed with a similar weapon, the appellant was armed with a sword and Bapusingh possessed a gun.
They lanuched an attack on the deceased Negji whereupon the the latter raised an alarm which attracted the attention of Pw 1 Bherusingh and Pw 3 Bhuwan Singh, who were working in the adjacent filed.
They reached the spot and witnessed the incident.
On their raising a hue and cry, the appellant and his companions fled away.
PW 4 had run away frightened when a shot was fired at him.
The deceased, Negji, sustained serious injuries on the head and his right leg was cut into two.
PWs 1 and 3 went in search of PW 4 but on the way met two police constables PW 8 Chhotelal and PW 10 Itratkhan.
They narrated the incident and disclosed the names of the assailants to them.
All the four returned to the place of occurrence, placed Negji in a cart and proceeded towards the police station.
But the injured passed away on the way.
The dead body appears to have been taken to the hospital on the next day at about 5.20 p.m. PW 2 Dr.
Sharma, performed the post mortem examination on 27th September, 1970 at about 7.00 a.m. Except the appellant the rest of the assailants could not be put to trial as they were reportedly absonding.
458 The prosecution mainly relies on the evidence of PW 1,3 and 4.
In addition, the prosecution seeks corroboration from the evidence of the two Police Constables PWs 8 and 10 whom the names of the assailants were disclosed immediately after the incident.
PW 8, however, turned hostile and was permitted to be cross examined by the learned Public Prosecutor.
This, in brief, is the prosecution evidence against the appellant.
The learned Trial Judge on an appreciation of the prosecutiion evidence concluded that having regard to the long standing enmity between the two families it was hazardous to place implicit reliance on the interested testimony of PWs 1,3 and 4, more so because their testimony was not corroborated in material particulars by independent evidence.
Besides, according to the Trial Judge, the evidence of DW 3 Keshav Shanker Varang established that the appellant was a physically disabled person who could not have weilded the sword with such ferocity as to cut the right leg into two pieces.
To disbelieve the prosecution case the learned Trial Judge referrd to the evidence of the hostile Constable, PW 8, but failed to take note of the evidence or PW 10.
As the three eye withnesses were closely related to the deceased, the learned Trial Judge applied the rule of prudence and thought it wise not to base a conviction on thier uncorroborated evidence.
He therefore, acquitted the appellant.
Feeling aggrieved by the order of acquittal passed by the learnd Trial Judge, the State of Madhya Pradesh preferred an appeal of the High Court which was disposed of by a Division bench by its impugned judgment and order dated 3rd, 1979.
The Division Bench held that although the three prosecution witnesses were closely related to the deceased their evidence could not be discarded solely on the ground that they were interested and partisan witnesses, but all that the rule of prudence demanded was to evaluate their evidence with caution.
On a close scrutiny of the evidence of the said three witnesses, the Hight Court found that nothing was brought out in their cross examination to doubt their credibility.
On the contrary the High Court felt that their evidence was partly corroborated by PW 10 and medical evidence.
So far as the evidence of PW 8 is concerned the High Court observed that he had turned hostile and had deliberately departed from his earlier statement to the Police as well as the entry in his police diary.
In this view of the matter, the High Court reversed the order of acquittal and convicted the appellant under section 302/34, IPC.
It is this conviction which is assailed before us in this appeal by the appellant.
459 The learned counsel for the appeallant took us through the evidence of PWs 1,3 and 4.
PWs 1 and 3 are the brothers of the deceased and PW 4 is his son.
Indisputably there was bad blood between the two families on account of past incidents which may have ignited a desire for vendatta in the appellant and his companions.
At the same time, the High Court also cautioned itself to the possibility of false involvement on account of the long standing enmity.
The Hight Court then scrutinised the evidence of the aforesaid three witnesses and found that their evidence had no been shaken by elaborate cross examination.
That means, according to both the Courts, if their evidence can be trusted as credible, it would prove the appellant 's involvement in the crime.
Therefore, if their evidence is otherwise found to be reliable there can be no doubt that a conviction can be based on their evidence, notwithstanding (i) their close relations with the deceased, and (ii) the long standing enmity between the two families.
We too have perused their evidence and taken at its face value we find no infirmity.
Even the learned counsel for the appellant did not contend that there was any intrinsic infirmity in their evidence.
All that he submitted was that it would be unwise to convict the appellant on their evidence without seeking corroboration.
Since PW 8 has deliberately departed from his earlier version and has not told the truth his evidence cannot dilute their evidence.
Immediately after the incident , while PWs 8 and 10 were passing by, they were informed of the incident and the names of the assailants were disclosed to them, in regard to which they made enteries in their respective diaries.
The contradiction brought on record in the cross examination of PW 8 shows that the names of the assailants were disclosed to him.
This was sought to be further reinforced by the entry in his diary wherein the name of the appellant appeared as one of the assailants.
The learned Trial Judge wrongly attributed this entry to the ingenuity of the investigation officer.
It is, therefore, obvious that PW 8 is not a dependable witness.
The High Court 's conclusion in this behalf is unassailable.
The learned Trial Judge made no reference to the evidence of PW 10.
The High Court has referred to his testimony.
This witness stated that while he and PW 8 were passing by, a frightened PW 1 approached them and reported that his brother was assaulted by the appellant and his companions.
The High Court has accepted the testimony of the witness and we think rightly.
The evidence of the witness, therefore, lends corroboration to the prosecution version regarding the involvement of the appellant.
This discloseure was made to PW 10 immediately after the incident before there was any time of deliberation or concoction.
the medical evidence shows that the deceased had as many as seven injuries, one of which was on the skull.
the number and nature of the 460 injuries clearly indicate that more than one person was involved in the assault.
It is, therefore, clear that the medical evidence also lends corroboration to the prosecution version to this limited extent.
Strong reliance was, however, placed by the learned counsel for the appellant on the evidence of PW 2 Dr.
Sharma.
This witness has after describing the various injuries stated that the body was cold, rigor mortis and passed off and the body was decomposed when he performed the post mortem examination on the morning of 27th September, 1970.
He also noticed blisters containing reddish fluid all over the body.
The abdomen was swollen and greenish discoloration was noticed.
In his opinion death was caused on account of the brain injury.
In paragraph 6 of his deposition he stated "the duration of injury since death was 36 to 48 hours".
In cross examination he said: "As the dead body was decomposed externally and internally blisters had formed all over the body, scrotum distented, marks of swelling on body, presence of magets on body; all these symptoms do indicate that their duration of injury since death could be 14 to 20 days also.
" On the basis of these statements made by PW 2, counsel for the appellant strongly argued that death must have taken place long before 25th September, 1970 since blisters had appeared on the body.
In this connection, he placed reliance on the table found at page 134 of Modi 's Medical Jurisprudence and Toxicology,(12th Edn.).
It read as under: Putrefactive changes Time 1 to 3 days after 1.
Greenish coloration death.
over the iliac fossae The eyeballs, soft and yielding.
Green coloration spreading 3 to 6 days over the whole abdomen, after death.
external genitals and other parts of the body.
Frothy blood from mouth and nostrils.
Abdomen distrended with gas.
Cornea 8 to 10 days fallen in and concave.
Pur after death.
lish red streaks of veins prominent on the extremities, Sphincters relaxed, Nails firm.
461 4.
Body greenish brown.
Blisters 14 to 20 days froming all over the body.
Skin after death.
peels off.
Features unrecogniz able.
Scrotum distension.
Body swallow up owing to distorsiopn Maggots on the body.
Nails and hair loose and easily detached.
Soft parts changed into a thick, semi 2 to 5 fluid, black mass.
Skull, abdomen and months thorax burst.
Bones exposed.
Orbits after empty.
death.
_______________________________________________________ It is indeed suprising that no such submission was made on behalf of defence before the Trial Court as well as the High Court.
Even in the memo of appeal no such precise contention appears.
Hoeever, we have thought it proper to examine the submission on merits rather than reject it on a technical ground.
Counsel of the appellant strongly relied on this statement of PW 2 Dr.
Sharma and contended that the presence of blisters all over the body is a sure pointer to the fact that death had taken place 14 to 20 days before the post mortem examiniation.
It may be recalled that the deceased was 45 years of age and was the victim of violent attack with lethal weapons in which he had suffered a fatal semi circular woundon the scalp 6" x 4" extended by 2" to the left mid line.
In addition thereto he had received incised wounds on his left forearm resulting in fractures.
His right leg was cut into two pieces 6" below the tibia, liquified blood was oozing out, maggots were prersent, blisters were seen all over the body and the soft cuticle peeled off easily.
There was another cut wound on the left leg exposing the tibia.
A 5" wound was seen at the right side of the mouth.
It was the scalp injury which caused the death.
It is common knowledge that after death the body starts to cool down to the surrounding temperature.
The cooling of the body is the earliest phenomenon which is followed by post mortem lividity resulting from discontinuance of blood circulation and collection of blood in certain parts under gravitational action, depending on the position of the dead body.
the stoppage of blood circulation and the inaction of the natural defensive mechanism result in the bacteria present in the body as well as those that enter from outside getting scattered in everypart of the body setting in the process of putrefaction, unless special 462 care is taken to prevent the same.
Decomposition in thus essentially the process of putrefaction which is dependent on environmental climatic conditions.
In the present case death had occurred on 25th September and the dead body lay in the police station with the wounds exposed till it was brought to the hospital at 5.20 p.m. on the next day.
The body remained in the same condition in the hospital till 7.00 a.m. on the next day when the post mortem examination was undertaken.
The bdy thus remained fully exposed to the heat and humidity of the month of September for over thirty hours and hence it is not surprising that the rigor mortis had passed off.
Ordinarily after rigor mortis has passed off, the process of putrefaction sets in but it may set in even earlier during summer depending on the heat and humidity.
Body changing colour and emitting foul smell, are the two special characteristics of the decomposition process.
The first external evidence of putrefaction is the formation of greenish discoloration of the abdominal skin over the iliac fossae which occurs within six to twelve hours in summer and spreads all over the body within twelve to eighteen hours of death.
As time passes they deepen in colour and become purple.
With the spread of bacteria, there is gradual development of gases in the intestines within twelve to eighteen hours and liquefaction also takes place and soon spreads to other parts of the body.
Putrefaction thus results in general disintegration of the tissues due to residual enzymatic activity in the cells causing widespread formation of gases emitting foul smell and if the body is exposed, as in the present case, files lay eggs on exposed wounds forming maggots.
The body gets bloated and liquified, the skin looses coherence, the superficial layers peel off easily and blisters are formed.
it is, therefore, not suprising that owning to the formation of gases the penis and the scrotum were swollen and there was the presence of maggots.
Before we answer the contention it is essential to notice a few facts.
The evidence of PWs 1,3 and 4 is that the incident occurred in the field of the deceased.
This fact is corroborated of PW 5 Motilal and PW 6 Parbatsingh.
The find of blood on the grass blades and on the earth attached under the seizure memo Exh.
p 8 confirms their testimony.
The evidence of these witnesses further shows that the injured was taken in a cart to the village and from there to the Bhakheda police station.
this is further established by PW 10 who has deposed that the vitim was brought in a cart to the village.
the circle Inspector PW 12 also deposes that the corpse was brought to the police station and from there it was sent to the hospital for post mortem examination which was undertaken on 27th September, 1970 at 7.00 a.m.
This evidence establishes the chain of events showing the movement of the dead body and rules out of the theory that death had taken 463 place many days before 25th September, 1970, a theory not put to the witnesses in cross examination.
The direct testimony, therefore, does not support the theory urged on behalf of the appellant.
Counsel for the appellant, however, emphasised that the statement of PW 2 in cross examination clearly established the existence of blisters, an objective fact, which clearly supports the defense theory that death had taken place 14 to 20 days prior to the date on which the post mortem examination was held and thereby disprove the prosecution version that the victim of assault died on the evening of 25th September, 1970.
It is interesting to note that table on which the learned counsel for the appellant relies is omitted from the 19th and 20th edition of the book.
But that apart at pages 128 129 of the bok (Twentieth Edition) it is stated as under: "From twelve to eighteen hours after death in summer the green coloration spreads over the entire abdomen and the external genitals. . .
Side by side with the appearance of the greenish patch on the abodomen the body begins to emit a nauseating and unpleasant smell owing to gradual develoment of the gases of decomposition, some of which are sulphuretted hydrogen, marsh gas, carbon dioxide, ammonia and phosphoretted hydrogen.
From twelve to eighteen hours after death in summer these gases collect in the intestine, consequently abdomen swells up.
The sphincters relax, and the urine and faeces may escape.
From eighteen to thirty six or forty eight hours after death the gases collect in the tissues, cavities and hollow viscera under considerable pressure with the result that the features become bloated and distored, the eyes are forcedout of their sockets, the tongue is protruded between the teeth, and the lips become swollen and everted.
A frothy, reddish fluid or mucus is forced from the mouth and nostrils.
Ultimately the features become obilterated and unrecognizable.
The abdomen becomes greately distended; hence on opening the cavity the gas escapes with a loud explosive noise.
Owing to the pressure of the gases the stomach contents are forced into the mouth the larynx and are seen running out of the mouth and nostrils.
The breast of female bodies are greatly distended.
The penis and scrotum become enormously swollen.
The cellular tissues are inflated throughout, so that the shole body appears stouter and older than it actually is.
464 These gases from blisters under the skin containing a reddish coloured fluid on the various parts of the body.
When these bursts, the cuticle being softened peels of easily.
These are characterised by absence of vital reaction.
It will thus be seen that blisters appear after the process of decomposition sets in whithin eighteen to fotry eight hours.
It shows that the existence of blisters does not mean that death had taken place 14 to 20 days ago.
That is why PW 2 is cautious to use the pharseology 'the duration of the injury since death could be 14 to 20 days also '.
Having regard to the nature of the direct testimony to which we have adverted earlier andthe passage reproduced above, we find it difficult to accept the belated submissions of the learnd counsel for the appellant that the opinion of the medical expert PW 2 destroys the version of the prosecution witnesses, particularly PWs 1,3,4 and 10, that the deceased suffered a fatal wound on the evening of 25th September, 1970 to which he succumbed on that very day.
We, therefore, reject this submission.
It was lastly submitted that the evidence of the radiologist.
Keshav Shanker Varang, DW 3 goes to show that the appellant was a disabled person and it was not possible for him to cause an injury so serious as to cut the leg in two parts.
In this connection, our attention was drawn to paragraph 7 of his deposition, wherein he has stated that looking to the fracture of the appellant 's leg and his chest condition he was a disabled person who could not run fast or walk quickly and, therefore, argued counsel, he could weild the sword with such ferocity as to cut the leg in to parts.
In cross examination he has admitted that he had not examined the muscle power the appellant.
He conceded that the elbow was free and, therefore, he could use the weapon but not with great force.
The High Court has considered this submission in paragraph 8 of its judgment and has rejected it.
We do not think that having regard to the fact that the appellant alone was weilding the sword, it is to rely on this opinion evidence in preference to the direct evidence of three witnesses.
High Court has rigtly rejected this submission and we need not dilate on it.
For the above reason, we see no merit in this appeal and dismiss the same.
Bail cancelled.
The appellant will surrender forthwith.
| IN-Abs | The appellant has been convicted under Section 302/34, Indian Penal Code, by the high Court, for the murder of one Nagji, with whom he had strained relations.
According to the prosecution there was bad blood between the family of the appellant and the deceased and there have incidents in the past, the last being the murder of two sons of the appellant and inflicting of grievous injuries on the third son, by the deceased, in which case, the deceased and his companions were acquitted.
The appellant was keen to avenge the deaths of his sons and with that end in view, on 25th Septemeber, 1970, he along with three others, duly armed with guns and sticks, attacked the deceased, Negji, while he along with his son PW4 was working in his field.
The deceased Negji raised an alarm which attacted the attention of PW 1 and PW 3, who were working in the adjacent field.
They reached the spot and withnessed the incdent.
On thier raising hue and cry, the appellant and his companions fled away PW 4 had run away frightened when a shot was fired at him.
The deceased Nagaji received serious injuries on the head and his leg was cut into two peices.
PWs 1 and 3 went in search of PW 4 and on the way met two police constables PW 8 and PW 10 to whom they narrated the whole incident and disclosed the names of the assailants.
The deceased passed away, when his body was being taken to the police station.
The postmortem examination was performed on the 27th at 7 a.m.
The appellant was put up for trial, as others were abscondng.
The learned trial Judge n appreciation of the prosecution evidence held that having regard to the long standing enmity between the two families, it was hazardous to place implict reliance on the interested testimony of PWs 1,3 and 4, more so because their testimony was not corroborated in material particulars by independent evidence.
The Trial Judge applying the rule of prudence, did not convict the appellant on uncorroborated evidence of interest withnesses and accordigly acquitted the appellant.
The State preferred an appeal to the 456 High Court.
The High Court held that although the three prosecution witnesses were closely related to the deceased, their evidence could not be discards solely on the ground they were interested and partisan witnesses.
The High Court found their evidence duly corroborated and therefore reversed and order of acquittal and convicted the appellant under Section 302/34, I.P.C.
In this appeal the appellant had challenged his conviction.
Apart from the question of appraisal of evidence,the appellants has placed strong reliance on the testimony of PW 2, Dr. Sharma and argued for the first time in the Court that his testimony shws that the death must have taken place long before 25the September 1970 there being blisters containing reddish fluid all over the body.
Dismissing the appeal, this Court, HELD: Death had occurred on 25th September 1970 and the dead body law in the police station with the wounds exposed till it was brought to the hospital at 5.20 p.m. on the next day.
The body remained in the same condition in the hospital till 7.00 a.m. on the next day when the post mortem examination was undertaken.
The body thus remained fully exposed to the heat and humidity of the month of September for over thirty hours and hence it is not surprising that the rigor mortis had passed off.
Ordinarily after rigor mortis has passed off, the process of putrefaction sets in but it may set in even earlier during summer depending on the heat and humidity.[462A C] The evidence establishes the chain of events showing the movement of the dead body and rules out the theory that death had taken place many days before 25th September 1970, a theory not put to the witnesses in corss examination.[462H 463] Blisters appear after the process of decomposition sets in within eighteen to forty eight hours.
It shows that the existence of blisters does not mean that death had taken 14 to 20 days ago.[464B]
|
ivil Appeal No. 1430 of 1990.
From the Judgment and Order dated 21.10.1989 of the Central Government Industrial Tribunal, New Delhi in I.D. No. 40 of 1986.
N.B. Shetye and A.M. Khanwilkar for the Appellant.
Ashok H. Desai, R.P. Bhatt.
P.H. Parekh and Mrs. Sumita Sharma for the Respondents.
The Judgment of the Court was delivered by PUNCHHI, J.
This appeal by special leave is directed against the Award of the Central Government Industrial Tribunal, New Delhi, in I.D. No. 40 of 1986 published in the Gazette of India, New Delhi dated 21.10 89.
The appellant is the Mathura Refinery Mazdoor Sangh (here after referred to as 'Union ').
The contesting respondent is the Indian Oil Corporation Ltd., Mathura Refinery Project, Mathura, U.P. (hereafter referred to as the 'Refinery ').
The Union represents about 900 casual labourers working in the Refinery.
These labourers are contract labourers coming under the Contract Labour (Regulation & Abolition) Act, 1971.
The nature of their work has grouped them .Some of the labourers have formed themselves into cooperative societies and those societies have entered into labour contracts with 470 the Refinery.
Other labourers are working under labour contractors who have contracts with the Refinery.
Theirs is not a constant relationship with one contractor and these labourers keep shifting from one contractor to another.
However it is claimed that these casual labourers, have been working in the Refinery for so many years in the past ranging between ten to fifteen years but they are denied wages and other benefits as also other beneficial service conditions enjoyed by workmen who are regular employees of the Refinery.
Claiming that they had a right to be treated at par with regular employees, the Union filed Writ Petition No. 2876 of 1985 under Article 32 of the Constitution of India in this Court which was disposed of on January 16, 1986 by directing the Central Government to refer to the Industrial Tribunal for adjudication the following questions: 1.
Whether, in law, the petitioners and the 48 workmen whose services have been terminated are employees of the Indian Oil Corporation, Mathura Refinery Project, Mathura? 2.
Whether the termination of the services of 48 workmen was justified? and 3.
To what relief are the workmen entitled?" Status quo was ordered to be maintained and the services of the workmen were ordered not to be terminated.
At that time, the services of 48 workmen alone were involved but as is evident the adjudication of the Tribunal would have affected others too.
Pursuant to the order of this Court, the Central Government referred and the Industrial Tribunal decided the above referred questions holding that the workmen were not employees of the Refinery and were rather the employees of the contractors.
With regard to the termination of the services of the workmen and to what relief they were entitled, the Tribunal, after answering the questions against the Union and in favour of the Refinery, suggested the following steps in the interest of Industrial harmony: (i) Though the Union should have pressed their demand for abolition of the contract labour system in the Refinery to the Central Advisory Board constituted under the Act, and even though it had been pursuing its remedies before this Court and the Tribunal, suggestions were made to the Refinery to approach 471 the Advisory Board to make a study with regard to the desirability of continuance of the contract labour system in the Refinery.
(ii) Till the Central Advisory Board makes its recommendations and the action is taken, the management of the Refinery to ensure that the contract labour is paid at least the minimum of the pay scale of its regular employees performing the same or similar duties as the workmen of the contract labour and further that the workmen among the contract labour who have put in 5 years or more of work at the Mathura Refinery shall be continued to be employed in the same work even if there is a change in the contractor and such workmen shall not be terminated except as a punishment inflicted by way of disciplinary action for misconduct, etc., voluntary retirement or retirement on reaching the age of superannuation (which may be taken as the superannuation age for the I.O.C. employees) or on ground of continuous ill health.
(iii) Refinery to give preference to those workmen in its employment by waiving the requirement of age and other qualifications wherever possible and it may also consider the creation of a benevolent fund for the contract labour wherein it may make a lumpsum contribution initially and then make equivalent or even more contribution to match the contribution made by the workmen of the contract labour.
Having suggested these, the Tribunal has clarified that these ameliorative steps, if taken by the Refinery, shall not be taken to mean that the contract labour has become the direct employees of the Refinery.
Learned counsel for the appellant says that though the above suggestions, which have the colour of directions, are in accord with the decision of this Court in 13HEL workers Association, Hardwar and Others etc.
vs Union of India and Others, [ ; yet they fall short of the expectancies of the Union and in particular to the wide sweep of the principles laid down by this Court in Dharwad Distt P.W.D. Literate Daily Wage Employees Association and Others vs State of Karnataka and Others, [ ; and prayed for directions such as those given to the State of Karnataka in the Dharwad 's case (supra).
The argument of the learned counsel has barely to be noted and 472 rejected.
The Tribunal has given to the appellant Union the maximum which could be given in the facts and circumstances of the, case.
In Dharwad 's case (supra), the State of Karnataka had itself come out with a scheme to absorb the casual workers in regular government service in a phased manner and though it did not satisfy all concerned, yet it was given a workable final shape.
This Court observed as follows: "Though the, scheme so finalised is not the ideal one but it is the obligation of the court to individualise justice to suit a given situation in a set of facts that are placed before it.
Under the scheme of the Constitution the purse remains in the hands of the executive.
The legislature of the State controls the Consolidated Fund out of which the expenditure to be incurred, in giving effect to the scheme, will have to be met.
The flow into the Consolidated Fund depends upon the policy of taxation depending perhaps on the capacity of the payer.
Therefore, unduly burdening the State for implementing the constitutional obligation forth with would create problems which the State may not be able to handle.
Therefore, the directions have been made with judicious restraint.
" Those casual workers were under the employment of the State and the State came out with a scheme for phased absorption and a graded financial responsibility.
In the instant case before us, the contract labourers are not, and have also not been found to be, having a direct connection with the Refinery, even though it is a State for the purpose of enforcement of fundamental rights.
The suggestions/directions given by the Tribunal, appear to us to be the only relief which was due to the appellant and its members in the given situation and circumstances.
Therefore, the impugned Award of the Tribunal cannot be improved upon.
Finding no merit in the appeal, we dismiss the same.
No costs.
T.N.A. Appeal dismissed.
| IN-Abs | The appellant Union, representing about 900 casual labourers falling under the Contract Labour (Regulation and Abolition) Act, 1971 some of whom formed Co operative societies and entered into contracts with the respondent refinery while others worked for contractors who had contracts with the refinery, filed a writ petition in this court claiming parity in wages and service conditions with the regular workmen of the respondent refinery.
This Court disposed the petition by directing the Central Government to refer to the Industrial Tribunal for adjudication the questions whether the petitioners and some of the workmen whose services were terminated were employees of the refinery; whether their termination was justified and to what relief they were entitled to.
The Government referred and the Tribunal decided the questions against the appellant union by holding that the labourers were employees of the contractors and not of the refinery and their termination was justified.
But the Tribunal gave certain directions by way of relief for consideration by the Advisory Board about the desirability of continuance of the contract system in the refinery, for providing minimum pay of scale of regular employees to the contract labour and giving them preference in the regular employment.
Against the award of the Industrial Tribunal, the Union filed an appeal in this Court praying for directions to the refinery to absorb and regularise the casual labourers in a phased manner.
Dismissing the appeal, this Court, 469 HELD:The contract laboures are not, and have also not been found to be, having a direct connection with the Refinery, even though it is a State for the purpose of enforcement of fundamental rights.
The directions given by the Tribunal was the only relief which was due to the appellant_union and its members.
Hence the Tribunal has given to the appellant union the maximum which could be given in the facts and circumstances of the case.
Therefore, the impugned Award of the Tribunal cannot be improved upon.
[472E F] BHEL Workers Association, Hardwar and Ors.
vs Union of India and Ors.
, ; , referred to.
Dharwad Distt.
P.W.D. Literate Daily Wage Employees Association and Ors.
V. State Of Karnataka and Ors.
, ; , distinguished.
|
tition (CRL.) No. 1218 of 1990.
(Under Article 32 of the Constitution of India).
John Joseph and T.G.N. Nair for the Petitioner.
A.D. Giri, Solicitor General, Ashok Bhan, Ms. A. Subhashini and T.T. Kunhikannan for the Respondents.
The Judgment of the Court was delivered by VERMA J.
This writ petition under Article 32 of the Constitution of India is by the mother of the detenu Noor alias Babu to quash the detention order F. No. 801/1/90 PITNDPS dated 25.1.1990 passed under Section 3 of the Prevention of Illicit Traffic in Narcotic Drugs and Psychotropic Substances Act, 1988 (in short 'PIT 'NDPS Act ') and the order of confirmation F. No. 801/1/90 PITNDPS dated 24.4.1990 'passed under Section 9(f) read with Section 10(2) of the PITNDPS Act, by the Central Government directing detention of the detenu for a period of two yeare w.e.f. 30.1.1990.
The only argument advanced in support of this writ petition is infraction of Article 22(5) of the Con 424 stitution of India.
The facts material for the point raised are stated hereafter.
The detenu was arrested from his family estate at Kochuveetil House, Kuthugal, Udumpanchola Taluk, Idikki District, Kerala on 19.10 1989 on the accusation that he and his brothers were involved in extensive illicit cultivation of ganja plants (Cannabis Sativa) in violation of the provisions of (in short 'NDPS Act '), He was produced before the Judicial Magistrate who rejected his bail application.
The Sessions Judge also rejected the bail application once but late, granted conditional bail.
Thereafter, the detention order dated 25.1.1990 was served on the detenu on 30.1.1990.
It was stated therein that even though prosecution of the detenu was likely to be initiated under the NDPS Act, there was likelihood of the detenu indulging in cultivation and production of narcotic drugs (ganja) on the detenu being released on bail on account of which there was compelling necessity to detain him under the PITNDPS Act.
The detenu was informed that he had a right to make representation to the detaining authority, Central Government and the Central Advisory Board against the detention order.
The mode of address of the representation to the Central Government and the Central Advisory Board was also indicated in the detention order along with the grounds of detention in accordance with Article 22(5) of the Constitution of India.
The detenu 's case was referred by the Central Government to the Central Advisory Board on 2.3.1990.
During pendency of the reference before the Advisory Board, the detenu made his representation on 24.3.1990 and addressed it to the Advisory Board.
The Advisory Board considered the reference relating to the detenu made by the Central Government and also the detenu 's representation submitted to it.
The Advisory Board, gave the opinion that there was sufficient cause to justify his preventive detention.
The Central Government then made the order dated 24.4.1990 confirming his detention and directed that the detenu Noor alias Babu be detained for a period of two years w.e.f. 30.1.1990.
It is admitted that the Advisory Board considered the detenu 's representation before sending its opinion to the Central Government along with the entire record including the representation submitted by the detenu.
It is also admitted that the Central Government made the order of confirmation dated 24.4.1990 on receipt of the opinion of the Advisory Board, but there was no independent consideration of the detenu 's representation by the Central Government at any time.
In the counter affidavit filed initially by Shri A.K. Roy, Under Secretary to 425 the Government of India, this fact was not clearly stated and, therefore, we directed an additional affidavit to be filed.
In the additional affidavit filed by Shri A.K. Roy, it has not been disputed that the Central Government did not at any time consider independently the detenu 's representation addressed to and given to the Advisory Board.
In the additional affidavit, the stand of the Central Government in this behalf has been stated thus: ".
Since the detenu in the present case has not made any representation to the Central Government, the assertion in para 2 of the grounds of petition that no opportunity was afforded by the Central Government to the said detenu is vehemently denied.
The question of consideration of a representation and providing of an opportunity would only arise when a representation is duly made to the Central Government.
" On the above facts, the question is: Whether there has been any infraction of the guarantee under Article 22(5) of the Constitution as a result of Central Government 's omission to consider the detenu 's representation independent of its consideration by the Advisory Board? The Central Government 's stand is that the detenu 's representation being addressed to the Advisory Board to which it was submitted during pendency of the reference before the Advisory Board, there was no obligation on the Central Government also to consider the same independently since the representation was not addressed to the Central Government.
The Constitutional mandate in Article 22(5) was considered recently by a Constitution Bench in K.M. Abdulla Kunhi and B.L. Abdul Khader vs Union of India and Ors., State of Karnataka and Ors., JT , in view of some conflict in earlier decisions of this Court regarding the detaining authority 's obligation to consider the detenu 's representation independently of the Advisory Board 's duty in this behalf.
The Constitution Bench held as follows: "It is now beyond the pale of controversy that the constitutional right to make representation under clause (5) of Article 22 by necessary implication guarantees the constitutional right to a proper consideration of the representation.
Secondly, the obligation of the Government to afford to the detenu an opportunity to make representation is distinct from the Government 's obligation to refer the 426 case of detenu along with the representation to the Advisory Board to enable it to form its opinion and send a report to the Government.
It is implicit in clauses (4) and (5) of Article 22 that the Government while discharging its duty to consider the representation, cannot depend upon the views of the Board on such representation.
It has to consider the representation on its own without being influenced by any such view of the Board.
The obligation of the Government to consider the representation is different from the obligation of the Board to consider the representation at the time of hearing the references.
The Government considers the representation to ascertain essentially whether the order is in conformity with the power under the law.
The Board, on the other hand, considers the representation and the case of the detenu to examine whether there is sufficient case (sic) for detention.
The consideration by the Board is an additional safeguard and not a substitute for consideration of the representation by the Government.
The right to have the representation considered by the Government, is safeguarded by cl.
(5) of Article 22 and it is independent of the consideration of the detenu 's case and his representation by the Advisory Board under cl.
(4) of article 22 read with Section 8(c) of the Act.
(See: Sk.
Abdul Karim & Ors.
vs State of West Bengal, [ ; ; Pankaj Kumar Chakrabarty & Ors.
vs State of West Bengal, [1970]1 SCR 543; Shayamal Chakraborty vs The Commissioner of Police Calcutta and Anr., [ ; ; B. Sundar Rao and Ors.
vs State of Orissa, [ 1; John Martin vs State of West Bengal, 1 1; section K. Sekawat vs Stale of West Bengal; , and Haradhan Saha & Anr.
vs State of IVest Bengal and Ors.
, ; (emphasis supplied) It is thus clear that the obligation of the Government to consider the representation is different and in addition to the obligation of the Board to consider it at the time of hearing the reference before giving its opinion to the Government.
Consideration of the representation by the Government has to be uninfluenced by the view of the Advisory Board.
In short, the detenu 's right to have the representation considered by the Government under Article 22(5) is independent of the consideration of the detenu 's case and his representation by the Advi 427 sory Board.
This position in law is also not disputed before us.
The learned Solicitor General, however, contended that in the present case there being no representation addressed to the Central Government, the only representation made by the detenu being addressed to the Advisory Board during pendency of the reference, there was in fact no representation of the detenu giving rise to the Central Government 's obligation to consider the same.
The question is: Whether this contention can be accepted in the face of the clear mandate in Article 22(5) of the Constitution? It is undisputed that if there be only one representation by the detenu addressed to the detaining authority, the obligation arises under Article 22(5) of its consideration by the detaining authority independent of the opinion of the Advisory Board in addition to its consideration by the Advisory Board while giving its opinion.
In other words, one representation of the detenu addressed only to the Central Government and not also to the Advisory Board does not dispense with the requirement of its consideration also by the Advisory Board.
The question, therefore, is: Whether one of the requirement of consideration by Government is dispensed with when the detenu 's representation instead of being addressed to the Government or also to the Government is addressed only to the Advisory Board and submitted to the Advisory Board instead of the Government? On principle, we find it difficult to uphold the teamed Solicitor General 's contention which would reduce the duty of the detaining authority from one of substance to mere form.
The nature of duty imposed on the detaining authority under Article 22(5) in the context of the extraordinary power of preventive detention is sufficient to indicate that strict compliance is necessary to justify interference with personal liberty.
It is more so since the liberty involved is of a person in detention and not of a free agent.
Article 22(5) casts an important duty on the detaining authority to communicate the grounds of detention to the detenu at the earliest to afford him the earliest opportunity of making a representation against the detention order which implies the duty to consider and decide the representation when made, as soon as possible.
Article 22(5) speaks of the detenu 's 'representation against the order ', and imposes the obligation on the detaining authority.
Thus, any representation of the detenu against the order of his detention has to be considered and decided by the detaining authority, the requirement of its separate consideration by the Advisory Board being an additional requirement implied by reading together clauses (4) and (5) of Article 22, even though express mention in Article 22(5) is only of the detain 428 ing authority.
Moreover, the order of detention is by the detaining authority and so also the order of its revocation if the representation is accepted, the Advisory Board 's role being merely advisory in nature without the power to make any order itself.
It is not as if there are two separate and distinct provisions for representation to two different authorities viz. the detaining authority and the Advisory Board, both having independent power to act on its own.
It being settled that the aforesaid dual obligation of consideration of the detenu 's representation by the Advisory Board and independently by the detaining authority flows from Article 22(5) when only one representation is made addressed to the detaining authority, there is no reason to hold that the detaining authority is relieved of this obligation merely because the representation is addressed to the Advisory Board instead of the detaining authority and submitted to the Advisory Board during pendency of the reference before it.
It is difficult to spell out such an inference from the contents of Article 22(5) in support of the contention of the learned Solicitor General.
The contents of Article 22(5) as well as the nature of duty imposed thereby on the detaining authority support the view that so long as there is a representation made by the detenu against the order of detention, the aforesaid dual obligation under Article 22(5) arises irrespective of the fact whether the representation is addressed to the detaining authority or to the Advisory Board or to both.
The mode of address is only a matter of form which cannot whittle down the requirement of the Constitutional mandate in Article 22(5) enacted as one of the safeguards provided to the detenu in case of preventive detention.
We are, therefore, unable to accept the only argument advanced by the learned Solicitor General to support the detention.
On this conclusion, it is not disputed that there has been a breach by the Central Government of its duty under Article 22(5) of the Constitution of India to consider and decide the representation independently of the Advisory Board 's opinion.
The order of detention dated 25.1.1990 as well as the order dated 24.4.1990 of its confirmation passed by the Central Government are, therefore, quashed.
This shall not, however, affect the detenu 's prosecution for the alleged offence and it shall also not be construed as a direction to release him in case he is in custody as a result of refusal of bail.
The writ petition is allowed, accordingly.
G.N. Petition allowed.
| IN-Abs | The petitioner 's son was arrested on 19.10 1989 on the accusation that he and his brothers were involved in extensive illicit cultivation of ganja plants in violation of the provisions of (NDPS Act).
The Magistrate before whom he was Produced, rejected the bail application.
The Sessions Court granted conditional bail.
The detention order dated 25.1.1990 was served on the detenu on 30.1.1990.
The order stated that though prosecution was likely to be initiated under the NDPS Act, there was every likelihood of his continuing the cultivation of ganja plants and thus there was a compelling reason to detain him under the Prevention of Illicit Traffic in Narcotic Drugs and Psychotropic Substances Act, 1988.
The detenu was informed of his right to make a representation to the detaining authority, Central Government and the Central Advisory Board against the detention order.
The mode of representation was also indicated along with the grounds of detention, in accordance with Article 22(5) of the Constitution of India.
In accordance with the procedure, the Central Government referred the case to the Central Advisory Board.
During the pendency of the reference, the detenu made a representation to the Advisory Board.
The Advisory Board considered the reference along with the detenu 's 422 representation and came to the conclusion that there was sufficient cause to justify his preventive detention.
Thereafter, the Central Government made an order dated 24.4.1990 confirming its earlier order and directing his detention for a period of two years.
In the present Writ Petition, the mother of the detenu prayed for quashing of the detention order contending that there has been infraction of the guarantee under Article 22(5) of the Constitution as a result of the Central Government 's omission to consider the representation of the detenu, independent of its consideration by the Advisory Board.
Petitioner also challenged the stand of the Central Government that there was no obligation on it to consider the representation of the detenu independently since the same was addressed to the Advisory Board and not to the Central Government.
Allowing the Writ Petition, this Court, HELD: 1.
The obligation of the Government to consider the representation is different and in addition to the obligation of the Advisory Board to consider it at the time of hearing the reference before giving its opinion to the Government.
Consideration of the representation by the Government has to be uninfluenced by the view of the Advisory Board.
The detenu 's right to have the representation considered by the Government under Article 22(5) of the Constitution is independent of the consideration of the detenu 's case and his representation by the Advisory Board.
[426G H] K.M. Abdulla Kunhi and B.L. Abdul Khader vs Union of India and Ors.
, State of Karnataka and Ors., JT ; relied on.
Any representation of the detenu against the order of his detention has to be considered and decided by the detaining authority, the requirement of its separate consideration by the Advisory Board being an additional requirement implied by reading together clauses (4) and (5) of Article 22, even though express mention in Article 22(5) is only of the detaining authority.
The order of detention is by the detaining authority and so also the order of its revocation of the representation is accepted, the Advisory Board 's role being merely advisory in nature without the power to make any order itself.
It is not as if there are two separate and distinct provisions for representation to two different authorities viz., the detaining authority and the Advisory Board, both having independent power to act on its own.
(427G H; 428A B] 423 3.
It being settled that this dual obligation flows from article 22(5) when only one representation is made and addressed to the detaining authority, there is no reason to hold that the detaining authority is relieved of this obligation merely because the representation is addressed to the Advisory Board instead of the detaining authority and submitted to the Advisory Board during pendency of the reference before it.
So long as there is a representation made by the detenu against the order of detention, the dual obligation under Article 22(5) arises irrespective of the fact whether the representation is addressed to the detaining authority or to the Advisory Board or to both.
The mode of address is only a matter of form which cannot whittle down the requirement of the Constitutional mandate in Article 22(5) enacted as one of the safeguards provided to the detenu in case of preventive detention.
[428B El 4.
In the instant case, there has been a breach by the Central Government of its duty under Article 22(5) of the Constitution to consider and decide the representation independently of the Advisory Board 's opinion.
The order of detention dated 25.1.1990 as well as the order dated 24.4.1990 of its confirmation passed by the Central Government are quashed.
[428F G]
|
Civil Appeal No. 740 of 1978.
From the Judgment and Decree dated 18.3.1975 of the Andhra Pradesh High Court in C.C.C.A. No. 106 of 1969.
G.A. Shah, V.J. Francis and N.M. Popli for the Appellant.
S.B. Bhasme, P.K. Pillai and Dilip Pillai for the Respondents.
The Judgment of the Court was delivered by SAWANT, J.
Although the leave granted by this Court is limited to the question whether the plaintiff is entitled to an amount of Rs.75,000 which according to him he had actually advanced and the respondents had received for the purpose of prosecuting their litigation, and, therefore, the issue to be answered lies within a narrow 331 compass, it is necessary to state the relevant facts briefly to understand correctly the significance of the question to be answered.
Nawab Salar Jung III, a celebrity of the erstwhile State of Hyderabad expired on March 2, 1949 leaving behind him no issue but a vast estate.
As was expected, several persons came forward claiming to be his heirs, and among them were Sajjid Yar Jung and Turab Yar Jung who claimed to be his first cousins.
The Nizam by a notification of May 9, 1949, appointed a Committee to administer the estate of the late Nawab Salar Jung.
On the merger of the Hyderabad State, the Central Government by the , continued the Committee and also provided that no suit or other legal proceeding for the enforcement of any right or remedy in respect of any asset, shall be instituted in any court by any person other than the Committee except with the previous consent of the Central Government.
In the meanwhile, on May 31, 1949, the Nizam had already appointed a Commission to enquire into the question of succession to the estate, and one of the questions referred to the Commission was whether the Jagir of the late Nawab Salar Jung escheated to the Government and another was the ascertainment of his heirs.
The Commission was unable to proceed with the inquiry as some of the claimants filed a writ petition in the High Court of Andhra Pradesh challenging the jurisdiction of the Commission to enquire into the question of succession.
The High Court, by its decision of September 23, 1952 held that the Commission was not the proper forum for determining the question of succession and directed that the management of the estate should remain with the Committee until the question was settled by a Civil Court.
The question was ultimately settled by compromise between the various claimants including the Government.
The compromise was incorporated in a decree dated March 5, 1959 passed in a suit being Suit No. O.S. 13/58 which was filed by some of the claimants.
The present proceedings are an offshoot of the said suit.
Sajjid Yar Jung who claimed to be one of the first cousins of the late Nawab Salar Jung did not have the wherewithal to establish his claim to a share in the estate.
He approached the plaintiff who was a businessman of Bombay for financial help to enable him to establish his claim.
According to the plaintiff, he agreed to do so and Sajjid Yar Jung agreed to return all amounts to be advanced to him from time to time and also to give the plaintiff one anna share in the amount that 332 would be received by him from the estate.
The agreement was executed in writing on June 27, 1952 which is the subject matter of the present proceedings.
Pursuant to this agreement Sajjid Yar Jung and his agents drew large amounts from the plaintiff from time to time, totalling to about Rs.75,000.
Sajjid Yar Jung expired before the plaintiff received his share of the amount as per the agreement but after Sajjid Yar Jung successfully established his claim to the share in the estate.
According to the plaintiff, the amount due to Saijid Yar Jung from the estate was about Rs.60 lakhs and hence he claimed Rs.3 lakhs as his share (calculated at one anna in a rupee) in addition to the return of the sums advanced by him which as stated above was Rs.75,000.
The plaintiff, therefore, filed the present suit against the heirs of Sajjid Yar Jung for accounts and for administration of his estate and for distribution of the amount among the plaintiff and the defendants.
He also joined the receiver of the estate of Nawab Salar Jung Bahadur as one of the defendants to the suit.
The heirs of the late Nawab Sajjid Yar Jung (hereinafter referred to as "Nawab") contested the suit and denied that the plaintiff had advanced any amounts to the Nawab.
They also raised other contentions including the contentions that the suit was barred by limitation and that the agreement of June 27, 1952 was unenforceable in law as it was in the nature of a champerty deal which was opposed to public policy and forbidden by law.
The City Civil Court where the suit was filed found that the agreement was genuine, that it was admissible in evidence, that the amounts were advanced by the plaintiff to the Nawab and that the suit was not barred by limitation.
However, the Court found that the agreement was opposed to public policy as the object of the agreement was that the plaintiff should wield his influence with Central and State Ministers to have the Nawab recognised as the heir to the estate in return for his being given one anna share in the amount to be received by the Nawab.
The Court, therefore, held that the agreement in question was not enforceable.
The Court also held that even the amounts actually advanced by the plaintiff and received by the Nawab could not be recovered by the plaintiff.
Accordingly, the Court dismissed the suit with costs.
The plaintiff preferred an appeal to the High Court.
The Division Bench of the High Court held that the appeal had abated against all the respondents on account of the failure of the plaintiff appellant to bring on record the heirs of one of the respondents, viz., Askar Nawab Jung who had died pending the appeal.
On 333 merits, the Bench also held that the agreement was against the public policy.
The Court further held that the agreement was one whole agreement and hence the plaintiff was not entitled to recover even the amount of Rs.75,000 which was actually advanced by him to the Nawab for prosecuting the litigation.
It is this decision which is challenged before us.
As stated earlier, leave has been granted only in respect of the said amount of Rs.75,000 and, therefore, we are concerned in the present appeal only with the question as to whether the conclusion arrived at by the High Court, i.e., that the agreement is opposed to public policy and the actual advance of Rs.75,000 was a part of the whole agreement and was, therefore, also tainted by the vice of being contrary to public policy is correct.
That the amount of Rs.75,000 was advanced by the plaintiff to the Nawab for prosecuting his claim as a sharer in the estate, is not disputed.
In fact, the Nawab had to approach the plaintiff and had to enter into the agreement in question for the express purpose of successfully prosecuting his claim.
The plaintiff cannot also contend that he had agreed to and did advance the said amount of Rs.75,000 only because he wanted and expected the Nawab to be successful in the prosecution of his claim.
The advance was not a friendly loan or without consideration.
The agreement itself stipulated that on the successful establishment of the claim, the Nawab would not only return the said advance but would also pay to the plaintiff consideration for the said advance.
That consideration was agreed to be at the rate of one anna in a rupee.
It is, therefore, apparent on the face of the record that the advance and the share in the estate, were a part of the same contract one as a consideration for the other.
The two stand together and none can stand without the other.
Hence, I am not impressed by the contention advanced by Shri Shah for the appellant that the amount of Rs.75,000 which was advanced by the appellant can be separated from the other agreement or could be treated differently.
I am in agreement with the High Court that the agreement has to be treated as a whole and the two parts, viz., the advance and the consideration for the same cannot be separated from each other.
The next question is whether the advance in question was opposed to public policy.
On this question, Shri Shah took us through the law on the subject, and contended that both the City Civil Court as well as the High Court have created a new head of public policy to declare the agreement as void, although according to the relevant 334 statutory Provisions as well as the decisions of the Court, the agreement is not void.
In the first instance, he referred us to the provisions of Sections 23, 65, 69, 70 and Part (ii) of Section 73 of the Indian Contract Act.
Section 23 states that the consideration or object of an agreement is lawful, unless it is forbidden by law; or is of such a nature that, if permitted, would defeat the provisions of any law, or is fraudulent; or involves or implies injury to the person or property of another; or the Court regards it as immoral, or opposed to public policy.
In each of these cases the consideration or object of an agreement is said to be unlawful.
Every agreement of which the object or consideration is unlawful is void.
He then pointed out to us that the specific rule of English law against maintenance and champerty have not been adopted in India and a champertous agreement is not per se void in this country.
He contended that before a champertous agreement is held to be void, it must be shown that it is against public policy or against justice, equity and good conscience.
He contended in this connection that the Nawab admittedly did not have sufficient finance to prosecute his claim though, he had a valid claim as shown by the result of the litigation in that behalf.
The plaintiff, therefore, did not do anything wrong in advancing the amount in question to him to enable him to establish his claim successfully since the Nawab could not have repaid the amount unless he got a share in the estate.
It was a legitimate exercise to reduce the agreement to writing and to stipulate therein that the amount should be repaid along with a share in the estate when the Nawab 's claim was established.
The share in the estate being only one anna in a rupee could not also be said to be on the high side and conscionable.
The High Court has given a finding in that behalf in favour of the appellant.
The High Court has, however, held against the appellant only on the ground that the agreement was against public policy.
He strenuously urged that if the champertous nature of the agreement is ignored which it is legitimate to do so in this country, there is no other ground of public policy on which the agreement can be struck down.
In this connection, he referred us to the decision of this Court in the matter of Mr. 'G ', a Senior Advocate of the Supreme Court, where it is reiterated that a champertous contract would be legally unobjectionable if no lawyer was involved and that the rigid English rules of Champerty and Maintenance do not apply in India.
In that case, he pointed out to us that the agreement was held unenforceable because it was agreement between a lawyer and his client and it amounted to professional misconduct.
However, this Court has also observed there that if such an agreement had been 335 between a third party "it would have been legally enforceable and good.
It may even be that it is good in law and enforceable as it stands though we do not so decide because the question does not arise; but that was argued and for the sake of argument even that can be conceded.
It follows that there is nothing morally wrong, nothing to shock the conscience, nothing against public policy and public morals in such a transaction per se, that is to say, when a legal practitioner is not concerned.
But that is not the question we have to consider.
However much these agreements may be open to other men what we have to decide is whether they are permissible under the rigid rules of conduct enjoyed by the members of a very close professional preserve so that their integrity, dignity and honour may be placed above the breath of scandal".
His second leg of the argument rested on the other provisions of the Indian Contract Act to which I have made reference above.
He contended that even assuming that it was an agreement to receive consideration a share in the claim that was to be established by the Nawab, it was not against public policy.
He contended that the amount in question was admittedly advanced and an advantage of it was taken by the Nawab to establish his claim.
He had, therefore, to return the same to the appellant.
In this connection, he referred to us to the other provisions of the Indian Contract Act to which I have made a reference earlier.
Section 65 states that when an agreement is discovered to be void or when a contract becomes void, any person who has received any advantage under such agreement or contract, is bound to restore it, or to make compensation for it, to the person from whom he received it.
Section 69 states that a person who is interested in the payment of moneys which another is bound by law to pay, and who therefore pays it, is entitled to be reimbursed by the other.
Section 70 declares that where a person lawfully does anything for another person, or delivers anything to him, not intending to do so gratuitously, and such other person enjoys the benefit therefore, the latter is bound to make compensation to the former in respect of, or to restore, the thing so done or delivered.
Part (ii) of Section 73 states that when an obligation resembling those created by contract has been incurred and has not been discharged, any person injured by the failure to discharge it, is entitled to receive the same compensation from the party in default as if such person had contracted to discharge it and had broken his contract.
Shri Shah also referred us to the provisions of Section 84 of the which reads as follows: 336 "84.
Where the owner of property transfers it to another for an illegal purpose and such purpose is not carried into execution, or the transferor is not as guilty as the transferee, or the effect of permitting the transferee to retain the property might be to defeat the provisions of any law, the transferee must hold the property for the benefit of the transferor.
Relying on these statutory provisions as well as the judicial decisions, he contended firstly that assuming that the agreement was a champertous one, it was neither immoral nor against public policy, and secondly even de hors the agreement, the appellant is entitled to the said advance of Rs.75,000 under Section 70 of the Indian Contract Act.
The High Court referred to the evidence on record in appeal which had an intimate bearing on the nature and the purpose of the agreement in question and came to the following conclusions.
The Court held that the plaintiff appellant was approached by the Nawab because being a businessman of eminence, he was highly influencial.
He had an access to the ministers and other worthies in the Government.
He was in a position to secure to the Nawab his claim by wielding his influence.
The Nawab knew about it and the plaintiff was also confident about it.
It 'was immaterial that those whom he had approached were men of high repute and great integrity of character.
The fact that because of his accessibility he could get things done through them or could make use of his other standing with them to deliver goods to the Nawab, was enough to taint the entire agreement with the vice of introducing corruption in public life.
The High Court also found that the advance which was made was in the nature of an investment to share the booty.
There was no reason for the plaintiff who was a total stranger to the Nawab to undertake the financing in question which was in those days on a considerably high scale.
No person who was not confident of delivering the goods would have embarked on financing on such a liberal scale.
The plaintiff admittedly was a businessman who knew the value of each pie he was spending.
He was doing it as a fruitful investment with sure returns.
That is evident from the terms of the contract themselves since both the advance and the consideration for which the advances were made form part of one integral contract.
On these facts which are on record, the High Court came to the conclusion that the parties had entered into the agreement in question with the avowed purpose that the plaintiff would use his then prevailing influence with the worthies in the 337 Government to secure the gains for the Nawab.
The Court On this evidence came to the conclusion that the agreement was nothing but one obviously made to lend services as a "go between" or a "carrier" for commission.
This being so, it was against public interest and detrimental to the health of body politic.
The High Court further repelled the contention that either the City Civil Court or it was evolving a new head of public policy by referring to a decision of this Court in Ghurelal Parakh vs Mahadeodas Maiya & Ors., AIR 1959 SC 781=(1959) Suppl.
2 SCR 406 and the decisions of the English Court and to opinions of the jurists/experts in treatises and essays on the subject of public policy.
The Court also pointed out that this was by no means a new head of public policy and it can come under the head "agreements tending to injure the public" as mentioned at page 325 of Anson 's Law of Contract (23rd ed).
I am in respectful agreement with the conclusion arrived at by the High Court.
It cannot be disputed that a contract which has a tendency to injure public interests or public welfare is one against public policy.
What constitutes an injury to public interests or welfare would depend upon the times and climes.
The social milieu in which the contract is sought to be enforced would decide the factum, the nature and the degree of the injury.
It is contrary to the concept of public policy to contend that it is immatable, since it must vary with the varying needs of the society.
What those needs are would depend upon the consensus value judgments of the enlightened section of the society.
These values may sometimes get incorporated in the legislation, but sometimes they may not.
The legislature often fails to keep pace with the changing needs and values nor is it realistic to expect that it will have provided for all contingencies and eventualities.
It is, therefore, not only necessary but obligatory on the courts to step in to fill the lacuna.
When courts perform this function undoubtedly they legislate judicially.
But that is a kind of legislation which stands implicitly delegated to them to further the object of the legislation and to promote the goals of the society.
Or to put it negatively, to prevent the frustration of the legislation or perversion of the goals and values of the society.
So long as the courts keep themselves tethered to the ethos of the society and do not travel off its course, so long as they attempt to furnish the felt necessities of the time and do not refurbish them, their role in this respect has to be welcomed.
It is true that as observed by Burrough, J. in Richardson vs Mellish, [ ; at 252 public policy is "an unruly horse and 338 dangerous to ride" and as observed by Cave, J. in re Mirams, [189] 1 QB 594 at 595 it is "a branch of the law, however, which certainly should not be extended, as judges are more to be trusted as interpreters of the law than as expounders of what is called public policy".
But as observed by Prof. Winfield in his article 'Public Policy in the English Common Law ' [1928]42 Harv.
L. Rev. 76, 91]: "Some judges appear to have thought it [the unruly horse of public policy] more like a tiger, and refused to mount it at all perhaps because they feared the fate of the young lady of Riga.
Others have regarded it like Balaam 's ass which would carry its rider nowhere.
But none, at any rate at the present day, has looked upon it as a Pegasus that might soar beyond the momentary needs of the community.
" All courts are at one time or the other felt the need to bridge the gap between what is and what is intended to be.
The courts cannot in such circumstances shirk from their duty and refuse to fill the gap.
In performing this duty they do not foist upon the society their value judgments.
They respect and accept the prevailing values, and do what is expected of them.
The courts will, on the other hand, fail in their duty if they do not rise to the occasion but approve helplessly of an interpretation of a statute or a document or of an action of an individual which is certain to subvert the societal goals and endanger the public good.
The contract such as the present one which is found by the City Civil Court as well as the High Court to have been entered into with the obvious purpose of influencing the authorities to procure a verdict in favour of the late Nawab was obviously a "carrier" contract.
To enforce such a contract although its tendencies to injure public weal is manifest is not only to abdicate one 's public duty but to assist in the promotion of a pernicious practice of procuring decisions by influencing authorities when they should abide by the law.
To strike down such contracts is not to invent a new head of public policy but to give effect to its true implications.
A democratic society is founded on the rule of law and any practice which seeks to subvert or circumvent the law strikes at its very root.
When the Court discountenances such practice, it only safeguards the foundation of the society.
Even assuming, therefore, that the Court finds a new head of public policy to strike down such practice, its activism is not only warranted but desired.
339 The appeal is, therefore, dismissed.
In the circumstances of the case, there will be no order as to costs.
FATHIMA BEEVI, J. I have had the advantage of perusing the judgment prepared by my teamed brother, Sawant, J.
I agree with him that the appeal must fail.
I wish to say a few words.
The only point that arises for decision in the appeal is whether an amount of Rs.75,000 which the plaintiff claims to have advanced, is recoverable from the respondents.
The relevant facts have been stated by my learned brother and it is not necessary to repeat the same.
The City Civil Court found that the agreement on the basis of which the plaintiff claimed relief was opposed to public policy.
The object of the agreement according to the trial court was that the plaintiff should wield his influence with Central and State Ministers to have Sajjid Yar Jung recognised as the heir of late Nawab Salar Jung in return for his being given one anna share in the assets to be received by Sajjid Yar Jung from the estate of late Nawab Salar Jung.
The High Court has confirmed that under the agreement the plaintiff was to promote the cause of Sajjid Yar Jung in his being recognised as heir of the Nawab Salar Jung and for the help thus rendered to receive a share of one anna in a rupee out of the assets obtained.
The plaintiff appears to have advanced an amount of Rs.75,000 in promoting the cause of Sajjid Yar Jung as agreed upon.
The help in promoting the cause was much more than mere financing.
On the evidence the High Court found that the help Sajjid Yar Jung wanted from the plaintiff was to bring to bear his influence with the Central and State Ministers and the request for financial help was secondary to the request to represent the cause with the use of influence.
The High Court affirmed that the object of agreement was to influence the Central and State Ministers and to advance and expand all amounts necessary in that connection.
In the face of the concurrent findings with which we agree, I have no doubt in our mind that the contract relating to the payment of the amount is not severable from the agreement to promote the cause of Sajjid Yar Jung by wielding the influence the plaintiff had.
Every agreement of which the object or consideration is unlawful is void.
The consideration or object of an agreement is unlawful when the court regards it as opposed to public policy.
If anything is done against the public law or public policy that would be illegal in as much as the interest of the public would suffer in case a contract against public policy is permitted to stand.
Public policy is a principle of judicial 340 interpretation founded on the current needs of the community.
The law relating to public policy cannot remain immutable.
It must change with passage of time.
A bargain whereby one party is to assist another in recovering property and is to share in the proceeds of the action and such assistance is by using the influence with the administration, irrespective of the fact that the persons intended to be influenced are not amenable to such influence is against protection and promotion of public welfare.
It is opposed to public policy.
In this view, we would hold that the plaintiff cannot enforce the agreement to recover the amount from the respondents.
ORDER The appeal is, therefore, dismissed with no order as to costs.
R. section section Appeal dismissed.
| IN-Abs | Nawab Salar Jung III expired on March 2, 1949 leaving behind him no issue but a vast estate.
Several persons came forward to be his heirs.
One of the claimants, Sajjid Yar Jung, did not have the wherewithal to establish his claim to a share in the estate.
He approached the plaintiff for financial help.
An agreement was executed between them according to which Sajjid Yar Jung agreed to return all amounts to be advanced by the plaintiff and in addition to give him one anna share in the amount that would be received by Sajjid Yar Jung from the estate.
Sajjid Yar Jung borrowed a total sum of Rs 75,000 under the agreement.
The dispute was ultimately settled in the Civil Court by compromise between the various claimants.
According to the plaintiff, the amount due to Sajjid Yar Jung was about Rs.60 Lakhs and hence the plaintiff claimed Rs.3 lakh as one anna share in addition to the sum advanced, i.e. Rs.75,000.
The plaintiff filed the present suit for the recovery of the total amount.
The City Civil Court inter alia found that the agreement was opposed to public policy as the object of the agreement was that the plaintiff should wield his influence with Central and State Ministers to have the Nawab recognised as the heir to the estate in return for his being given one anna share in the amount to be received by the Nawab.
The Court, therefore, held that the agreement in question was not enforceable, and even the amounts actually advanced could not be recovered by the plaintiff.
In the appeal, the Division Bench of the High Court held that the agreement was one whole agreement and hence the plaintiff was not entitled to recover even the amount of Rs.75,000 which was actually advanced.
The Division Bench also held that the agreement was public policy.
328 This Court granted special leave only in respect of the said amount of Rs.75,000.
Before this Court it was contended on behalf of the plaintiff that (i) the amount of Rs.75,000 could be separated from the other agreement or could be treated differently; (ii) if the champertous nature of the agreement was ignored which it was legitimate to do so in this country, there was no other ground of public policy on which the agreement could be struck down; (iii) assuming that the agreement was a champertous one, it was neither immoral nor against public policy, and even de hors the agreement, the appellant was entitled to the said advance of Rs.75,000 under section 70 of the Indian Contract Act.
It was further urged that both the City Civil Court as well as the High Court had created a new head of public policy to declare the agreement as void, although according to the relevant statutory provisions as well as the decisions of the court, the agreement was not void.
Dismissing the appeal, this Court, HELD: Per Sawant, J. (1) It is apparent on the face of the record that the advance and the share in the estate were parts of the same contract one as a consideration for the other.
The two stand together and none can stand without the other.
[333F] (2) A contract which has a tendency to injure public interests or public welfare is one against public policy.
[337D] (3) What constitutes an injury to public interests or welfare would depend upon the times and climes.
The social milieu in which the contract is sought to be enforced would decide the factum, the nature and the degree of the injury.
It is contrary to the concept of pubic policy to contend that it is immutable, since it must vary with the varying needs of the society.
What those needs are would depend upon the consensus value judgments of the enlightened section of the society.
These values may sometimes get incorporated in the legislation, but sometimes they may not.
[337E] (4) The legislature often fails to keep pace with the changing needs and values nor is it realistic to expect that it will have provided for all contingencies and eventualities.
[337E F] 329 (5) It is not only necessary but obligatory on the courts to step in to fill the lacluna.
When courts perform this function undoubtedly they legislate judicially.
But that is a kind of legislation which stands implicitly delegated to them to further the object of the legislation and to promote the goals of the society.
[337F] (6) So long as the courts keep themselves tethered to the ethos of the society and do not travel off its course, so long as they attempt to furnish the felt necessities of the time and do not refurbish them.
their role in this respect has to be welcomed.
[337G] Ghurelal Parakh vs Mahadeodas Maiya & Ors., [1959] Suppl.
2 S.C.R. 406; Richardson vs Mellish, ; ; In re Mirams, , referred to.
(7) All courts are at one time or the other felt the need to bridge the gap between what is and what is intended to be.
The courts cannot in such circumstances shirk from their duty and refuse to fill the gap.
In performing this duty they do not foist upon the society their value judgments.
They respect and accept the prevailling values, and do what is expected of them.
[338D] (8) The courts will fail in their duty if they do not rise to the occasion but approve helplessly of an interpretation of a statute or a document or an action of an individual which is certain to subvert the societal goals and endanger the public good.
[338E] (9) The contract in the present case had been entered into with the obvious purpose of influencing the authorities to procure a verdict in favour of the late Nawab and was obviously a "carrier" contract.
To enforce such a contract although its tendencies to injure public weal are manifest is not only to abdicate one 's public duty but to assist in the promotion of a pernicious practice of procuring decisions by influencing authorities when they should abide by the law.
To strike down such contracts is not to invent a new head of public policy but to give effect to its true implications.
[338F G] In the matter of Mr. 'G ', a Senior Advocate of the Supreme Court, , referred to.
(10) A democratic society is founded on the rule of law and any practice which seeks to subvert or circumvent the law at its very root.
When the Court discountenances such practice, it only safeguards 330 the foundation of the society.
Even assuming that the Court finds a new head of public policy to strike down such practice, its activism is not only warranted but desired.
[338G H] Per Fathima Beevi, J. (1) There is no doubt that the contract relating to the payment of the amount is not severable from the agreement to promote the cause of Sajjid Yar Jung by wielding the influence the plaintiff had.
[339G] (2) Every agreement of which the object or consideration is unlawful is void.
The consideration or object of an agreement is unlawful when the court regards it as opposed to public policy.
[339G] (3) Public Policy is a principle of judicial interpretation founded on the current needs of the community.
The law relating to public policy cannot remain immutable.
It must change with passage of time.
[339H 340A] (4) A bargain whereby one party is to assist another in recovering property and is to share in the proceeds of the action and such assistance is by using the influence with the administration irrespective of the fact that the persons intended to be influenced are not amenable to such influence is against protection and promotion of public welfare.
It is opposed to public policy.
[340B]
|
Civil Appeal No. 334 of 1978.
From the Judgment and Order dated 14.2.1977 of the Punjab and Haryana High Court in Civil Writ Petition No. 1860 of 1975.
WITH Civil Appeal No. 833 of 1977.
414 From the Judgment and Order dated 14 2.1977 of the Punjab and Haryana High Court in Civil Writ Petition No. 1172 of 1974.
Anil Dev Singh, P.P. Rao, O.P. Sharma, Janinder Lal, N.S. Das Bahl, R.C. Gubrela, R.S. Suri, R.S. Sodhi (NP) and M.S. Dhillon (NP) for the appearing parties.
The Judgment of the Court was delivered by PUNCHHI, J.
These two allied appeals arising from a common judgment of the Punjab and Haryana High Court at Chandigarh, in Civil Writ Petitions Nos.
1172 of 1974 and 1860 of 1975, on grant of special leave, can appropriately be disposed of by a common judgment.
In order to recruit 71 officers in the Punjab Civil Services (Executive Branch) and Allied services, the Punjab Public Service Commission, at the behest of the State of Punjab, held a competitive examination in December, 1972.
As advertised 12 vacancies were for the Punjab Civil Services and the remaining for Allied Services.
The applying candidates as per the requirement of the Punjab Civil Service (Executive Branch) Rules, 1930 (for short the Rules) specified the posts in order of preference in their respective applications.
The result of those who were declared qualified was published in the daily Tribune dated September 21, 1973.
Out of the 71 candidates declared successful Shri V.M. Bansal, the appellant in Civil Appeal No. 833 of 1977 was declared successful for a post in the Punjab Civil Service and Shri Jaswant Singh Nerwal, the appellant in Civil Appeal No. 334 of 1978 for the post of Tehsildar in the Allied services.
Some of the unsuccessful candidates challenged this selection in its entirety on various grounds before the High Court through Civil Writ Petition No. 1722 of 1974.
On the other hand challenge in Civil Writ Petition No. 1860 of 1975 was made by Nerwal against Bansal for the latter having been allowed in the meantime substituted preference for the posts to the ones given in the first instance in his application, and which led to his becoming a Punjab Civil Services Officer and Nerwal to be a Tehsildar, in the Allied services and had the substitution not been allowed the position would have been that Nerwal would have been in the P.C.S. and Bansal an Excise & Taxation Officer.
The challenge thus was to the Commission having allowed substitution of the preference.
The High Court negatived the challenge of Nerwal and his claim to be declared successful to a post in the Punjab Civil Service 415 in preference to Bansal and thus dismissed Civil Writ Petition No. 1860 of 1975.
Simultaneously Writ Petition No. 1172 of 1974 preferred by the unsuccessful candidates was allowed in part inasmuch as the selection of Bansal as a Punjab Civil Service Officer and his consequential appointment was quashed.
The High Court, however, did not disturb the selection of the remaining 70 successful candidates but required Bansal to compete again by issuing the following direction: "However, he is entitled to compete with the other unsuccessful candidates for securing place in the merit and we, therefore, direct that Shri V.M. Bansal (respondent No. 8) along with the other unsuccessful candidates be again interviewed by the members of the Commission except Shri J.R. Bansal (respondent No. 4) and whosoever is selected on merits shall have to be appointed against the post for which he is selected in accordance with the Rules.
We may, however, observe that if Shri J.R. Bansal (respondent No. 8) is again selected on merits, he will be entitled to his original seniority and all other benefits of the Service which he would have enjoyed had his selection not been quashed.
If in any case, no candidate is selected against the post of P.C.S. Cadre in accordance with the Rules, any of the other selected candidates may then make representation to the Government for being appointed to the post of P.C.S. in accordance with the Rules.
" Bansal is here before us to have the aforesaid direction quashed and Nerwal to have the place of Bansal as a Punjab Civil Service Officer.
We heard learned counsel for the respective parties on every aspect of the case at great length.
The High Court was goaded to issue the above direction regulating selection between Bansal and other unsuccessful candidates, as also the consequence thereof, on applying the decision of this Court in A.K. Kraipak & Ors. etc.
vs Union of India & Ors., to neutralise Bansal 's father Shri J. R. Bansal being a member of the Public service Commission.
And even though he had not participated in the deliberations of the Commission, when Bansal had been interviewed, his brooding presence was held negatively to have influenced the selection and the possible ouster of a possibly successful candidate.
Kraipak 's case was one where one of the persons, who sat as a member of the selection board, was himself, one of the persons to be considered for selection.
He participated in the 416 deliberations of the selection board when the claims of his rivals were considered.
He participated in the decisions relating to the preference in seniority.
He participated at every stage in the deliberations of the selection board where there was conflict between his interest and duty.
In such set of facts this Court unhesitatingly came to the conclusion that there was a reasonable likelihood of bias and therefore the principles of natural justice had got violated.
But this Court in Javid Rasool Bhat & Ors.
vs State of Jammu & Kashmir & Ors.
, ; did not vitiate the selection of a candidate to admission in a medical college on the ground of presence in the selection board of the father of one of the candidates.
In this case, the Principal of Medical College, Srinagar whose daughter was a candidate for admission to the Medical College informed the Selection Committee at the very outset about this fact and told them that he would not have anything to do with a written test and would not be present when his daughter would be interviewed.
The other members of the Selection Committee agreed to the proposal.
The procedure adopted by the Selection Committee and the members concerned was in accord with the generally accepted and well known procedure adopted by the Public Service Commissions every where in the country, as it was not unusual for candidates related to members of the Service Commission and selection Committees to seek employment.
In such a situation the practice generally in vogue is for the member concerned to excuse himself when the particular candidate is interviewed and such a selection is beyond challenge, unless, of course, mala fide.
See this Court 's decision in S.N. Nagarajan & Ors.
vs State of Mysore & Ors., , also.
Then we have the momentous decision of this Court in Ashok Kumar Yadav and Ors.
vs State of Haryana & Ors. etc.
etc., [1985] (Supp.) SCR 657 which without whittling down the salutary principle evolved in Kraipak 's case (supra) has put the Public Service Commissions, being creatures of the Constitution, at a higher pedestal.
At pages 686 87, it was ruled as follows: "But the situation here is a little different because the selection of candidates to the Haryana Civil Service (Executive) and allied services is being made not by any Selection Committee constituted for that purpose but it is being done by the Haryana Public Service Commission which is a Commission set up under Article 316 of the Constitution.
It is a Commission which consists of a Chairman and a specified number of members and is a Constitutional Authority.
We do not think that the princi 417 ple which requires that a member of a selection committee whose close relative is appearing for selection should decline to become a member of the selection committee or withdraw from it leaving it to the appointing authority to nominate another person in his place, need be applied in case of a Constitutional Authority like the Public Service Commission, whether Central or State.
If a member of a Public Service Commission were to withdraw altogether from the selection process on the ground that a close relative of his is appearing for selection, no other person save a member can be substituted in his place.
And it may sometimes happen that no other member is available to take the place of such member and the functioning of the Public Service Commission may be affected.
When two or more members of a Public Service Commission are holding a viva voce examination they are functioning not as individuals but as the Public Service Commission.
Of course, we must make it clear that when a close relative of a member of a Public Service Commission is appearing for interview, such member must withdraw from participation in the interview of that candidate and must not take part in any discussion in regard to the merits of that candidate and even the marks or credits given to that candidate should not be disclosed to him.
" It was the admitted case before the High Court that Bansal 's father did participate in the deliberations of the Commission when the viva voce test of other candidates appearing before the Commission had been taken and he had accordingly awarded marks to the candidates otherwise competing with his own son.
The High Court has still deduced that inspite of the afore suggested bias the candidates who got selected against the posts (except his son) got their due unbiased and therefore their selection cannot be questioned.
Taking this deduction to be correct, the High Court before issuing the direction under challenge, had further to find that there was bias in excluding the unsuccessful candidates.
We do not find this to have engaged the attention of the High Court.
It is noticeable that besides Bansal 's father there were four other members of the Public Service Commission and who had functioned as a Commission.
As is evident there was a long list of as many 540 candidates to be interviewed and the interviews went on from 24 9 1973 uptill 30 10 1973.
In the nature of things, there was no material before the High Court, and none has been pointed to us, from which it could be concluded that the members 418 of the commission could keep track of the comparatives of each of those 540 candidates so as to manipulate a favourable result to Bansal.
We have not been shown any material to entertain the doubt that Bansal 's father being a member of the Public Service Commission, per se had the effect of other members keeping track of comparatives in order to single out Bansal 's as a successful candidate.
And lastly there is not a word of mala fide suggested against the other members of the Public Service Commission, of having shared the supposed animus of Bansal 's father.
Thus, in the facts and circumstances of this case, we do not find any reason to sustain the judgment of the High Court on this aspect of the case.
Bansal 's father did what was expected of him, in having declined to participate in the deliberations of the commission when Bansal went for the viva voce test.
Our view in this regard is further strengthened by the manner in which the viva voce test is conducted and which the High Court even has not disapproved.
It appears that out of a total of 825 marks, 625 marks have been allotted for written tests and the remaining 200 marks for viva voce test.
These viva voce marks are distributed in various heads as enumerated by the High Court.
What is significant is that each member individually gets 25 marks but on actual working, if one of them is not attending, the share of marks are divided in the present members.
Further these marks are strictly not divided as 25 marks for each member but each member allots marks to each candidate out of 125 marks and these when added are divided by 5 or by the actual number of members present and participating in the interview.
We may not be taken to be commending such a system of division of marks out of the allocated marks for the viva voce test but it seems this is the practice in which they are actually worked out.
Similarly the provision of 200 marks for viva voce test cannot meet our approval because of the percentage now authoritatively fixed in Ashok Kumar Yadav 's case (supra).
On these particulars and for these reasons no single member can possibly usurp to himself the total functioning of the commission and jealous as human nature is, no other member can be expected to have abdicated his powers to another, at that level, and to oblige another.
These circumstances do not give rise to the likelihood of Bansal 's father espousing the cause of his son to the other four members of the commission and monitor the performance of 540 candidates to be interviewed, the results of written examination of which, he was not alleged to be aware beforehand.
In these circumstances, we find it difficult to uphold the view of the High Court requiring Bansal to be interviewed again so as to rub against the unsuccessful candidates and suffer the consequence.
419 On the grant of special leave to Bansal, operation of the judgment and order of the High Court appealed against, was on 27th July, 1977, stayed.
Bansal has stayed put and working as an Officer in the Punjab Civil Service and his displacement at the present stage would otherwise be inequitous serving nobody 's purpose due to the time lag.
The unsuccessful candidates cannot possibly now, at this stage, due to age and other supervening factors, be fit for the viva voce test, so as to elbow out Bansal.
The obedience of the directions of the High Court at this late stage would overly be counter productive and thus not worth sustaining.
This brings us to the claim of Nerwal for displacement of Bansal from the post in the Punjab Civil Service in substitution to that held by him as a Tehsildar.
The facts as found by the High Court are that initially Shri V.M.Bansal 's first preference was for the post of Excise & Taxation Officer, but on December 4, 1973, he had intimated to the Commission that he required change of his preference so that his first preference was of Punjab Civil Service (Executive Branch).
The intimation was received in the office of the commission on December 4, 1974 itself and the Chairman of the commission on the same date allowed the change.
That such change was permissible before the declaration of the result is beyond dispute.
What was urged before the High Court was that since Bansal 's application did not form part of all like applications sent in a bundle by the commission to the state Government on 11th December, 1973 and had rather been sent separately later on December 20, 1973, that by itself raised a doubt as to the authenticity thereof.
The High Court negatived the contention.
It held that this circumstance alone did not conclusively prove that the change of preference was intimated to the commission after the declaration of the result on December 7, 1973 as alleged.
Though the High Court went on to observe that there was no statutory rule that no change in preference could be made after the result is communicated by the commission to the State Government, we are not obliged to go into that question.
In face of the finding of the High Court that circumstantially it was established on the record that the preference had been changed by Bansal on 4 12 73, before the declaration of the result, it is difficult to take a contrary view.
The High Court had even seen the original record to come to that view.
Such like inferences drawn are in the realm of facts and we have not been persuaded to take a different view.
Once this is established that the change of preference could be made and it was intimated and appproved timely, the conclusion is inescapable that Bansal 's first preference to a post in the Punjab Civil 420 service ranked superior to Nerwal 's preference, because of their interse ranking in the examination results.
Thus,the appeal of Jaswant Singh Nerwal has no substance deserving rejection.
Resultantly for the views afore expressed, Civil Appeal No. 833 of 1977 preferred by Shri V.M. Bansal is allowed and the Civil Writ Petition No. 1172 of 1974 before the High Court would stand dismissed and Civil Appeal No. 334 of 1978 of Shri Jaswant Singh Nerwal would stand dismissed affirming the dismissal of his Writ Petition No. 1860 of 1975 before the High Court, but without any order as to costs in both appeals.
D.R.L. C.A. No.334/78 dismissed C.A. No.833/77 allowed.
| IN-Abs | For the recruitment of 71 officers in the Punjab Civil Services (Executive Branch) and Allied Services, the Punjab Public Service Commission, at the behest of the State of Punjab, held a competitive examination.
As per the requirement of the Punjab Civil Services (Executive Branch) Rules, 1930, the applying candidates specified the posts in order of preference in their respective applications.
One such candidate, appellant V.M. Bansal, who had initially indicated his first preference for the post of Excise & Taxation Officer, intimated to the Commission, but undisputedly before the declaration of the result, that he wanted change of his preference so that his first preference was of Punjab Civil Service (Executive Branch).
This change was allowed by the Commission.
Bansal 's father, who was a member of the Commission, did not participate in the deliberations of the Commission when Bansal was interviewed.
Of the 71 candidates declared successful, Bansal was declared successful for a post in the Punjab Civil Service, and appellant jaswant Singh Nerwal for the post of Tehsildar in the Allied Services.
Some of the unsuccessful candidates challenged the entire selection on various grounds before the Punjab and Haryana High Court by means of a writ petition.
On the other hand, Nerwal, through a separate writ petition, challenged the change of preference allowed by the Commission to Bansal which led to Bansal becoming a Punjab Civil Service Officer and Nerwal a Tehsildar, and claimed that he be declared successful to a post in the Punjab Civil Service in preference to Bansal.
The High Court by a common judgment rejected the claim of Nerwal and dismissed his writ petition, but allowed the writ petition preferred by the unsuccessful candidates in part inasmuch as the selection of Bansal as a Punjab Civil Service Officer and his consequential appointment was quashed.
The High Court however did not disturb the selection of the remaining 70 successful candidates but 412 required Bansal to compete again with the other unsuccessful candidates as per its direction extracted in the judgment.
The High Court in issuing the aforesaid direction applied the decision of this Court in A. K. Kraipak & Ors. etc.
V. Union of India & Ors., , to neutralise Bansal 's father being a member of the Commission.
And even though Bansal 's father had not participated in the deliberations of the Commission, when Bansal was interviewed, his brooding presence was held negatively to have influenced the selection and the possible ouster of a possibly successful candidate.
Hence these two appeals by special leave, one by Bansal and the other by Nerwal, against the judgment of the High Court.
Allowing the appeal of Bansal and dismissing the one filed by Nerwal, the Court, HELD: (1) Besides Bansal 's father, there were four other members of the Public Service Commission and who had functioned as a Commission.
There was a long list of as many 540 candidates to be interviewed and the interviews went on from 24.9.1973 uptil 30.10.1973.
[417G] (2) Bansal 's father did what was expected of him, in having declined to participate in the deliberations of the Commission when Bansal went for the viva voce test.
[418C] (3) No material has been shown to entertain the doubt that Bansal 's father being a member of the Public Service Commission, per se had the effect of other members keeping track of comparatives in order to single out Bansal as a successful candidate.
There is not a word of mala fide suggested against the other members of the Public Service Commission, of having shared the supposed animus of Bansal 's father.
There is therefore no reason to sustain the judgment of the High Court on this aspect of the case.
[418A B] A.K. Kraipak & Ors. etc.
vs Union of India & Ors., [19701 1 SCC 457, distinguished; Javid Rasool Bhat & Ors.
vs State of Jammu & Kashmir & Ors.
, ; , affirmed; B.N. Nagarajan & Ors.
vs State of Mysore & Ors.
, [ , referred to.
Ashok Kumar Yadav & Ors.
vs State of Haryana & Ors. etc.
, [1985] Supp.
SCR 657, relied upon.
(4) The manner in which the viva voce test is conducted, no single 413 member can possibly usurp to himself the total functioning of the Commission and jealous as human nature is, no other member can be expected to have abdicated his powers to another, at that level, and to oblige another.
These circumstances do not give rise to the likelihood of Bansal 's father espousing the cause of his son to the other four members of the Commission and monitor the performance of 540 candidates to be interviewed, the results of written examination of which, he was not alleged to be aware before hand.
In these circumstances, it is to uphold the view of the High Court requiring Bansal to be interviewed again so as to rub against the unsuccessful candidates and to suffer the consequence.
[418C H] In the instant case, the system of division of marks out of the allocated marks for the viva voce test amongst the actual number of members present and participating in the interview, was not however commended by the Court, nor did the Court approve the provision of 200 marks for the viva voce test because of the percentage now authoritatively fixed in Ashok Kumar Yadav 's case.
[418F] (5) Bansal has stayed put and working as an Officer in the Punjab Civil Service and his displacement at the present stage would otherwise be inequitous serving nobody 's purpose due to the time lag.
The unsuccessful candidates cannot possibly now, at this stage, due to age and other supervening factors be fit for the viva voce test, so as to elbow out Bansal.
The obedience of the directions of the High Court at this late stage would overly be counter productive and thus not worth sustaining.
[419A B] (6) Once it is established that the change of preference could be made and it was intimated and approved timely, the conclusion is inescapable that Bansal 's first preference to a post in the Punjab Civil Service ranked superior to Nerwal 's preference, because of their interse ranking in the examination results.
Thus the appeal of Nerwal has no substance and deserves rejection.
[419H 420A]
|
103 of 1958.
Petition under article 32 of the Constitution for enforcement of fundamental rights.
M. T. Paikeday and Ganpat Rai, for the petitioner.
Sardar Bahadur, for respondent No. 1.
M. R. Krishna Pillai, for respondent No. 3. 788 1958.
December 11.
The Judgment of the Court was delivered by HIDAYATULLAH, J.
This is a petition under article 32 of the Constitution by one C. K. Achuthan, who claims to have held a contract for the supply of milk and other articles of diet for the year 1958 1959 but whose contract for supply of milk is said to have been cancelled by the District Medical Officer (second respondent herein).
The contract for the.
supply of milk has now been given to the third respondent, the Co operative Milk Supplies Society, Cannanore.
From the petition, it appears that the petitioner held contracts for the supply of milk to the Government Hospital at Cannanore (Kerala State) ever since 1946, and that previous to this, his brother in the same business held similar contracts from 1936.
In 1957, a " uniform procedure for fixing up contracts " was adopted, and by a notification, conditions for acceptance of tender were laid down.
The petitioner as well as the third respondent submitted their respective tenders, which were to be opened by the Superintendent of the Hospital in the presence of interested parties.
We need not refer to all the conditions under which tenders were to be accepted, except those which have a bearing upon this matter.
It was stated in the conditions that no tender marked at " current market rates " would be accepted, and further that in the supply of milk, preference would be given to approved Co operative Milk Supply Unions and Societies, if their tender was within a margin of 5 per cent.
over the market rate or the lowest tendered rate, whichever was less.
All persons making tender for the contract had to produce a certificate of solvency and tax clearance certificates, and to make a deposit with the tender.
On January 20, 1958, the tenders which were submitted were scrutinised and the tender of the petitioner for the supply of milk was accepted and that of the third respondent rejected.
It appears that the Superintendent (respondent No. 2) communicated to the Director of Public Health, her reasons for accepting the tender of the petitioner and not accepting that 789 of the third respondent.
Certain correspondence then ensued between the Director of Health Services and the second respondent, as a result of which the petitioner was informed that the contract for the supply of milk given to him was cancelled.
He was informed that it was the policy of Government that in the matter of supply to Government medical institutions in Cannanore District the Co operative Milk Supplies Union was to be given contracts on the basis of prices fixed by the Revenue Department.
It appears that some more correspondence between the Director of Health Services and the second respondent ensued, and it was pointed out to the second respondent that action should have been taken under Cl. 20 of the conditions of the tender and the contract only cancelled after giving a month 's notice to the petitioner.
In furtherance of these instructions, the second respondent issued a notice in terms of Cl. 20 of the tender, and cancelled the contract after the notice period.
The present petition has been filed to question the several orders referred to above.
It may be pointed out that previous to this, the petitioner had applied under article 226 of the Constitution to the High Court of Kerala, but his petition (O. P. No. 201 of 1958) was rejected by Raman Nayar, J., on June 6, 1958.
A Letters Patent Appeal was also dismissed by Koshi, C. J., and Vaidialingam, J. (A. section No. 354 of 1958 decided on July 7, 1958).
The High Court held that the present matter was no more than a breach, if any, of the contract by the State Government, and that the appropriate remedy was to file a civil suit and not to proceed under article 226.
It appears that no special leave to appeal was sought from this Court against the above orders, and the matter has been brought for adjudication, not by way of appeal but directly under article 32 of the Constitution as an infringement of the fundamental right of the petitioner.
The contention of the petitioner in this behalf is that he is entitled to an equal treatment in the eye of law, and that there has been discrimination against him vis a vis, the third respondent.
He claims protection under articles 14, 16(1), 19(1)(g) and 790 31 of the Constitution.
In our opinion, none of these Articles can be made applicable to the facts of the present case.
No doubt, the petitioner claims to have succeeded in obtaining the contract from the Government, and the third respondent failed to do so.
But even if he held the contract, the petitioner did not acquire an absolute right to be continued in that contract, because power was reserved by the Government under Cl. 20 to terminate the contract after giving a month 's notice.
Whether the exercise of that power in the present case was regular or legal, is not a matter on which we are called upon to pronounce, because adjudication of such dispute can appropriately take place only before the ordinary Civil Courts, where evidence can be gone into and examined at length.
The gist of the present matter is the breach, if any, of the contract said to have been given to the petitioner which has been cancelled either for good or for bad reasons.
There is no discrimination, because it is perfectly open to the Government, even as it is to a private party, to choose a person to their liking, to fulfill contracts which they wish to be performed.
When one person is chosen rather than another, the aggrieved party cannot claim the protection of article 14, because the choice of the person to fulfill a particular contract must be left to the Government.
Similarly, a contract which is held from Government stands on no different footing from a contract held from a private party.
The breach of the contract, if any, may entitle the person aggrieved to sue for damages or in appropriate cases, even specific performance, but he cannot complain that there has been a deprivation of the right to practise any profession or to carry on any occupation, trade or business, such as is contemplated by article 19(1)(g).
Nor has it been shown how article 31 of the Constitution may be invoked to prevent cancellation of a contract in exercise of powers conferred by one of the terms of the contract itself.
The main contention of the petitioner before us was thus under article 16(1) of the Constitution, and he claimed equal opportunity of employment under the 791 State.
To begin with, a contract for the supply of goods is not a contract of employment in the sense in which that word has been used in the Article.
The petitioner wag not to be employed as a servant to fetch milk on behalf of the institution, but was a contractor for supplying the articles on payment of price.
He claimed to have been given a contract for supply of milk, and did not claim to be an employee of the State.
Article 16(1) of the Constitution , both in its terms and in the collocation of the words, indicates that it is confined to " employment " by the State, and has reference to employment in service rather than as contractors.
Of course, there may be cases in which the contract may include within itself an element of service.
In the present case, however, such a consideration does not arise, and it is therefore not necessary for us to examine whether those cases are covered by the said Article.
But it is clear that every person whose offer to perform a contract of supply is refused or whose contract for such supply is breached cannot be said to have been denied equal opportunity of employment, and it is to this matter that this case is confined.
Looking to the facts of the case, it is manifest that the petitioner was supplying, or in other words, selling milk and other articles of diet to the State for the use of hospitals and similar institutions.
He was in no sense a servant, and no question of employment qua servant arose.
In these circumstances, it is plain that article 16(1) of the Constitution is not attracted to the facts.
In our opinion, the petition under article 32 of the Constitution is wholly misconceived.
No fundamental right is involved.
At best, it is a right to take the matter to the Civil Court, if so advised, and to claim damages for breach of contract, if any.
The petition accordingly fails, and is dismissed with costs.
Petition dismissed.
| IN-Abs | For the supply of milk to the Government Hospital at Cannanore for the year 1948 49, the petitioner and the third respondent, the Co operative Milk Supplies Society, Cannanore, had submitted tenders, and the Superintendent who scrutinised them accepted that of the petitioner and communicated to the Director of Public Health the reasons for the decision.
Subsequently, the contract to the petitioner was cancelled after giving the requisite notice in terms of Cl. 20 Of the tender, and he was informed that it was the policy of the Government that in the matter of supply to Government medical institutions in Cannanore District, the Co operative Milk Supplies Union was to be given contracts on the basis of prices fixed by the Revenue Department.
The petitioner contended, in a petition filed under article 32 Of the Constitution, that there had been discrimination against him vis a vis the third respondent, that he was denied equal opportunity of employment under the State, and that the fundamental rights under articles 14, 16(1), 19(1) (g) and 31 had been infringed.
Held, that none of the fundamental rights were involved in the present case.
A contract which is held from Government stands on no different footing from a contract held from a private party and when one person is chosen rather than another the aggrieved party cannot claim the protection of article 14.
A contract for the supply of goods is not a contract of employment and the petitioner who was supplying milk to the State hospital was in no sense a servant and no question of employment qua servant arose.
Article 16 (1) was therefore not attracted to the case.
|
Civil Appeal No. 1196 of 1986 with 830 of 1991.
From the Judgment and Order dated 19.4.1985 of the Calcutta 519 High Court in F.M.A.T.Nos.
153 of 1980 and 326 of 1983.
N.S. Hegde, Additional Solicitor General, Tapas Ray, D.K. Sinha, J.R.Das and D.N. Mukherjee for the Appellants.
P.P. Rao, A.K. Ganguli, Ajit Chakraborty, A. Mariarputham.
Mridula Ray, A. D. Sikri and B.B. Tawakley for the Respondents.
The Judgment of the Court was delivered by FATHIMA BEEVI, J.
The West Bengal Services (Revision of Pay and allowance) Rules, 1970, (hereinafter referred to as 1970 Rules), issued in exercise of the power conferred by the proviso to Article 309 of the Constitution of India, vide Notification No. 5212.F dated 30th December, 1970 on the basis of the Pay Commission Report specified the revised scales of pay of the government employees in various departments with effect from 1st April, 1970.
Schedule I of the 1970 Rules relates to services generally.
The Government of West Bengal issued Notification No. 10303.F dated 19th November, 1974, amending the 1970 Rules.
The Notification material for the purpose of these cases is set out below: "NOTIFICATION No. 10303.F, Dated the 19th November, 1974.
In exercise of the powers conferred by the proviso to Article 309 of the Constitution of India, the Governor is pleased to direct that the following amendment shall be made in the West Bengal Services (Revision of Pay and Allowance) Rules, 1970, Published with Finance Department Notification No. 5212,F, dated the 30th December.
1970, as amended from time to time, namely: AMENDMENTS In Schedule I, Part B, to the said rules, the following amendments shall be made: 1.
In the cadre of Assistant Engineers under different Departments, the Intermediate Selection Grade shall be at 15 per cent of the Cadre in the scale as shown in Column (3) of the Schedule.
520 II.
In departments/offices having services/posts as shown in Column (i) in the scale as shown in Column (2) of the Schedule, there shall be no Intermediate or New Selection Grade as the case may be at 10 per cent of the services/posts (except in the cadre of Assistant Engineer) in the scale as shown in Column (3) of the Schedule.
From 1st August 1974, the New/Intermediate Selection Grade shall be raised to 15 per cent, from 10 per cent.
(i) Sub Assistant Engineers having Engineering Degree shall have an initial start in the existing scale of Rs.300 600 at the stage of Rs.360 per month.
They will also get the benefit of age relaxation for direct recruitment either through the Public Service Commission or for ad hoc appointments.
(ii) All Test Relief Overseers and other diploma holder Engineers will henceforth be termed as Sub Assistant Engineers.
(iii) Sub Assistant Engineers with L.E.E. who have supervisor 's licence from the Commerce and Industries Department will get a qualification pay of Rs.50 per month.
(iv) Gazetted status is hereby conferred on the members of the Subordinate Engineering Service and all Sub Assistant Engineers.
The existing scale, namely Rs.375 10 415 15 610 20 650 prescribed for the members of the non gazetted Health Service having M.B.B.S., or M.M.F. qualifications shall be changed to Rs. 375 10 415 15 610 20 650 (E.B. after 8th and 18th stages) higher initial start at Rs.450.
All Licentiate Medical Officers in the West Bengal Health Service (Non Gazetted) who have completed 10 years of service shall be eligible for appointment in the West Bengal Health Service (Gazetted) within the existing cadre strength of the basic grade provided they are found suitable for the basic grade in consultation with the Public Service Commission.
521 VII.
The New or Intermediate Selection Grades sanctioned above shall be admissible after 10 years of service in the grade next below.
Unless otherwise stated above and in the Schedule; these amendments shall be deemed to have come into effect from 1st day of March, 1974.
The Notifications bearing No. 2194.F, 2195.F and 2197, dated the 11th March, 1974, stand cancelled.
No prior consultations with the Public Service Commission shall be necessary for making appointments to New/Intermediate Selection Grades sanctioned in this Notification." The said Notification contained a Schedule.
The relevant items dealing with Engineering is provided as follows: SCHEDULE _______________________________________________________________ Service/ Existing scale New/Intermediate Posts Rs. Selection Grade Rs. ________________________________________________________________ 1.
Engineering Services/Posts.
i) Assistant 475 30 685 35 1000 825 50 875 60 1415.
Engineer 50 1150, with selec tion grade for 5 per cent of the cadre on 1150 50 1350.
ii) Executive 825 50 875 1535 60 1775.
Engineer 60 1475.
iii) Sub Assistant 300 10 430 15 600 560 20 700 25 Engineer with higher initial 825(a).
start at Rs. 330/ .
____________________________________________________________ The respondents in Civil Appeal No. 1196 of 1986 and the respondents in the other Civil Appeal arising out of S.L.P. (Civil) No. 5298 of 1987 are diploma holder engineers employed in various 522 departments of the Government of West Bengal in the post of Operator cum Mechanics/Electricians etc.
in the scale of pay of Rs.230 425.
These respondents filed two writ petitions bearing No. C.R. Nos. 6053 (W) of 1978 and C.R. No.6593(W) of 1978 before the High Court of Calcutta, claiming that by virtue of sub para (ii) of Para IV of the Notification No. 10303.F dated 19th November, 1974, the writ petitioners who are diploma holders in engineering are to be termed as Sub Assistant Engineers and given the benefit of that post and the scale of pay of Rs.300 600.
They contended inter alia that the benefit of the aforesaid Notification was given to similarly situated persons in the other deparptments of the Government of West Bengal and the writ petitioners employed in the Agriculture Department had been subjected to discriminatory treatment.
The State Government contended before the High Court that sub para (ii) of Para IV of the said Notification applies only to the Overseers, Estimators and Sub Overseers already holding the scale of pay of Rs.300 600 and not to Operator cum Mechanics/Electricians etc.like the writ petitioners whose scale of pay is Rs.230 425.
According to the State, the said Notification was merely one changing the designation of various techniques and engineers having scale of pay of Rs.300 600 but having different designations and was meant to give uniformity of designation to all the aforesaid officials in the same scale of pay of Rs.300 600.
It was also the contention of the State that they being Operator cum Mechanics whose recruitment qualifications is much less than the the diploma in engineerings, the writ petitioners cannot or are not entitled to be redesignated as Sub Assistant Engineers.
These contentions were repelled by the learned single Judge who by judgment dated 19th September, 1979, allowed the writ petitions.
In the Judgment, Sabyasachi Mukharji, J., (as he then was) held as under: "Now it is important to emphasise that the said Notifications covered `other diploma holder Engineers '.
Now, if those who were engineers or those for whose recruitments qualification of being engineers was essential there was no necessity to indicate that they should be henceforth be termed as Sub Assistant Engineers.
They are Engineers, Sub Assistant or otherwise, before they were called by the deeming provision of the amended Notifications referred to hereinbefore.
" In construing sub para (ii) of Para IV of the said Notification, the learned Judge said thus: 523 "The aforesaid clause in the Notifications can only mean, in my opinion, that even though the persons who come within the purview of this amended clause of the Notification will for the limited purpose of their pay, allowances and other financial emoluments be termed from the date of coming into operation or from the mentioned in the Notification of 1974 that is to say from 1st of March, 1974 as Sub Assistant Engineers though they are, in fact, not engineers.
That in my opinion, is clear from the language used.
" The learned single Judge noticed that the history preceding the Notification supported the clear language used and persons holding different positions became by virtue of the Notification entitled to be termed as Sub Assistant Engineers irrespective and independent of whether by fortuitous circumstances some of the incumbents who got the benefits of the said Notification are also qualified engineers.
Accordingly, it was held that the writ petitioners come within the purview of the Notification for purpose of the the pay scale and the rule was made absolute.
The State Government carried the matter in appeal.
The Division Bench of the High Court vide judgment and order dated 19.4.1985, however, affirmed the judgment while holding that sub para (ii) of Para IV of the Notification dated 19.11.1974 cannot be construed to include the Operator cum Mechanics/Electricians who are holders of diploma in engineering and drawing the scale of pay of Rs. 230 425.
The appeal was dismissed with the observation that the writ petitioners should have been admitted to the benefit of the scale of pay of Rs.300 600 with higher initial start long before others holding the same position as the writ petitioners have been granted the benefits and that great injustice had been done to the writ petitioners by keeping them in the panel since 1974 without taking any steps for their appointments to the post of Sub Assistant Engineers although others have been appointed to the said post in implementation of the impugned Notification.
Being aggrieved by the appellate judgment, the State has moved this Court under Article 136 of Constitution.
Leave is granted in S.L.P.(C) No. 5298 of 1987.
The main contention urged on behalf of the appellants is two fold.
It is contended that the Division Bench having come to the 524 specific conclusion that the Notification in question is not applicable to the respsondents herein, the writ petitions ought to have been dismissed.
The further contention is that the appointment of 17 other persons without considering the case of the respondents even if irregular cannot be the basis for making the Notification applicable to the respondents.
Before considering these propositions put forward by Mr. Hegde, Addl.
Solicitor General, appearing for the appellants, we shall dispose of the preliminary objection raised by Mr. P.P. Rao, counsel for the respondents.
It was pointed out that no appeal has been preferred by the State of West Bengal against the judgment dated 25.6.1982 in the case of Ranjit Kumar Ghosh & Ors.
vs The State of West Bengal & Ors., being C.R. No. 923 (W) of 1980, granting similar relief and that the rule of law has become final so far as that matter is concerned.
Relying on the decision of this Court in Chief Secretary to Govt.
A.P. vs Cornelius, ; , it was argued that the State cannot agitate the case of only few others.
It is not disputed that the judgment against which no appeal has been preferred is only based on the judgment in the main case which is now pending before us for consideration.
The Court in State of Punjab vs Joginder Singh, [1963] Supp.2 SCR 169, where a similar objection was raised overruled the same observing at page 177 thus: "In our opinion, the true position arising, if the present appeal by the State Government should succeed, would be that the finality of the orders passed in the other three writ petitions by the Punjab High Court would not be disturbed and that those three successful petitioners would be entitled to retain the advantages which they had secured by the decision in their favour not being challenged by an appeal being filed.
That however would not help the present respondent who would be bound by our judgment in this appeal and besides, so far as the general law is concerned as applicable to everyone other than the three writ petitioners (who would be entitled to the benefit of decisions in their favours having attained finality), the law will be as laid down by this Court.
We therefore overrule the preliminary objection.
" It appears that this pronouncement was not noticed in Cornelius case (supra) where the facts were also not identical.
We have, therefore, no hesitation in overruling the preliminary objection.
525 The appellants, in our opinion, cannot however, succeed on the merits.
The basis of the respondents ' claim is that they are diploma holder engineers who are to be designated as Sub Assistant Engineers for the purpose of the revised pay scale by virtue of the Notification dated 19th November, 1974.
The learned single Judge had construed the expression 'other diploma holder engineers ' in clause (ii) of Para IV of the said Notification as covering persons like the respondents who are holders of diploma in engineering.
The Division Bench in holding a contrary view overlooked the fact that the posts of Overseers, Estimators and Sub Overseers were already covered under the category of Sub Assistant Engineers even under the unamended rules and were in the pay scale of Rs.300 600 whereas the respondents holding the post of Operator cum Mechanics/Electricians were diploma holder engineers in the scale of pay of Rs.230 425.
As noticed by the learned single Judge, the reasons for amending the 1970 Rules by the Notifications dated 11.3.1974 and 19.11.1974 was the decision of the Government to remove the anomalies in the existing rule so as to attract men of quality and also with a view to remove frustration among those having specialised knowledge of a technical nature.
This factual background was not considered by the Division Bench while considering the scope of the amended provisions.
The appellants admitted that in 1970 the pay scale of Overseers and Sub Overseers was revised and both Overseers and Sub Overseers were brought within the scale of Rs.300 600.
The Division Bench has recorded a finding to the effect that the Overseers.
Estimators and Sub Overseers were already included in the categories of Sub Assistant Engineers under Schedule I Part B of the 1970 Rules even before the same was amended by the Notification.
The persons brought under the category of 'other diploma holder engineers ' can only be the persons like the Operator cum Mechanic/Electrician with diploma in engineering and working in various departments in the Engineering Service.
It is to be noticed that the respondents have been absorbed in the posts of Operator cum Mechanics after having attended to the training sponsored under the scheme 'Training of Educated Unemployed Youths ' in the operation of river lift, deep tubewells and shallow tubewells etc.
Clause (iv) of Part IV of the Notification which states that Gazetted status is conferred on the members of the Subordinate Engineering Services and all Sub Assistant Engineers also relates to these two categories, that is, the Overseers, Sub Overseers and Estimators who are already members of the Subordinate Engineering Service and the 'other diploma holder engineers ' now termed as Sub Assistant Engineers.
526 It has been contended for the appellants that by construing the Notification as including Operators cum Mechanics in the lower time scale as Sub Assistant Engineers and giving them a higher scale, there would be a division amongst the Operators cum Mechanics in the matter of their pay scale and such an anomly would not have been contemplated by the rule makers.
There is no force in this contention.
It is well settled that difference in pay of employees belonging to the same cadre post or educational qualification is constitutionally valid and permissible and is not violative of Articles 14 and 16 of the Constitution.
The post of Sub Assistant Engineer is a direct recruitment post.
It appears that the Division Bench assumed that the post of Sub Assistant Engineers were ultimately a promotional post for the Operators cum Mechanics through intermediary promotions in intermediary grades.
This is incorrect.
Under the Rules, the post of Sub Assistant Engineers is not at all a promotional post for any categories of employees in the State, on the contrary, it is a direct recruitment post.
It is not contested that 17 other employees similarly placed as the respondents herein were given the benefits of the said amended Notifications and were conferred both status of Sub Assistant Engineers and also the pay scale thereof for the reason that they were also diploma holder engineers though they were not in the pay scale of Rs.300 600.
This is a concurrent finding that these respondents have been discriminated and the State Government had acted arbitrarily without any rational basis by conferring benefits of the Notification to 17 other employees in other departments while denying the said benefits to the said respondents in the Agriculture Department.
It has been brought to the notice of the Court that the Operators cum Mechanics would be absorbed in the existing vacancies in the category of Sub Assistant Engineers since injustice had been done to the respondents by keeping them in the panel since 1974 without taking any steps for their appointments as Sub Assistant Engineers along with others when such appointments were made and the assurance made before the Court.
The fact that in implementation of the judgment of the learned single Judge, the respondents have already been admitted to the benefits of the amended Rule, is an additional reason for this Court not to interfere with the impugned judgment.
We are, therefore, of the view that both the civil appeals have only to be dismissed.
We do so accordingly.
The parties are directed to bear their respective costs.
Y.L. Appeals dismissed.
| IN-Abs | The respondents in these appeals are diploma holder engineers employed in the various departments of the Government of West Bengal as Operator cum mechanics/Electricians etc.
in the pay scale of Rs.230 425.
Consequent upon the amendment of West Bengal Services (Revision of Pay and Allowances) Rules, 1970 the respondents filed writ petitions before the High Court claiming that by virtue of sub para (ii) of Para IV of the Notification dated 19.11.74 they are to be termed as Sub Assistant Engineers and given the benefit of that post and scale of pay of Rs.300 600, as they are diploma holders in engineers.
It was asserted by them that the benefit of the said Notification had been given to similarly situated persons in the other department of the State Government but they had been subjected to discriminatory treatment by denying to them those benefits.
The State Government contended before the High Court that sub para (ii) Para IV of the notification applied only to Overseers, Estimators and Sub Overseers already working in the pay scale of Rs.300 600 and not to Operator cum Mechanics/Electricians etc.
whose scale of pay was Rs.230 425.
According to the State, the said Notification was intended merely to change the designation of various technicians and engineers having identical scale of pay Rs.300 600 to secure uniformity of designation of those employees and since the recruitment qualification of the respondents was much less than the diploma in engineering, they were not entitled to be redesignated as Sub Assistant Engineers.
The learned single Judge of the High Court allowed the writ petitions holding that the case of the respondents fell within the purview of the November 1974 notification and they were entitled to be termed as Sub Assistant Engineers.
The State Government preferred an appeal against the said order before the Division Bench.
The Division Bench of the High Court, though held that sub para (ii) of para IV of the Notification dated 19.11.1974 could not be 518 construed to include the Operator cum Mechanics/Electricians, who were drawing the pay scale of Rs.230 425, dismissed the appeals with the observation that the respondents/writ petitioners should have been admitted to the benefit of the pay scale of Rs.300 600 long before others holding the same position as the writ petitioners had been granted the benefits.
The State Government has now filed these appeals after obtaining special leave.
Dismissing the appeals, this Court, HELD: The reasons for amending the 1970 Rules by the Notifications dated 11.3.1974 and 19.11.1974 was the decision of the Government to remove the anomalies in the existing rule so as to attract men of quality and also with a view to remove frustration among those having specialised knowledge of a technical nature.[525C D] The persons brought under the category of `other diploma holder engineers ' can only be the persons like the Operator Cum Mechanic/Electrician with diploma in engineering and working in various departments in the Engineering Service.
[525F] Clause (iv) of Para IV of the Notification which states that Gazetted status is conferred on the members of the Subordinate Engineering Services and all sub Assistant Engineers also relates to these two categories, that is, the Overseers, Sub Overseers and Estimators who are already members of the Subordinate Engineering Service and the `other diploma holder engineers ' now termed as Sub Assistant Engineering.
[525G H] There is a concurrent finding that these respondents have been discriminated and the State Government had acted arbitrarily without any rational basis by conferring benefits of the Notification to 17 other employees in other departments while denying the said benefits to the said respondents in the Agriculture Department.[526E] Chief Secretary to Government of A.P. vs Cornelius, ; ; State of Punjab vs Joginder Singh, [1963] Supp.2 SCR 169, referred to.
|
Civil Appeal No. 4 of 1977.
From the Judgment and Order dated 3/4.3.1975 of the Calcutta High Court in Appeal No. 156 of 1974.
G.L. Sanghi, Dhruv Mehta, Aman Vachhar and S.K. Mehta for the Appellants.
Tapas Ray and G.S. Chatterjee for the Respondents.
Harish N. Salve, Lalit Bhasin, Ms. Nina Gupta, Vibhu Bhakru, Pranab Mullick and Vineet Kumar for the intervener.
The Judgment of the Court was delivered by K.N. SAIKIA, J.
This appeal by certificate is from the Judgment of the Calcutta High Court dated 4.3.1975 passed in appeal No. 156 of 1974.
The appellants in partnership have been carrying on business of restaurants under the name and style of Trinca 's at No. 17B, Park Street Calcutta, providing food and drinks (alcohol and non alcohol) to the customers under valid licences.
Sometimes musical performences are also arranged.
The restaurants are provided with air conditioning plant.
Under the West Bengal Entertainments and Luxuries (Hotels and Restaurants) Tax Act, 1972 as amended by the Act of 1974, hereinafter referred to as 'the Act, the respondents by their Memo No. 4942/A.T. dated 9.12.1972 called upon the appellants to make ad hoc payment of luxury tax calculated at Rs.2,40,000.00.
The President of the Hotelers ' Association made a representation against this illegal tax which was turned down by the respondents, and thereafter the appellants challenged the validity of this action in the Calcutta High Court by filing Writ Petition No. 358 of 1973 on 16.5.1973.
The appelants contended, inter alia before the High Court that the levy was unreasonable restriction on carrying the business; that the levy was unreasonable restriction on carrying the business; the Act was not meaningful and purposeful; the rules were confiscatory in nature; and the mode of the Act.
The learned Single Judge of the High Court dismissed the writ petition relying on the Judgment passed on 6.3.1974 in Writ Petition No. 338 of 1973 wherefrom Civil Appeal No. 406 of 1976 was filed in this Court.
467 From the above order of the learned Single Judge, the appellants filed Appeal No. 156 of 1974 on 26.6.1974 before the Division Bench of the Calcutta High Court contending that the legislature cannot enlarge the scope of Entry 62 and seek to impose a tax on expenditure incurred by a customer on services rendered to him including food and drinks.
The High Court held that section 2(b) defined entertainment tax but section 2(c) defined entertainment tax and under the Act entertainment tax meant tax payable under section 3 of the Act.
A clear distinction had been made between entertainment and entertainment tax and in this case the High Court was concerned only with entertainment tax as defined in section 2(C).
The second submission before the High Court was whether the State legislature had the competence to impose entertainment tax payable under section 3 of the Act and the High Court held that section 3 was a valid piece of legislation.
The argument of the appellants was that tax imposed by section 3 was discriminatory and it violated article 14 of the Constitution.
The High Court held that the differentia made in section 3 had a rational relation to the object sought to be achieved by the statute.
The last submission was whether the persons enjoying the same facilities had been treated differently as the section had imposed a maximum tax of 15% on amount paid or payable by the customer.
The High Court held that since a distinction had to be maintained between section 2(b) and section 2(c), the learned counsel 's argument on discrimination could not be acceded to.
The appeal was accordingly dismissed, but certificate of fitness to appeal was granted.
The contentions raised in this appeal are the same as were raised in Civil Appeal No. 406 of 1976 whcih has just been dismissed.
In East India Hotels Ltd. vs State of West Bengal, AIR 1990 SC 2029 this Court held that whatever has been said by this Court in relation to section 4 of the Act will be equally applicable to section 3 of the Act.
Consequently, for the above reason and for the reasons stated in our Judgment in Civil Appeal No. 406 of 1976, we dismiss this appeal also with costs quantified at Rs.5,000 (Rupees five thousand).
G.N. Appeal dismissed.
| IN-Abs | Under the West Bengal Entertainments and Luxuries (Hotels and Restaurents) Tax Act, 1972 as amended in 1974, the appellants were called upon to make ad hoc payment of luxury tax calculated at Rs.2,40,000.
A representation from the Hotel Association to the Respondents having being turned down, the appellants filed Writ Petition before the High Court, challenging the constitutional validity of the Act.
The Writ Petition was dismissed by a Single Judge.
On appeal, the Division Bench declined to interfere holding that there was no dicrimination, and thus there was no violation of Article 14 of the Constitution.
Aggrieved, the appellants preferred the present appeal.
Dismissing the appeal, this Court, HELD: 1.
The Luxury Tax charged under Section 4 of the West Bengal Entertainments and Luxuries (Hotels and Restaurants) Tax Act, 1972, is not discriminatory and is constitutionally valid for the reasons stated in the judgment of this Court in a similar matter wherein the same contentions were urged.
[467E F] M/s. Spences Hotel Pvt. Ltd. & Anr.
vs State of West Bengal and Ors., [1991] 1 SCR applied.
Whatever has been stated by this Court in relation to Section 4 of the Act would be equally applicable to Section 3 of the Act.
[467F] East India Hotels Ltd. vs State of West Bengal, AIR 1990 SC 2029, relied on.
|
ivil Appeal No.2327 of 1977.
From the Judgment and Order dated 23.5 1975 of the Allahabad High Court in First Appeal No. 302 of 1966.
K.C. Jain and H.K. Puri for the Appellants.
A.P.S. Chauhan, Roopendra Singh and A.S. Pundir for the Respondent.
The Judgment of the Court was delivered by PUNCHHI, J.
This appeal by special leave is directed against the common judgment and order of the Division Bench of the Allahabad High Court dated May 23, 1975.
The appellant herein (since deceased and represented by Legal 391 Representatives) was the owner of 48613 sq. yards of land in village Ghatwasan, Teh.
Sadar, Dist.
The same was acquired by the Agra Town Improvement Trust under the provisions of the U.P. Town Improvement Act, 1919.
Notification under section 36(2) of the aforesaid Act.
which is analogous to section 4 of the Land Acquisition Act, 1894 was issued on 29 7 1950 and the acquisition proceedings culminated by an award of the Land Acquisition Collector, followed by taking possession of the land from the appellant on 11 3 1953.
For the land acquired, the appellant was paid a partly sum of Rs. 1344 2 annas &, 6 paise as compensation.
No solatium was awarded as none was awardable under the U.P. Town Improvement Act, 1919.
Feeling dissatisfied the appellant sought a reference under section 18 of the Land Acquisition Act before the Nagar Mahapalika Tribunal, a creature of the U.P. Town Improvement Act, 1919.
The appellant asserted before the Tribunal that he should have been allowed a rate of Rs.8 per sq. yard for the acquired land.
The Tribunal partly accepted the claim of the appellant by its order dated 5 11 1965 raising compensation to the rate of Rs.3 per sq. yard and thus held the appellant entitled to a total sum of Rs. 1,45,889 inclusive of the sum of about Rs. 1344 already received by him.
The Tribunal also awarded interest on the amount due at the rate of 4 1/2 percent per annum with effect from 11 3 1953, the date of taking possession of the land till its payment.
Still dissatisfied, the appellant moved the High Court of Allahabad in appeal; a forum provided under the U.P. Town Improvement (Appeals) Act, 1920, but on grounds analogous to section 100 CPC.
Correspondingly the Nagar Mahapalika also filed a cross appeal against enhancement.
The Tribunal disposed of both the appeals by a common judgment.
The appellant was awarded enhanced compensation at the rate of Rs.4 per sq. yard.
Consequently an additional sum of Rs.48613 was held due to him.
The High Court also changed the rate Of interest from 4 1/2 percent per annum to 6 percent per annum, correcting the error committed by the Tribunal.
The claim of the appellant to solatium at the rate of 15 per cent on the sum awarded uptill the Tribunal 's level was rejected as the appellant had not claimed the same before the Tribunal and had not made a grouse thereof in his memorandum of appeal before the High Court.
So on the sum of Rs. 1,45,839 assessed as market value by the Tribunal, no Solatium was awarded.
On the amount of Rs.48,613 enhanced by the High Court, solatium at the rate of 15 per cent was awarded by the High Court, and interest thereon was also awarded from 11 3 1953.
392 the date of taking possession till its payment.
The appeal of the Nagar Mahapalika was dismissed.
The appellant alone who is before us has challenged the common judgment of the High Court.
No dispute herein has been raised to any further increase in the market value of the land.
The claim vehemently put forth is with regard to the solatium of 15 per cent on the market value of the land and which claim, partly has been negatived by the High Court.
It is not disputed that if the claim is valid, the rate of solatium would be 15 percent of the market value.
Though a faint attempt was made to raise claim to solatium at the rate of 30 per cent and interest to 9 per cent per annum in terms of the amendments made in the Land Acquisition Act, 1894 by means of Act No. 68 of 1984, but such claim was abandoned in the next breath.
So we are thus concerned only to the claim of solatium which has been declined by the High Court.
Section 23(2) of Land Acquisition Act, as it then was, provided that in addition to the market value of the land, as provided in sub section (1) of section 23, the court shall in every case award a sum of rupees fifteen per centum on such market value in consideration of the compulsory nature of acquisition.
Solatium, as the word goes, is "money comfort", quantified by the statute, and given as a conciliatory measure for the compulsory acquisition of the land of the citizen, by a welfare state such as ours.
The concern for such a citizen was voiced by the Law Commission of India in its Report submitted in 1957 on the Need for Reform in the Land Acquisition by observing as follows: "We are not also in favour of omitting Section 23(2) so as to exclude solatium of 15% for the compulsory nature of the acquisition.
It is not enough for a person to get the market value of the land as compensation in order to place himself in a position similar to that which he could have occupied had there been no acquisition; he may have to spend a considerable further amount for putting himself in the same position as before. .
As pointed out by Fitzgerald the community has no right to enrich itself by deliberately taking away the property of any of its members in such circumstances without providing adequate compensation for it.
This principle has been in force in India ever since the Act of 1870.
The Select Committee which examined the Bill of 1883 did not think it necessary to omit the provision but on the other hand transferred it to Section 23.
" 393 The importance of the award Of solatium cannot be undermined by any procedural blockades.
It follows automatically the market value of the land acquired, as a shadow would to a man.
It springs up spontaneously as a part of the statutory growth on the determination and emergence of market value of the land acquired.
It follows as a matter of course without any impediment.
That it falls to be awarded by the Court "in every case" leaves no discretion with the court in not awarding it in some cases and awarding in others.
Since the award of solatium is in consideration of the compulsory nature of acquisition, it is a hanging mandate for the court to award and supply the omission at any stage where the Court gets occasion to amend or rectify.
This is the spirit of the provision, wherever made.
It is pertinent to note here that the claim of the appellant to solatium was not entertainable before the Land Acquisition Collector, taking proceedings of the acquisition under the U.P. Town Improvement Act in the absence of a provision allowing it.
Rather the amendments and modifications set out in the schedule attached to the U.P.Town Improvement Act made read that way.
The payment of solatium as awardable under section 23(2) of the Land Acquisition Act was specifically not made applicable to the land acquired under the U.P. Town Improvement Act.
Such amendment to the schedule, however, being violative of Article 14 of the Constitution was struck down by this Court on 14 12 1973 in Om Prakash & Another vs State of U.P. and Others vs State of U.P. and Others, This Court took the view that if the government could acquire land for a Mahapalika or other local body by resort either to the Land Acquisition Act or the U.P. Town Improvement Act, it would in the former case have to pay solatium and in the latter case not at all and which would lead to discrimination, and consequently granted relief of solatium to the land owner whose land was acquired.
On the law laid down by this Court, the High Court rightly took the view that since the amendments made to the schedule to the Town Improvement Act had gone out of the way of the appellant, the compensation due to him would have to be assessed in accordance with the provisions of section 23 of the Land Acquisition Act.
Holding so, the High Court awarded solatium on the amount enhanced by it and for that part rightly.
The denial of the solatium to the appellant on the sum awarded by the Tribunal is based on the reasoning that firstly the Collector had not awarded solatium and the appellant while taking the matter to the Tribunal had not raised such claim.
Secondly after the order of the Tribunal the appellant when taking the matter to the High Court in 394 appeal, had not made a grouse and laid claim to it in his grounds of appeal.
The High Court, it appears was even then prepared to grant solatium to the appellant and offered the appellant to seek amendment of the grounds of appeal but the appellant declined to do so asserting that his claim to solatium was not based on any demand at his instance but was rather a statutory duty of the Court to grant it, as otherwise, the mandate of section 23(2) would fail.
The High Court negatived such contention.
We do not appreciate the distinction made by the High Court in this regard.
The appellant had all the same not pleaded for grant of solatium in the grounds of appeal before the High Court while claiming enhanced compensation, and yet the High Court felt that it was under the statutory duty to grant solatium on the amount enhanced by it.
The High Court did not shut out the claim of the appellant on the ground that he had not asked for it specifically in the grounds of appeal.
If that is so, the legal error which was otherwise patent needed to be rectified by the High Court in favour of the appellant; more so when there was a cross appeal of the Nagar Mahapalika before it and resort could be had to the provisions of Order 41 Rule 33 C.P.C. Additionally, the claim to solatium arose in this regard on the basis of Om Prakash 's case (supra) on 14 12 1973 by which the provisions of the U.P. Town Improvement Act whereunder solatium was withheld were struck down, and on that date the appeal of the appellant against the order of the Tribunal dated 5 11 1965 was pending before the High Court.
The claim to solatiun surfaced and compulsory acquistition of the land but also on the law on the subject being declared by this Court in Om Prakash 's case (supra).
We are thus of the view that the High Court should have measured the claim of the appellant to solatium on the sum awarded by the Tribunal with the same yardstick as to the sum awarded by it and modified in decree accordingly.
We have thus no hesitation in upsetting the judgment and order of the High Court in this regard and award to the appellant solatium at the rate of 15% on the entire market value of the land, which would include a sum of Rs. 1,45,839 left out by the Tribunal and the High Court.
The appellant further shall be entitled to the interest at the rate of 6% per annum from 11 3 1953, the date of taking possession, till the date of payment of the sum due as solatium.
The appeal shall stand allowed accordingly.
Before parting with the judgment, we need to clarify that solatium in the scheme of section 23(2) of the Land Acquisition Act is part of the compensation and section 28 and 34 of the said Act pro 395 vided payment of interest on the amount of compensation.
This Court recently in Periyar and Pareekanni Rubbers Ltd. vs State of Kerala; , has ruled that compensation is recompense or reparation to the loss caused to the owner of the land and that payment of interest on solatium is to recompensate the owner of the land the loss of user of the land from the date of taking possession till date of payment into Court.
Therein the land owner was held entitled to interest on solatium).
Attention, however, may be invited to Dr. Shamlal Narula V. Commissioner of Income tax Punjab, ; The quality of the sum paid as interest was held somewhat different.
It was ruled therein that the statutory interest paid under the Act is interest paid for the delayed payment of compensation amount and in no event can that be described as compensation for owner 's right to retain possession, for he has no right to retain possession after possession was taken under sections 16 and 17 of the Act.
The quality of the receipt of interest can be left by us here, whether it be a recompense for the loss of user of land or is a sum paid for the delayed payment of compensation.
Solatium being part of compensation must fetch statutory interest from the date of dispossession of the land owner till date of payment.
Accordingly, we allow this appeal and direct that the appellant shall also be paid solatium at the rate of 15% on the left out amount of Rs. 1,45,839 and interest at the rate of 6% per annum thereon from 11 3 1953, the date of taking possession till date of payment, and that too with costs.
R. section section Appeal allowed.
| IN-Abs | Appellant 's land was acquired by the Agra Town improvement Trust under the provisions of the U.P. Town Improvement Act, 1919.
For the land acquired, the appellant was paid a paltry sum.
No solatium was awarded as none was awardable under the Act.
[391B].
The appellant sought a reference before the Nagar Mahapalika Tribunal.
The Tribunal raised the compensation to Rs.1,45,839 and also awarded interest at the rate of 4 1/2 percent.
Still dissatisfied, the appellant moved the High Court in appeal.
The Nagarpalika also filed a cross appeal against enhancement.
The High Court allowed the appeal of the appellant and further enhanced the compensation by Rs.48,613 and the rate of interest to 6 percent.
On the amount of Rs.48,613 solatium at the rate of 15% was awarded by the High Court.
No solatium was however awarded on the slim Of Rs. 1,45,839 awarded by the Tribunal, on the ground that the appellant had not made a grouse or laid any claim to it in his grounds of appeal.
The High Court negatived the contention of the appellant that his claim to solatium was not based on any demand at his instance but it was rather a statutory duty of the Court to grant it.
Allowing the appeal, this Court, HELD: (1) Solatium, as the word goes, is "money comfort" quantified by the statute, and given as a conciliatory measure for the Compulsory acquisition of the land of the citizen, by a welfare state such as ours.
[392D E] 390 (2) The importance of the award of solatium cannot be undermined by any procedural brocades.
It follows automatically the market value of the land acquired, as a shadow would to a man.
It springs up spontaneously as a part of the statutory growth on the determination and emergence of market value of the land acquired.
That it falls to be awarded by the Court "in every case" leaves no discretion with the court in not awarding it in some cases and awarding in others.
[393A B] Om Prakash vs State of Uttar Pradesh, [19741 2 S.C.C. 731, referred to.
(3) Solatium in the scheme of section 23(2) of the Land Acquisition Act is part of the compensation and sections 28 and 34 of the said Act Provide for payment of interest on the amount of compensation.
[394H 395A] Periyar & Pareekanni Rubbers Ltd. vs State of Kerala, ; , referred to.
(4) Solatium being part of compensation must fetch statutory interest from the date of dispossession of the land owner tin date of payment.
[395D] Dr. Shamlal Narula V. Commissioner of Income Tax Punjab, ; , referred to.
|
ivil Appeal Nos.
4032 & 4033 of 1989.
From the Judgment and Order dated 30.4.1988 of the Rajasthan High Court in D. B. Civil W. P. Nos. 694 & 696 of 1988.
Appellant in person in C. A. No. 4032 of 1989.
Rajinder Sachher, and Ravinder Bana for the Appellant in C. A. No. 4033 of 1989.
Aruneshwar Gupta for the Respondents in both the appeals.
The Judgment of the Court was delivered by PUNCHHI, J.
The identification of the highest post/posts in the Rajasthan Administrative Service, capable of being filled by merit alone, under sub rule (7) of 28 B of the Rajasthan Administrative Service Rules, 1954 (hereafter referred to as the `Rules '), is the search undertaken in these two connected appeals by special leave.
The respective appellants herein are Ajeet Singh Singhvi, who appeared in person, and Jagbir Singh who appeared through learned counsel.
Both the appellants, at the time they moved the Rajasthan High Court by means of their respective writ petitions, were high ranked officers in the Rajasthan Administrative Service but found their further chances to promotion obstacled on account of the amendments caused in the said Rules with effect from July 17, 1987.
Broadly stated, on such amendments a Super Time scale was created which statedly was to remove stagnation in service.
The contention of 581 the appellants before the High Court was, and is, that the creation of Super Time scale did not have the automatic effect of creating highest post/posts to be filled by merit alone, and that the posts which Super Time scale was attractive remained `higher posts ' in contrast to `highest post ' available to the members of the Rajasthan Administrative Service on the prescribed percentage of 50 percent on merit and the remaining fifty percent on seniority cum merit.
The appellants challenged the vires of the amendments dated 17 7 1987 for confining the selection to the highest posts made thereafter solely on the basis of merit.
Before the High Court, however, the question of vires of the amendments was given up and thus the High Court invited its attention to the following two questions: (i) whether the Super Time scale is/are the highest post/posts in the service; and (ii) if it is so, whether that post/posts is/are to be filled on the basis of seniority cum merit in the proportion of 50:50 or on merit alone in accordance with sub rule (7) of Rule 28 B of the Rules? The High Court by a long and an elaborate judgment, dated 30.4.1988 traced the history of the Rules and the amendments made to rules 28 B and 32 from time to time expressed the opinion that Super Time scale post/posts was/were the highest post/posts in the service and those required to be filled on merit alone and not in the proportion of 50:50 on the basis of merit and seniority cum merit.
It is to challenge that view that these matters are here before us and we have had the opportunity of hearing the party in person and learned counsel on both sides.
We begin by taking note that the word `highest ' has not been given a definitive meaning in the Rules, and has to be understood and employed in the context in its ordinary meaning and diction.
Rule 6 prescribes the strength of the service.
It mandates that the strength of post in each grade of the service shall be such as may be determined by the government from time to time.
The proviso thereto leaves all the possible flexibility with the government in the creation of any post of any kind and nature and for its abolition.
The latest notification in that regard, as was placed before us, is Notification No. F1(2) Karmik/ Ka IV/79 dated January 12, 1988 issued from the Department of Personnel and Administrative Reforms, Government of Rajasthan specifying that as per Rule 6 of the Service Rules, the strength of posts 582 in each grade of Rajasthan Administrative Service is determined therein.
The said notification is found in a compilation prepared by the Rajasthan Administrative Service Association, amended upto June, 19,1988.
It demonstrates posts with their titles divided into seven categories.
The first category is of Super Time Scale posts in the grade of Rs. 3900 125 4400 150 5300.
The second category is of selection scale post in the grade of 2978 75 3050 100 3650 125 4400 150 4700.
Thereafter there are lesser pay scale given in the third category of senior scale posts and in the fourth category, junior scale posts followed by special ex cadre posts, training reserve and leave reserve posts.
The Super Time Scale posts are 25 in number and those posts are named and numbered as follows: section NO.
Name of the Post No. of Posts 1.
Director of Agriculture Marketing & Ex 1 Officio Dy.
to Govt.
Director, Local Bodies 1 3.
Commissioner, Devasthan Deptt.
Revenue Appellate Authority 10 5.
Principal, A.P.R.T.S., TONK 1 6.
Divisional Commissioners 6 7.
Director, HCM RIPA, Udaipur 1 8.
Commissioner, Co,.
Cum R. A. A., Bikaner1 9.
Commissioner, TAD 1 10.
Commissioner, Desert Dav.
Commissioner, Transport 1 25 Now whether these posts are the highest posts in the Rajasthan Administrative Service or are just higher posts, so as to identify the criteria applicable for promoting to these posts their personnel.
`Service ' has been defined in Rule 4 L to mean the Rajasthan Administrative Service.
Sub rule (7) of Rule 28 B prescribes that 583 selection for promotion to the highest post/posts in the State Service shall always be made on the basis of merit alone.
As said before, `highest posts ' has nowhere been defined.
Prior to the amendment of July 17, 1987, sub rule (7) read as follows: "Selection for promotion to the highest post or highest category of posts in the State Service shall always be made on the basis of merit alone." According to the appellants, prior to July 17, 1987 the highest post was never identified and equally the highest category of posts were nowhere visible.
The posts now falling in the Super Time Scale, tabulation of which stands incorporated above, were always considered as higher posts and in terms of sub rule (6) of rule 28 B,Selection for promotion to all other higher posts/higher category of posts in the State Service were required to be made on the basis of merit and seniority cum merit in the proportion of 50:50.
The proviso, however, to sub rule (6) provided that if the Committee (appointed under Rule 28) was satisfied that suitable persons are not available for selection by promotion strictly on the basis of merit in a particular year, selection by promotion on the basis of seniority cum merit may be made in the same manner as specified in these Rules.
The two appellants maintained that before the introduction of the Super Time scale vide amendment dated July 17, 1987 there were only three categories, namely, ordinary scale posts (alternatively known as junior scale), senior scale posts and selection scale posts in the Service and these continued as such despite the amendments.
Before the High Court the exercise to identify the Super Time selection posts would have been easy had the government notification dated 12th January,1988 been brought to its notice.
In any event after the issuance of the Government notification dated 12th January, 1988, those very posts in the Service have now been designated as junior scale, senior scale, selection scale and super time scale posts and for valid administrative reason have Super Time Scale posts been treated as highest posts even though they may have hitherto belonged to the category of higher posts; the State Service remaining the same.
Rule 15 prescribes eligibility for consideration for promotion on the basis of qualifying service for promotion.
Rule 28 prescribes the procedure for promotion and postulates the Constitution of a Commitee.
Rule 28 B, so far as is relevant for our purpose, is called out below: "28 B REVISED CRITERIA, ELIGIBILITY AND 584 PROCEDURE FOR PROMOTION TO JUNIOR, SENIOR AND OTHER POSTS ENCADRED IN THE SERVICE (i) As soon as the appointing authority determines the number of vacancies (under rule 9 of these Rules) and decides that a certain number of posts are required to be filled in by promotion, it shall, subject to provisions of sub rule (9), prepare a correct and complete list of senior most persons who are eligible and qualified under these Rules for promotion on the basis of seniority cum merit or on the basis of merit to the class of posts concerned.
(2) For appointment to the Service by promotion, the eligible persons included in the list mentioned in rule 28 shall be considered.
(3) xxxxxxxxxxx (4) Selection for promotion in the reguler line of promotion from the post/posts not included in Service to the lowest post or category of post in the Service shall be made strictly on the basis of merit and on the basis of seniority cum merit in the proportion of 50:50.
PROVIDED that if the Committee is satisfied that suitable persons are not available for selection by promotion strictly on the basis of merit in a particular year, selection by promotion on the basis of seniority cum merit may be made in the manner as specified in these Rules.
(5) Subject to the provisions of sub rule (7),selection for promotion from the lowest post or category of post in the State Service to the next higher post or category of post in the State Service and for all posts in the Subordinate Services and in the Ministerial Services shall be made strictly on the basis of seniority cum merit from amongst the persons who have passed the qualifying examination, if any, prescribed under these Rules, and have put in at least five years service, unless a different period is prescribed elsewhere in these Rules, on the first day of the month of April of the year of selection on the post or category of post from which selection is made: 585 PROVIDED that in the event of non availability of the persons with the requisite period of Service of five years, the Committee may consider the persons having less than the prescribed period of Service, if they fulfill the qualifications and other conditions for promotion prescribed elsewhere in these Rules, and are found otherwise suitable for promotion on the basis of seniority cum merit.
(6) Selection for promotion to all other higher posts or higher categories of posts in the States Service shall be made on the basis of merit and on the basis of seniority cum merit in the proportion of 50:50.
PROVIDED that if the Committee is satisfied that suitable persons are not available for selection by promotion strictly on the basis of merit in a particular year, selection by promotion on the basis of seniority cum merit may be made in the same manner as specified in these Rules.
EXPLANATION: If in a Service, in any category of post, number of posts available for promotion is an odd number then for purpose of determining the vacancies for selection by promotion on the basis of seniority cum merit and merit in the proportion of 50:50, the following cyclic order shall be followed: The first vacancy by seniority cum merit; The subsequent vacancy by merit; The cycle to be repeated.
(7) Selection for promotion to the highest post/posts in the State Service shall always be made on the basis of merit alone: PROVIDED that (a) in a Service or Groups or Sections thereunder, where there are only two scales e.g. junior scale or senior scale and there is only one promotion then promotion shall be made on the basis of seniority cum merit alone; (b) in a Service or Groups or Section thereunder, where there are three scales e.g. junior scale, and selection scale and there are two promotions then promotion shall be as under: 586 (i) first promotion on the basis of seniority cum merit.
(ii) second promotion on the basis of seniority cum merit and merit in the proportion of 50:50; (c) in Services or Groups or Sections thereunder, where there are more than two promotions then first promotion shall be made on the basis or seniority cum merit alone and promotions to subsequent higher posts shall be made on the basis of seniority cum merit and merit in the proportion of 50:50 except to the highest post.
PROVIDED further that if the Committee is satisfied that suitable persons are not available for selection by promotion to highest post/posts, strictly on the basis of merit in a particular year, selection by promotion to highest post/posts on the basis of seniority cum merit may be made in the same manner as specified in these rules.
(8) The persons having been selected and appointed by promotion to a post or category of post on the basis of merit, shall be eligible for promotion to the next higher post or category of post, which is to be filled in by merit, only when they have put in after regular selection, at least five years ' service, unless a higher period of Service is prescribed elsewhere in these Rules, on the first day of the month of April of the year of selection on the post or category of post from which selection is to be made: PROVIDED that the condition of five years 'service shall not be applicable to a person, if any person junior to him is eligible for consideration for promotion on the basis of merit.
PROVIDED further that in the event of non availability of persons equal to the number of vacancies to be filled in, eligible for promotion in the category of post next lower from which promotion is made, the Committee may consider the persons having less than five years ' service, if they are found otherwise suitable for promotion on the basis of merit alone.
587 EXPLANATION: If any doubt arises about the categoriesation of the post as the lowest, next higher or highest post in the Service, the matter shall be referred to the Government in the Department of Personnel and Administrative Reforms whose decision thereon shall be final.
(9) The zone of consideration of persons eligible for promotion shall be as under: i) No. of vacancies No. of eligible persons to be considered a) for one vacancy Five eligible persons b) for two vacancies Eight eligible persons c) for three vacancies Ten eligible persons d) for four or more vacancies Three times the number of vacancies.
ii) Where, the number of eligible persons for promotion to higher post is less than the number specified above, all the persons so eligible shall be considered.
iii) Where,adequate number of candidates belonging to the Scheduled Castes or the Scheduled Tribes, as the cases may be, are not available within the zone of consideration specified above, the zone of consideration may be extended to five times the number of vacancies and the candidates belonging to the Scheduled Castes or the Scheduled Tribes, as the case may be, (and not any other) coming within the extended zone of consideration shall also be considered against the vacancies reserved for them.
iv) For the highest post in a State Service a) if promotion is from one category of post, eligible persons upto five in number shall be considered for promotion; b) if promotion is from different categories of the post in the same pay scale, eligible persons upto two in number from each category of posts in the same pay scale shall be considered for promotion; 588 c) if promotion is from different categories of posts carrying different pay scales, eligible persons in the higher paying scale shall be considered for promotion first and if no suitable person is available for promotion on the basis of merit in the higher pay scale then only the eligible persons of other categories of posts in lower pay scales shall be considered for promotion and so on and so forth.
The zone of consideration for eligibility in this case shall be limited to five senior most eligible persons in all.
xxxxxxxx 11.
a) XXXXXX b) XXXXXX c) XXXXXX 12.
XXXXXX 13.
XXXXXX 14.
XXXXXX 15.
XXXXXX 16.
XXXXXX Rule 32 after the amendment reads as follows: "32.
APPOINTMENT TO SENIOR POST (1) [In accordance with vacancies determined according to the provisions laid down in rule 9] appointment to [senior scale, selection scale and super time scale] post shall be made by Government from amongst the members of the Service in accordance with the selection having been made on the basis of merit and seniority cum merit on the recommendations of a Committee which shall consist of following: 1.
Chairman, Rajasthan Public Service Commission .
Chairman 2.
Chairman, Board of Revenue .
Member 3.
Secretary to Government in Super time scale of the 589 Indian Administrative Service, as may be nominated by the State Government .
Member 4.
Special Secretary to Govt.
in the Department of Personnel .
Member Secretary PROVIDED that in case any Member or Member Secretary, as the case may be constituting the Committee has not been appointed to the post concerned the officer holding charge of the post for the time being shall be the Member or Member Secretary, as the case may be of the Committee.
(2) Except as provided in this rule, the procedure and the principles for selection by merit shall, in so far it may apply, be the same as provided in rule 28 B.
For selection by seniority cum merit, the Committee shall consider the cases of all the persons eligible for promotion by examining their Confidential Rolls and Personal Files and interviewing such of them as they may deem necessary, and shall select a number of candidates equal to the number of vacancies likely to be filled by promotion by seniority cum merit.
PROVIDED (1) that appointment to the senior or selection grade post [or super time scale] post may be made by Government by appointing thereto temporarily a person eligible for appointment by the promotion to the Service under the provisions of these Rules.
(2) No appointment made under [proviso (1)] above shall be continued beyond a period of one year without referring it to the Commission for their concurrence and shall be terminated immediately on their refusal to concur".
Argument was sought to be built that in Rule 32, Super Time scale was introduced with effect from 17 7 1987 whereunder the Government was required to make an appointment on the basis of merit and seniority cum merit on 50:50 basis in accordance with subrule 6 of rule 28 B in the absence of identification of posts.
The argument looses its thrust in entirety when viewed on the basis of sub rule (2) whereunder the procedure and principles for selection by merit 590 shall, in so far it may apply, is the same as provided in rule 28 B. which embodies sub rule (7) as well.
We have in the context to apply the Rule of harmonious construction.
In The J. K. Cotton Spinning & Weaving Mills Co. Ltd. vs The State of Uttar Pradesh & Others; ; this Court applied the rule of harmonious construction even to subordinate legislation and laid down as follows: "In applying the rule however we have to remember that to harmonise is not to destroy.
In the interpretation of statutes the courts always presume that the legislature inserted every part thereof for a purpose and the legislative intention is that every part of the statute should have effect.
These presumption will have to be made in the case of rule making authority also." Then again in Lt. Col. Prithi Pal Singh Bedi etc.
vs Union of India & Others, at pages 404 05 it was observed as follows: "The dominant purpose in construing a statute is to ascertain the intention of the Parliament.
One of the well recognised canons of construction is that the legislature speaks its mind by use of correct expression and unless there is any ambiguity in the language of the provision the Court should adopt literal construction if it does not lead to an absurdity.
The first question to the posed is whether there is any ambiguity in the language used in rule 40.
If there is none, it would mean the language used, speaks the mind of Parliament and there is no need to look somewhere else discover the intention or meaning.
If the literal construction leads to an absurdity, external aids to construction can be resorted to.
To ascertain the literal meaning it is equally necessary first to ascertain the juxtaposition in which the rule is placed, the purpose for which it is enacted and the object which it is required to subserve and the authority by which the rule is framed.
This necessitates examination of the broad features of the Act.
" On the application of above principles, it is noticeable that the terms `higher post ' and `highest post ' occuring in Rules 28 B and 32 by all means are relative ones expected to be created in singular or plural terms under Rule 6 whereunder the strength of posts in each grade was determinable by the government from time to time.
Sub rule (7) even before the amendment of 17 7 1987 postulated a highest post/posts capable of being filled on the basis of merit alone.
The fact that they 591 remained un identified gives no basis to the plea that the State was incapacitated to identify at a later stage the highest posts in the State Service required to be filled on the basis of merit alone.
It seems to us, on a close analysis,and on the language employed in Rules 28 B and 32 that the highest post/posts conceptually were part of the Rules but their effectuation and identification has surfaced only by means of the amendments of July 17, 1987 and the notification of January 12, 1988.
Another significant factor which leans towards such an interpretation is the stance of the State which militates against the views canvassed on behalf of the appellants.
There is an inbuilt safety kept in the explanation added to sub rule (8) of Rule 28 B which prescribes that if any doubt arises, amongst others, about the categorisation of the posts as the highest posts in the Service, the matter shall be referred to the government in the Department of Personnel and Administrative Reforms, whose decision there on shall be final.
The appellants could easily have raked up and got referred the matter to the government to have a decision thereon.
The view of the government in maintaining that the Super Time scale posts are highest posts is not only a bare and literal interpretation given by it to the Rules but also is reflective of its policy in this regard and no decision needs to be given by the Court in normal circumstances to amend or alter such policy.
In such a realm even contemporaneous exposition of a similar rule in an other set of rules cannot play their part to influence either the Court or the Government to give the same interpretation or exposition to the rules requiring interpretation herein.
Besides the government being the author of the rule, has kept to itself, as a matter of prudence; the right to remove any ambiguity about the identification of any post including the highest post/posts.
The stance of the government in this regard should have clinched the matter but since the same had been put forth as a defence in the High Court, its view nonetheless are entitled to great weight and the burden of the appellants to lift that weight, an uphill task by all means, has remained unfulfilled.
To sum up, our interpretation of the rules is in accord with the interpretation of the rules as put by the High Court holding that the Super Time scale posts are the highest posts in the Service and selection for promotion and appointment on that basis in the Service has to be made on the basis of merit alone and not on the basis of seniority cum merit and merit in the proportion of 50:50.
In the facts and circumstances of the case, however, we pass no order as to costs, while dismissing the appeals.
| IN-Abs | The appellants are high ranking officers in Rajasthan Administrative Service governed by the Rajasthan Administrative Service Rules, 1954.
Consequent upon the amendment caused to the said rules on July 17, 1987, they felt that the amendment had affected their further promotional chances.
They therefore filed writ petitions before the High court challenging the vires of the amendment dated 17.7.1987 contending that the creation of Super time scale did not have the automatic effect of creating highest post/posts to be filled by merit alone, and that the posts to which Super Time Scale was attracted remained `higher posts ' in contrast to `highest posts ' available to the members of the Rajasthan Administrative Service on the prescribed percentage of 50 per cent on merit and the remaining fifty per cent on seniority cum merit.
Their case was that section to the highest posts made under the amended rule solely on the basis of the merit was bad in law.
Before the High Court challenge to the vires of the amendment was abandoned and the High Court considered the question (i) whether the Super time scale is/are the highest post/posts in the service and (ii) if it is so, whether the post/posts is/are to be filled on the basis of seniority cum merit in the proportion of 50:50 or on merit alone in accordance with sub rule (7) of /Rule 28 B of the Rules: The High Court rejected the writ petitions opening that the Super Time Scale post/posts was/were the highest post/posts in the service and those are required to be filled on merit alone and not in the proportion of 50:50 on the basis of merit and seniority cum merit.
Hence these appeals by the appellants.
Dismissing the appeals this Court HELD: The terms `higher post ' and `highest post ' occurring in 580 Rules 28 B and 32 by all means are relative ones expected to be created in singular or plural terms under rule 6 whereunder the strength of posts in each grade was determinable by the government from time to time.
Sub rule (7) even before the amendment of 17.7.1987 postulated a highest post/post capable of being filled on the basis of merit alone.
[590 G H] Super Time Scale posts are the highest posts in the service and selection for promotion and appointment on that basis in the service has to be made on the basis of merit alone and not on the basis of seniority cum merit in the proportion of 50:50.[591 G] J.K. Cotton Spinning & Weaving Mills Co. Ltd. vs State of U. P. and Ors. ; ; Lt. Col. Prithi Pal Singh Bedi etc.
vs Union of India and Ors.
|
ivil Appeal No. 1440 of 1986.
From the Judgment and Order dated 30.11.1985 of the Patna High Court in Second Appeal No. 129 of 1983.
Ranjan Diwvedi, A.N. Bardiar and R.S. Sharma for the Appellants.
D. Goburdhan and D.N. Goburdhan for the Respondent.
The Judgment of the Court was delivered by FATHIMA BEEVI, J.
The plaintiff respondent instituted the suit for possession of the land in Khata No. 19 in village Gauripur in 1968 claiming title under exhibit 2 sale deed dated February 10, 1964 executed in his favour by Mst.
Tetri, the widow of Chhathu Sah, the original owner.
Tetri had earlier executed exhibit 2 A sale deed on 546 February 14, 1959 in favour of her brother 's son Lakhan Sao for a consideration of Rs.600.
She cancelled this deed on July 31, 1962 before transferring the property in favour of the respondent.
By proceeding dated 11.7.1963 obtained mutation in her name and paid rent on 18.7.1963.
The dispute, however, arose over possession of the land between the respondent and Lakhan Sao that led to proceedings under section 145, Cr.
By the order dated March 4, 1966, Lakhan Sao and his brother Gulab Sao the appellants herein were put in possession.
The present suit was thereafter instituted by the respondent for declaration of this title and possession.
The respondent alleged that the deed of 1959 in favour of Lakhan sao was a Farzi Kebala executed without consideration and was not operative and the respondent had acquired valid title under the transfer in his favour.
The suit was resisted denying plaintiff 's title and asserting that the title and possession passed under the deed of 1959.
The Trial Court decreed the suit and the decree was confirmed in appeal.
The High Court set aside the decree and remanded the case to the first appellate court pointing out that the burden to prove that the document of 1959 was farzi in character and remained inoperative clearly lay on the plaintiff and the finding of the first appellate court was vitiated by erroneous conception of law.
After the remand, the appeal was disposed of by the Additional District Judge by judgment dated January 31, 1983 upholding the plaintiff 's title and confirming the decree of the Trial court.
The second appeal filed against that judgment was dismissed in limine by the High Court on 30.11.1985.
This appeal by special leave is directed against that judgment of the High Court.
Shri Ranjan Dwivedi, learned counsel for the appellants, maintained that the first appellate court committed the same error as was pointed out by the High Court earlier in disposing of the appeal and the error thus committed has given rise to a substantial question of law and the High Court failed to exercise the jurisdiction under section 100, C.P.C., in dismissing the appeal in limine.
The original defendant died and his legal representatives are the appellants before this Court.
It was submitted that the Additional District Judge had approached the question as to whether the impugned deed of 1959 is a sham and inoperative transaction by casting the burden on the defendant, in spite of the specific direction in the order of remand.
No fresh evidence had been tendered by the plaintiff to discharge the burden of proving that no consideration passed under the document and that the document was inoperative.
The Court proceeded to examine the 547 evidence tendered by the defendant to arrive at the conclusion and has found fault with the defendant for not proving that consideration passed and the transaction has come into operation.
This approach, according to the learned counsel, has vitiated the finding and resulted in miscarriage of justice.
The submission is that the lower appellate court has discussed the evidence tendered by the defendant and rejected the same.
The respondent 's learned counsel pointed out that the lower appellate court had properly appreciated the evidence applying the correct law as to the burden of proof.
The findings recorded are on the appreciation of the facts and evidence of the case and no question of law did arise and therefore the second appeal has been rightly dismissed.
In the suit based on title the burden was undoubtedly on the plaintiff to prove such title.
When the plaintiff has assailed the earlier deed executed by his vendor in respect of the same land it was for the plaintiff to establish that it was Farzi Kebala and sham transaction unsupported by consideration.
The learned Additional District Judge has proceeded to consider how far this onus which lay heavily on the plaintiff had been discharged.
He referred to the various tests that have been laid down in order to ascertain that a particular deed is a Farzi Kebala.
He considered the relationship between the parties, the evidence relating to the custody of the document, passing of consideration, motive and possession.
It was found that Lakhan Sao and his brother Gulab Sao were closely related to Tetri, that exhibit 2 A sale deed was in the custody of Tetri and it had been produced in Court by the plaintiff.
On the evidence, it was found hat the stamp paper for the document was purchased by the vendor and there was clear indication that the vendee did not take part in the preparation of the document.
He inforred this fact from the circumstance that incorrect particulars had been incorporated in the deed.
He rejected the contention that the documents were surreptitiously obtained by the plaintiff and his vendor.
It was noticed that even after the execution of the deed, Tetri was continued to be in possession.
She moved the authorities for recording her name in Jamabandi and she had paid the rent.
Regarding the motive for the execution of the deed, it was noticed that Mst.
Tetri had debts and the deed was executed to cover the property from the reach of the creditors and without consideration.
The learned Additional District Judge considered the evidence relating to the consideration.
He referred to the evidence of PW 8, the attesting witness and PW 14 the plaintiff.
These witness stated that nothing had been paid as consideration.
As per the recital in the deed an amount of Rs. 500 was a prior payment and Rs.100 was paid in cash at the time of execu 548 tion.
The learned Judge noticed that there was no specific statement regarding the payment of any part of the consideration in cash.
The vendor was dead.
Lakhan Sao, the defendant, avoided the witness box.
The evidence of the parties to the document was not therefore on record.
Gulab Sao, the brother of Lakhan Sao, was examined as DW 11.
His evidence was analysed and was found to be discrepant.
The learned Judge on a consideration of evidence on both sides found that the evidence on the point of payment of consideration by appellant Lakhan Sao is far from satisfactory and the evidence of the appellants is unworthy of credit.
Motive was found to be satisfactorily established as the existence of debts to some creditors was admitted.
On the question of possession, the learned Judge scrutinised the evidence and found that Tetri was in possession even after execution of exhibit 2 A. Having found these ingredients in favour of the plaintiff, the learned Judge concluded that exhibit 2 A executed by Tetri on 14.2.1959 was only Farzi Kebala without any consideration and it created no title and possession to the appellant.
The findings are essentially findings of fact.
If, however, the appellants succeed in showing that in recording the findings of fact, the court had proceeded on a wrong conception of law as to onus, the correctness of the findings has necessarily to be examined.
The only point that has been stressed before us is that lower appellate court has wrongly proceeded on the basis that onus shifted to the defendant to prove the passing of consideration and that the evidence did not establish that fact.
It was maintained that the onus did not shift as the burden was entirely on the plaintiff to prove the fact that document was inoperative and no consideration did pass thereunder.
We have point out earlier that the High Court has set aside the earlier decree pointing out the error committed by the lower appellate court.
This observation made by the High Court has been kept in mind by the Additional District Judge in disposing of the appeal thereafter.
The learned Judge has considered the question of burden on the plaintiff to establish that there had been no consideration.
In examining the question whether the plaintiff had succeeded in proving the negative fact it was open to the court to consider the entire evidence on record when both the parties have tendered evidence and no part of the evidence could be left out.
On a consideration of the whole evidence, the Court has concluded that there had passed consideration.
This finding cannot, therefore, be said to be vitiated.
It is always open to the defendant not to lead any evidence where the onus is upon the plaintiff but after having gone into evidence, he 549 cannot ask the court not to look at and act on it.
The question of burden of proof at the end of case when both parties have tendered evidence is not of any great importance and the court has to come to a decision on a consideration of all material.
In the present case, the plaintiff proceeded on the basis that the deed executed by his vendor in 1959 was sham unsupported by consideration and it never came into operation thereby pleading the necessary facts in support of his title.
Evidence was tendered to prove what has been alleged.
To counter the claim, the defendants have asserted that the consideration was paid under the deed and counter evidence was tendered.
The entire evidence was fully appreciated by the Court and the findings have been recorded.
We do not agree that any error had been committed by the learned Judge in his approach.
He recorded definite findings on a clear analysis of the entire evidence and the findings are fully supported by the evidence on record.
We do not therefore see any merit in the appeal which is accordingly dismissed.
No costs.
T.N.A. Appeal dismissed.
| IN-Abs | The respondent plaintiff instituted a suit against the appellant defendant for declaration of title and possession of the suit properties on the basis of a sale deed dated February 10, 1964 executed in his favour by Mrs. T.
The appellant defendant also asserted his title and possession under an earlier deed dated February 14, 1959 executed by Mrs. T in his favour.
The respondent contended that the deed of 1959 in favour of the defendant was sham and without any consideration.
The Trial Court decreed the suit and the decree was confirmed in appeal.
The High Court set aside the decree and remanded the case to the first appellate court stating that the burden to prove that the 1959 deed was sham was on the plaintiff.
After the remand, the first appellate court considered the evidence adduced by both sides and upheld the plaintiff 's title and confirmed the decree of the trial court.
The second appeal filed against the judgment was dismissed in limine by the High Court.
In defendant 's appeal to this court it was contended that inspite of specific direction by the High Court in the order of remand that the burden to prove that 1959 deed was sham was on the plaintiff, no fresh evidence was tendered by the plaintiff to discharge the burden and the appellate court proceeded to examine the evidence tendered by the defendant and rejected the same; hence the appellate court committed an error in disposing the appeal which gave rise to a substantial question of law and the High Court failed to exercise its jurisdiction under Section 100 CPC in dismissing the second appeal in limine.
Dismissing the appeal, this Court HELD: 1.
It is always open to the defendant not to lead any evidence where the onus is upon the plaintiff but after having gone into 545 evidence, he cannot ask the court not to look at and act on it.
The question of burden of proof at the end of case when both parties have tendered evidence is not of any great importance and the court has to come to a decision on a consideration of all materials.
[515H; 516A] 2.
In the suit based on title the burden was undoubtedly on the plaintiff to prove such title.
When the plaintiff assailed the earlier deed executed by his vendor in respect of the same land it was for him to establish that it was a Farzi Kebala and sham transaction unsupported by consideration.
But in examining the question whether the plaintiff had succeeded in proving the negative fact it was open to the court to consider the entire evidence on record when both the parties have tendered evidence and no part of the evidence could be left out.
The plaintiff proceeded on the basis that the deed executed by his vendor in 1959 was sham unsupported by consideration and it never came into operation thereby pleading the necessary facts in support of his title.
Evidence was tendered to prove what has alleged.
To counter the claim, the defendants have asserted that the consideration was paid under the deed and counter evidence was tendered.
The entire evidence was fully apprecited by the Appellate Court and the findings recorded.
Thus the Appellate Court recorded definite findings on a clear analysis of the entire evidence and the findings are fully supported by the evidence on record.
Therefore, no error had been committed by the learned Judge in his approach.
[597C D; 599B C]
|
Civil Appeal No. 195 of 1978.
From the Judgment and Order dated 10.8.1976 of the Delhi High Court in C.R. No. 354 of 1975.
Dr. Y.S. Chitale, K.B. Rohatagi, S.K. Dhingra and Shashank Shekhar for the Appellants.
V.C. Mahajan, R.B. Mishra, C.V.S. Rao and S.N. Terdal for the Respondents.
The Judgment of the Court was delivered by KASLIWAL, J.
This appeal by special leave is directed against the judgment of Delhi High Court dated 10.8.1976 in Civil Revision No. 354 of 1975.
Agricultural land measuring 78 bighas and 14 biswas belonging to the appellants situated in village Garhi Peeran was acquired under the Land Acquisition Act, 1894 (hereinafter referred to as 'the Act ').
The Land Acquisition Collector passed an award on 10.10.1967 allowing compensation for land in block 'A ' @ Rs. 2300 per bigha and in block 'B ' @ Rs. 1200 per bigha.
The claimants/appellants submitted an application under Sec. 18 of the Act for making a reference to the Court.
The Collector made a reference to the Court in pursuance to the said application submitted by the appellants.
The Additional District Judge by Judgment dated 15.1.1971 increased the amount of compensation to Rs.4,000 per bigha for land in block 'A ' and Rs.2,500 per bigha for land in block 'B '.
The appellants filed an application on 16.1.1971 under Sections 151 153 C.P.C. before the Additional District Judge praying that the land in Khasra Nos. 408, 411, 763, 764, 891, 893, 410, 432, 433, 504, 506, 761, 900, 901, & 904 had not been shown by the Land Acquisition Collector in the statement under Section 19 of the Act although he had sent he names of all the Bhoomidars of the aforesaid land.
The mistake was on the part of the Land Acquisition Collector and the appellants should not suffer on account of the mistake or oversight of the Collector.
It was thus prayed that in the interest of justice the Collector may be directed to file a revised statement under Sec.
19 of the Act giving the details of the whole of the land belonging to the claimants which had been left out on account of accidental slip or omission.
The application was opposed on behalf of the Union of India.
The Additional District Judge after hearing the parties at length, by order dated 18.2.1975 allowed the 652 application and directed the Land Acquisition Collector concerned to furnish the correct statement under Sec.
19 of the Act regarding the land acquired of the appellants.
Aggrieved against the aforesaid order of the Additional District Judge, Union of India filed a revision before the High Court.
The High Court by judgment dated 10.8.1976 allowed the revision and set aside the order of the Additional District Judge dated 18.2.1975.
The appellants have now, come in appeal against the order of the High Court.
We have heard learned counsel for the parties and have perused the record.
There is no manner of dispute that the land acquired was 78 bighas and 14 biswas and the appellants were entitled to the compensation of the entire land.
The Land Acquisition Collector gave an award and the appellants being not satisfied with the amount of compensation submitted an application for making a reference to the Court under Sec. 18 of the Act.
A perusal of the application submitted by the appellants under Sec.
18 of the Act shows that in para (1) it was stated as under: "That the claimants ' land details of which are given in the schedule has been acquired under the aforesaid Award.
The Collector has awarded a very low rate of compensation to which claimants are not satisfied as their claims have not been adequately considered by the Collector.
" Thereafter grounds of reference were stated and ground (9) which is relevant for our purpose is reproduced as under: "9.
That the claimant petitioners claim compensation for the whole of their land at the rate of Rs. 20,000 per bigha, Rs.10,000 for the well and Rs.200 each for each tree.
They further claim Rs.60,000 each for their resettlement as their entire land in the village has been taken away under the acquisition and they have been uprooted.
They also claim 15% solatium and interest at the rate of 6% per annum on the enhanced amount of compensation plus the solatium with effect from 4.3.1963.
" A schedule of land belonging to claimant petitioners was also annexed with the application which is as under: 653 Kh.
Area 898 4 16 899 0 11 417 1 03 431 2 09 407 0 05 405 1 11 507 5 06 514 4 16 515 4 16 520 2 04 406 2 17 416 3 08 etc.
etc The High Court took the view that only those Khasra Nos.
which were specifically mentioned in the schedule could alone be considered for the purpose of enhancement of the claim of compensation and not the entire land acquired.
The area of the above Khasra Nos.
amounted to 34 bighas 2 biswas only though the total area of acquired land amounted to 78 bighas and 14 biswas.
The High Court in this regard took the view that the reference was made by the Collector by sending a statement of the Court of the Additional District Judge under Sec.
19 of the Act.
In this statement only those fields were included which had been listed in the schedule attached to the application under Sec. 18.
The High Court further held that the power of the Collector to make the reference was restricted to what was stated in the claimants ' application for reference under Sec. 18 and does not extend beyond it.
If the claimant, does not include some fields in his reference application, the Collector cannot include it in the statement under Sec. 19.
The High Court further held as under: "In the original reference petition under section 18 by claimants the adjective "whole" was used in relation to the 654 land of the claimants and the words "etc.
" were also used in the schedule.
At the same time, certain fields of the claimants which were the subject matter of the Collector 's award were not included in the reference petition.
There was certainly an ambiguity as to the intention of the claimants as expressed by the reference petition.
The counsel for the Union of India was, therefore, justified in requesting the Additional District Judge to call upon the claimants either to admit the statement sent by the Collector under Section 19 or to file an amended reference petition stating their shares individually.
The Additional District Judge was also justified in asking the counsel for the claimants to examine the preliminary objections and to make a statement.
The power of the Court to call upon the counsel for the claimants to make a statement was derived from Order X, Civil Procedure Code.
Under Rule 2 of Order X, the Court had power to examine a party or his pleader and to record his answer in relation to any material question relating to the reference before it.
Under Order XIV rule 3, the materials on which issues had to be framed by the Court included such statements made by the pleaders of the parties under Order X. Accordingly, we find that the learned Additional District Judge used the statement made by the counsel for the claimants as the basis for dismissing the preliminary objections advanced by the Union of India.
The Counsel for the claimants had authority to make the statement which he did.
The Supreme Court has recently pointed out in Smt.
Jamilabai vs Shankarlal Gulabchand, AIR 1975 S.C. 2202, that the implied authority of the counsel extends not only to make such a statement but even to compromise a suit or to admit a claim.
Had the counsel for the claimants not made the statement there that the Collector 's statement under Section 19 is correct, the Additional District Judge would have been found to call upon the claimants to clarify the schedule to the reference petition so that the Court could know precisely the fields in respect of which enhancement of compensation was claimed.
It is because the claimants ' counsel asked the Court to take the Collector 's statement under Section 19 as correct that the Court decided to investigate only the correctness of the compensation regarding those fields.
" The High Court ultimately took the view that the only conclusion 655 possible was that the enhancement was restricted to the land in dispute and the land in dispute could only be such land in respect of which reference was demanded by the claimants.
In our view the High Court was totally wrong and unnecessarily complicated the matter which seems to us, quite simple.
It is an admitted position that 78 bighas and 14 biswas of land belonging to the appellants was acquired and the Land Acquisition Collector had given an award @ Rs.2,300 per bigha for block 'A ' and Rs.1,200 per bigha for block 'B '.
The appellants were not satisfied with the above rate of compensation and they had moved an application for making a reference under Sec. 18 of the Act.
In the application it was clearly mentioned that the Collector had awarded a very low rate of compensation to which the claimants were not satisfied.
In ground No. 9 the claimants/petitioners had mentioned that they were claiming compensation for the whole of their land @ Rs.20,000 per bigha.
That apart in the schedule also some khasra Nos.
were mentioned specifically but in the end the words used were 'etc.
etc '.
The Additional District Judge had passed the order on 15.1.1971 and immediately on the next day i.e. 16.1.1971 the appellants had submitted the application under Secs.
151 153 C.P.C. for correcting the mistake.
The Additional District Judge who was seized of the matter allowed the said application by his order dated 18.2.1975.
Thus from a perusal of the application filed under Sec.
18 of the Act alongwith the schedule we are fully satisfied that the appellants were claiming an enhancement in the compensation in respect of the entire land acquired and there was no question of asking for a reference for a limited portion of land measuring 34 bighas and 2 bigwas only.
The High Court unnecessarily went into the question of some statement made by the learned counsel for the appellants before the Additional District Judge and in examining its validity under Order X of the C.P.C. It was a simple matter to be decided on the basis of factual statements made in the application and we are fully convinced that the appellants had sought a reference for the entire land acquired and there was no reason whatsoever in leaving out some portion of the land when the grievance of the appellants was for enhancing the compensation which was awarded at a low rate.
The appellants were not required to pay any Court fees ad valorem on a prayer for enhancement of compensation while moving an application to the Collector for making a reference to the Court under Sec. 18 of the Act.
Learned counsel for the Union of India was unable to give any plausible explanation which might have persuaded the appellants to have left a large portion of the land in the application filed under Sec.
18 of the Act from claiming enhancement in the amount of compensation.
656 In order to appreciate the controversy we would like to Secs.
18 & 19 of the Act which are reproduced as under: Sec. 18.
Reference to Court: (1) Any person interested who has not accepted the award may by written application to the Collector, require that the matter be referred by the Collector for the determination of the Court, whether his objection to the measurement of the land, the amount of the compensation, the persons to whom it is payable or the apportionment of the compensation among the persons interested.
(2) The application shall state the grounds on which objection to the award is taken: Provided that every such application shall be made, (a) if the person making it was present or represented before the Collector at the time when he made his award, within six weeks from the date of the Collector 's award; (b) in other cases, within six weeks of the receipt of the notice from the Collector under Sec.
12, sub section (2), or within six months from the date of the Collector 's award, whichever period shall first expire.
19 Collector 's statement to the Court (1) In making the reference, the Collector shall state for the information of the Court, in writing under his hand, (a) the situation and extent of the land, with particulars of any trees, buildings or standing crops thereon; (b) the names of the persons whom he has reason to think interested in such land, (c) the amount awarded for damages and paid or tendered under section 5 and 17, or either of them, and the amount of compensation awarded under section 11;and (d) if the objection be to the amount of the compensation, 657 grounds on which the amount of compensation was determined.
(2) To the said statement shall be attached a schedule giving the particulars of the notices served upon, and of the statements in writing made or delivered by the parties interested respectively.
" Under Sec. 18 of the Act the only requirement for the person interested who had not accepted the award was to move a written application to the Collector requiring that the matter be referred for the determination of the Court.
One of the grounds for the accepting the award was the amount of compensation.
Once such application was moved it was the duty of the Collector to make a reference to the Court.
Under Sec.
19 of the Act while making the reference the Collector was required to state for the information of the Court the particulars as mentioned in clauses (a) to (d) of sub Sec.
(1) of Sec. 19 of the Act.
Thus it was the duty of the Collector to mention not only the situation and extent of land but even particulars of any trees, buildings or standing crops thereon.
The agriculturist whose land is acquired may not be fully conversant with the khasra No. or area as entered in the Revenue records and the Union of India or the State acquiring such land should not be allowed to take any advantage of such ignorance of the agriculturists.
Once an application is moved for making a reference under Sec.
18 of the Act it becomes the duty of the Collector to send full information to the Court regarding the entire land acquired and it is thereafter the duty of the Court to decide the matter in accordance with law.
Thus looking into the matter from any angle, we are fully satisfied that the Additional District Judge was justified in allowing the application filed by the appellants and the High Court committed an error in deciding the matter with a wrong approach and in a technical manner.
In the result we allow this appeal, set aside the order of the High Court dated 10.8.1976 and uphold the order of the Additional District Judge dated 15.1.1971, with costs.
Appeal allowed.
| IN-Abs | The lands belonging to the appellants were acquired and they were awarded compensation for their lands.
Being dissatisfied with the compensation they made an application for a reference to the Court under section 18 of the Land Acquisition Act, 1894.
The Collector made a reference to the Additional District Judge and in its statement under Section 19 the Collector included only those lands which were included by the appellants in their application for reference under section 18.
The appellants filed an application before the Additional District Judge under section 151 153 of the Code of Civil Procedure for a direction to the Collector to file a revised statement giving the details of the whole of their lands acquired for the purposes of claim of enhanced compensation.
The Additional District Judge directed the Collector to furnish a correct statement under section 19.
Against the order of the Additional District Judge the Union of India filed a revision petition before the High Court, which allowed the petition by holding that the power of the Collector to make a reference was restricted to what was stated by the appellants in their application for reference and only those Khasra Nos.
which were specifically mentioned in the Schedule annexed with the application under section 18 could be considered for the purposes of enhancement of the claim of compensation and not the entire land acquired.
Hence this appeal against the order of the High Court.
650 Allowing the appeal and setting aside the order of the High Court, this Court, HELD: 1.
Under Section 18 of the Land Acquisition Act, 1894 the only requirement for the person interested who has not accepted the award is to move a written application to the Collector requiring that the matter be referred for the determination of the Court.
One of the grounds for not accepting the award is the amount of compensation.
Once such application is moved it is the duty of the Collector to make a reference to the Court.
Under section 19 of the Act while making the reference the Collector is required to state for the information of the Court the particulars as mentioned in clause (a) to (d) of sub section (1) of Section 19 of the Act.
Thus it is the duty of the Collector to mention not only the situation and extent of land but even particulars of any trees, buildings or standing crops thereon.
The agriculturist whose land is acquired may not be fully conversant with the Khasra No. or area as entered in the Revenue records and the Union of India or the State acquiring such land cannot be allowed to take any advantage of such ignorance of the agriculturists.
Once an application is moved for making a reference under section 18 of the Act it becomes the duty of the Collector to send full information to the Court regarding the entire land acquired and it is thereafter the duty of the Court to decide the matter in accordance with law.
[657B E] 2.
From a perusal of the application filed under Section 18 of the Act along with the Schedule annexed therewith it is clear that the appellants were claiming an enhancement in the compensation in respect of the entire land acquired and there was no question of asking for a reference for a limited portion of land.
The appellants were not required to pay any Court fees ad valorem on a prayer for enhancement of compensation while moving an application to the Collector for making a reference to the Court under section 18 of the Act.
The High Court unnecessarily went into the question of some statement made by the learned counsel for the appellants before the Additional District Judge and examining its validity under Order X of the Code of Civil Procedure and thus committed an error in deciding the matter with a wrong approach and in a technical manner.
[655E, F G, 657F] Smt Jamilabai vs Shankarlal Gulabchand, ; ; cited.
|
ivil Appeal No. 2846 of 1989.
From the Judgment and Order dated 24.4.1989 of the Bombay High Court in W.P.No. 4118 of 1986.
H.S. Guru Raja Rao, section Markandeya and Ms. C. Markandeya, for the Appellant.
L.A. Kriplani and S.K. Jain for the Respondents.
The Judgment of the Court was delivered by K.N. SAIKIA, J.
This appeal by special leave is from the Judgment and Order of the High Court of Bombay dated 24.4.1989 in Writ Petition No. 4118 of 1986 dismissing the petition.
The second respondent Shyam Cooperative Housing Society Ltd. was a tenant co partnership cooperative society (for short, `the 597 Society ') and Panjumal H. Advani late father of the first respondent (for short, `Advani ') was its tenant co partner member.
By an application dated 10.6.1969, Advani obtained permission of the Society to induct the appellant temporarily into his flat and accordingly, the appellant took on rent from Advani flat No. 24, Block No. 1,second floor, Nanik Niwas, situate at Bhulabhai Desai Road, Bombay (for short, `the flat ') on a monthly rent of Rs. 1,000 (Rupees one thousand) on 10.6.1969.
On the same date the appellant, under the Society 's rules, applied for its nominal membership stating, inter alia, that he intended to take the flat for temporary use and occupation; that he would not claim any right of permanent nature; and that he would vacate the flat on receipt of notice thereof.
By an agreement of leave and licence dated 11.6.1969 entered into between the appellant and Advani, the appellant took exclusive possession of the flat.
The agreement was for a period of 11 months and was renewable for 2 further periods of 11 months each.
Vide Resolution No. 208 dated 13.6.1969, the Managing Committee of the Society granted the permission.
By letter dated 22.1.1972 Advani purported to terminate the licence with effect from 10.3.1972 and asked the appellant to vacate the flat and the appellant having not acceded to the request, Advani informed the Society, which, vide letter dated 22.2.1972 required the appellant to vacate the flat and to deliver possession thereof to Advani on or before the 10th March, 1972.
The appellant instead of vacating the flat filed an application in the Court of Small Causes, Bombay on 13.3.1972 for fixation of its standard rent.
In April 1972, Advani and the Society raised a dispute under section 91 of the Maharashtra Cooperative Societies Act to recover possession from the appellant who in turn filed declaratory suit No. 989/5305 of 1972 in the Court of Small Causes, Bombay on 10.11.1972 seeking a declaration that he was the tenant of the flat, with an interim application for stay of the proceeding till the disposal of his application for fixation of standard rent; but that application was rejected and the appellant was thereafter unsuccessful in the High Court which was dismissed on 7.9.1977.
The learned Judge of the IInd Cooperative Court, Greater Bombay by his Judgment dated 6.3.1985 dismissed the suit holding that the appellant was a licensee and not a tenant, but the Society was an idle party and had acted in collusion with Advani to vacate the appellant.
Advani and Society appealed therefrom to the Maharashtra State Cooperative Appellate Court, Bombay in Appeal No. 397 of 1985 which was allowed and the impugned Judgment of the IInd 598 Cooperative Court was set aside on 31.7.1986.
The appellant impugned the appellate order in Writ petition No. 4118 of 1986 in the High Court of Judicature at Bombay, contending, inter alia, that the agreement between the appellant and Advani, though styled as a leave and licence, was a lease; that section 91 of the Maharashtra Cooperative Societies Act, 1960 was not attracted and could not have been invoked by Advani and the Society; and that section 91 itself was ultra vires the Article 14 of the Constitution of India to the extent it tried to reach persons who were not members of cooperative societies.
The High Court, while dismissing the writ petition, inter alia, held that the agreement was of temporary nature and no interest in the flat having been created in favour of the appellant, even though he had exclusive possession, it could not have been a lease; that the alleged collusion between Advani and the Society to evict the appellant was based on conjectures and could not take the matter out of the purview of section 91 of the Cooperative Societies Act which was not ultra vires.
Mr. S.S. Gururaja Rao, the learned counsel for the appellant submits, inter alia, that the agreement dated 11.6.1969 between Advani and the appellant was one of lease with all its ingredients and not one of leave and licence; that the agreement having been a lease the cooperative Court had no jurisdiction in respect thereof and it was the Civil Court envisaged under the Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947 that would have jurisdiction in the matter; and that even assuming that the Cooperative Court had jurisdiction in respect of a leave and licence created under the provisions of the Act, that Court would not have jurisdiction in this matter, the appellant being only a nominal member and not a tenant member of the Society.
Mr. L.A. Kripalani, the learned counsel for the respondents, submits that the agreement was one of leave and licence and not of lease; that in the matter of the agreement the Cooperative Court alone has jurisdiction and no other court; and that being a nominal member of the Society in view of his application for such a membership the appellant would come within the jurisdiction of the Cooperative Court.
The first question to be decided in this appeal, therefore, is 599 whether the agreement dated 11.6.1969 was one of lease or of leave and licence.
In the agreement dated 11.6.1969 the Party of the First part has been called the `licensor ' and the Party of the Second part has been called the `licensees '.
The licensor is stated to be a shareholder and member of the Society.
Its recitals said: "AND WHEREAS the Licensor is the absolute owner of the said flat and whereas the party of the Second part has approached the Party of the First part to allow them the use of the said flat with, fittings, fixtures and furniture lying therein.
AND WHEREAS the Party of the First part has agreed to allow the party of the Second part to use the said flat along with fittings, furniture, fixtures etc.
The following were the relevant terms of the agreement: "1.
The `licensor ' has given the use of his flat No.24, 2nd floor, Nanik Niwas, Block No. 1, Bhulabhai Desai Road on Leave and Licence basis.
The licence in the initial stage is for the period of 11 months to be renewed by another period of 11 months and a second option of 11 months also, to make up the period of 33 months.
The Licensees shall pay compensation of Rs. 1,000 (Rupees one thousand only) per month to the `licensor ' the use of the said flat along with fittings, fixtures and furniture lying therein more fully described in the schedule herewith attached; This compensation payable by the said `Licensees ' to the said `Licensor ' shall include all the charges and taxes leviable either by the Shyam Cooperative Housing Society Ltd., Bombay 26 or by the Bombay Municipal Corporation or by any local or State authorities except the changes which are specially mentioned hereunder.
xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx 600 9.
It is agreed by this agreement that only `Licensee ' is intended to be given to the `Licensees ' to use the flat and fixtures, fittings, furniture etc.
more fully described in the schedule attached herewith and the `Licensees ' will at no time claim tenancy or sub tenancy of the premises.
The premises are in Nanik Niwas, Block No.1, Second Floor, Flat No.24, of the Shyam Cooperative Housing Society Ltd., and the rules regulations and bye laws of the said Society do not permit any tenancy or sub tenancy being created in respect of the premises.
xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx 22.
That the `Licensee ' will not surrender their rights under this agreement in favour of anyone else except the `Licensors '.
That the `Licensees ' shall observe all rules, regulations, and by laws of the Shyam Cooperative Society as nominal members during the period of this licence.
From the above recitals and the terms and conditions there is no doubt that ex facie it is one of leave and licence for use of the flat and fixtures, fittings, furniture etc.
and that the licensee would at no time claim tenancy or sub tenancy in respect of the flat.
There is also no doubt that in his application for nominal membership, the appellant stated that he intended to take the flat for temporary use and occupation and that he would not claim any right of permanent nature.
In the Managing Committee Resolution No.208 dated 13.6.1969, the appellant was admitted as a nominal member of the Society and was permitted to temporarily occupy the flat.
Thus, there appears to be no room for contending, contrary to the terms of the agreement, that the agreement was a lease and the appellant was a tenant of Advani, as such the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, hereinafter referred to as `the Rent Act ', was applicable to him.
However, relying on Antoniades vs Villiers and Anr., reported in ; , it is submitted for the appellant that he having been given exclusive possession of the flat for a time, the agreement must be construed as a lease and him as a tenant.
In that case the respondent let a flat to the appellants, a young unmarried couple, under separate but identical agreements termed `licenses ', which were executed contemporaneously and stipulated with reiterated emphasis that the appellants were not to have exclusive possession.
In particular, 601 by clause 16, that agreement stated that the licensor shall be entitled at any time to use the rooms together with the licensee and permit other persons to use all of the rooms together with the licensee and further stated that the real intention of the parties in all the circumstances was to create a licence which did not come under the Rent Acts.
The rental payable was 87 pounds per month by each occupant and the agreements were determinable by one month 's notice by either party.
The respondent never attempted to use any of the rooms or authorised any other persons to use the rooms.
In July 1986 the respondent gave the appellants a notice to quit and applied to the court for an order for possession, but his claim was dismissed on the ground that the appellants were tenants who were entitled to the protection of the Rent Acts.
The respondent appealed to the Court of Appeal, which allowed his appeal.
The appellants having appealed to the House of Lords it was held that the agreements were interdependent on one another and were therefore to be read together as constituting one single transaction.
Since it was the intention of the two appellants to occupy the flat as man and wife and since that intention was known to the respondent, the true nature of the arrangement was to create a joint tenancy and the purported retention by the respondent of the right to share the occupation of the small flat with the appellants or to introduce an indefinite number of third parties to do so was clearly a pretence to deprive them of the protection of the Rent Acts.
It followed that the agreements created a joint tenancy and not a licence, and the appeal would therefore be allowed.
It may be noted that in the above case there was no obligation of or relation to any cooperative society and laws governing members thereof, whereas in the instant case admittedly Advanai was a tenant co partner member of the Society and the appellant by virtue of the agreement of licence was also admitted to nominal membership accepting his statement in his application.
While interpreting the agreement we have also to see what transpired before and after the agreement.
Ex praecedentibus et consequentibus optima bit interpretation.
The best interpretation is made from the context.
"It is a true rule of construction that the sense and meaning of the parties in any particular part of an instrument may be collected ex antecedentibus et consequentibus; every part of it may be brought into action in order to collect from the whole one uniform and consistent sense, if that may be done.
" As was said in N.E. Railway vs Hastings, "The deed must be read as a whole in order to ascertain the true meaning of its several clauses, and the words of each clause should be so interpreted as to bring them into 602 harmony with the other provisions of the deed if that interpretation does no violence to the meaning of which they are naturally susceptible.
In the agreement the intention to create a licence is clear.
Positively it speaks of a licence for the use of the flat and negatively that the licensee would not claim any tenancy or sub tenancy.
That the intention of the parties was to create only a licence and not a lease is clear from the tenor of the agreement.
True, by mere use of the word lease or licence the correct categorisation of an instrument under law cannot be affected.
What was given to the licensee was to use of the flat with furniture, fittings etc., which could not be said to have created any interest in the flat though in effect the use continued for a stipulated period of time.
It is true, where the ingredients of a lease are present and the licensee is according to law, a tenant, he ought to be given the benefit of the Rent Act.
As was held in Board of Revenue etc.
vs A.M. Ansari etc.
; , , it is the substance of the agreement between the parties which is a decisive consideration on the question whether a particular grant amounts to a lease or a licence.
In Tarkeshwar Sio Thakur Jiu vs Dar Dass Dey & Co. & Ors., ; ; , the document though named as licence was construed as a lease.
If a document gives only a right to use the property in a particular way or under certain terms while it remains in possession and control of the owner thereof it will be a licence.
If there is a transfer of interest in law and exclusive possession is given to the grantee then it is a lease.
Thus, exclusive possession by itself will not amount to creation of interest.
Exclusive possession by itself would not militate against the concept of a licence, if the circumstances negative any intention to create a tenancy.
Following Sohan Lal Naraindas vs Laxmidas Raghunath Gadit, , we reiterate that the intention of the parties to an agreement has to be gathered from the terms of the agreement construed in the context of the surrounding, antecedent and consequent circumstances.
The crucial test would be what the parties intended.
If infact it was intended to create an interest in the property, it would be a lease, if it did not, it would be a licence.
In determining whether the agreement was a lease or licence, the test of exclusive possession, though of significance, is not decisive.
Interest for this purpose means a right to have the advantage accruing from the premises or a right in the nature of property in the premises but less than title.
603 Lease has been defined in section 105 of the as under: "A lease of immovable property is a transfer of a right to enjoy such property, made for 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.
" The essential elements of a lease are: 1.
the parties 2.
the subject matter, or immovable property 3.
the demise, or partial transfer 4.
the term, or period 5.
the consideration, or rent.
The relationship of lessor and lessee is one of contract.
In Bacon 's Abridgement, a lease is defined as "a contract between the lessor and the lessee for the possession and profits of land, etc., on the one side and recompense by rent or other consideration on the other.
" Hence it has been held that "a mere demand for rent is not sufficient to create the relationship of landlord and tenant which is a matter of contract assented to by both parties.
" When the agreement vests in the lessee a right of possession for a certain time it operates as a conveyance or transfer and is a lease.
The section defines a lease as a partial transfer, i.e., a transfer of a right of enjoyment for a certain time.
This Court has held that a renewal of a lease is really grant of a fresh lease though it is called a renewal because it postulates the existence of a prior lease.
Where the initial term was, say one year, it could not co exist with a renewal of that very lease within one year.
Renewal could take place only on the expiry of the initial lease, and not before.
The intention of the parties in making the agreement is determinative of the question whether it was a lease or licence.
In Halsbury 's Laws of England, 4th Edn.
27, at paragraph 6, on General Principles 604 for determining whether agreement creates lease or a licence we read: "In determining whether an agreement creates between the parties the relationship of landlord and tenant or merely that of licensor and licensee the decisive considerations is the intention of the parties.
The parties to an agreement cannot, however, turn a lease into a licence merely by stating that the document is to be deemed a licence or describing it as such.
The parties ' relationship is determined by law on a consideration of all relevant provisions of the agreement; and an agreement labelled by the parties to it as a `licence ' will still be held to create a tenancy if the substance of the agreement conflicts with that label.
Similarly, the use of operative words (`let ', `lessor ' etc.) which are appropriate to a lease will not prevent the agreement from conferring only a licence if from the whole document it appears that it was intended merely to confer a licence.
Primarily the court is concerned to see whether the parties to the agreement intend to create an arrangement personal in its nature or not, so that the assignability of the grantee 's interest, the nature of the land and the grantor 's capacity to grant a lease will all be relevant considerations in assessing what is the nature of the interest created by the transaction.
In the absence of any formal document the parties ' intention must be inferred from the circumstances and the parties ' conduct.
" It has been submitted for the appellant that the very fact of exclusive possession of the flat being given to the appellant was sufficient to make him lessee and Advani his landlord.
We do not agree with the submission in an unqualified form.
There have been cases where exclusive possession has been given outside the Rent Act.
In Isaac vs Hotel De Paris, Ltd., [1960] (1) All E.R.348, the respondent company owning the hotel de Paris where the lessees of another building called the P.Hotel, it was held that the respondent company were entitled to an order for possession because the relationships between the parties was not that of landlord and tenant but of licensor and licensee, even though there was exclusive possession by the appellant and the acceptance of the amount of the rent by the respondent company, the circumstances and the conduct of the parties showing that all that was intended was that the appellant should have a personal privilege of running a night bar at the P.Hotel with no interest 605 in the land at all, and this privilege came to an end with the notice of May, 1956 and that after the notice the appellant remained in occupation at sufferance, and, in the circumstances, the acceptance of rent by the respondent company did not waive their right to immediate possession.
It was observed that there were many cases in the books where exclusive possession had been given of premises outside the Rent Restriction Acts and yet there had been held to be no tenancy.
Lord Denning quoted from Booker vs
Palmer, (677): "There is one golden rule which is of very general application, namely, that the law does not impute intention to enter into legal relationship where the circumstances and the conduct of the parties negative any intention of the kind. ' The following passaged was also cited with approval: "It is clear from the authorities that the intention of the parties is the paramount consideration and while the fact of exclusive possession together with the payment of rent is of the first importance, the circumstances in which exclusive possession has been given and the character in which money paid as rent has been received are also matters to be considered.
" On the question of nature and effect of the grant of exclusive possession in paragraph 7 of Halsbury 's Laws of England, 4th Edn., Vol.27, we read: "The fact that the agreement grants a right of exclusive possession is not in itself conclusive evidence of the existence of a tenancy, but it is a consideration of the first importance, although of lesser significance than the intention of the parties.
In deciding whether a grantee is entitled to exclusive posession regard must be had to the substance of the agreement.
In order to give exclusive possession there need not be express words to that effect; it is sufficient if the nature of the acts to be done by the grantee requires that he should have exclusive possession.
However, the grant of an exclusive right to a benefit can be inferred only from language 606 which is clear and explicit.
If an exclusive right of possession is subject to certain reservations or to a restriction of the purposes for which the premises may be used, the reservations or restriction will not necessarily prevent the grant operating as a lease.
" We may now examine the position of the appellant under the Rent Act.
The Rent Act has not defined a `lease '.
As defined in section 5(11) `tenant ' means any person by whom or on whose account rent is payable for any premises and includes (a) such sub tenants and other persons as have derived title under a tenant before the 1st day of February, 1973; (aa) any person to whom interest in premises has been assigned or transferred as permitted or deemed to be permitted, under section 15; (b) any person remaining, after the determination of the lease, in possession, with or without the assent of the landlord, of the premises leased to such person or his predecessor who has derived title before the 1st day of February, 1973; (bb) such licensees as are deemed to be tenants for the purpose of this Act by section 15A; (c) xxx xxx xxx xxx xxx xxx" Thus the above sub section (bb) read with section 15A of the Rent Act makes the `tenant ' one of status and not of contract.
the licensee has been conferred the status of a tenat.
This reminds us of what Sir Henry Maine observed in Ancient Law.
"The movement of progressive societies had been from status to contract".
But Lord Simmonds pointed out in Johnson vs Merston, , that since the days of Maine, the movement of the progressive societies in various fields, has been almost the reverse, that is, from contract to status.
With acute dearth of accommodation and dire need for it people may agree to a pretence or unreasonable term from which law alone can protect them and render justice to the parties.
As defined in the section 5(4A) of the Rent Act `licensee ', in respect of any premises or any part thereof means: 607 "The person who is in occupation of the premises or such part as the case may be under a subsisting agreement for licence given for a licence fee or charge; and includes any person in such occupation of any premises or part thereof in a building vesting in or leased to a co operative housing society registered or deemed to be registered under the Maharashtra Cooperative Societies Act, 1960; but does not include a paying guest, a member of a family residing together, a person in the service or employment of the licensor, or a person conducting a running business belonging to the licensor or a person having any accommodation for rendering or carrying on medical or para medical services or activities in or near a nursing home, hospital or sanatorium, or a person having any accommodation in a hotel, lodging house, hostel, guest house, club, nursing home, sanatorium, dharamshala, home for widows, orphans or like premises, marriage or public hall or like premises, or in a place of amusement or entertainment or like institution, or in any premises belonging to or held by an employee or his spouse who on account of the exigencies of service or provision of a residence attached to his or her post or office is temporarily not occupying the premises, provided that he or she charges licence fee or charge for such premises of the employee or spouse not exceeding the standard rent and permitted increases for such premises, and any additional sum for services supplied with such premises, or person having accommodation in any premises or part thereof for conducting a canteen, creche,dispensary or other services as amenities by any undertaking or institution; and the expressions `licence ', `licensor ' and `premises given on licence ' shall be construed accordingly.
" The above definition is comprehensive one.
A licence is a power or authority to do some act which, without such authority, could not lawfully be done.
In the context of an immovable property a licence is an authority to do an act which would otherwise be a trespass.
It passes no interest, and does not amount to a demise, nor does it give the licensee an exclusive right to the use of the property.
The definition in the Rent Act includes any person in occupation under a subsisting agreement for licence given for a licence fee or charge of any premises or part thereof in a building vesting in or lease to a cooperative housing society registered or deemed to be registered under the 608 Maharashtra Cooperative Societies Act, 1960.
The appellant would, otherwise, be included within this definition.
But he has no subsisting licence, the same having been cancelled on 10.3.72.
Section 15A of the Rent Act which was inserted by Maharashtra Act 17 of 1973 provides: "Certain licensee in occupation on 1st February 1973 to become tenants.
(1) Notwithstanding anything contained elsewhere in this Act or anything contrary in any other law for the time being in force, or in any contract, where any person is on the 1st day of February 1973 in occupation of any premises, or any part thereof which is not less than a room, as a licensee he shall on that date be deemed to have become, for the purposes of this Act, the tenant of the landlord, in respect of the premises or part thereof, in his occupation .
(2) The provisions of sub section (1) shall not affect in any manner the operation of sub section (1) of section 15 after the date aforesaid.
" Thus, section 15A read with section 5(11) (bb) of the Rent Act makes the tenant one of status rather than of contract.
Intention to create a licence as defined in that Act if the other requirements fulfilled would, therefore, be enough to confer that status from the specified date.
The above provisions applies to person in occupation of any premises or part thereof which is not less than a room, as a licensee he shall on the date be deemed to have become a tenant on the first day of February 1973.
The licence of the appellant was cancelled on 10.3.72.
Again, in the instant agreement what has been given is only the use of the flat and the furnitures and fittings.
`Licence ' had earlier been defined in section 52 of the : "Where one person grants to another, or to a definite number of other persons, a right to do, or continue to do, in or upon the immovable property of the grantor, something which would, in the absence of such right, be unlawful and such right does not amount to an easement or 609 an interest in the property, the right is called a license.
" In view of licence of the appellant having been cancelled on 10.3.72, licence as defined by the Rent Act itself, would not apply, to the appellant 's case.
He would, therefore, not be protected under section 15A of the Rent Act.
The learned counsel for the appellant submits that due to scarcity of accommodation, the appellant had to accept the terms that he would not, by virtue of the agreement of leave and licence, claim any right of tenancy or sub tenancy and that should not be a bar to his being given the benefit under the Rent Act.
However, considering the facts and circumstances of this case we are not inclined to hold that the appellant should not be bound by the expressed intention in the agreement.
In Chandavarkar Sita Ratna Rao vs Ashalata S.Guram, ; , this Court held that licence was a privilege and not an interest in property.
A tenant, whose interest in the tenancy is determined for any reason but who is protected by the statute, was entitled to create a licence in favour of another person until a decree of eviction has been passed against him.
A statutory tenant was in the same position as a contractual tenant until a decree for eviction is passed against him and the rights of contractual tenant including the right to create licence even if he was transferor of an interest which was not in fact the transfer of interest.
If the licence have been created before February 1, 1973, the licensee must, by the express terms of section 15A of the Rent Act be deemed to be a tenant and he should, subject to provisions of the said Act be deemed tenant of the landlord on the terms and conditions of the agreement consistent with the provisions of the Act.
At paragraph 58 of the report it was observed that there was no reason and there was nothing in the Rent Act or the Statement of Objects and Reasons to indicate that restricted meaning to the expression "licence" should be given.
As the amended section said that whoever was in possession as a licensee should be deemed to have become for the purpose of the Act the tenant of the landlord and there was no warrant to restrict the ordinary meaning of that expression.
If the restricted meaning was given then the apparent scheme or the purpose for introduction of the amendment would be defeated at least to a large section of licensees who were contemplated to be protected, as the objects of the Act sought to do.
The Rent Act was amended by Maharashtra Act 17 of 1973.
By 610 the Amending Act section 5(4A) and section 15A were introduced in the parent Act to confer on the licensee, who had a subsisting agreement of February 1, 1973 the status and protection of a tenant under the Rent Act.
Section 15A required that the occupant must be in occupation of the premises as a licensee as defined in section 5(4A) on the 1st of February, 1973.
If he be such a licensee, the non obstinate clause of section 15A (1) gives him the status and protection of a tenant in spite of there being anything to the contrary in any other law or in any contract.
In other words, even as against the express terms of the subsisting contract of licence,the licensee would enjoy the benefits of section 15A.
But if he was not a licensee under a subsisting agreement on the 1st of February, 1973, then he did not get the advantage of the amending provision of the Rent Act.
A person continuing in possession of the premises after termination, withdrawal or revocation of the licence continued to occupy it as a trespasser or as a person who has no semblance of any right to continue in occupation of the premises.
Such a person by no stretch of imagination could be called a licensee.
In D.H. Maniar and Ors.
vs Waman Laxman Kudav; , , this position was made clear.
The appellant in the instant case was not in possession as a licensee on 1st of February, 1973, the licence having been terminated prior to that date.
This takes us to the next question, namely, whether the Cooperative Court had jurisdiction over the matter.
Section 91(1) of the Maharashtra Cooperative Societies Act which deals with disputes, provides: "(1) Notwithstanding anything contained in any other law for the time being in force any dispute touching the constitution, elections of the committee or its officers other than the elections of committees of the specified societies including its officers, conduct of general meetings, management of business of a society shall be referred by any of the parties to the dispute, or by a federal society to which the society is affiliated or by a creditor of the society, to a cooperative Court if both the parties thereto are one or other of the following: (a) a society its committee, any past committee, any past or present officer, any past or present agent, any past or present servant or nominee, heir or legal representative of any deceased officer, deceased agent or deceased servant of the society, or the Liquidator of the society; 611 (b) a member, past member or a person claiming through a member, past member or a deceased member of a society, or a society which is a member of the society or a person who claims to be a member of the society.
xxx xxx xxx xxx xxx xxx Under the above provision the matter of eviction of the appellant by the tenant co partner member of the society can be said to be touching the business of the society.
In Deccan Merchants Cooperative Bank Ltd. vs M/s Dalichand Jugraj Jain & Ors., [1969] (1) SCR 887, it has been held that the word "business" in the expression `touching the business of a society ' in section 91 (1) does not mean affairs of the society.
It has been used here in a narrower sense and means the actual trading or commercial or other similar business activity of the society which the society is authorised to enter into under the Act and the Rules and its bye laws.
It was, however, held that section 91 of the Maharashtra Cooperative Societies Act did not affect the provisions of section 26 of the Bombay Rents, Hotel & Lodging House Rates Control Act, 1947.
Although both these provisions start by excluding "anything contained in any other law", two Acts could be harmonized best by holding that in matters covered by the Rent Act, its provisions rather than the provisions of the Maharashtra Cooperative Societies Act, should apply.
The latter Act was passed in the main, to shorten litigation, lessen its cost and to provide a summary procedure for the determination of the disputes relating to internal management of the society.
But under the Rent Act a different social objective was intended to be achieved and for achieving that social objective it was necessary that the dispute between the landlord and the tenant should be dealt with by the courts set up under the Rent Act and in accordance with the special provisions of that Act and this social objective did not impinge on the objective underlying the Maharashtra Cooperative Societies Act.
In O.N.Bhatnagar vs Smt.
Rukibai Narsindas & Ors.
, ; , which was also case of Shyam Cooperative Housing Society Limited, it was held that the claim of the society together with such member for ejectment of a person who was permitted to occupy having become a nominal member thereof, upon revocation of licence was a dispute falling within the purview of section 1 of the Maharashtra Cooperative Societies Act, 1960 and that the proceeding under section 91(1) of the Maharashtra Cooperative Societies Act, 1960 were 612 not barred by the provisions of section 28 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947.
The two Acts, could be best harmonized by holding that the matters covered by the Rent Acts, its provisions, rather than the provisions of the Cooperative Societies Act should apply.
But where the parties admittedly did not stand in the jural relationship of landlord and tenant, as their dispute would be governed by section 91(1) of the Societies Act and that the appellant by virtue of his being a nominal member, acquired a right to occupy the flat as a licensee, but his rights were inchoate,.
In the facts of the instant case upon the terms of sections 5(4A) and 15A of the Rent Act, it is clear that the appellant was not entitled to the protection of section 15A.
The sine qua non for the applicability of section 15A of the Rent Act was that a licensee must be in occupation as on February 1, 1973 under a subsisting licence.
It is not disputed that the appellant did not answer that description since the agreement of leave and licence in his favour admittedly stood terminated by the notice of the respondent No. 1 on 10.3.1972.
That being so, the appellant was nothing but a rank trespasser and was not entitled to the protection of section 15A of the Rent Act and could not, therefore, plead the bar of section 28(1) thereof.
In Hindustan Petroleum Corporation Ltd. & Anr.
vs Shyam Cooperative Housing Society & Ors., ; , at paragraph 14 it was held under the facts of that case that the petitioner Hindustan Petroleum Corporation Ltd. was clearly protected under section 15A of the Rent Act and in that view of the matter the jurisdiction of the Registrar under Section 91(1) of the Cooperative Societies Act would be as laid down in O.N. Bhatnagar 's case (supra).
The proceedings initiated under section 91 were accordingly quashed.
This case is, therefore, distinguishable on facts.
Following Bhatnagar 's case in Smt.
Krishna Rajpal Bhatia and Ors.
vs Miss Leela H. Advani & Ors., ; , where a tenant co partner member of a registered co partnership type cooperative housing society inducting another person into her flat for a term of eleven months subject to renewal of the term from time to time after obtaining society 's permission and after the person so inducted becoming a nominal member of the society and the agreement between the parties embodied in usual standard form of leave and licence, it was held that the tenant co partner member only created a licence and not a lease and that the Maharashtra Cooperative Societies Act, 1960 was applicable.
There also the nominal membership of the society was obtained in terms of the society 's bye laws and the licence was 613 terminated by notice after expiry of the term, but the occupant was not vacating.
Claim made by the co partner under section 91 of the Maharashtra Cooperative Societies Act, 1960 for ejectment of the occupant was held to constitute a `dispute touching the business of a society ' within the meaning of section 91 and hence the Registrar 's jurisdiction to entertain the claim was held not to have been barred under section 28 of the Rent Act.
Applying the law laid down in the above decisions we are of the view that the instant dispute is one envisaged in section 91 of the Maharashtra Cooperative Societies Act and the Cooperative Courts rightly exercised jurisdiction.
The next question, namely, section 91 is ultra vires the Article 14 of the Constitution of India to the extent it tries to reach persons who are not members is not tenable, inasmuch as the appellant is involved in a dispute touching the business of the Society and he was a nominal member of the Society by dint of his agreement of leave and licence and he was made so on his application.
Result is that this appeal fails and it is dismissed, but under the facts and circumstances of the case without any order as to costs.
Interim orders stand vacated.
R.P. Appeal dismissed.
| IN-Abs | The second respondent was a tenant copartnership co operative Housing Society and father of the first respondent was its tenant co partner member.
By an application dated 10.6.1969 he sought permission of the society to temporarily induct the appellant into his flat.
On the same date the appellant applied to the said Society for its nominal membership stating that he intended to take the flat for temporary use and occupation, that he would not claim any right of permanent nature and that on receipt of notice he would vacate the flat.
By an agreement of leave and licence dated 11.6.1969, the father of respondent No. 1 (licensor)gave use of the flat with its furniture and fittings to the appellant (licensee) on Rs. 1,000 per month as compensation for use and occupation for a period of 11 months with a facility of renewal of the agreement for two such further periods.
The Managing Committee of the Society, by its Resolution dated 13.6.1969.
I granted the permission.
593 The licensor by letter dated 22.1.1972 purported to terminate the licence w.e.f. 10.3.1972, and asked the appellant to vacate the flat, but the latter declined to do so.
On receiving intimation from the licensor, the Society, by its letter dated 22.2.1972, required the appellant to vacate the flat and deliver its possession to the licenser before the stipulated date, but in vain.
Instead, the appellant on 13.3.1972 applied to the Court of Small Causes, Bombay for fixation of standard rent of flat.
In April 1972 the licensor and the Society raised a dispute under section 91 of the Maharashtra Co operative Societies Act, 1960 to recover possession from the appellant,who in turn filed a suit in the Court of Small Causes, Bombay for declaration that he was tenant of the flat.
He also filed an interim application for stay of the dispute proceeding till disposal of his application for fixation of standard rent, which was rejected and his writ petition against the said order was also dismissed by the High Court on 7.9.1977.
The Co operative Court, Bombay dismissed the dispute proceeding holding that the appellant was a licensee and not a tenant but the society was an idle party which acted in collusion with the licensor to evict the appellant.
On appeal by the licenser and the Society, the Maharashtra State Co operative Appellate Court set aside the order of the Co operative Court, against which the appellant filed a writ petition before the High Court contending that the agreement, though style as a leave and licence, was a lease; that section 91 of the Maharashtra Co operative Societies Act was not attracted and could not have been invoked by the respondents; and that section 91 itself was ultra vires article 14 of the Constitution to the extent it tried to reach non members of co operative societies.
The High Court dismissed the writ petition.
Hence the present appeal by special leave.
By Maharashtra Act 17 of 1973, sections 5(4A), and 15 A were introduced in the Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947,to confer the status and protection of a tenant on a licensee, who, on the first day of Feb. 1973, had a subsisting agreement and was on that date in occupation of any premises or part thereof, which was not less than a room, as a licensee.
On the question whether:(1) the agreement dated 11.6.1969 was one of leave and licence or if lease, and if it was so, whether the 594 occupant was entitled to benefit of section 15 A of the Rent Act; and (2) the matter was one touching the business of the society so as to attract s.19 of the Maharashtra co operative Societies Act within the jurisdiction of Co operative Courts.
Dismissing the appeal, this Court HELD: 1.1 By mere use of the word lease or licence the correct categorisation of an instrument under law cannot be affected.
Whether a particular grant amounts to lease or a licence, depends on its substance.
If a document gives only a right to use the property in a particular way or under certain terms while it remains in possession and control of the owner thereof, it will be a licence.
If there is a transfer of interest in law and exclusive possession is given to the grantee or where the ingredients of a lease are present and the licensee is, according to law, a tenant, then it is a lease and he ought to be given benefit of the Rent Act.
[602B E] 1.2 In determining whether the agreement was a lease or licence, the test of exclusive possession, though of significance, is not decisive and exclusive possession itself will not amount to creation of interest nor would it militate against the concept of a licence, if the circumstances negative any intention to create a tenancy.
[602G, E F] 1.3 The intention of the parties in making the agreement is determinative of the question whether it was a lease or licence.
The intention has to be gathered from the terms of the agreement construed in the context of the surrounding, antecedent and consequent circumstances.
The crucial test would be what the parties intended.
If in fact it was intended to create an interest in the property it would be a lease, if it did not, it would be a licence Interest for this purpose means a right to have the advantage accruing from the premises or a right in the nature of property in the premises but less than title.
[603H, 602F H] 2.
In the instant case, it is clear from the tenor of the agreement that the intention of the parties was to create only a licence and not a lease.
Positively it speaks of a licence for the use of the flat and negatively that the licensee would not claim any tenancy or subtenancy.
What was given to the licensee was the use of the flat with furniture, fittings etc., which could not be said to have created any interest in the flat though in effect the use continued for a stipulated period of time.
[602A C] 595 Board of Revenue etc.
vs A.M. Ansari etc.
; , ; Tarkeshwar Sio Thakur Jiu vs Dar Dass Dey & Co. & Ors., ; , relied on; Sohan Lal Naraindas vs Laxmidas, Raghunath Gadit , followed.
Antoniades vs Villiers and Anr., [1988] (3) All.
E.R. 1058; N.E. Railway vs Hastings, , Isaac vs Hotel De Paris, Ltd. , Booker vs Palmer referred to.
3.1 Section 15A read with section 5(11)(bb) of the Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947, makes the tenant one of status rather than of contract.
Intention to create a licence as defined in the Act if the other requirements fulfilled, would, therefore, be enough to confer that status from the specified date.
Section 15A required that the occupant must be in occupation of the premises as a licensee as defined in s.5(4A) on the first day of Feb. 1973.
If he be such a licensee, the non obstante clause of s.15A(1) gives him the status and protection of a tenant in spite of there being anything to the contrary in any other law or in any contract.
Even as against the express terms of the subsisting contract licence, a person in occupation of any premises or part thereof, which is not less than a room, as a licensee, shall, in view of these provision, be deemed to have become a tenant on the first day of Feb. 1973, and would enjoy the benefits of section 15A.
But if he was not a licensee under a subsisting agreement on the 1st of Feb. 1973, then he did not get the advantage of the amending provision of the Rent Act.
[608E F, 610AB] 3.2 The sine qua non for the applicability of section 15A of the Rent Act was that a licensee must be in occupation as on Feb.1, 1973, under a subsisting licence.
A person continuing in possession after termination, withdrawal or revocation of the licence is a trespasser or a person who has no semblance of any right to continue in occupation of the premises.
Such a person by no stretch of imagination could be called a licensee.
[612B C, 610C] 4.
The appellant would, otherwise, be included in the definition of licensee under section 5(4A) of the Rent Act, but as he had no subsisting licence, the same having stood terminated by notice on 10.3.1972, the licence as defined by the Rent Act itself would not apply to appellant 's case, and he was nothing but a rank trespasser not entitled to the protection of section 15A of the Rent Act and could not, therefore, plead the bar of section 28(1) thereof.[608A, 609A, 612C D] 596 D.H. Maniar and Ors.
vs Waman Laxman Kudav, ; , O.N. Bhatnagar vs Smt.
Rukibai Narsindas & Others, ; , relied on.
Chandavarkar Sita Ratna Rao vs Ashalata section Guram; , , referred to.
Hindustan Petroleum Corporation Ltd. & Anr.
vs Shyam Cooperative Housing Society & Ors, ; , distinguished.
The matter of eviction of the appellant was a dispute touching the business of the society as envisaged by s.91 of the Maharashtra Co operative Societies Act and the Co operative Courts rightly exercised jurisdiction.[611B; 613B] Smt.
Krishna Rajpal Bhatia and Ors.
vs Miss Leela H. Advani & Ors., ; , relied on.
Deccan Merchants Cooperative Bank Ltd. vs M/S Dalichand Jugraj Jain & Ors., [1969] 1 SCR 887 referred to.
Since the appellant was involved in a dispute touching the business of the society of which he was a nominal member, his contention that section 91 of the Maharashtra Co operative Societies Act to the extent it tries to reach persons who are not members is ultra vires article 14 of the Constitution, was not tenable.
[613C D]
|
Appeal No. 782 of 1991.
From the Judgment and Order dated 10.7.1990 of the Bombay 484 High Court in Appeal No. 423 of 1987.
Ashok H. Desai, Vinay Tulzapurkar, Raghu Kothare and Rajiv Dutta for the Appeallant.
Soli J. Sorabjee, D.R. Poddar, Ms. Purnima, Atul Sharma, A.V.Palli, E.C.Agrawala and V.B.Joshi for the Respondents.
The Judgments of the Court was delivered by OJHA, J. Special leave granted.
This appeal by special leave has been preferred against the judgment dated 10th July, 1990 of the Bombay High Court in Appeal No. 423 of 1987.
Respondent No. I is a private limited company whereas Respondents 2 to 4 are its Directors.
Respondent No. 1, for setting up a factory, sought financial assistance from the appellant and the appellant sanctioned a loan of Rupees thirty lakhs.
In order to secure the loan Respondent No. 1 executed a deed of mortgage of certain properties on 29th June, 1979 and Respondents 2 to 4 on the same date by executing a deed of guarantee stood surety for repayment of the said loan.
It was a case of personal guarantee only as no property was given in security.
For the sake of brevity the appellant, Respondent No. I and Respondents 2 to 4 shall hereinafter be referred to as the Corporation, the Company and the sureties respectively.
The amount of loan was to be advanced in phases and after the Corporation had advanced a part of the total sanctioned loan, the Company did not want to avail of the balance of the amount as it seems to have lost interest in setting up the factory for reasons with which we are not concerned.
The Corporation consequently called upon the Company to repay the amount already advanced together with interest and on its failure to do so took possession under Section 29 of the (for short the Act) over the industrial concern, a term defined under Section 2(c) of the Act and took steps to realise its outstanding dues by transfer of property in the manner provided therein.
However, notwithstanding advertisement for sale thereof having been made on several occasions the Corporation could not get an offer of more than about Rupees five lakhs.
Having failed to recover the amount due to it in the manner stated above, the Corporation proceeded to recover the same from the sureties whose liability was coextensive and for this purpose it filed a petition in the High Court under Sections 31 and 32 of the Act arraying 485 the Company as Respondent No. I and the sureties as Resondents 2 to 4, with the prayer that "the respondents be jointly and severally ordered and decreed to pay the petitioners the sum of Rs 15,87,391.20 as per particulars hereto annexed and marked exhibit H. with further interest at the rates of 14 1/2% per annum till payment and may further "be ordered to pay to the petitioners costs of the petition".
Thus, according to the relief claimed in the petition the liability of the respondents with regard to the amount payable to the Corporation on the date of making of the petition was for a sum which was more than Rupees fifty thousand which, as will be presently shown, represents maximum amount over which the Bombay City Civil Court has pecuniary jurisdiction.
The respondents contested the petition and raised three pleas in defence: (1) A petition under Sections 31 and 32 of the Act could be filed only in the Bombay City Civil Court and the High Court had no jurisdiction to entertain it, (2) the relief claimed in the petition could not be granted under Sections 31 and 32 of the Act inasmuch as these sections did not contemplate passing of a money decree not only against the principal debtor but also against the sureties; and (3) the provisions in the Act relating to enforcement of the liability of a surety were ultra vires Article 14 of the Constitution.
The learned Single Judge of the High Court before whom the petition came up for hearing did not, in view of his finding on the first two pleas, entertain any argument on the last plea nor has the said plea been raised before us and as such the same does not need to be gone into.
As regards the second plea it was conceded before the learned Single Judge on behalf of the Corporation by its learned counsel that no such money decree could be passed against the Company as was claimed in the petition.
It was, however, asserted that such a decree could be passed as against the sureties.
In this view of the matter the petition was treated and decided as being confined against the sureties only.
In regard to the plea of jurisdiction the learned Single Judge took the view that since an appeal was pending before a Division Bench of the High Court against the judgment of a Single Judge in Misc Petition No. 357 of 1985, Maharashtra State Financial Corporation vs Hindtex Engineers Pvt. Ltd., decided on 3rd December, 1986 (since reported in , in which it had been held that such a petition was maintainable in the High Court, he would proceed to decide the petition on merits on the assumption that he had jurisdiction to entertain it.
On merits, he took the view that no money decree could be passed in a petition under Sections 31 and 32 of the Act 486 even against the sureties and since in the instant case sureties had admittedly not given any security except their personal guarantee the said surety could be enforced only in the ordinary course and not under the special machinery provided under the Act.
The petition was accordingly dismissed.
Aggrieved by the judgment of the learned Single Judge the Corporation preferred an appeal before a Division Bench which has been dismissed by the judgment under appeal.
The Division Bench not only upheld the finding of the Single Judge on merits but also over ruled the decision reported in and held that the High Court had no jurisdiction to entertain a petition under Sections 31 and 32 of the Act.
Shri Ashok Desai, Senior Advocate appearing for the Appellant Corporation has assailed the findings of the High Court in the judgment under appeal both on merits and on the plea about jurisdiction.
Shri Soli J. Sorabjee, Senior Advocate appearing for the respondents has in reply asserted that the findings of the High Court on both the pleas were unassailable.
An application for intervention being I.A. No. 3 of 1990 has been made on behalf of Nav Bharat Udyog, a partnernship firm having its office at Mehta Building, 2nd Floor, 47, Nagindas Marg, Bombay, confined to the plea with regard to jurisdiction and it has been urged by learned counsel for the intervenor also, in line with the submission made by learned counsel for the respondents, that it is only the Bombay City Civil Court and not the High Court which has jurisdiction to entertain a petition under sections 31 and 32 of the Act.
For the sake of facility in considering the respective submissions made by learned counsel for the parties we find it useful to refer to the statutory provisions relevant in this behalf.
Section 2 of the Bombay City Civil Court Act, 1948 contains definitions and inter alia provides: "2.
In this Act unless there is anything repugnant in the subject or context, (1) "City Court" means the Court established under Section 3; (2) "High Court" means the High Court of Judicature at Bombay" 487 Section 3 in its turn provides: "3.
The State Government may by notification in the Official Gazette, establish for the Greater Bombay a court, to be called the Bombay city Civil Court.
Notwithstanding anything contained in any law, such court shall have jurisdiction to receive, try and dispose of all suits and other proceedings of a civil nature not exceeding fifty thousand rupees in value, and arising within the Greater Bombay, except suits or proceedings which are cognizable (a) by the High Court as a Court of Admiralty or Vice Admiralty or as a Colonial Court of Admiralty, or as a Court having testamentary, intestate or matrimonial jurisdiction, or (b) by the High Court for the relief of insolvent debtors, or (c) by the High Court under any special law other than the Letters Patent; or (d) by the Small Cause Court: Provided that the State Government may, from time to time, after consultation with the High Court, by a like notification extend the jurisdiction of the City Court to any suits or proceedings which are cognizable by the High Court as a court having testamentary or intestate jurisdiction or for the relief of insolvent debtor.
" The other Section which is relevant is Section 12 which reads: "12.
Notwithstanding anything contained in any law, the High Court shall not have jurisdiction to try suits and proceedings cognizable by the City Court; Provided that the High Court may, for any special reason, and at any stage remove for trial by itself any suit or proceeding from the City Court.
" As regards Sections 31 and 32 of the , since the submissions made by learned counsel for the 488 parties referred to most of the provisions contained therein these two Sections may be quoted in their entirety.
They read: "31.
(1) Where an industrial concern, in breach of any agreement makes any default in repayment of any loan or advance or any instalment thereof or in meeting its obligations in relation to any guarantee given by the Corporation or otherwise fails to comply with the terms of its agreement with the Financial Corporation or where the Financial Corporation requires an industrial concern to make immediate repayment of any loan or advance under section 30 and the industrial concern fails to make such repayment, then, without prejudice to the provisions of section 29 of this Act and of section 69 of the any officer of the Financial Corporation, generally or specifically authorised by the Board in this behalf, may apply to the district judge within the limits of whose jurisdiction the industrial concern carries on the whole or a substantial part of its business for one or more of the following reliefs, namely: (a) for an order for the sale of the property pledged, mortgaged, hypothecated or assigned to the Financial Corporation as security for the loan or advance; or (aa) for enforcing the liability of any surety; or (b) for transferring the management of the industrial concern to the Financial Corporation; or (c) for an ad interim injunction restraining the industrial concern from transferring or removing its machinery or plant or equipment from the premises of the industrial concern without the permission of the Board, where such removal is apprehended.
(2) An application under sub section (1) shall state the nature and extent of the liability of the industrial concern to the Financial Corporation, the ground on which it is made and such other particulars as may be prescribed.
(1) When the application is for the reliefs mentioned in clauses (a) and (c) of sub section (1) of section 31, the 489 district judge shall pass an ad interim order attaching the security, or so much of the property of the industrial concern as would on being sold realise in his estimate an amount equivalent in value to the outstanding liability of the industrial concern to the Financial Corporation, together with the costs of the proceedings taken under section 31, with or without an ad interim injunction restraining the industrial concern from transferring or removing its machinery, plant or equipment.
(IA) When the application is for the relief mentioned in clause (aa) of sub section (1) of section 31, the district judge shall issue a notice calling upon the surety to show cause on a date to be specified in the notice why his liability should not be enforced.
(2) When the application is for the relief mentioned in clause (b) of sub section (1) of section 31, the district judge shall grant an ad interim injunction restraining the industrial concern from transferring or removing its machinery, plant or equipment and issue a notice calling upon the industrial concern to show cause, on a date to be specified in the notice, why the management of the industrial concern should not be transferred to the Financial Corporation.
(3) Before passing any order under sub section I) or sub section (2) or issuing a notice under sub section (IA), the district judge may, if he thinks fit, examine the officer making the application.
(4) At the same time as he passes an order under sub section (1), the district judge shall issue to the industrial concern or to the owner of the security attached a notice accompanied by copies of the order, the application and the evidence, if any, recorded by him calling upon it or him to show cause on a date to be specified in the notice why the ad interim order of attachment should not be made absolute or the injunction confirmed.
(4A) If no cause is shown on or before the date specified in the notice under sub section (IA), the district judge shall forthwith order the enforcement of the liability of the surety.
490 (5) If no cause is shown on or before the date specified in the notice under sub sections (2) and (4), the district judge shall forthwith make the ad interim order absolute and direct the sale of the attached property or transfer the management of the industrial concern to the Financial Corporation or confirm the injunction.
(6) If cause is shown, the district judge shall proceed to investigate the claim of the Financial Corporation in accordance with the provisions contained in the Code of Civil Procedure, 1908, in so far as such provisions may be applied thereto.
(7) After making an investigation under sub section (6), the district judge may (a) confirm the order of attachment and direct the sale of the attached property; (b) vary the order of attachment so as to release a portion of the property from attachment and direct the sale of the remainder of the attached property; (c) release the property from attachment; (d) confirm or dissolve the injunction; (da) direct the enforcement of the liability of the surety or reject the claim made in this behalf, or (e) transfer the management of the industrial concern to the Financial Corporation or reject the claim made in this behalf; Provided that when making an order under clause (c) or making an order rejecting the claim to enforce the liability of the surety under clause (da) or making an order rejecting the claim to transfer the management of the industrial concern to the Financial Corporation under clause (e), the district judge may make such further orders as he thinks necessary to protect the interests of the Financial Corporation and may apportion the costs of the proceedings in such manner as he thinks fit: 491 Provided further that unless the Financial Corporation intimates to the district judge that it will not appeal against any order releasing any property from attachment or rejecting the claim to enforce the liability of the surety or rejecting the claim to transfer the industrial concern to the Financial Corporation, such order shall not be given effect to, until the expiry of the period fixed under sub section (9) within which an appeal may be preferred or, if an appeal is preferred, unless the High Court otherwise directs until the appeal is disposed of.
(8) An order of attachment or sale of property under this section shall be carried into effect as far as practicable in the manner provided in the Code of Civil Procedure, 1908 for the attachment or sale of property in execution of a decree as if the Financial Corporation were the decree holder.
(8A) An order under this section transferring the management of an industrial concern to the Financial Corporation shall be carried into effect, as far as may be practicable, in the manner provided in the Code of Civil Procedure, 1908, for the possession of immovable property or the delivery of immovable property in execution of a decree, as if the Financial Corporation were the decree holder.
(9) Any party aggrieved by an order under sub section (4A), sub section (5) or sub section (7) may, within thirty days from, the date of the order, appeal to the High Court, and upon such appeal the High Court may, after hearing the parties, pass such orders thereon as it thinks proper.
(10) Where proceedings for liquidation in respect of an industrial concern have commenced before an application is made under sub section (1) of section 31, nothing in this section shall be construed as giving to the Financial Corporation any preference over the other creditors of the industrial concern not conferred on it by any other law.
(11) The functions of a district judge under this section shall be exercisable 492 (a) in a presidency town, where there is a City Civil Court having jurisdiction, by a judge of that court and in the absence of such court, by the High Court; and b) elsewhere, also by an additional district judge or by any judge of the principal court of civil jurisdiction.
(12) For the removal of doubts it is hereby declared that any court competent to grant an ad interim injunction under this section shall also have the power to appoint a Receiver and to exercise all the court powers incidental thereto.
At this place it may be pointed out that with regard to the enforcement of the liability of a surety it was held by a Full Bench of the Allahabad High Court in Munnalal Gupta vs Uttar Pradesh Financial Corporation and Another, A.I.R. 1975 Allahabad 416 that from the scheme of the Act it is clear that the speedy remedy contained in Section 31 is available not against the surety but against the borrower only.
In arriving at this conclusion reference was made inter alia to the reliefs (a), (b) and (c) contained in sub section (1) of Section 31 and to sub section (4) of Section 32 of the Act as it then stood.
It was pointed out that this sub section (4) contemplated a notice to the borrower industrial concern after an interim order had been passed to show cause why the ad interim injunction should not be made absolute but did not contemplate a notice to the surety and that it would be unthinkable that the Legislature intended that the property of the surety may be attached and put to sale without even a notice to him.
It appears that in order to meet the difficulty in enforcing the liability of a surety as pointed out in the case of Munnalal Gupta (supra) Parliament found it necessary to make specific provisions in this behalf and passed the State Financial Corporations (Amendment) Act, 1985 (hereinafter referred to as Act 43 of 1985).
Among other amendments made by Act 43 of 1985 were the following: (i) In sub section (1) of Section 31 clause (aa) was inserted.
(ii) In Section 32 a new sub section (lA) and in sub section (3) thereof the words "or issuing a notice under sub section (lA)" were inserted.
493 (iii) Sub section (4) of Section 32 was substituted with an inclusion of sub section (4A).
(iv) The word "or" occurring at the end of clause (d) of sub section (7) was omitted and a new clause (da) was inserted.
(v) In the first proviso after sub section (7) the words "or making an order rejecting the claim to enforce the liability of the surety under clause (da) or making an order rejecting the claim to transfer the management of the industrial concern to the Financial Corporation under clause (e)" and in the second provis1on the words "or rejecting the claim to enforce the liability of the surety or rejecting the claim to transfer the industrial concern to the Financial Corporation" were inserted and in sub section (9) the words "under sub section (4A), sub section (5)" were substituted for "under sub section (5)" By the same Act 43 of 1985 a new Section 32G was inserted which reads: "32G.
Where any amount is due to the Financial Corporation in respect of any accommodation granted by it to any industrial concern, the Financial Corporation or any person authorised by it in writing in this behalf, may, without prejudice to any other mode of recovery, make an application to the State Government for the recovery of the amount due to it, and if the State Government or such authority, as that Government may specify in this behalf, is satisfied, after following such procedure as may be prescribed, that any amount is so due, it may issue a certificate for that amount to the Collector, and the Collector shall proceed to recover that amount in the same manner as an arrear of land revenue.
" Having extracted the relevant statutory provisions we now take up the question of jurisdiction.
Sub section (1) of Section 31 of the Act contemplates making of the petition thereunder "to the district judge within the limits of whose jurisdiction the industrial concern carries on the whole or a substantial part of its business".
A petition so made is to be decided in the manner provided by Section 32 of the Act, subsection (11) whereof inter alia provides that the functions of a district judge under the said Section shall be exercisable, in a Presidency town, where there is a City Civil Court having jurisdiction, by a judge 494 of the court and in the absence of such court, by the High Court.
It has been urged by learned counsel for the appellant that in a case to which the provisions contained in sub section (1) of Section 32 of the Act and of the Bombay City Civil Court apply, if the extent of the liability sought to be enforced against a surety is upto Rupees fifty thousand a petition under Section 31 read with Section 32 of the Act would lie before the Bombay City Civil Court and if the liability is more than the said amount it would lie before the High Court.
This, according to him is apparent from the use of the words "having jurisdiction" in sub section (11) of Section 32 of the Act and the extent of the pecuniary jurisdiction of the Bombay City Civil Court as contained in Section 3 of the Bombay City Civil Court Act.
According to him since in the instant case the liability sought to be enforced against the sureties was for a sum of more than Rupees fifty thousand the petition made by the appellant was maintainable in the High Court alone and not in the Bombay City Civil Court.
On the other hand, it has been urged on behalf of the respondents and the intervenor by their learned counsel that word "jurisdiction" used in sub section (1) of Section 31 and sub section (11) of Section 32 of the Act connotes territorial jurisdiction alone and that the concept of pecuniary jurisdiction is beyond the scope of Sections 31 and 32 in view of the decision of this Court in Gujarat State Financial Corporation vs Natson Manufacturing Co. Pvt. Ltd. and Ors., relied on in M/s. Everest Industrial Corporation and Ors.
vs Gujarat State Financial Corporation, [ ; and Maganlal vs M/s. Jaiswal Industries, Neemach and Ors., [ ; which lays down that an application under Section 31(1) of the Act is neither a plaint as contemplated by Article I of Schedule I nor an application in the nature of a plaint as contemplated by Article 7 of the Court Fees Act, 1870, that the special procedure contained in Section 3 1(1) was not even something akin to a suit of a mortgagee to recover mortgage money by sale of mortgaged property, that even if the Corporation applicant so chooses it cannot pray for a preliminary decree for accounts or final decree for payment of money nor can it seek any personal liability, that the Corporation cannot pray for a decree of its outstanding dues, that the reliefs contemplated by Section 31(1) on being granted do not result in a money decree or decree for recovery of outstanding loans or advance, that a substantive relief in an application under Section 31(1) is something akin to an application for attachment of property in execution of a decree at a stage posterior to the passing of the decree and that such relief cannot be valued in terms of the monetary gain or prevention of monetary loss.
495 Having given our anxious consideration to the question we are inclined to agree with the submission made by learned counsel for the appellant.
The three decisions of this Court referred to above and relied on by learned counsel for the respondents were not cases relating to the enforcement of a liability of a surety made possible by the amendments by Act 43 of 1985.
In our opinion, what has been laid down therein does not in any way militate against ascertaining in monetary terms value or the extent of the liability of a surety, which is sought to be enforced and there is intrinsic evidence in Sections 31 and 32 themselves to support this view.
Sub section (2) of Section 31 makes it obligatory to state the "extent of the liability (1) of Section 32 refers to "an amount equivalent in value to the outstanding liability".
Sub section (lA) of Section 32 contemplates notice to the surety to show cause "why his liability" should not be enforced.
Sub section (6) of Section 32 contemplates investigation and determination of "the claim" of the Financial Corporation which is to be recovered.
If the application under Section 3 1(1) is made before the district judge, there is no difficulty because he has unlimited pecuniary jurisdiction.
The difficulty arises, as in the instant case, when such application is to be made either before the city Civil Court or the High Court as contemplated by sub section (11) of Section 32.
In our opinion, the extent of the liability stated in the application as contemplated by sub section (2) of Section 31 of the Act would represent the value of the claim of the Corporation and if such value is upto Rupees fifty thousand the application would lie in the City Civil Court and if it is more than that amount it would lie in the High Court.
This interpretation would give meaning and relevance to the words "having jurisdiction" used in sub section (11) of Section 32.
A different interpretation would render superfluous or otiose not only the words "having jurisdiction" but also the words"and in the absence of such court, by the High Court" occurring in the said sub section (11) inasmuch as in a Presidency town, in terms of territorial jurisdiction, the jurisdiction of the City Civil Court and of the High Court is co terminus.
That it is so is clear from Section 3 of the Bombay city Civil Court Act and the definition of the term "Presidency town" contained in Section 3(44) of the according to which "Presidency town" shall mean the local limits for the time being of the ordinary original civil jurisdiction of the High Court of Judicature at Calcutta, Madras or Bombay, as the case may be.
It is a settled rule of interpretation of statutes that if the language and words used are plain and unambiguous, full effect must be given to them as they stand and in the garb of finding out the intention of the 496 Legislature no words should be added thereto or subtracted there from.
Likewise, it is again a settled rule of interpretation that statutory provisions should be construed in a manner which subserves the purpose of the enactment and does not defeat it and that no part thereof is rendered surplus or otiose.
The aforesaid interpretation of sub section (II) of Section 32 of the Act is not only in conformity with the rule of interpretation referred to above, it also does not militate in any way with the concept of an application under Section 31(1) of the Act, not being a plaint in a suit for recovery of money.
Reliance in this behalf has been placed by learned counsel for the intervenor on a decision of the Delhi High Court in Parkash Playing Cards Manufacturing Company vs Delhi Financial Corporation, In our opinion, however, the said decision is of little assistance in resolving the plea of jurisdiction raised in the instant case, namely, whether in a Presidency town an application under Section 31(1) of the Act is to be made before a City Civil Court or High Court.
In the case of Parkash Cards Manufacturing Company (supra), the provision which came up for consideration in the forefront was Section 5 of the and the question of jurisdiction was largely considered on that basis.
Sub section (11) of Section 32 with pointed reference to the jurisdiction exercisable by a City Civil Court in a Presidency town and the High Court did not fall for consideration in that case.
The case which throws some light on the point is a decision of the Calcutta Court Court in West Bengal Financial Corporation vs Gluco Series Private Limited, where it was held: "Section 32 sub section (1 1) does not say that the City Civil Court will have exclusive jurisdiction but states "in the Presidency Town where there is City Civil Court having jurisdiction, by a Judge of that Court and in the absence of such Court by the High Court.
" The words "in the absence of such Court" mean in the absence of such Court having jurisdiction in the matter.
The City Civil Court has no jurisdiction to entertain and try suits and proceedings of Civil nature exceeding Rs.50,000 in value.
Here the value of the claims in the proceedings exceeds much more than Rs.50,000 and, therefore, under Section 32, sub section (11) this proceeding has been duly instituted in the High Court.
497 In the instant case the extent of the liability of the surety being more than Rupees fifty thousand, the application could only have been filed and was rightly filed in the High Court and the finding in the judgment under appeal to the contrary for holding that the High Court had no jurisdiction to entertain the application cannot be sustained.
Now we come to the second plea raised on behalf of the respondents, namely, that the relief claimed in the petition could not be granted under Sections 31 and 32 of the Act inasmuch as these sections did not contemplate passing of a money decree not only against the principal debtor but also against the sureties.
In so far as the special machinery provided under Sections 31 and 32 of the Act being applied to a surety who has given some property in security, it has been pointed out by learned counsel for the appellant that even before the amendment introduced in these sections by Act 43 of 1985 a Division Bench of the Kerala High Court had, in Thressiamma Varghese vs K. section F. Corporation, AIR 1986 Kerala 222, taken the view that the provisions contained in these sections would be applicable.
According to teamed counsel, in any view of the matter, after the amendment of these sections by Act 43 of 1985 introducing specific provisions for enforcement of the liability of a surety, the matter is now beyond doubt that the procedure contained in these sections shall be applicable for the enforcement of the liability of such surety who has given some property in security.
According to him even in the judgment under appeal the High Court has accepted this proposition and has expressed its reservation with regard to enforcement of the liability of a surety who has not given any property in security and has given only a personal guarantee.
Reference in this connection has been made to the following observations in the judgment under appeal: "Even if the Corporation s now entitled to obtain relief also against any property which might have been given a security by the surety, the further question would remain whether the Corporation is entitled under Section 31(l)(aa) to obtain any relief personally against such a surety.
" Indeed, the submission even before us which was made by learned counsel for the appellant has been that the only effect of the 1985 amendment is that it enables proceedings to be taken for the realisation of the security given by the surety in respect of his own 498 liability whereas such proceedings could not be taken before the amendment.
He, however, asserted that the Act even after the amendment does not enable a monetary decree to be passed against the surety any more than a decree can be passed against the principal debtor.
According to him, in this view of the matter, in the instant case, the liability of the sureties could not be enforced under Sections 31 and 32 of the Act in as much as they had given only personal guarantee and had not given any property in security.
In the background of the rules of interpretation of statutes adverted to earlier and the specific provisions with regard to enforcement of the liability of a surety introduced in Sections 31 and 32 of the Act by Act 43 of 1985 we find it difficult to agree with the submission made by learned counsel for the respondents.
It is true, as has been indicated above, that this Court has in the case of Gujarat State Financial Corporation (supra) taken the view that Sections 31 and 32 of the Act do not contemplate the passing of a money decree and the principle laid down in that case has been relied on in two later decisions referred to above.
The said principle would, in our opinion, not come in the way of enforcing the liability under Sections 31 and 32 of the Act even against the surety who has given only a personal guarantee.
As indicated earlier those were not cases dealing with the question of enforcement of the liability of such a surety and naturally, therefore, the provisions in this behalf specifically introduced in Sections 31 and 32 of the Act by Act 43 of 1985 were not considered in those cases.
However, in this connection what is of significance is that clause (aa) inserted in sub section (1) of Section 31 of the Act by Act 43 of 1985 uses the words "any surety".
On its plain grammatical meaning there can be no doubt that the term "any surety" will include not only a surety who has given some security but also one who has given only a personal guarantee.
If the submission made by learned counsel for the respondents is accepted the words "who has given property by way of security" will have to be added after the words "any surety".
Such a course not only militates against the normal rule of interpretation but also tends to defeat the very purpose of the amendment introduced by Act 43 of 1985 enabling the Financial Corporation to make an application under Section 31(1) of the Act "for enforcing the liability of any surety", inasmuch as it would have the effect of restricting or qualifying the amplitude of the term "any surety" which the Legislature has in its wisdom thought it fit to use in its widest sense.
The procedure, in our opinion, for enforcing the liability of a surety who has given only a personal guarantee would, after the amendment introduced by Act 43 of 1985, be that an application under Section 31(1) shall lie for enforc 499 ing the liability of such surety as contemplated by clause (aa) of the said section.
On such an application being made notice shall be issued to the surety as contemplated by sub section (1A) of Section 32.
This may, in view of sub section (3), be done after examining the officer making the application.
If no cause is shown in pursuance of the notice served on him by the surety sub section (4A) of Section 32 contemplates passing of an order forthwith for the enforcement of the liability of surety.
If, on the other hand, cause is shown the claim of the Financial Corporation shall be determined as contemplated by sub section (6) of Section 32 and thereafter a direction as contemplated by clause (da) of sub section (7) shall be issued for the enforcement of the liability of the surety or rejecting the claim made in this behalf.
In the case of Maganlal (supra) which related to the relief contemplated by clause (a) of Section 31(1) of the Act it was pointed out that the purpose of enacting Sections 31 and 32 of the Act was apparently to provide for a speedy remedy for recovery of the dues of the Financial Corporation and that these sections had the effect of cutting across and dispensing with the provisions of the Code of Civil Procedure, 1908 (hereinafter referred to as the Code) from the stage of filing a suit to the stage of obtaining a decree in execution whereof such properties as are referred to in clause (a) of sub section (1) of Section 31 could be sold.
In our opinion, on the same principle, even in a case where the relief claimed in the application under Section 31(1) of the Act is for enforcing the liability of a surety who has given only a personal guarantee, sub section (4A) of Section 32 where no cause is shown and clause (da) of sub section (7) where cause is shown contemplate cutting across and dispensing with the provisions of the Code from the stage of filing a suit to the stage of obtaining a decree against the surety, the passing of an order which can straightaway be executed as if it were a decree against the surety which may be passed in the event of a suit being filed.
As seen above, sub section (2) of Section 31 enjoins upon the Financial Corporation to state the "extent of the liability of the industrial concern" in the application to be made under sub section (1) thereof.
Since the liability of the surety is co extensive the same shall, in the absence of anything contrary in the surety bond, be the liability of the surety also.
In a case where there is any provision confining the liability of the surety, the extent of the liability to be shown in the application shall be such as is in conformity with the surety bond.
When no cause is shown by the surety on being served with the show cause notice the order which will be passed under sub section (4A) of Section 32 would be for the enforcement against the surety of that liability which is stated in the application.
Where, however, cause has been shown by the surety the extent of his liability shall be determined 500 as contemplated in sub section (6) of Section 32 and it is the liability so determined which shall be enforced under clause (da) of sub section (7) of Section 32.
It does not require any elucidation that the extent of the liability referred to above will necessarily have to be in the very nature of things in terms of monetary value even though it may not be possible to call it a decree stricto sensu defined in Section 2(2) of the Code for recovery of money.
Here, Section 46B of the Act may be usefully extracted: "46B.
The provision of this Act and of any rule or orders made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in the memorandum or articles of association of industrial concern or in any other instrument having effect by virtue of any law other than this Act, but save as aforesaid, the provisions of this Act shall be in addition to, and not in derogation of, any other law for the time being applicable to an industrial concern.
On its plain language, in the absence of anything inconsistent in the Act, the provisions of the Code shall obviously be applicable for the enforcement of the liability of the surety directed to be enforced as aforesaid in the same manner as a decree is enforced in a suit instituted in this behalf.
It is true, as has been emphasised by learned counsel for the respondents, that there is no provision corresponding to sub section (8) of Section 32 for the enforcement of the liability of a surety who has given only personal guarantee but, in our opinion, keeping in view the amendments introduced by Act 43 of 1985, it is not very significant.
To us it appears that in view of Section 46B of the Act and for the reasons to be stated shortly even if Section 46B was not there, in the absence of any provision to the contrary in the Act, that order also, which was passed in a case where relief contemplated by clause (a) of Section 31(1) of the Act was claimed, could have been enforced in the manner provided in the Code.
The purpose of yet inserting sub section (8) in Section 32 seems to be that it was not intended to apply the provisions of execution of a decree for attachment or sale of property as contained in the Code in its entirety and to achieve this purpose the words "as far as practicable" were used in that sub section.
To us it appears that in the absence of any provision such as sub section (8) of Section 32 applying the manner provided in the Code for the execution of a decree against a surety only "as far as practicable" the entire provision contained in this behalf in the Code 501 shall be applicable.
this would be so in view of the use of the expression "any other law for the time being applicable to an industrial concern".
That the Code is applicable to an industrial concern also is not in dispute and cannot be doubted.
We may now state our reasons for holding that even if Section 46B of the Act was not there the provisions of the Code for the execution of a decree against a surety who had given only personal guarantee would, in the absence of any provision to the contrary in the Act, be applicable.
In view of the decision of this Court in The Central Taikies Ltd. Kanpur vs Dwarka Prasad, ; , where it was held that a persona designata is a person selected as an individual in his private capacity, and not in his capacity as filling a particular character or office, since the term used in Section 31(1) of the Act is "district judge" it cannot be doubted that the district judge is not a persona designata but a court of ordinary civil jurisdiction while exercising jurisdiction under Sections 31 and 32 of the Act.
In National Sewing Thread Co. Ltd. vs James Chadwick & Bros. Ltd., ; while repelling the objection that an appeal under the Letters Patent against the judgment of a Single Judge passed in an appeal against the decision of the Registrar under Section 76(1) of the was not maintainable it was held at pages 1033 34 of the Report: "Obviously after the appeal had reached the High Court it has to be determined according to the rules of practice and procedure of that Court and in accordance with the provisions of the charter under which that court is constituted and which confers on it power in respect to the method and manner of exercising that jurisdiction.
The rule is well settled that when a statute directs that an appeal shall lie to a Court already established, then that appeal must be regulated by the practice and procedure of that Court.
This rule was very succinctly stated by Viscount Haldane L.C. in National Telephone Co. Ltd. vs Postmaster General, in these terms: "When a question is stated to referred to an established Court without more, it, in my opinion, imports that the ordinary incidents of the procedure of that Court are to attach, and also that any general right of appeal from its decision likewise attaches.
" 502 The same view was expressed by their Lordships of the Privy Council in R.M.A.R.A. Adaikappa Chettiar vs Ra.
Chandrasekhara Thevar, wherein it was said: "Where a legal right is in dispute and the ordinary Courts of the country are seized of such dispute the Courts are governed by the ordinary rules of procedure applicable thereto and an appeal lies if authorised by such rules, notwithstanding that the legal right claimed arises under a special statute which does not, in terms confer a right of appeal." Again in Secretary of State for India vs Chellikani Rama Rao, when dealing with the case under the Madras Forest Act their Lordships observed as follows: "It was contended on behalf of the appellant that all further proceedings in Courts in India or by way of appeal were incompetent, these being excluded by the terms of the statute just quoted.
In their Lordships ' opinion this objection is not well founded.
Their view is that when proceedings of this character reach the District Court, that Court is appealed to as one of the ordinary Courts of the country, with regard to whose procedure, orders, and decrees the ordinary rules of the Civil Procedure Code apply." Though the facts of the cases laying down the above rule were not exactly similar to the facts of the present case, the principle enunciated therein is one of general application and has an apposite application to the facts and circumstances of the present case.
Section 76 of the confers a right of appeal to the High Court and says nothing more about it.
That being so, the High Court being seized as such of the appellate jurisdiction conferred by section 76 it has to exercise that jurisdiction in the same manner as it exercises its other appellate jurisdiction and when such jurisdiction is exercised by a single Judge, his judgment becomes subject to appeal under clause 15 of the Letters Patent there being nothing to the contrary in the .
And it is in view of this decision that we are of the opinion that the provisions of the Code would have, even in the absence of Section 503 46B of the Act, been attracted in the matter of enforcing the liability of a surety.
In view of the foregoing discussion, the finding of the High Court even on this point cannot be sustained.
Since, however, the High Court has not made a determination of the liability of the sureties as contemplated by sub section (6) of Section 32 of the Act, the matter has to be sent back to it for doing so and thereafter to pass an order as contemplated by clause (da) of sub section (7) of Section 32 of the Act and to proceed to enforce the liability so determined an against the sureties.
In the result, this appeal succeeds and is allowed with costs and the judgment of the Division Bench and also of the Single Judge of the High Court are set aside.
The High Court shall now decide the application made by the appellant in accordance with law and in the light of the observations made above.
S.C. AGRAWAL, J. Special leave granted.
In this appeal two questions arise for consideration: 1) whether a petition under sections 31 and 32 of the (hereinafter referred to as 'the Act ') can be filed only in the Bombay Civil City Court and the Bombay High Court, on its original side, has no jurisdiction to entertain it? and 2) whether in such a petition, a decree/order can be passed directing payment of money by respondents nos.
2 to 4 who stood surety for repayment of the loan advanced by the appellant, Financial Corporation to respondent No. 1? The Division Bench of the Bombay High Court has answered both these questions against the appellant.
My learned brother Ojha, J. has disagreed with this view of the Bombay High Court on both the questions.
He has held that as the extent of the liability of the surety is more than Rupees fifty thousand the application could only have been filed and was rightly filed in the High Court which had the jurisdiction to entertain it.
He has also held that in view of the amendments introduced in the Act by the Amending Act 43 of 1985, an order for payment of money can be passed against the surety who has given only a personal guarantee.
While I am fully in agreement with the decision of my learned brother on the first question with regard to the jurisdiction of the Bombay High Court to entertain the petition filed by the appellant, I have not been able to persuade myself to agree with the view taken by him on the second question.
Section 31 of the Act has been described in the marginal note as special provisions for enforcement of claims by the Financial Corpora 504 tion.
It deals with a situation where an industrial concern, in breach of any agreement, makes any default in repayment of any loan or advance or any instalment thereof or in meeting its obligations in relation to any guarantee given by the Corporation or otherwise fails to comply with the terms of its agreement with the Financial Corporation or where the Financial Corporation requires an industrial concern to make immediate repayment of any loan or advance under section 30 of the Act and the industrial concern fails to make such repayment.
It enables an officer of the Financial Corporation, generally or specially authorised by the Board in this behalf, to apply to the District Judge within the limits of whose jurisdiction the Industrial concern carries on the whole or a substantial part of its business for one or more of the following reliefs: (a) for an order for the sale of the property pledged, mortgaged, hypothecated or assigned to the Financial Corporation as security for the loan or advance; or (aa) for enforcing the liability of any surety; or (b) for transferring the management of the industrial concern to the Financial Corporation; or (c) for an ad interim injunction restraining the industrial concern from transferring or removing its machinery or plant or equipment from the premises of the industrial concern without the permission of the Board, where such removal is apprehended.
Clause (aa) was inserted in sub section (1) of section 31 by section 19 of Act 43 of 1985.
Section 32 of the Act prescribes the procedure to be followed by the District Judge in respect of applications under section 31 of the Act.
Prior to the amendments introduced in it by Act 43 of 1985, the said section read as under: "32.
Procedure of district judge in respect of applications under Section 31.
(1) When the application is for the reliefs mentioned in clauses (a) and (c) of sub section (1) of section 31, the district judge shall pass an ad interim order attaching the security, or so much of the property of the industrial concern as would on being sold realise in his estimate an amount equivalent in value to the outstanding 505 liability of the industrial concern to the Financial Corporation, together with the costs of the poceedings taken under section 31, with or without an ad interim injunction restraining the industrial concern from transferring or removing its machinery, plant or equipment.
(2) When the application is for the relief mentioned in clause (b) of sub section (1) of section 31, the district judge shall grant an ad interim injunction restraining the industrial concern from transferring or removing its machinery, plant or equipment and issue a notice calling upon the industrial concern to show cause, on a date to be specified in the notice, why the management of the industrial concern should not be transferred to the Financial Corporation.
(3) Before passing any order under sub section (1) or sub section (2) the district judge may, if he thinks fit, examine the officer making the application.
(4) At the same time as he passes an order under sub section (1), the district judge shall issue to the industrial concern a notice accompanied by copies of the order, the application and the evidence, if any, recorded by him calling upon it to show cause on a date to be specified in the notice why the ad interim order of attachment should not be made absolute or the injunction confirmed.
(5) If no cause is shown on or before the date specified in the notice under sub sections (2) and (4), the district judge shall forthwith make the ad interim order absolute and direct the sale of the attached property or transfer the management of the industrial concern to the Financial Corporation or confirm the injunction.
(6) If cause is shown, the district judge shall proceed to investigate the claim of the Financial Corporation in accordance with the provisions contained in the Code of Civil procedure, 1908, in so far as such provisions may be applied thereto.
(7) After making an investigation under sub section (6), the district judge may 506 (a) confirm the order of attachment and direct the sale of the attached property: (b) Vary the order of attachment so as to release a portion of the property from attachment and direct the sale of the remainder of the attached property; (c) release the property from attachment; (d) confirm or dissolve the injunction; or (e) transfer the management of the industrial concern to the Financial Corporation or reject the claim made in this behalf: Provided that when making an order under clause (c) the district judge may make such further orders as he thinks necessary to protect the interests of the Financial Corporation and may apportion the costs of the proceedings in such manner as he thinks fit: Provided further that unless the Financial Corporation intimates to the district judge that it will not appeal against any order releasing any property from attachment, such order shall not be given effect to, untill the expiry of the period fixed under sub section (9) within which an appeal may be preferred or, if an appeal is preferred, unless the High Court otherwise directs until the appeal is disposed of.
(8) An order of attachment or sale of property under this section shall be carried into effect as far as practicable in the manner provided in the Code of Civil Procedure, 1908 for the attachment or sale of property in execution of a decree, as if the Financial Corporation were the decree holder.
(8A) An order under this section transferring the management of an industrial concern to the Financial Corporation shall be carried into effect, as far as may be practicable, in the manner provided in the Code of Civil Procedure, 1908, for the possession of immovable property of the delivery of movable property in execution of a decree, as if the Financial Corporation were the decree holder.
507 (9) Any party aggrieved by an order under sub section (5) or sub section (7) may, within thirty days from the date of the order, appeal to the High Court, and upon such appeal the High Court may, after hearing the parties, pass such orders thereon as it thinks proper.
(10) Where proceedings for liquidation in respect of an industrial concern have commenced before an application is made under sub section (1) of section 31, nothing in this section shall be construed as giving to the Financial Corporation any preference over the other creditors of the industrial concern not conferred on it by any other law.
(11) The functions of a district judge under this section shall be exercisable (a) in a presidency town, where there is a city civil court having jurisdiction, by a judge of that court and in the absence of such court, by the High Court; and (b) elsewhere, also by an additional district judge or by any judge of the principal court of civil jurisdiction.
(12) For the removal of doubts it is hereby declared that any court competent to grant an ad interim injunction under this section shall also have the power to appoint a Receiver and to exercise all the other powers incidental thereto.
" By Act 43 of 1985, the following amendments have been introduced in section 32 of the Act: (1) Sub section (1A) which reads as under was inserted: "(1A) When the application is for the relief mentioned in clause (aa) of sub section (1) of section 31, the district judge shall issue a notice calling upon the surety to show cause on a date to be specified in the notice why his liability should not be enforced." (2) In sub section (3), the words, or issuing a notice under sub section (1A) "were inserted after the words" "or sub section (2)".
508 (3) Subsection (4) was substituted by sub sections (4) and (4A), which read as under: "(4) At the same time as he passes an order under subsection (1), the district judge shall issue to the industrial concern or to the owner of the security attached a notice accompanied by copies of the order, the application and the evidence, if any, recorded by him calling upon it or him to show cause on a date to be specified in the notice why the ad interim order of attachment should not be made absolute or the injunction confirmed.
(4A) If no cause is shown on or before the date specified in the notice under sub section (1A), the district judge shall forthwith order the enforcement of the liability of the surety.
(4) In sub section (7), clause (da) was inserted which provides as under: "(da) direct the enforcement of the liability of the surety or reject the claim made in this behalf; or" (5) In the first proviso to sub section (7), the words "or making an order rejecting the claim to enforce the liability of the surety under clause (da) or making an order rejecting the claim to transfer the management of the industrial concern to the Financial Corporation under clause (e)" were inserted after the words "order under clause (c)".
(6) In the second proviso to sub section (7), the following words were inserted after words "any property from attachment": or rejecting the claim to enforce the liability of the surety or rejecting the claim to transfer the industrial concern to the Financial Corporation." (7) In sub section (9), for the words "sub section (5)", the words "under sub section (4A), sub section (5)" were substituted.
In order to find an answer to the second question, it is necessary to construe the words "for enforcing the liability of any surety" which were introduced by way of clause (aa) in sub section (1) of section 31 509 by the Act 43 of 1985, and also find mention in sub sections (IA), (4A) and (7) of section 32.
The learned counsel for the appellant has urged that the said words are wide in their amplitude and would cover a case where the surety has given a personal guarantee only and his liability is purely monetary.
The learned counsel for the sureties, viz., respondents Nos. 2, 3 and 4, has, on the other hand, submitted that the said words must be construed in a more limited sense to cover only those cases where surety has given security of property to guarantee the repayment of loan and in such an event the remedy provided by sections 31 and 32 of the Act can be invoked against the surety and that the said provisions do not enable passing of an order for payment of a monetary sum against the surety who has given personal guarantee only.
In order to deal with these rival contentions, it would be of relevance to take note of the state of law existing on the date of the enactment of Act 43 of 1985 whereby amendments were introduced in sections 31 and 32 of the Act.
The provisions contained in sections 31 and 32 of the Act came up for consideration before this Court in Gujarat State Financial Corporation vs M/s Natson Manufacturing Co. (P) Ltd. & Ors., ; That case related to payment of court fee on an application submitted under section 31(1) of the Act and the question for consideration was whether such an application should be treated on par with a suit by a mortgagee to enforce the mortgage debt by sale of the mortgaged property which is being treated as a money suit failing within the purview of Article 1 of Schedule I to the Bombay Court Fees Act, 1959 or it should bear a fixed court fee under the residuary Article 1(c) to Schedule II of the said Act.
This Court disagreeing withthe view of the Gujarat High Court, held that an application under section 31(1) of the Act would be covered by the residuary Article 1(c) of Schedule II to the said Act and it should bear a fixed court fee.
In this context, this Court has examined the nature of the proceedings contemplated by section 31(1) of the Act.
After referring to the provisions of the Act, this Court has held that "it would be inappropriate to say that an application under section 31(1) is something akin to a suit by a mortgagee to recover mortgage money by sale of mortgaged property" and that "in an application under section 31(1), the Corporation does not and cannot pray for a decree for its outstanding dues" and that none of the three reliefs mentioned in sub section (1) of section 31, if granted, "results in a money decree or decree for recovery of outstanding loans or advance" (pages 378 379).
After referring to the provisions contained in sub section (6) of section 32, which provides for investigation of the claim of the Financial Corporation in 510 accordance with the provisions contained in the code of Civil Procedure, 1908, this Court has laid down: "The claim of the Corporation is not the monetary claim to be investigated though it may become necessary to specify the figure for the purpose of determining how much of the security should be sold.
But the investigation of the claim does not involve all the contentions that can be raised in a suit.
The claim of the Corporation is that there is a breach of agreement or default in making repayment of loan or advance or instalment thereof and, therefore, the mortgaged property should be sold.
It is not a money claim.
The contest can be that the jurisdictional fact which enables the Corporation to seek the relief of sale of property is not available to it or no case is made out for transfer of management of the industrial concern.
" (p.381) This Court has further emphasised that sub section (7) of section 32 "prescribes what reliefs can be given after investigation under subsection (6) is made, and it clearly gives a clue to the nature of contest under sub section (6)" and further that sub section (8) of section 32 . 'only prescribes the mode and method of executing the order of attachment or sale of property as provided in the Code of Civil Procedure".
According to this Court, "the provision contained in sub section (6) does not expand the contest in the application under section 31(1) as to render the application to be a suit between a mortgagee and the mortgagor for sale of mortgaged property" (p.381).
This Court has held that "the substantive relief in an application under section 31(1) is something akin to an application for attachment of property in execution of a decree at a stage posterior to the passing of the decree" (p.382).
In Everest Industrial Corporation & Ors.
vs Gujarat State Financial Corporation, this Court was examining the question whether the rate of interest on the amount payable under an order passed under section 32 of the Act from the date said order is governed by section 34 of the Code of Civil Procedure, 1908 or whether it is payable at the contractual rate.
This Court held that section 34 CPC was not applicable to these proceedings.
After referring to the earlier decision in Gujarat State Financial Corporation vs M/s Natson Manufacturing Co. (P) Ltd. & Ors. case (supra), this Court has reiterated that the proceedings instituted under section 31(1) of the Act is something akin to an application for attachment of property in execution of a decree at a stage posterior 511 to the passing of the decree and, therefore, no question of passing any order under section 34 CPC would arise since section 34 CPC would be applicable only at the stage of the passing of the decree and not to a stage posterior to the passing of the decree.
In Maganlal etc.
vs Jaiswal Industries Neemach & Ors., , after referring to the decisions mentioned above, this Court has observed: "In view of these two decisions, the law seems to be settled that an application under section 31(1) of the Act cannot be put on par to a suit for enforcement of a mortgage nor the order passed thereon under section 32 of the Act be put on par as if it was an order in a suit between a mortgagee and the mortgagor for sale of mortgaged property.
On the other hand the substantive relief in an application section 31(1) is something akin to an application for attachment of property in execution of a decree at a stage posterior to the passing of the decree." (p.710) The question whether the provisions of sections 31 and 32 of the Act could be invoked against the property of the surety came up for consideration before a full bench of the Allahabad High Court in Munnalal Gupta vs Uttar Pradesh Financial Corporation & Anr., AIR 1975 ALL 416.
In that case, the surety had mortgaged his house by way of collateral security for the loan granted to the borrower industrial concern and the Financial Corporation had moved an application under section 31 of the Act for sale of the property of the surety which had been mortgaged as well as the property of the principal debtor which had been mortgaged and the question was whether an order for sale of the property of the surety could be passed on an application under section 31( 1) of the Act.
It was held that the relief which can be granted by a District Judge under section 32 of the Act must be confined against the borrower industrial concern and its property and that the District Judge can pass an ad interim order attaching the security or so much of the property of the industrial concern as would be sufficient in his opinion to satisfy the outstanding liability.
It was laid down that the order of attachment is restricted to the property of industrial concern given to the Corporation by way of surety and he is not empowered to attach the property of a person other than an industrial concern.
According to the said decision, a surety, who is not a partner or otherwise interested in the industrial concern, cannot be proceeded against under section 31 so that his property, even if mortgaged with the Corporation, cannot be attached 512 by the District Judge.
In this context, the teamed Judges pointed out the sub section (4) of section 32 contemplates a notice to the borrower industrial concern after an interim order has been passed to show cause why the ad interim injunction should not be made absolute and the said provision does not contemplate a notice to the surety and that it would be unthinkable that the legislature intended that the property of the surety may be attached and put to sale without even a notice to him.
The amendments introduced in sections 31 and 32 by Act 43 of 1985 seek to remove the lacunae in those provisions as pointed out in the aforesaid judgment of the Allahabad High Court and with that end in view clause (aa) has been inserted in sub section (1) of section 31 whereby a Financial Corporation can move an application under section 31(1) for enforcing the liability of any surety and amendments have been made in section 32 to prescribe the procedure for grant of the said relief on such application.
Express provision has been made in sub section (1A) of section 32 for issuing a notice to the surety requiring him to show cause why his liability should not be enforced.
It is argued on behalf of the appellant that the words "for enforcing the liability of any surety" are wide in their amplitude to cover the monetary liability of a surety who has given personal guarantee only and has not given his property as security for repayment of the loan by the borrower industrial concern, though it is not disputed that in so far as the borrower industrial concern is concerned, the amendments introduced in sections 31 and 32 by Act 43 of 1985 do not alter the existing law and no order in the nature of a money decree can be passed against him in these proceedings.
It is, however, urged that in so far as the surety is concerned the position is different and in view of the amendments introduced in sections 31 and 32, an order in the nature of a money decree can be passed against the surety who has given personal guarantee only and has not given security of his property for repayment of the loan.
This argument implies that as a result of the amendments introduced in sections 31 and 32 by Act 43 of 1985 while the nature of the proceedings as against the borrower industrial concern remains unchanged and the said proceedings continue to be proceedings akin to an application for attachment of property in execution of a decree at a stage posterior to the passing of the decree, the nature of these poceedings has been changed in so far as the surety is concerned and they have become proceedings in which an order in the nature of a money decree can be passed.
In other words, in a case where the borrower industrial concern has obtained a loan from the Financial Corporation without furnishing the security of property on the basis of 513 a personal guarantee given by the surety, the Financial Corporation will have to proceed against the borrower industrial concern by instituting a regular suit for recovery of the dues whereas it can proceed against the surety under sections 31 and 32 of the Act.
It means that as compared to the principal debtor the Financial Corporation vis a vis the surety has been placed on a more advantageous Position.
It may, however, be mentioned that under the common law, which finds re enactment in section 128 of the , the liability of the surety is coextensive with that of the principal debtor unless it is otherwise provided by the contract.
It means that the liability must be proved against the surety in the same way as against the principal debtor.
Thus under the general law the surety stands on the same footing as the principal debtor.
These submissions raise the question: can the legislature be attributed the intention to alter the existing law so as to bring about a change in the nature of proceedings under sections 31 and 32 of the Act and also to alter the general law relating to the enforcement of the liability of the surety? I find it difficult to answer this question in the affirmative.
In the matter of interpretation of statutes, a principle which is well recognised in England is: "it is thought to be in the highest degree improbable that Parliament would depart from the general system of law without expressing its intention with irresistible clearness, and to give any such effect to general words merely because this would be their widest, usual, natural or literal meaning would be to place on them a construction other than that which Parliament must be supposed to have intended." (See: Mexwell on The Interpretation of Statutes, 12th Edition, p. 116).
In Minet vs Leman, [1955] (20) Eeav.
Sir John Romilly, M.R. stated as a principle of construction, which could not be disputed, that "the general words of the Act are not to be so construed as to alter the previous policy of the law, unless no sense or meaning can be applied to those words consistently with the intention of preserving the existing policy untouched".
In this context, it would be of relevance to take note of the decision of this court in M.K.Ranganathan & Anr.
vs Government of Madras & Ors.
, ; In that case this Court was required to construe the words "or any sale held without leave of the Court of any of the properties of the Company" which were added in section 232 (1) of the Indian Companies Act, 1913 by Act 22 of 1936.
the said amendment was introduced with a view to get over the decision of the Allahabad High Court in Kayastha Training and Banking Corporation Ltd vs Sat Narain Singh, All. 433.
The question was whether the words which had been added refer only to sales held through the intervention of the 514 court or whether they included the sales effected by the secured creditors outside the winding up and without the intervention of the court.
This Court held that the said words referred only to sales held through the intervention of the Court and that the amendments whereby these words were introduced were not intended to bring within the sweep of the general words "sales effected by the secured creditors outside the winding up".
In order to arrive at this conclusion, this Court placed reliance on the principle of interpretation referred to above and it was observed: "If the construction sought to be put upon the words "or any sale held without leave of the Court of any of the properties" by the Appellants were accepted it would effect a fundamental alteration in the law as it stood before the amendment was inserted in section 232 by Act XXII of 1936.
Whereas before the amendment the secured creditor stood outside the winding up and could if the mortgage deed so provided, realise his security without the intervention of the Court by effecting a sale either by private treaty or by public auction, no such sale could be effected by him after the amendment and that was certainly a fundamental alteration in the law which could not be effected unless one found words used which pointed unmistakably to that conclusion or unless such intention was expressed with irresistible clearness.
Having regard to the circumstances under which the amendment was inserted in section 232 by Act XXII of 1936 and also having regard to the context we are not prepared to hold that the Legislature in inserting that amendment intended to effect a fundamental alteration in law with irresistible clearness.
Such a great and sudden change of policy could not be attributed to the Legislature and it would be legitimate therefore to adopt the narrower interpretation of those words of the amendment rather than an interpretation which would have the contrary effect." (p. 388) In my opinion, regard must be had of this principle of interpretation while construing the expression "for enforcing the liability of any surety" which has been inserted by way of clause (aa) in sub section (1) of section 31 by Act 43 of 1985.
Considering the amendments introduced in sections 31 and 32 of the Act by Act 43 of 1985 and having regard to the principle of interpretation referred to above I do not find any provision in the said amendments which may indicate that 515 Parliament has evinced an intention to effect a fundamental alteration in the law with irresistible clearness.
In this context, it would be of relevance to note that while introducing the said amendments Parliament has chosen not to make any alteration in relation to the following matters: (1) In the marginal note, section 31 is described as `special provisions for enforcement of claims by Financial Corporation '.
No alteration has been made therein by Act 43 of 1985 and section 31 continues to be a special provision for enforcement of claims by Financial Corporation.
(2) Parliament has not expressly indicated that an order for payment of money only may be passed against the surety.
(3) Although in sub sections (8) and (8A) of section 32, express provision has been made prescribing the procedure for carrying into effect an order of attachment and sale of property and an order transferring the management of an industrial concern to the Financial Corporation passed under sub section (7) of section 32, no specific provision was made prescribing the procedure for carrying into effect of an order passed under clause (da) of sub section (7) of section 32 directing the enforcement of the liability of the surety.
It cannot be comprehended that while making a provision which would enable passing of an order in the nature of a money decree against a surety on an application under section 31 of the Act, Parliament would have refrained from making a corresponding provision prescribing the procedure for carrying into effect of such an order.
Having regard to the features referred to above, it appears to be more in consonance with the scheme of the Act and the object underlying sections 31 and 32 that by introducing the amendments in sections 31 and 32 of the Act, Parliament intended to place the surety on the same footing as the principal debtor in the matter of enforcement of the claims of the Financial Corporation so as to enable the Financial Corporation to obtain relief against the properties of the principal debtor as well as the surety.
If considered in this perspective, the expression "enforcing the liability of any surety" in clause (aa) of section 31(1) would mean enforcing the liability of a surety in the same manner as the liability of principal debtor is enforced, i.e., by attachment and sale of property keeping in view that the proceedings under sections 31 and 32 of the Act are akin to an application for attachment of property in execution of a decree at a stage posterior to the passing 516 of the decree.
This construction would obviate the need for a procedure for carrying into effect of the order passed under clause (da) of sub section (7) of section 32 of the Act because such an order would be an order for attachment and sale of the property of the surety and it can be carried into effect in accordance with sub section (8) of section 32 which prescribes the procedure for carrying into effect an order for attachment and sale of property.
This construction will also preserve the special nature of the proceedings under section 31 and would not result in bringing about a fundamental alteration in the law laid down by this Court with regard to the nature of these proceedings as well as the general law whereunder a surety is to be treated on par with the principal debtor.
For the reasons aforesaid, I am in agreement with the view of the Division Bench of the High Court on this question and I am unable to concur with the decision of my learned brother Ojha, J. I would, therefore, uphold the decision of the Division Bench of the High Court that the petition whereby the appellant had sought the relief of a money decree for payment of Rs. 15,87,391.20 paise against respondents 2 to 4 was not maintainable and the said relief could not be granted to the appellant in proceedings under section 31 of the Act.
As a result, the petition filed by the appellant must be dismissed and for the same reason this appeal also must fail.
R. N. J. Appeal allowed.
| IN-Abs | Respondent No. 1 a Private Limited Company, was sanctioned a loan of Rs.30 lakh by the Appellant Corporation for the setting up of a factory.
To secure this loan a mortgage deed of certain properties was executed by the Company and Respondents 2 to 4 as its directors had executed a personal Surety Bond without any security for its repayment.
After obtaining a part of the sanctioned loan, which was to be given in phases, the Company became disinterested in availing of the balance amount.
Consequently the Corporation demanded back the amount ahead taken together with interest and on the company 's failure to do so, it took over the Industrial Concern under section 29 of the Act and initiated steps to realise its dues by putting the property to sale.
Having failed to recover the amount as no adequate offer was forthcoming despite repeated advertisements, it filed a petition before the Bombay High Court under sections 31 and 32 of the Act both against the Company as well as its directors sureties praying for a decree in the sum of Rs. 15,87,391.20 to be passed against them jointly and severally.
The respondents contested the petition contending (a) that a petition under sections 31 and 32 of the Act could be filed only before the City Civil Court and the High Court had no jurisdiction to entertain it, (b) that no money decree can be passed under sections 31 and 32 of the Act, and (c) that the provision in the Act relating to enforcement of the 481 liablity of surety were ultra vires of Article 149 of the Constitution.
The learned single judge relying on an earlier decision of the Bombay High Court reported in 1987 Mah.
L.J 243 held that the High Court had to entertain the petition but on merits took the view that no money decree could be passed under sections 31 and 32 even against the sureties and since in the instant case the sureties had not given any security except their personal guarantee, the same could be enforced only in the ordinary course and not under the special machinery provided under the Act.
In view of his findings on the first two pleas no arguments were entertained on the last plea and accordingly the petition was dismissed.
The Division Bench while dismissing the appeal not only upheld the finding of the single Judge on merits but also overruled the decision reported in and held that the High Court had no jurisdiction to entertain a petition under sections 31 and 32 of the Act.
The Corporation came up in appeal before this court by special leave against this decision of the High Court of Bombay.
The impugned judgement was assailed by the Appellant Corporation both on merites and on the plea of juridiction.
The respondents in reply asserted that the findings of the High Court on both pleas were unassailable.
Allowing the appeal, by a majority decision, HELD: A.
By the Full Court (i)The extent of the liability stated in the application as contemplated by sub section (2) of section 31 of the Act would represent the value of the claim of the Corporation and if since value is upto Rupees Fifty Thousand, the application would lie in the City City Court and if it is more than that amount it would lie in the High Court.
This interpretation would give meaning and relevance to the words "having jurisdiction" used in sub section (11) of section 32.
A different interpretation would render superfluous or otiose not only the words "having jurisdiction" but also the words and in the absence such court, by the High Court, occurring in the said sub section (11) inasmuch as in a Presidency town, in terms of territorial jurisdiction, the jurisdiction of the City Civil Court and of the High Court is co terminus [495D F] (ii) In the instant case the extent of liability of the surety being more than Rupees fifty thousand, the application could only have been filed and was rightly filed in the High Court and the finding in the 482 judgment under appeal to the contrary for holding that the High Court had no jurisdiction to entertain the application cannot be sustained.
[497A] B. Per N.
D. Ojha, J. for himself and Ranganathan, J. (iii) There can be no doubt that the term, "any surety" used in clause (aa) in sub section (1) of section 31 of the Act, will include not only a surety who has given some security but also one who has given only a personal guarantee.
In our opinion, in a case where the relief claimed in the application under section 31(1) of the Act is for enforcing the liability of a surety who has given only a personal guarantee, sub section 4(A) of section 32 where no cause is shown and clause (da) of sub section (7) where cause is shown, contemplate cutting across and dispensing with the provisions of the Code of Civil Procedure from the stage of filing a suit to the stage of obtaining a decree against the surety, the passing of an order which can straightaway be executed as if it were a decree against the surety which may be passed in the event of suit being filed.
[498F, 499E] (iv) In the absence of any provision such as sub section (8) of section 32 of the Act applying the manner provided in the Code for the execution of a decree against a surety only "as far as practicable" the entire provision contained in this behalf in the Code shall be applicable.
This would be so in view of the use of the expression "any other law for the time being applicable to an industrial concern" used in section 46B of the Act.
That the Code is applicable to an industrial concern also is not in dispute and cannot be doubted.
[50OH 501A] (v) Even in the absence of section 46B of the Act the provisions of the Code would have been attracted in the matter of enforcing the liability of a surety in view of the decision of this Court in National Sewing Thread Co. Ltd. vs James Chadwick & Bros. Ltd., ; inasmuch as the District Judge while exercising jurisdiction under sections 31 and 32 of the Act is not a persona designate but a court of ordinary civil jurisdiction.
[501B D] (Per section C. Agrawal, J. Dissenting.) It cannot be comprehended that while making provision which would enable passing of an order in the nature of a money decree against a surety on an application under section 31 of the Act, Parliament would have refrained from making a corresponding provision prescribing the procedure for carrying into effect such an order.
It 483 appears to be more in consonance with the scheme of the Act and the object underlying sections 31 and 32 that by introducing the amendments in sections 31 and 32 of the Act the Parliament intended to place the surety on the same footing as the principal debtor so as to enable the Financial Corporation to obtain relief against the properties of the principal debtor as well as the surety [515E G] If considered in this perspective, the expression "enforcing the liability of any surety" in clause (aa) of section 31(1) would mean enforcing the liability of a surety in the same manner as the liability of principal debtor is enforced, by attachment and sale of property keeping in view that the proceedings under sections 31 and 32 of the Act are akin to an application for attachment of property in execution of a decree at a stage posterior to the passing of the decree.
The relief of a money decree sought against the sureties respondents 2 to 4 was not maintainable and the said relief could not be granted to the appellant in proceedings under section 31 of the Act.
As a result, the petition filed by the appellant must be dismissed and for the same reason this appeal must fail.
[515G 516A, 516D E] Munnalal Gupta vs Uttar Pradesh Financial Corporation & Anr.
,A.I.R. 1975 Allahabad 416; Thressiamma Varghese vs K. section F. Corporation, A.I.R. 1986 Kerala 222; Maharashtra State Financial Corporation vs Hindtex Engineers Pvt. Ltd., ; Kayastha Training & Banking Corporation Ltd vs Sat Narain Singh, All. 433; M. K. Ranganathan & Anr.
vs Government of Madras & Ors.
,[1955] 2 S.C.R. 374; The Central Talkies Ltd., Kanpur vs Dwarka Prasad, ; , referred to.
Maganlal V. MIS.
Jaiswal Industries, Neemach & Ors., ; ; M/s. Everest Industrial Corporation & Ors.
vs Gujarat State Financial Corporation, [1987] 3S.C.C. 597; Parkash Playing Cards Manufacturing Co. vs Delhi Financial Corporation, ; Gujarat State Financial Corporation V. Natson Manufacturing Co. Pvt. Ltd. & Ors., , distinguished.
West Bengal Financial Corporation vs Gluco Series Pvt. Ltd.
,A.I.R. , approved.
|
Civil Appeal Nos. 826 & 827 28 of 1991.
From the Judgment and Order dated 10.9.1986 of the Kerala High Court in M.F.A. Nos.
48 & 291 of 1991.
K. Sudhakaran, Attorney General, T.S. Krishnamurthy Iyer, A.S. Nambiar, T.R.G. Wariyar, P.S. Poti, P.K. Manohar, Shanta Vasudevan, K.R. Nambiar, P.K. Pillai and V. Jai Kumar for the appearing parties.
The Judgment of the Court was delivered by K.N. SAIKIA, J.
Special leave granted.
Civil Appeal arising out of Special Leave Petition (Civil) No. 7314 of 1987 and Civil Appeals arising out of Special Leave petitions (Civil) Nos.
6837 38 of 1987 are from common Judgment of the High Court of Kerala dated 10.9.1986 passed in MFA Nos. 48 and 291 of 1981.
The appellant Bhavani Tea and Produce Co. Ltd., hereinafter referred to as `the company ' is a public limited company engaged mainly in plantations of Tea, Coffee, Cardamom, Rubber and other plantation crops over an extensive area in the Western Ghats close to the border of the States of Kerala and Tamil Nadu.
On the basis of their title deeds, the company claimed to have purchased an extent of 3273.72 acres of land, but it and only 3, 151.20 acres in occupation.
Bulk of the plantations were purchased by the company in 1946 from M/s. B.B. Rubber Estates Ltd., hereinafter called `the vendors ', and the remaining estates acquired in 1955 and 1956.
The vendors were in possession of 3151.20 acres of land situated in surveyed lands in R.S. Nos.
2,3,3/1 and 5/1 in Sholayar village, mannarghat Taluk of palghat district which belonged in `Jenmom ' to mannarghat mooppil Sthanam and the vendors established the plantations taking the same on Verumpattam lease in the year 1935.
The plantations are now known as Siruvani Group of Estates of four divisions namely, Siruvani, Varddymalai, Elamali and Halton.
The Kerala Private Forests (Vesting & Assignment) Act, 1971 (Act 26 of 1971), hereinafter referred to as `the Vesting Act ' an Act to provide for the vesting in the Govt.
private forests in the State of Kerala and for the assignment thereof to agriculturists and agricultural labourers for cultivation, extending to the whole of Kerala State, received the assent of the President on 23.8.1971, and as provided in its 554 Section 1(3) it was deemed to have come into force on the 10th day of May, 1971 which was also declared to be the appointed day.
The preamble to the Vesting Act indicated that the private forests in the State of Kerala are agricultural lands and the Government considered that such agricultural lands should be so utilised as to increase the agricultural production in the State and to promote the welfare of the agricultural population of the State.
The statement of objects and reasons also said that the private forests as defined in the Kerala Land Reforms Act, 1963(1 of 1964) were exempt from the ceiling thereunder and that with high density of population there was scarcity of land and it was against the Directive Principles of State policy to allow a few persons to be in ownership and control of these agricultural lands.
In other words, the object of the Vesting Act was to distribute the private forest lands among the agriculturists and agricultural labourers for agriculture.
The forest officials having commenced survey over the company 's plantations ' land from 28.6.1997, it approached the Tribunal under Section 8 of the Vesting Act for a declaration that no portion of the land in R.S. Nos. 2,3,3/1 and 5/1 in Sholayar Village, Nannarghat Taluk, Palghat District shown in the schedule to the application was liable to vest in the State under the Vesting Act.
The Company maintained that at the time of the Vesting Act coming into force out of the company 's lands about 10 acres were covered by roads, 50 acres by buildings, 490.14 acres by tea plants, 700.00 acres by coffee plants, 798.56 acres by cardamom and 250 acres by rubber plantation.
Besides an area of 60 acres was maintained as windbelts and an area of 189.50 was reserved for the purpose of firewood meant for the preparation of rubber for the market.
The company claimed that the entire area was thus principally cultivated with tea, coffee, cardamom and rubber and for the purposes ancillary thereto and that total 2,338.70 acres were utilised for plantations by the end of 1969.
The entire area having stated to have been principally cultivated, the company claimed that no portion thereof was covered by the exproprietory provisions of the Vesting Act.
The respondent State of Kerala stated before the Tribunal that the plantation area in the schedule property had already been exempted, and that only such areas as fell within the definition of private forests in the Vesting Act, mainly areas full of forest trees aged 20 to 100 years were being surveyed and demarcated as vested forests.
The state also disputed the area under plantations and the areas claimed to have been reserved for fuel and fire wood etc.
It was also stated that in favour of the fourth 555 respondent which was a cooperative farming society 190.54 hectares of the area taken over as vested forests as already assigned and the society got possession of that area from out of uncultivated forest tracts for itself.
An Advocate Commissioner was appointed by the Tribunal to prepare a plan and report regarding the properties claimed as vested forests out of the schedule land and he submitted Exhibit C 1 plan, C 2 and C 3 interim reports and C 4 final report.
On the basis of Exhibit C 4 report the company amended its application.
The earlier Schedule was retained as `A ' Schedule.
An area of 1397.60 acres (566.11 hectares) identified as plot Nos. 1 to 69 were located by the Commissioner as areas claimed by the respondent as vested forests and those 69 plots were included in the `B ' Schedule to the application after the amendment.
The controversy thenceforth related only to some of the plots in `B ' Schedule.
The company examined PWs.
1 to 3 and produced documents A1 to A24 in support of its claim, while the respondents examined RW 1 and marked Exhibit B 1 only.
On the basis of the evidence available before it and mainly depending upon the observation of the commissioner, the Tribunal held that plot Nos.
2,9,12,13,15,16,24,25,29,35,48,49 and 56 had been brought under cultivation prior to 14.12.1949, and therefore, did not fall within the purview of the Madras Preservation of Private Forests Act(hereinafter referred to as M.P.P.F. Act), and therefore, held to be outside the purview of the Vesting Act.plot Nos. 4, 5, 7, 10, 19, 20, 21, 27, 32, 34, 42, 43, 45, 47, 52, 53, 54, 57, 60, 66 and 67 were held to be used principally for the cultivation of tea, coffee, and cardamom and therefore were to be excluded from the purview of the Vesting Act in view of the provisions contained in Section 2(f) thereof.
The remaining plots 1, 3, 6, 8, 11, 14, 17, 18, 22, 23, 25, 28, 30, 31, 33, 36, 37, 38, 39, 40, 41, 44, 46, 50, 51, 51A, 55, 58, 59, 61, 62, 63, 64, 65, 68, and 69 were found to be not excludable under Section 2(f) or to be exempted under Section 3 of the Vesting Act.
The Tribunal thus allowed the company to retain 206.06 acres out of B Schedule lands as excluded/exempted from the provisions of the vesting Act and declared total 1,184.68 acres as vested forests under the Vesting Act.
From the Tribunal 's order both the company and the State appealed to the High Court which by the impugned common Judgment 556 dated 10.9.86 partly allowed the company 's MFA No. 48 of 1981 to the extent of modifying the order of the Tribunal and declaring that plot Nos. 1, 3, 6, 8, 17, 22, 23, 31, 51A, 68 and 69 were to be excluded from vesting; and also partly allowed the State 's MFA Nos. 291 of 1981 to the extent of declaring that plots Nos. 12, 13, 15, 16, 26, 27, &, 56 were to vest in the state.
The result was that the company would be entitled to retain plot Nos. 1 to 10, 17, 19 to 24, 31, 32, 34, 35, 42, 43, 45, 47, 48, 49, 51A, 52 to 54, 57, 60 and 66 to 69 totalling 144.13 acres in B Schedule properties and the remaining plot Nos. 11 to 16, 18, 25, to 29, 30, 33, 36 to 41, 44, 46, 50, 51, 55, 56, 58, 59 and 61 to 65 would vest in the State.
The High Court also observed that out of the excluded areas less than 70 acres alone were planted areas, meaning thereby lands which were principally used for the cultivation of tea, coffee and cardamom under Section 2(f) (B) of the Act and that the remaining area could be used for ancillary purposes.
The reservation for roads, water sources etc.
which were in use at that time were also allowed.
The High Court also directed: "One existing road each to connect each of the different blocks of plantations along the shortest route lying along the vested areas will be allowed to be used and maintained by the applicant at its cost, but in roads passing through the vested forests will be under the control of the respondents.
The existing roads providing access from the Estate to the public road will also be maintained by the applicant at its cost subject to the above reservation.
the present case of water sources, streams and channels located within the vested forests for supply of drinking water or as source for irrigation and for supply for purposes of the factories etc.
will be preserved.
The respondents will not interfere with any such user of these facilities." Thus out of the total 3, 151.20 acres 1, 753.60 acres are admitted not to have been vested under the Act.
Out of the remaining 1,397.60 acres 609.91 acres are admitted to be private forest and hence vested under the Act.
This covers plot Nos. 11, 18, 25, 28, 30 and 63.
Out of the remaining plots, namely, 1 10, 12 17, 19 24, 26, 27, 29 62 and 64 69, the Tribunal allowed 33 plot totalling 206.06 acres.
The High Court by the impugned order allowed 36 plots totalling 144.13 acres.
The result is that excluding the plots included in the peripheral area of virgin forests of 609.91 acres, the dispute is now confined only to following plots totalling 641.73 acres.
557 Plot 12 27.50 acres Plot 13 25.08 acres Plot 14 3.67 acres Plot 15 1.65 acres Plot 16 3.82 acres Plot 26 10.70 acres Plot 27 10.58 acres Plot 29 8.10 acres Plot 33 16.20 acres Plot 36 14.87 acres Plot 37 9.63 acres Plot 38 5.26 acres Plot 39 6.37 acres Plot 40 32.42 acres Plot 41 26.32 acres Plot 44 84.06 acres Plot 46 5.31 acres Plot 50 30.96 acres Plot 51 44.11 acres Plot 55 13.12 acres Plot 56 24.84 acres Plot 58 75.19 acres Plot 59 73.03 acres Plot 61 7.56 acres Plot 62 23.45 acres Plot 64 9.21 acres Plot 65 48.72 acres Total : 641.73 acres 558 Both the company and the State of Kerala have filed Special Leave Petition from the common order of the High Court and are given special leave.
Both the company and the State having claimed these plots under the provisions of the Vesting Act and the Custodian and the Tribunal on the basis of the Commissioner 's report and evidence adduced before it as also the High Court having already found the facts as regards these plots we are of the view that the scope of this Court in this Appeal under Article 136 of the Constitution of India is rather limited.
Both Mr. Krishnamurthy Ayer for the company and Mr. P.S. Poti for the State have argued this case with dexterity presenting the meticulous details and explaining the relevant statutory provisions.
Mr. Krishnamurthy emphasised that these disputed plots must be held to have been principally used for cultivation of tea, coffee, rubber, cardamom and cinnamon which are the crops envisaged under the Vesting Act and for purposes ancillary thereto.
Counsel submits that if these plots were not exempted from vesting the company 's plantations will be broken down in untiy, contiguity and economy, and that for deciding the area principally cultivated, the plantations owned by the company must be taken as a whole and not piece by piece or plot by plot as has been done in this case.
Mr. Poti emphasises the objects and purposes of the Vesting Act, namely, to distribute agricultural land to the landless agriculturists and agricultural labourers so as to reduce the scarciy of agricultural land, and not to allow few individuals to remain in control thereof.
Counsel submits that the Vesting Act even did not use the word `plantation ' and therefore private forest has to be determined on the basis of land whereupon the private forest stands irrespective of its size and there could arise no question of the plantation of the company being treated as a whole, and that, at any rate it was the Custodian and the Commissioner who demarcated the plots and company has also been arguing on plot by plot basis.
In deciding these appeals, therefore, this Court has to take the facts as found by the courts and authorities below and examine whether the provisions of the Vesting Act have been applied correctly to those facts keeping in mind its objects and purpose; and so we proceed.
Some acquaintance with the relevant laws of the place may be instructive at this stage.
The company 's plantations are within erstwhile Malabar district.
Baden Powell in Land Systems of British India, Vol.
1 page 95 described Malabar as "curious district on the west coast of India" and as "source of puzzled remarks from reporters on land affairs".
Some of the unique facts about the district according to the 559 author were that there "private property ' in land had existed, while it could not be found anywhere else and it presented a unique history of land holding customs and the development.
When the Mysore Sultan conquered the country the local military chiefs retained their rule over some territorial estates and the families of the chiefs clung to the land or part of it as landlords, calling themselves `Janmis ' and claiming to be, in facts absolute landlord.
The lower landholders acknowledged the `Janmis ' as their superior.
The reports compiled showed that "almost the whole of land in Malabar, cultivated and uncltivated, was private property and held by "Jemnum" (Janmam), right which conveys full absolute property in the soil. . " Thus the janmis became the proprietors.
We find mention of this `Jenmom ' right in the sale deeds of the company.
The meaning of the words `Janmam ' and Janmi ' and their rights envisaged in Gudalur janmam Estates (Abolition and Conversion into Ryotwari) Act, 1969 (24 of 1969) were considered in Balmadies Plantation Ltd. & Anr.
vs State of Tamil Nadu, ; The exclusive right to, and herditary possession of the soil in Malabar is denoted by word janmam which means birth right and the holder therof is Known as Janmi, Janmakaran or Mutalalan.
In other words "Janmam" is a hereditary proprietorship in the freehold property in Kerala.
Janmam interest has been described as proprietory interest of the landlords in lands and such a right is described as `estate ' in the Constitution.
This was followed in the Kannan Devan Hills Produce vs The State of Kerala and Anr., [1972]2 SCC 218.
The Statement of Objects and Reasons of the Vesting Act and the definition of private forests under the Act were examined in State of Kerala & Anr.
vs The Gwalior Rayons Silk Mfg.
(Wvg.) Co. Ltd. etc.
; It was observed by Palekar, J. that the Vesting Act purported to acquire forests land without payment of compensation for implementing a scheme of agrarian reform by assigning lands on registry or by way of lease to the poorer section of the agricultural pouplation.
This was done after reserving certain portions of the forests as might be necessary for purposes "directed towards the promotion of agriculture for the welfare of the agricultural population or for purposes ancillary thereto.
" It was observed that extensive areas of private forests were available in the Malabar district which could be acquired and distributed and that the private forest lands of Malabar district were contiguous and formed one long belt of a mountainous terrain now forming part of the State of Kerala.
It was also observed that plantations of tea, coffee, rubber, cardamom, cinnmon and the 560 like were grown on extensive scale in these forests and industries had taken leases of vast areas of these forests for those pruposes.
This Court observed: "In recent years industrialists have taken leases of vast areas of these forests from their owners and a fraction of the same has been brought under cultivation by planting eucalyptus and other types of trees useful for paper and other industries.
Large areas in these forests seem to be even now in their pristine form but are capable of being utilized by absorbing a large proportion of the population by setting them on the land.
These forests, therefore, have attained a peculiar character owing to their geography and climate and the evidence available to us shows that vast areas of these forests are still capable of supporting a large agricultural population.
" This Court quoted from paragraph 6 of the Judgment in V. Venugopala Varma Rajaa vs Controller of Estate Duty, Kerala, "It is well known that the extensive areas of different varieties of plantations that we have got in this State were once forest land; and it is also equally well known that year after year large areas of forest lands in this State are being cleared and converted into valuable plantations.
In the absence of exceptional circumstances such as the land being entirely rocky or barren for other reasons all forest land in this State are agricultural lands in the sense that they can be prudently and profitably exploited for agricultural purposes.
" The scheme of the Vesting Act was also examined while upholding its validity.
The Madras Preservation of Private Forests Act 1949 (Madras ACt XXVII of 1949) which received the assent of the Governor General on the 10th December, 1949, hereinafter referred to as `the M.P.P.F. Act ', was an Act to prevent the indiscriminate destruction of private forests and interference with customary and prescriptive rights therein.
Under sub section (2) of Section 1 thereof, that Act applied (i) to private forests, in the districts of Malabar and South Kanara having a contiguous area exceeding 100 acres.
By an Explanation added thereto by Section 2(a) of the Madras Preservation of Private Forests (Second Amendment) Act, 1954 (Madras Act XVIII of 1954), it was explained that nothing in this clause shall be deemed to apply to any land which was brought under fugitive or other cultivation prior to the 14th December, 1949 by an owner or any person claiming under him.
Thus the company 's plantations, if cultivated before that date 561 would be excluded.
The words `forest ' is defined in Section 2 clause (a) of the M.P.P.F. Act: "forest includes waste or communal land containing trees and shrubs, pasture land and any other class of land declared by the State Government to be a forest by notification in the Fort St. George Gazette." "Communal ' land meant any land of the description mentioned in sub clause (a) or sub clause (b) of clause (16) of section 3 of the Madras Estates Land Act, 1908.
There is nothing in evidence in the case to shown that the company 's plantations area was a forest under the M.P.P.F. Act.
The Kerala Forest Act, 1961 (Act 4 of 1962) was an Act to unify and amend the law relating to the protection and management of forests in the State of Kerala and it extended to the whole of the State of Kerala.
This Act repealed the Travancore Cochin Forest Act, 1951 (Act III of 1952) and the Madras Forest Act, 1882 (XXI of 1882) and the Madras Wild Elephants Preservation Act, 1872 (Act I of 1873) as in force in the Malabar district referred to in sub section (2) of section 5 of the State Reorganisation Act, 1956.
The M.P.P.F. Act in so far as it applied to Malabar district was not repealed.
The Kerala forest Act did not itself define `privat forest '.
The Kerala land Reforms Act, 1963 (Act I of 1964) was a comprehensive legislation relating to land reforms in the State of Kerala and it extended to the whole of the State.
Sub section (7) of section 2 defined the word `cultivate '.
Clause (15) of section 2 defined `garden ' to mean land used principally for growing cocoanut trees, arecanut trees or pepper vines, or any two or more of the same.
As defined in clause (38) `nilam ' means land adapted for the cultivation of paddy.
Under clause (34) `malabar ' means the Malabar District referred to in sub section (2) of section 5 of the .
Under clause (44) plantation means any land used by a person principally for the cultivation of tea, coffee, cocoa, rubber, cardamom or cinnamon (hereinafter in this clause referred to as: `plantation crops ') and includes(a) land used by the said person for any purpose ancillary to the cultivation of plantation or for the preparation of the same for the market. . (C) agricultural lands interspersed within the boundaries of the area cultivated by the said person with plantation crops not exceeding such extent as may be determined by the Land Board (or the Taluk Land Board) as necessary for the protection and efficient management of such cultivation.
Under the Explanation, lands used for the construction of the office buildings, godowns, factories, quarters for workmen, hospitals, school and play grounds shall be deemed to be lands used for the purposes of sub clause (a).
562 Thus under the Act `plantation ' has been defined to include areas principally cultivated with plantation crops and the lands used for ancillary purposes.
As defined in clause (47) of the Land Reforms Act, `private Forest ' means a forest which is not owned by the Government, but does not include (i) areas which are waste and are not enclaves within the wooded areas; (ii) areas which are gardens or nilams; (iii) areas which are planted with tea, coffee, cocoa, rubber, cardamom or cinnamon; and (iv) other areas which are cultivated with pepper, arecanut, cocoanut, cashew or other fruit bearing trees or are cultivated with any other agricultural crop.
Chapter III of the Act dealt with restriction on ownership and possession of land in excess of ceiling area and disposal of excess lands.
Section 81 dealt with exemptions and said that the provisions of this Chapter shall not apply to, amongst others, (d) private forests; (e) plantations.
Section 82 prescribed the ceiling area and sub section (6) thereof provided that in computing the ceiling area, lands exempted under section 81 shall be excluded.
Thus the private forests and plantations were excluded from ceiling area under the Land Reforms Act.
The provisions of the Vesting Act which was enacted in 1971 have, therefore, to be interpreted keeping in mind the relevant provisions of the above Acts in so far as plantations and private forests are concerned.
`Private forest ' as defined in Section 2 (f) of the Vesting Act means: "[1] in relation to the Malabar district referred to in sub.
section (2) of section 5 of the (Central Act 37 of 1956) (i) any land to which the Madras Preservation of Private Forests Act, 1949 (Madras Act XXVII of 19.19, applied immediately before the appointed day excluding (A) lands which are gardens or nilams and defined in the Kerala Land Reforms Act, 1963 (1 of 1964) (B) lands which are used principally for the cultivator of tea, coffee, cocooa, rubber, cardamom or cinnamon and lands used for any purpose ancillary to the cultivation of 563 such Crops or for the preparation of the same of the market.
Explanation: Lands used for the construction of office building, godowns, factories, quarters for workmen, hospitals, schools and playgrounds shall be deemed to be lands used for purposes ancillary to the cultivation of such crops; (C) lands which are principally cultivated with cashew or other fruit baring trees or are principally cultivated with any other agricultural crop and (D) sites of buildings and lands appurtenant to and necessary for the convenient enjoyment or use of, such buildings; (ii) any forest not owned by the Government, to which the Madras Preservation of Private Forests Act, 1949 did not apply, including waste lands which are enclaves within wooded areas.
(2) in relation to the remaining areas in the State of Kerala, any forest not owned by the Government, including waste lands which are enclaves within wooded areas.
Explanation: For the purposes of this clause, a land shall be deemed to be a waste land notwithstanding the existence thereon of scattered trees or shrubs;" Section 3 of the Vesting Act whereunder private forests were to vest in the Government said: "3.
Private forests to vest in Government.
(1) Notwithstanding any thing contained in any other law for the time being in force, or in any contract or other document, but subject to the provisions of sub section (2) and (3), with effect on and from the appointed day, the ownership and possession of all private forests in the State of Kerala shall by virtue of this Act, stand transferred to and vested in the Government free from all encumbrances, and the right, title and interest of the owner or any other person in any private forest shall stand extinguished.
564 (2) Nothing contained in sub section (1) shall apply in respect of so much extent of land comprised in private forests held by an owner under his personal cultivation as is within the ceiling limit applicable to him under the Kerala Land Reforms Act, 1963 [1 of 1964] or any building or structure standing thereon or appurtenant thereto.
Explanation.
For the purposes of this sub section, `cultivation ' includes cultivation of trees or plants of any species.
(3) Nothing contained in sub section 1 shall apply in respect of so much extent of private forests held by an owner under a valid registered document of title executed before the appointed day and intended for cultivation by him, which together with other lands held by him to which Chapter III of the Kerala Land Reforms Act, 1963, is applicable, does not exceed the extent of the ceiling area applicable to him under section 82 of the said Act.
(4) Notwithstanding anything contained in the Kerala Land Reforms Act, 1963, private forests shall, for the purposes of sub section (2) or sub section (3), be deemed to be lands to which chapter III of the said Act is applicable and for the purposes of calculating the ceiling limit applicable to an owner, private forests shall be deemed to be `other dry lands ' specified in Schedule II to the said Act." Section 4 of the Vesting Act provided that private forests after being vesting in the State were to be deemed to be reserved forests, and Section 5 provided for eviction of persons in unauthorised occupation of any such private forest.
Section 6 provided for demarcation of boundaries of the private forests vested in the Government by the Custodian.
We may now take the areas in dispute as stated above with their location and plantation.
In the sketch map Annexure D, the green coloured area is the planted area and it was not claimed by the State.
The blue coloured plots were also excluded from vesting and were allowed to the company by the High Court; and the remaining plots are disputed ones and are coloured pink and violet.
Mr. Poti points out that the original sketch map was not shaded and that the water tank and the dam were not shown therein.
There is, however, no dispute as to the colouring indications which are helpful for identification.
565 The areas on the periphery, according to the Commissioner, are forest area namely plot Nos. 11 (76.70 acres), 18 (28.36 acres), 25 (11.88 acres), 28 (90.79 acres), 30 (77.93 acres) and 63 (324.25 acres).
The total of this peripheral areas come to 609.91 acres.
Admittedly, these areas are virgin forests which as per the Vesting Act vested in the State.
We have no hesitation in confirming this finding.
According to Mr. Poti, to the entire North of the company 's estates, there are vested forests, namely, LGB Estates, Kakkanampara Estates and Malikkal Estates which are vested forest areas.
In the Eastern isolated estates, namely, upper Varadimullai Estates there is coffee plantation on plot Nos. 66, 67, 68, and 69 which have been rightly given to the company.
Regarding plots 12, 13, 15, 16, 26, 27, 29, and 56, Mr. Krishnamurthy submits that the Tribunal on the basis of the Commissioner 's report, Ext.
C 4, found these plots to have been cultivated prior to 1949.
There were reminiscences of the old plantations in these plots, of course they became decayed.
The Tribunal held that since these plots were brought under cultivation prior to 1949 and the provisions of the M.P.P.F. Act excluded these areas from definition of private forests, they could not be held to be forests as on 10.5.1971 under the Vesting Act.
The High Court, it is submitted, has not been shown to have reversed the findings of the Tribunal.
Mr. Poti submits that these plots are contiguous to forest areas and have rightly been given by the High Court to the State, though the Tribunal gave those to the company.
From the map it appears that on the other sides they are also contiguous to planted areas, excepting plot No. 56 which though connected with vested forests by a narrow strip, is almost surrounded by areas excluded from vesting by the High Court.
The company claimed these areas as principally cultivated areas and not included in the peripheral area.
The High Court has held that plots 12, 13, 15, and 16 are not principally planted as cultivation has been abandoned and the area "reverted to nature".
The conclusion that the area reverted to nature is presumably based on the observation of the Commissioner that the plantations were abandoned about 40 years ago as evidenced by the presence of scattered old plants, of shade trees and fruit bearing trees here and there such as silver oak trees, orange trees, guava trees, dadap trees and albezia which could not be of natural growth.
The Commissioner also observed that the condition of the estate was really miserable due to lack of proper maintenance and the plants were decayed or destroyed.
The explantation that due to continuous labour trouble in the previous 4 or 5 years, the estate could not be maintained 566 properly was not accepted.
For this reason the Commissioner expressed that the forest department had treated these areas as abandoned plantations and so vested forest and not as areas principally cultivated for the purpose of the Act and as according to the High Court "the area had reverted to nature decades ago and such reversion was naturally as forest.
" The High Court did not record any finding that these areas were forests either in 1949 or on 10.5.1971.
Its legal implication was not considered by the High Court.
The Commissioner on the other hand found about plot Nos. 12 and 13 that these were old plantation areas and the plants were aged 40 to 50 years and that almost all the plants were senile due to old age and that there were 100 to 200 coffee plants per acre and there were old silver oak trees and dadap trees which were planted as shade trees.
The Commissioner also found that from plot No. 13 old coffee plants were cut and removed by the cooperative society people who cleared the under growth of the area whereafter new saplings were sprouted out of the old coffee plants cut by the society people and there were good growth of young plants which would start to yield.
Similarly plot No. 15 was found to be an old coffee planted area with scattered coffee plants aged 30 to 40 years and similar shade trees.
Plot No. 16 was also found to be coffee plantation.
Similarly Plots 26 and 27 were found to be old coffee plantations.
Plot No. 27 was found to be a pucca cardamom area with plants aged 15 years, and was allowed by the Tribunal as a cultivated area.
The High Court, however, held that it reverted to nature.
Similarly, plot No. 29 was excluded by the Tribunal as an area not covered by the M.P.P.F. Act since they were cultivated prior to 1949 which finding the High Court has not directly reversed.
Plot no 56 was considered by the High Court with Plot No. 49, the extent of the plots being 24.84 acres and 0.89 acres, respectively, The Commissioner found 50 old rubber trees in Plot 49 and 600 older rubber trees in Plot 56 and both areas to have been neglected and abandoned and not used as a rubber plantation for a long time and definitely not on 10.5.1971.
The High Court concluded that 500 rubber trees in an area of 25 acres would not make it "principally cultivated with rubber".
since the average number of trees per acre, according to the publication of the Rubber Board, is from 140 to 160 per acre (vide Manual of Rubber Planting in India).
The High Court exempted Plot No. 49, but held Plot No. 56 liable to vest in the State.
Some of these plots having been planted and still containing old plants and shade trees the High Court applied the theory that the areas reverted to nature.
This leads to the question as to the meaning of forest and when, if at all, a particular plantation may be said to have reverted to nature.
567 In Words and Phrases Legally Defined, Vol. 2, p. 269, `forest ' means: "A certain territorie of woody grounds and fruitful pastures, privileged for wilde beasts and foules of forest, chase and warren, to rest and abide in, in the safe protection of the King, for his princely delight and pleasure, which territorie of ground, so privileged, is meered and bounded with unremovable marks, meeres, and boundaries, either known by matter of record, or else by prescription, and also replenished with wilde beasts of vererie or chase, and with great coverts of vert (i.e. green leaved trees, bushes, etc.) for the succour of the said wilde beasts, to have their abode in: for the preservation and continuance of which said place, together with the vert and venison, there are certain particular laws, privileges, and officers belonging to the same, meete for that purpose, that are only proper unto a forest, any not to any other place.
" The earliest of the Forest Laws in England is said to be the Charter of the forest which was issued in 1217 by Henry, as mentioned in Pollock and maitland 's History of English Law, Vol. 1, p. 179.
The forestal rights of the crown consisted essentially of the King 's rights to use the land (forest) whether belonging to himself or another for hunting game and for preserving the game and for preserving the land in such a way as to give maximum shelter and free room for the game.
The Forest Laws were applied to royal forests and were designed to protect these rights.
The medieval forest law in England has now been abrogated except in so far as it relates to the appointments and functions of verderers.
According to Mozley and Whiteley 's Law Dictionary `forest ' as a legal right is defined as a right of keeping, for the purpose of hunting, the wild beasts and fowls of forest, chase, park and warren, in a territory or precinct of woody ground or pasture set apart for the purpose.
According to Black Law Dictionary, `forest ' means: a tract of land covered with trees and one usually of considerable extent.
It is said that in old English law a certain territory of wooded ground and frutiful pastures, privileged for wild beasts and fowls of forest, chase, and warren, to rest and abide in the safe protection of the prince for his princely delight and pleasure, having a peculiar court and officers.
Thus, treatment of a certain extent of land as forest was implied.
The fact that an extent of land has not been so treated or declared would, therefore, be relevant in determining 568 whether that land constituted a forest.
This rule is found to have been applied by the Kerala High Court.
In State of Kerala vs Anglo American Direct Tea Trading Co. Ltd., where the respondents were owners of tea estates, the areas planted with tea had been excluded from the operation of the vesting provision of the Vesting Act.
There were portions of tea estates where there were eucalyptus plantations.
It was claimed by the respondents that those were areas which were required for ancillary purposes of the tea plantations, ancillary in the sense that the Eucalyptus trees grown in the Eucalyptus plantations served as fuel for processing the tea for the market.
There was also a plea that the lands having been converted into Eucalyptus plantations long before the appointed day under the Vesting Act such areas could not be said to be forests as on 10.5.1971 and, therfore, there was no scope for vesting of such areas in the State.
The latter plea having been accepted by the Tribunal and consequently the area where there were Eucalyptus plantations held not to have vested in the State, the Custodian challenged the findings in appeal before the High Court and the cases having related to lands outside the Malabar District to which Section 2(f) (2) of the Vesting Act was applicable, the State contended that Eucalyptus plantation was a forest.
The question therefore arose whether the land which had been converted into eucalyptus plantations could be said to be forest within the meaning of the terms in Section 2(f) (2) of the Vesting Act.
Subramonian Poti, J. speaking for the Division Bench consulted the dictionary meanings of forest as: "a large uncultivated tract of land covered with trees: a tract of woodland and open uncultivated ground","a large tract of land covered with trees and underbush; extensive wooded area.
" It was observed that the word `forest ' was derived from latin foris meaning outside, the reference being to village boundary or fence, and must have included all uncultivated and uninhabited land.
The World of the Knowledge Encyclopaedia Vol.
10 defines `forest ' at page 2201 as "a circuit of wooded ground and pastures, known in its bounds and piviledged for the abiding of wilde beasts and fouls of forest, chase and carron to be under the King 's protection for his princely delight.
" It was also found that the Abridged Glossary of Technical Terms published by Forest Research Institute and Colleges, Dehra Dun, page 52, the term forest was understood as an area set side for the production of timber and other forest produce, or maintained under woody vegetation for certain indirect benefits which it provided.
For example, climatic or protective.
It was further observed that in the context in which the term `private forest ' had been used in the Act it was evident that it applied to lands other than those 569 on which human skill, labour and resources had been spent for agricultural operations.
In Malankara Rubber & Produce Co. & Ors. etc.
vs State of Kerala & Ors.
, ; , it was held that lands under eucalyptus or teak which were the result of agricultural operations normally would be agricultural lands and not forests, but lands which were covered by eucalyptus or teak growing spontaneously as in a jungle or a forest, would be outside the purview of acquisition under Kerala Land Reforms Act.
In State of Kerala & Anr.
vs Nilgiri Tea Estates Ltd. [1988](supp) SCC 79, the view taken by the High Court that eucalyptus trees planted in a tea estate for supply of fuel for the manufacture of tea, were not covered by the vesting provisions of the Vesting Act was upheld.
There the eucalyptus trees were raised not for a forest but for supply of fuel necessary for the manufacture of tea which was the industry carried on by the respondent company.
In State of Kerala & Anr.
vs K.C. Moosa Haji & Ors.
A Full Bench of the Kerala High Court approved the observation of Poti, J. in State of Kerala vs Anglo American Direct Tea Trading Co. Ltd. [supra] that forest was not a term defined in the Act and that with reference to lands in the malabar area to which the M.P.P.F. Act applied on the appointed day the test for determination whether the land was private forest was different and that if the land was shown to be private forest on the date the M.P.P.F. Act came into force it would continue to be a private forest even if it had actually ceased to be a forest unless one or other of the exclusions in clauses A to D in the definition applied.
it was contended therein that the Vesting Act applied only to those lands which were forests under the M.P.P.F. Act immediately before 10.5.1971, inasmuch as the lands in question had ceased to be forest having been clear felled and as such had gone out of the purview of the M.P.P.F. Act and consequently they were not private forests for the purpose of the Vesting Act also.
Rejecting the contention the Full Bench held that if the M.P.P.F. Act was applicable to the land in 1949 and if it continued to apply to it up to 10.5.1971, that land would be a private forest for the purposes of the Vesting Act.
The question was not whether there was a forest in existence in 1971; but was whether there was any land in 1971 to which the M.P.P.F. Act was applicable in 1949 and continued to be under its coverage till 1971.
As the lands involved in that case were all private forests as definded in the Act, clear felling and replanting were carried out with the permission of the District Collector.
It was held that 570 denudation could not be held to have put the land out of the purview of the Act and that once the Act was applicable to the area in 1949 nothing done by the owners of the area or others was capable of putting an end to such applicability to that area.
We respectfully agree with this view.
The definition of private forest given in Section 2(f) of the Vesting Act and Section 2(47) of the Kerala Land Reforms Act were considered by K. Jagannatha Shetty, J. in Gwalior Rayons Silk Mfg.(Wvg.
) Co. Ltd. vs The Custodian of Vested Forests, Palghat & Anr. ; JT The lands involved in that case were all forests as defined in the M.P.P.F. Act, 1949 and continued to be so when the Vesting Act came into force in 1971.
It was observed that the definition of private forests as was applicable to the Malabar district was not general in terms but limited to the area and lands to which the M.P.P.F Act applied and exempted therefrom land described under sub clause (A) to (D).
This significant reference to M.P.P.F. Act in the definition of private forests in the Vesting Act made all the difference in the case.
The M.P.P.F. Act was a special enactment by the erstwhile Madras State to preserve the private forests in the district of Malabar and erstwhile South Kanara district.
The scheme appeared to be that if the land was shown to be private forest on the date on which the M.P.P.F. Act came into force, it would continue to be a forest even if there was subsequent replantation.
Accordingly it was held that the lands which were forests as defined M.P.P.F. Act and continued to be so when the Vesting Act came into force would continue as forests as under that Act.
The reverse question is involved in this case, namely if the land was not private forest but plantation under the M.P.P.F. Act and was similarly not private forest but plantation on 10.5.1971, it could not, without anything more, become private forest thereafter even though it was not under the same efficient or successful plantation as it was earlier.
Whether the plantation yielded any crop or not was for the owners to decide and not by the authorities under the Vesting Act, unless it did make specific provisions to cover such a situation.
We have not been shown any such provision or any provision as to such land reverting to nature.
Nature, according to Collings English Dictionary means all natural phenomena and plant and animal life as distinct from man and his creations; a wild primitive state untouched by man or civilization.
According to Shorter Oxford English Dictionary natural vegetation means self sown or planted; and not cultivated.
Uncultivated or undomesticated plants or animals.
There is 571 no finding as to prevalence of such a condition in these plots.
Mr. Krishnamurthy submits that the Ordinance which preceded the Vesting Act promulgated on 10.5.1971 included the private forests as defined in the M.P.P.F. Act.
We have seen that the Vesting Act gave two definitions of private forest; the first was in relation to the Malabar district referred to in sub section (2) of section 5 of the (Central Act 37 of 1956).
In that district private forest meant any land to which the M.P.P.F. Act applied immediately before the appointed day excluding the lands which were gardens or nilams as defined in Kerala Land Reforms Act, 1963 (Act 1 of 1964) and lands which were used principally for the cultivation of tea, coffee, cocoa, rubber, cardamom or cinnamon and lands used for any purpose ancillary to the cultivation of such crops or for the preparation of the same for the market.
It is accordingly argued that the company 's plantations did not constitute private forest either under the M.P.P.F. Act or under the Kerala Land Reforms Act and as such the entire area of the company 's plantations could not have come within the purview of the Vesting Act.
We find force in the submission to this extent, but in view of the objects and purposes of the Vesting Act, it can not be said that there could never be a case of such plantation land being converted to a forest by natural growth or otherwise.
It must necessarily depend on facts.
Mr. Krishnamurthy then submits that even assuming, the Vesting Act applied, the entire plantation area ought to be taken as a unit for the purpose of ascertaining whether there was private forest and not piece by piece or plot by plot as has been done in this case.
If the entire area is taken as a whole, if major portion of the area was found to be cultivated, the whole area ought to be taken as principally cultivated area, small enclaves or patches meant to give rest by rotation should also have been treated as cultivated area.
The entire method adopted by the respondents, counsel submits, was wrong and has immensely prejudiced the company 's case, As regards the concept of reversion to forest, Mr. Poti submits that this applied to a land where Section 2(i) of the M.P.P.F. Act did not apply.
According to him, it applied to two categories, namely, areas of less than 100 acres and areas of abandoned cultivation, in both cases when it was found to be forest on the appointed day i.e. 10.5.1971.
There is no difficulty about the extent of less than 100 acres, but the difficulty is with abandonment.
Mr. Poti submits that the Custodian judged by visual appearance but the Tribunal did not notice 572 clause (2) at all.
We are of the view that mere abandonment would not convert an area into a forest, unless the owner has decided to do so or the appropriate authority has notified it to be so.
Mere visual test would not be enough.
The decision of the owner could, of course, be expressed or implies.
Mr. Poti submits that the definition of forest as given in Section 2(a) is only an inclusive one.
Forest includes waste or communal land containing trees and shrubs, pastural land and any other class of land declared by the State Government to be a forest by Notification issued in the St. George Gazette.
Thus, according to counsel, forest has not been defined in the Act exhaustively nor has it been defined in the Kerala forests Act.
Mr. Poti while admitting that the Kerala Land Reforms Act exempted all plantations, submits that the Vesting Act made drastic curtailments and that when historically interpreted principally planted did not mean with reference to the area but with reference to the crop only inasmuch as the word plantation has not been used at all in the Vesting Act and, therefore, the plantations can not be treated as a unit but only as land and the vesting Act is prospective and not retrospective.
Counsel relied on Gwalior Rayons Silk Mfg.
(Wvg.) Co. Ltd. vs The Custodian of Vested Forests, Palghat & Anr.
(supra) and State of Kerala vs K. C. Moosa Haji (supra).
According to Mr. Poti if the definition permitted, the area could be taken plot by plot inasmuch as there could be a forest of even 1 acre only.
The size of the forest was not material, and the estate as a unit of management is also not material, the concept of plantation itself being absent.
It is submitted that the expression used principally for cultivation in sub clause (B) and "principally cultivated with" in sub clause (C) mean the same thing.
It is further submitted that if the land which was not cultivated in 1949 might have already come under the M.P.P.F. Act.
Division into plots was done by the Commissioner as he found these plots to have been different and the demarcation was of compact areas with few isolated areas, and such a demarcation was contemplated under the Act.
It was pointed out that the company also contested the case on plot by plot basis.
The Tribunal as well as the High Court also proceeded on that basis.
It is pointed out the company objected to the principle of division before the High Court but did not question the correctness of the actual division made and hence the High Court could decide only on plot by plot basis.
We have no difficulty in holding that the forest area is generally described or notified with reference to land in forest laws.
But that does not mean that what stood on the land has to be ignored, particularly in case of plantations which were exempted under the M.P.P.F.Act.
573 While we are not inclined to agree that the entire estate of the company was required to be taken as one whole, we find it difficult to agree that wherever some forest was found inside the company 's estate the Vesting Act would apply.
We find that the M.P.P.F. Act, the Kerala Forest Act, the Kerala Land Reform Acts considered the plantations as units by providing that they would include the land used for ancillary purposes as well.
Therefore, while applying the Vesting Act to such plantations the same principle would be applicable.
It is on record that the estate of the company is divided into four divisions, namely, Siruvani Varadimulai, Elamali and Halton.
In conformity with the idea of plantations, it would be reasonable to take each division as a unit, subject, of course, to natural and geographical factors.
Considered in light of the above principles also we find that plots 13,15,16,26,27,29 and 56 form small portions of the respective divisions and can be taken to have been principally cultivated.
We accordingly have no hesitation to exempt these plots from vesting.
However, considering the scarcity of land and the location of plot No.12 and the fact that the Co operative Society has already been formed, for the ends of distributive justice this plot should be taken to have vested in the State, so that the road will form the boundary of the company 's plantations.
Plot No. 14 of 3.67 acres though a forest area has been claimed by the company as its wind belt.
Mr. Poti submits that this plot is of high elevation but the experts did not agree that it could serve as wind belt.
From the sketch map, however, it is found to have been projecting inside the plantations and that may be sufficient reason for its special consideration.
It should accordingly be exempted from vesting.
After formulating the principles on the basis of the case law, at one stage we were thinking of remanding the case of the High Court for fresh determination in light of the observations made above.
However, there was the consensus that in view of the detailed findings of the Tribunal as well as the High Court this old pending case may be decided by this Court itself instead of remanding it.
We, therefore, decided to do so on the basis of the materials on record.
Plot No. 33 admeasuring 16.20 acres (6.56 hectares) was claimed by the company as originally planted area.
The Tribunal found that at the relevant time there was no evidence of any plantation but there were small forest trees aged 20 years and also wild bushes and shrubs.
The High Court did not specifically referred to this plot.
From the 574 sketch map it is seen that on all sides it is covered by planted area and only to the north by forest.
The company claimed it as an enclave.
There is some building, and a road passing throughout it.
It is a part of the Alamalai Division.
There is nothing to show that this plot was not exempted under the MPPF Act as plantations.
Considering all these factors this plot has to be left as a part of the plantation and exempted from vesting.
Accordingly it is exempted.
Plot No. 36 admeasuring 14.87 acres (6.02 hectares) was found by the Tribunal to be an uncultivated grassy waste land with some scattered forest trees.
As there is no evidence of it ever having been planted, having forests almost on three sides, this plot may be taken to have vested in the State.
Plot Nos.
37 & 38 have been claimed by the company as cardamom plantations.
To the south of these plots there is a strip of plantations.
Plot No. 37 admeasuring 9.63 (3.90 hectares) was found to have been newly planted with cardamom which the company claimed to have been replantation.
Some scattered old cardamom plants aged nearly 15 years here and there were also found.
Similarly Plot No. 38 admeasuring 5.26 (2.13 hectares) was claimed by the company as a cardamom plantation but there were no plants.
Both the plots may, therefore, be treated together as cardamom planted area and as such not vested in the State.
Plot no.64 extending over 9.21 acres (3.72 hectares) contains, as found by the Tribunal, water channel through which water from the forest area was flowing to the water tank constructed at the end of the north channel and that the entire water supply to the tea factory and other residential areas of this building was through this channel.
On both sides of this channel there were some scattered cardamom plants aged 10 15 years.
The High Court dealt it with plot Nos. 62 and 63 but did not mention about the water channel and the plants.
The findings of the Tribunal would justify exemption of this plot from vesting inasmuch as the water supply must be considered to be vital for the plantations and their administration.
Plot Nos. 39 and 40 extending over 6.37 acres (2.58 hectares) and 32.42 acres (13.12 hectares) are contiguous and through these plots passes a road.
They are surrounded on three sides by planted areas and only on one side by LGB estates.
The Tribunal found that plot No.39 was newly planted with coffee the plants being 6 months to 1 year old.
The company stated this area to have been an old cardamom planted 575 area and newly converted into coffee plantation.
Plot No. 40 was claimed to have been a cardamom plantation and the plants to have been destroyed by wild fire the Tribunal found it to be a forest area with trees ages 30 40 years and 15 dadaps of equal age.
There is nothing to show that this was not an exempted area under the MPPF Act or not included in the plantations when the Vesting Act came into force.
The High Court did not find otherwise.
These two plots accordingly have to be exempted from vesting.
The Tribunal found plot No. 41 extending over 26.32 acres (10.65 hectares) to be grassy land with only about 10 to 20 forest trees, wild bushes and undergrowth.
The company said that this area was used for fugitive cultivation by the estate labourers.
The High Court does not appear to have specifically dealt with this plot.
There having been no plantation it was not shown to have been included as forests under the MPPF Act.
In view of the objects and purposes of the Vesting Act it may be treated as to have vested in the State.
Plot No. 44 extending over 84.06 acres (34.62 hectares) was found by the Tribunal as mainly grassy hills with some scattered trees in some portion and not cultivated.
In the High Court it was submitted by the company that there were no forest trees in this area, that there were old tree plantations which were destroyed, and that it was close to the bungalow of the Managing Director, Exhibit A 19 which was the preliminary Land Register showed that this plot was tea area and the same was included in a re planting scheme sanctioned by the Tea Board.
This was also said to be an enclave within the plantations.
The High Court observed that re planting scheme sanctioned by the Tea Board had not been put in evidence and that the recital in Ext.
A 19 by itself could not entitle the applicant to claim exemption on he basis that the plot was a tea area and that Ext.
A 19 could only be a record of representation of the company.
It was not denied that this plot was close to the bungalow of the Managing Director and that there were no forest trees in that area.
It is seen to be extending far inside the plantations in Siruvani division.
There is no evidence to show that this area was not exempted as plantation under the MPPF Act or when the spontaneous growth of forest thereafter.
This plot cannot, therefore, be taken to have vested in the State.
Plot No. 46 admeasuring 5.31 acres (2.15 hectares) was claimed by the company to be an old coffee plantation though the Tribunal found that there were no coffee plants but there were dadaps aged 30 576 to 40 years which were planted as shade trees and some scattered forest trees also.
Neither the Tribunal nor the High Court found the area not to have ever been planted.
The presence of the shade trees proved otherwise.
It is also located to the north of plot No.65 and well inside the plantation and as such may be treated as an enclave.
It has, therefore, to be exempted.
Plot No. 50 is extending over 30.96 acres (12.53 hectares).
The company claimed that it was coffee planted area but subsequently the coffee plants were destroyed by wild fire.
The Tribunal found this to have been a planted area as there were a good number of shade trees such as dadaps which were aged about 40 years and there were a few scattered forest trees aged 30 to 40 years and the area was covered with bushes and wild growth.
The High Court did not exclude this area from vesting on the ground that there were no existing specified crops without considering whether this area was or was not excluded as plantation by the MPPF Act.
This plot is located almost at the centre of Siruvani Division and hardly touched by peripheral plot No. 63.
On north eastern side of this plot, number of houses have been shown in the sketch map.
This cannot, therefore, be taken as vested in the State.
Plot No.51 is described by the Tribunal as a thin forest area with scattered forest trees aged 15 to 20 years and no sort of cultivation or plantation seen.
Plot No. 55 extending over 13.12 acres (5.31 hectares) described by the Tribunal as a forest area with trees aged 40 to 50 years and not cultivated.
The High Court dealt with these two plots together.
The company claimed that plot No. 55 was a part of rubber plantation alongwith plot No.56 which have been exempted and that both these areas were covered by Registration No. 2 of 1964 under the Rubber Act.
At the relevant time the High court observed that the registration survey had not been produced inspite of the statement that the document was available for production or verification and that neither in Ext.
A 13 nor in Ext.
B 1 the applicant have claimed to have any area to be planted with rubber.
The Tribunal further observed that the balance sheet and profit and loss accounts attached to Ext.
A 13 also did not disclose any income from rubber, and no other evidence was produced that there was any rubber plantation.
The High Court did not arrive at any finding that this area was a forest area under the MPPF Act or at the time of the Vesting Act coming into force.
It is surrounded on all sides by plantations and may be taken an enclave.
From its location and the claim of registration under the Rubber Act these two areas cannot be taken to have been vested in the State.
577 The Tribunal treated plot No. 58 of 75.19 acres (30.43 hectares) and plot No. 59 of 73.03 acres (29.15 hectares) together.
The company claimed that the two plots were regularly planted with cardamom but a good number of plants were destroyed by the wild animals which were frequently coming from the nearby Muthikulam Reserve Forest.
But it found that there were only scattered cardamom plants which were 10 to 15 years.
In some portions of the area there were cardamom plants at the rate of 200 250 per acre and in other portion only 100 150 plants per acre.
There were regular forest trees also aged some 50 years but number was not stated.
The Tribunal accordingly observed: "Though the area is planted with cardamom, this portion of the estate is not at all properly looked after or maintained." The High Court dealt with plot 58,59 and 61 together and observed that it contained some cardamom plants which were found among regular forest trees aged about 50 years.
The cardamom plants few in number, 100 150 in some places and 200 250 in other places and aged about 10 15 years as against about 1,000 2,000 per acre which according to PW 3 would be an ordinary number, did not justify the claim that these areas were exempted as cardamom plantation.
Before the High Court it was submitted for the State that cardamom was only a plantation and it would not be found in forest, was only a misapprehension, and that cardamom was a wild plant found in profusion as natural growth in tropical forests.
Encyclopaedia Britanica state that "native to the moist forests of Southern India, cardamoms may be collected from wild plants but most are cultivated in India, Sri Lanka and Guatemala.
" The High Court accordingly concluded that the presence of a few scattered cardamom plants in thickly wooded forests cannot, therefore, justify an asumption that the aera is a cardamom plantation.
There was no finding to the effect that the area is a cardamom plantation.
There was no finding to the effect that this area was private forest under the MPPF Act and when the vesting Act came into force.
These two area are no doubt adjacent to the peripheral plot No. 63 but they extend far inside the plantation.
They cannot be said to have been forests and never brought under plantation.
The number of cardamom plants mentioned is enough to show that these areas were not private forests when the Vesting Act came into force nor they have become so thereafter.
These two areas, therefore, have to be taken not to have been vested in the State.
The result is that plot Nos.33,39,40,44,46,50 51,55,58,59,& 61 also have to be treated as not to have vested in the State under the Vesting Act.
578 As regards the exiting roads falling within the vested areas those shall have such margins on either side of the road as required under the P.W.D rules of the State and shall be maintained and controlled by the company.
No construction of new road by the company in or through the vested areas shall be permissible.
Needless to say that there shall be no restriction as to roads on the company 's own non vested areas.
The result is that the High Court 's Judgment stands modified only to the above extent.
The appeals of the company and the State are partly allowed to the above extent.
We leave the parties to bear their own costs of these appeals.
R.N.J. Appeals partly allowed.
| IN-Abs | Bhavani Tea and Produce Co., a Public Ltd. Company is engaged mainly in plantations of Tea, Coffee, Cardamom, Rubber and some other plantions in the western ghats comprising R.S Nos 2,3, 3/1 and 5/1 in Sholyar village Mannarghat Taluk of Palghat District, Kerala known as Siruvani Group of Estate of four divisions namely, Siruvani, Varddymalai, Elamali and Halton with the total area in its possession being 3, 151.20 acres.
As the forest officials undertook survey over the Company 's plantations under the Kerala Private Forests (Vesting & Assignment) Act, 1971, which had come into force on 10.5.1971, to locate and determine the forest area in the estate that would vest in the State, the Company moved an application under section 8 of the Act before the Tribunal asserting that no portion of the land in the estate as shown in the schedule to the application was liable to vest in the state.
An advocate commissioner was appointed by the state as vested forests.
The Advocate Commissioner in his final report found an area of 1397.60 acres indentified as plots nos.
1 to 69 claimed by the State as vested forests.
551 The Company thereupon amended its application showing these 69 plots as schedule 'B ' to the application.
Out of the total 3,151.20 acres 1,753.60 acres are admitted not to have vested under the Act.
Of the remaining 1, 397.60 acres, 609.91 acres are admitted to be private forest on the periphery of the Estate and hence vested under the Act.
This covers plots Nos. 11, 18, 25, 28, 30 and 63.
Out of the remaining plots, the Tribunal allowed 33 plots totalling 206.06 acres and declared total area of 1, 184.68 acres as vested forests.
Both parties preferred appeals to the High Court which by its impugned judgment partly allowed the appeal of the company as well as of the State.
Both side have again preferred appeals by special leave to this court.
The result of the High Court 's judgment is that the dispute before this Court is now confined only to an area of 641.73 acres covered by plots nos.
12,13,14,15,16,26,27,29,33,36,37,38,39,40,41,44,46,50,51,55, 56,58,59,61,62,64, and 65.
On behalf of the company it has been argued that these disputed plots must be held to have been principally used for cultivation of tea, coffee, rubbers and cardamom etc.
and for purposes ancillary thereto; that if these plots are not exempted, the plantation will be broken down in unity, economy and contiguity and that the plantation must be taken as a whole and not piece by piece or plot by plot.
The argument on behalf of the State was to emphasise the objects and purposes of the vesting Act namely, to distribute agricultural land to landlords, agriculturists/labourers so as to reduce the scarcity of such land, and not to allow few individuals to remain in control.
It was also contended that vesting Act did not use the word 'plantation ' and therefore private forest has to be determined on the basis of land where upon forest stands irrespective of its size.
Keeping in view the detailed findings of the Tribunal as well as the High Court this Court comes to the conclusion that out of the plots which are in dispute now as pointed out above, plot nos.
33,39,40,44,46,50,51,55,58,59 and 61 also have to be treated as not to have vested in the state under the vesting Act.
As regards the existing roads falling within the vested areas these shall have such margins on either side of the road as required under the PWD rules of the state and shall be maintained and controlled by the company.
But no construction of new roads by the company in or through the vested areas shall be permissible.
Thus in partly allowing the rival appeals by modifying the judgment of the High Court to the extent indicated above, this Court, 552 HELD: If the land was not private forest but plantation under the Madras preservation of Private Forest Act and was similarly not private forest but plantation on 10.5.1971, it could not, without anything more, become private forest thereafter even though it was not under the same efficient or successful plantation as it was earlier.
Whether the plantation yielded any crop or not was not for the owners to decide and not by the authority under the Vesting Act, unless it did made specific provisions to cover such a situation.
We have not been shown any such provision or any provision as to such land reverting to nature.
Nature, according to Collins English Dictonary, means all natural phenomena and plant and animal life as distinct from man and his creations; a Wild primitive State untouched by man or Civilzation.
According to Shorter Oxford English Dictionary, natural vegitation means self sown or planted; land not cultivated; uncultivated or undomesticated plants or animals.
There is no finding as to prevalence of such a condition in these plots.[570F 571A] While, we are not inclined to agree that the entire estate of the Company was required to be taken as one whole, we find it difficult to agree that wherever some forest was found under the Company 's estate the Vesting Act would apply.
We find that M.P.P.F. Act, the Kerala Forest Act, the Kerala Reforms Act, considered the plantations as Units by providing that they would include the land used for ancillary purposes as well.
Therefore while applying the Vesting Act to such plantations the same principle would be applicable.
It is on record that the estate of the Company is divided into four divisions.
In conformity with the idea of plantations, it would be reasonable to take each division as a Unit, subject, of course, to natural and geographical factors.
[573 A C] Balmadies Plantation Ltd. & Anr.
vs State of Tamil Nadu, ; ; The Kannan Devan Hills Produce vs The State of Kerala and Anr., ; ; State of Kerala & Anr.
vs The Gwalior Rayon Silk Mfg.
(Wvg.) Co. Ltd. etc.
; , ; V. Venugopala Verma Rajaa vs Controller of Estate Duty, Kerala, ; State of Kerala vs Anglo American Direct Tea Trading Co. Ltd., ; Malankara Rubber & Produce Co. & Ors. etc.
vs State of Kerala & Ors.
, ; ; State of Kerala & Anr.
vs Nilgiri Tea Estate Ltd., [1988] (Supp) SCC 79; State of Kerala & Anr.
vs K.C. Moosa Haji & Ors., and Gwalior Rayons Silk Mfg.
(Wvg.) Co. Ltd. vs The Custodian of Vested Forests, Palghat & Anr., ; , referred to.
|
Civil Appeal Nos. 12224 of 1975.
From the Judgment and Orders dated 9.4.1974 of the Punjab & Haryana High Court in L.P.A. Nos.
213,214 and 215 of 1973.
S.K. Mehta, Dhruv Mehta and Aman Vachher, for the Appellants.
K.C. Dua for the Respondents.
The Judgment of the Court was delivered by K. RAMASWAMY, J.
The appellants are mortgagees.
The respondents are the heirs of Kala Singh, the mortgagor.
Kala Singh executed three mortgages in favour of the appellants Resham Singh, Jaswant Singh and Harbans Singh on September 17, 1962, June 17, 1961 and May 31, 1962 respectively hypothecating the agricultural lands of 16 kanals 16 marlas in each of the first two mortgages and 16 kanals in the third mortgage.
The mortgagor filed an application under Sec. 4 of the Redemption of Mortgages (Punjab) Act, 2 of 1913, for short 'the Act '.
He deposited a sum of Rs.10 in each mortgage and sought redemption of the mortgages.
Ultimately the parties compromised and the mortgagor agreed to pay the balance of Rs.340 to each mortgagee within a month from May 1, 1964.
The Collector passed the order on compromise under s.11 thereof on February 3, 1964.
He committed default in the payment thereof.
The petitions were dismis 617 sed.
He filed separate suits against each mortgagee for redemption within one year under Sec. 12 of the Act on June 12, 1964.
Pending suits he died.
Thereafter the suits were dismissed.
After obtaining mutation of their names in the revenue records the respondents filed separate suits for redemption of the mortgages, but beyond one year as contemplated under Sec.
12 read with article 14 of the Limitation Act, 1903.
The suits were dismissed by the Trial Court and were confirmed by the First Appellate Court and by the High Court in Second Appeals.
But the Division Bench under Clause (10) of the Letter of Patent allowed the appeals and set aside the Judgments and Decrees of the courts below and granted decree of redemption in terms of the prayer by Judgment dated April 9, 1974.
Assailing the legality thereof the appeals have been filed after obtaining leave under the article 136 of the Constitution.
Since common questions of facts and law arise for decision in these appeals, they are disposed of by a common judgment.
The only question that was argued before the High Court and reiterated in this Court is whether the suits are barred by limitation.
The contention of Shri Mehta, the learned counsel for the appellants is that the order passed by the Collector under Sec.
12 of the Act is conclusive between the parties unless the suits are laid under article 14 of the Limitation Act within one year from the date of the Order.
Admittedly, the present suits have been filed beyond such limitation of one year.
The High Court committed a grave error of law in applying the provisions of Sec.
60 of the Transfer of property Act and the ratio of the Privy council in Raghunath Singh & Ors.
vs MT.
Hansraj Kanwar & Ors., A.I.R. 1934 P.C. 205.
He contends that the Act provides a right and remedy to the mortgagor and mortgagees.
Section 12 of the Act makes the order conclusive and binding and Sec.
13 bars second application in that regard unless the suit is filed within one year from the date of the order.
It is not open to the Civil Court to go behind the order of the Collector and enlarge the limitation provided under article 14 of the Limitation Act.
All the provisions of Transfer of Property Act were not applicable to State of Punjab.
Certain Provisions relating to Sale deeds and gifts were made applicable to the State of Punjab with effect from April 1, 1955 and to the area comprised in the erstwhile Pepsu State, w.e.f.
May 15, 1957.
As on the date when the suits were laid, section 60 of Transfer of Property Act did not apply to Punjab and so the ratio in Raghunath Singh 's case (supra) is inapplicable.
The High Court committed manifest error in applying s.60.
He cited decisions of Lahore High Court in support of the contention that the suit shall be laid within one year which we would advert to at a later stage.
Shri Dua, learned counsel for the respondents contended that the High 618 Court is justified in holding that the suit is not barred by limitation and the ratio of the decision cited by the appellants cannot be applied.
The Act is a beneficial legislation giving right to the mortgagors to seek redemption and restoration of possession of the hypotheca in summary proceedings before the revenue courts.
The Act applied only to mortgage of land where the principal money secured under the mortgage does not exceed Rs. 5,000 and the hypotheca does not exceed 50 acres of land.
Section 4 gives right to the mortgagor and other persons entitled to sue for redemption at any time after the principal money becomes payable and before the suit for redemption is barred, by presenting a petition to the collector for a direction i.e. mortgage be redeemed and erstwhile morgages shall put the mortgagor in possession of the hypotheca, after following the procedure in that behalf.
5 to 11 deal with the procedure.
Under section 11 if the Collector, on an enquiry, forms an opinion that the sum is rightly due under the mortgage, he shall, unless he dismisses the petition under Sec. 10, make an order under Sec.6.
If the sum is found larger than the sum deposited, the mortgagor shall deposit the amount with any further sum that may be due on account of interest upto date of the deposit; on making deposit within the period or extended period not exceeding 30 days, thereafter, the Collector shall make an order under Sec.6 thereto.
On committing default by the Mortgagor, the Collector shall dismiss the petition.
Section 6 provides the relief of redemption; of restoration of possession to the martgagor; delivery of the mortgage, deed and payment of the mortgage money to the mortgagee.
Section 12, which is material for the purpose of this case, reads thus: (1) "Saving of suits to establish rights Any party aggrieved by an order made under Section 6, 7, 8, 9, 10 or 11 of this Act may institute a suit to establish his right in respect of the mortgage, but subject to the result of such suit, if any, the order shall be conclusive.
(2) Setting aside ex parte orders or orders of dismissal Notwithstanding anything in this section a mortgagee against whom an ex parte order under section 7 has been made or a petitioner, whose petition has been dismissed in default under section 6 may apply to the Collector to have such order of dismissal set aside, and Collector may in his discretion set aside such order of dismissal, on such terms as to costs or otherwise as he may deem fit; provided that the order of dismissal shall not be set aside unless notice of 619 the application has been served on the opposite party.
" Section 13 creates a bar to make any further petition under the Act by the mortgagor or his successor in interest.
A reading of Sec.
12 clearly postulates that the aggrieved party, be it mortgagor or mortgagee, against an order made under sections 6 to 11 is empowered to institute a suit to establish his right in respect of the mortgage, subject to the result of the suit the order passed by the Collector shall be conclusive.
Article 14 of the Limitation Act, 1908 which is equivalent to article 100 of the , prescribes limitation of one year from the date of the decision or the order of the officer of the Government in his official capacity.
Article 61 of the present provides 30 years for redemption and recovery of the possession of the hypotheca.
The limitation of 30 years runs from the date when the right to redemption or possession accrues.
Articles 105, 134, and 145 of the Old would apply to the present litigation and the limitation is 60 years.
In Tulsi Dass @ Nirmal Das & Ors.
vs Diala Ram, (2) AIR 1943 Lah.
176 a Full Bench for which Tek Chand.
J. wrote the leading judgment held at page 189 thus: "The order of the Collector does not affect the rights of the parties in any way; it is conclusive to this extent only that the petition for summary redemption has been dismissed and no other petition under the Act would lie.
No suit under section 12 being necessary or comptetent, there was no bar to the mortgagor suing for redemption in the civil Courts within the period allowed by law in ordinary course.
It must, therefore, be held that the mortgagor 's suit in A.I.R. 1929 Lah.
513 was rightly decreed and that the contrary conclusion reached by the Single Bench in A.I.R. 1927 Lah.
461 and re affirmed by the Division Bench in A.I.R. that it is the form of the order of the Collector which has to be seen and not the substance of it, is erroneous.
This view was approved by this Court in Sheo Lal & Ors.
vs Sultan & Ors.
, ; by a Bench of three Judges.
The facts were that the Collector did not decide the dispute on merits, but rejected the application filed under Sec. 4 of the Act holding that the application raised complicated question of facts and law and thereby he declined to exercise summary jurisdiction under the Act.
On institution of the suit the plea of limitation under article 14 of Old was raised which was upheld by the Trial Court, but on 620 appeal the decree of redemption was granted and was confirmed by the High Court in Second Appeal.
The same contention was reiterated before this Court.
In that context Shah, J. as he then was, speaking for the court, held that it is not the form of the order of dismissal but its substance will determine the application of the period of limitation prescribed by article 14 of the .
An order relegating the mortgagor to a civil suit for obtaining an order of redemption, event if becomes final, does not bar a suit for redemption for it raises no cloud on the title of the mortgagor arising out of the mortgage.
Such an order is not one which is required to be set aside.
An order required to be set aside is one which the officer making it has jurisdiction to make it and has the effect of barring the claim for relief unless it is set aside.
It is clear that an order passed by the Collector under sections 6 to 11 is only conclusive for what was decided therein and if the adjudication made by the Collector in summary proceedings are sought to be reopened, certainly, unless the order is got over, either by the martgagor or by the mortgagee, or any person claiming right, title or interest through them being an aggrieved person within the meaning of Sec. 12, the order of the Collector binds the parties or the persons claiming right, title or interest from the parties.
Take for instance, there is a dispute as in the present case about the mortgage money before the Collector.
Kala Singh disputed the money secured of hypothecation but had compromised and agreed to pay the amount mentioned in the mortgages bond, namely, Rs.850 Rs.
10 in each of the mortages disputed but in the suit filed within one year he reiterated his original stand.
Had the same stand been taken by the respsondents disputing the mortgage money, certainly it would not be open to the respondents as successor in interest of the mortgagor to contend that the money advanced under the mortgage was not Rs. 850, but something less.
That is not the case in the present suit.
They agreed to pay Rs. 850 as decided by the Collector and sought redemption in the civil suit.
Thereby they are not seeking to set aside the order of the Collector, but they are seeking redemption of the mortage.
Take another instance where the mortgagor disputed the execution or validity of the mortgage, bond itself and the finding was recorded against the mortgagee, i.e. the mortgage bond was not either executed or is void for being vitiated by fraud, coercion or undue influence, etc.
The mortgagor successfully avoided the mortgage by a specific order passed by the Collector under the relevant provisions of the Act.
If no suit was filed within a period of one year, the findings of the Collector become conclusive between the mortgagee and the mortgagor and it is not open to assail the order of the Collector after one year in a suit of 621 foreclosure or sale by the mortgagee.
Therefore, what was prohibited by Sec.
12 is only the substance of the order and not the form.
Once a mortgage always a mortgage and gets extinguished by payment of mortgage money by the mortgagor or decree of redemption is passed and satisfied.
The creation of mortgage is an act intervivos and not a statutory or common law right.
The Act accords summary remedy and the default of compliance entails with dismissal of the application and section 13 prohibits second applications for the self same relief.
The remedy of civil suit for redemption available at common law, subject to limitation, is not taken away.
Civil suit is not a declaratory suit, but one to redeem the mortgage and to recover possession of mortgaged property.
The question then is whether the respondents are entitled to redemption of the mortgage.
Section 60 of the gives right to redemption of the mortgage by instituting a suit for redemption of the mortgage property.
But as seen, at the relevant time section 6D was not made applicable to Punjab.
In Mussammat Bhagwan Devi vs Mussammat Bunyadi Khanum, the Division Bench held that although the and the Indian Easement Act are not in force in Punjab, the Punjab Courts when deciding cases in which principles of law dealt with by the provisions of those Acts are involved, may adopt those provisions as embodying law applicable to the case especially when the law enunciated therein coincides with the principles of equity, good conscience and justice for which there is no statutory law applicable to the Punjab.
In that it was held that the mortgagor in possession had no authority, without the consent of the mortgagee, to do an act which was likely to prove destructive or permanently injurious to the property mortgaged.
In Safdar Ali.
vs Ghulam Mohi ud din & Ors., the Full Bench was to consider whether Doctrine of Clogging would apply when the was not made applicable to Punjab.
The Full Bench held that though the Doctrine of Clogging, in terms does not apply in Punjab, when there is no statutory prohibition, governing the matter be restricted to case where something unconscionable or oppressive in the bargain calls for redress.
In terms the Full Bench applied the Principles in the provisions of the consistent with the Doctrine of Justice, Equity and Good Conscience.
In Mian Nizam & Din Mohammad vs Lala Ram Sukh Das, the right of prior mortgagee purchasing property mortgaged to him be deemed to keep alive for his benefit as against subsequent mort 622 gagee.
It was held that the principles contained in section 101 of would be applicable and applied.
In Milkha Singh vs Mst.
Shankari & Ors., AIR (34) Lahore 1 a Full Bench of five Judges applied the Doctrine of Part Performance under section 53A of the as a defence.
It was further held that section 53A is based on equitable principles which were previously applicable to whole of India, though the per se was not applied to Punjab.
In M/s Ram Gopal Dula Singh vs Sardar Gurbux singh Jiwan Singh & Ors., Kapur, J., as he then was speaking for the Division Bench, held that though section 6 of the is not applicable to Punjab, the right to expectancy may not be transferred.
It was further held that in Punjab and Lahore there is no disagreement as to Principles of being applicable to Punjab because they are based on Justice, Equity and Good conscience.
This view was again reiterated in Atma Singh & Gian Singh vs Mangal Singh & Ors., I.L.R.1957 Jan. June (Vol.10) 79 and applied sections 58, 92 and 100, Doctrine of Subrogation, but excluded the applicability of the technical rules.
This Court in Ganeshi Lal vs Jyoti Pershad, held that though the does not apply to Punjab, the priciple of equity, justice and good conscience would apply to Punjab.
If one of the several mortgagor redeems the entire mortage by paying a sum less than the full amount due under the mortgage, he is entitled to receive from his co mortgagors only their proportionate shares on the amount actually paid by him.
He is not entitled to claim their proportionate shares on the amount which was due to the mortages under terms of the mortgage on the date of redemption.
The same principle laid down in Suryanarayan vs Sriramulu, [1913] 25 M.L.J. p. 16 was referred to with approval in Ganeshi Lal 's case.
Though in Ganeshi Lal 's case the entire claim under the suit for contribution was not decreed, the provision of were applied, on the Principles of equity, justice and good conscience and granted degree pro rata.
We hold that applying the principle of Justice, Equity and Good Conscience though section 60 of the per se did not apply, the principles in section 60 would apply.
Though the application for redemption was dismissed under s.11 of the Act and became conclusive under section 12 the mortgagor 's right to redemption is not barred.
A suit for redemption under section 60 of will be maintainable and civil court has jurisdiction to grant the decree of redemption.
In Gangu & Ors., vs Maharaj Das & Ors., I.L.R. 15 Lahore 380 a 623 Full Bench following Kaura vs Ram Chand Lah.
206 held that unless the order of the Collector be challenged within one year the civil court has no jurisdiction to entertain the suit.
In this case the right to redemption of mortgage itself was barred by limitation.
Therefore, the ratio does not apply.
Though the ratio in Bhagat Ram & Ors.
vs Jamna Ram & Ors. is in favour of the appellants, in our view the ratio therein is not good law.
Thus we hold that the suits for redemption are admittedly within limitation either under the Old Limitation or under the new .
The bar of Sec.
12 of the Act does not oust the jurisdiction of the civil Court to entertain and grant decree of redemption.
The appeals are accordingly dismissed, but in the circumstances parties are directed to bear their own costs throughout.
Y.L. Appeal dismissed.
| IN-Abs | Kala Singh predecessor of the respondents executed three mortgages hypothecating agricultural lands in favour of the appellants.
The mortgagor filed an application under Section 4 of the Redemption of Mortgages (Punjab) Act 2 of 1913 and sought redemption of the mortgages, by paying Rs.10 in respect of each of the mortgage.
The parties compromised regarding the amount payable and the Collector passed the order on compromise under Section 11 of the Act on Feb. 3, 1964.
The mortgagor having committed default in making the payment within the time allowed for the purpose, the petitions were dismissed by the Collector.
Thereupon the mortgagor filed three separate suits against each mortgagee for redemption within one year under Section 12 of the Act on June 12, 1964 and during the pendency of the suits, he having died the suits were dismissed.
The respondents after obtaining mutation of their names in the revenue records, filed separate suits for redemption of the mortgages but beyond one year as contemplated under section 12 read with Art.14 of the Limitation Act 1908.
The suits were dismissed by the trial court; which order was later affirmed both by the first appellate Court as also by the High Court.
On a further appeal under the Letter Patent Act, the Division Bench of the High Court allowed the appeals and set aside the judgments and Decrees of the courts below and granted decree of redemption holding that the suits were not barred by limitation.
The appellants have thus filed these appeals after obtaining special leave.
The appellants have reiterated their contention amongst others that the suits were barred by limitation and further the High Court was not right in applying the provisions of Section 60 of the Transfer of Property Act.
Dismissing the appeals this Court, 615 HELD: Section 13 creates a bar to make any further petition under the Act by the mortgagor or his successor in interest.
A reading of Section 12 clearly postulates that the aggrieved party, be it mortgagor or mortgagee, against an order made under sections 6 to 11 is empowered to institute a suit to establish his right in respect of the mortgage.
Subject to the result of the suit, the order passed by the Collector shall be conclusive.
Article 14 of the Limitation Act, 1908 which is equivalent to Article 100 of the , prescribes limitation of one year from the date of the decision or the order of the officer of the Government in his official capacity.
Article 61 of the present provides 30 years for redemption and recovery of the possession of the hypotheca.
The limitation of 30 years runs from the date when the right to redemption or posession accrues.
Articles 105, 134 and 145 of the old would apply to the present litigation and the limitation is 60 years.(619A C) The creation of mortgage is an act intervivos and not a statutory or common law right.
The Act accords summary remedy and the default of compliance entails with dismissal of the application and section 13 prohibits second application for the self same relief.
The remedy of civil suit for redemption available at common law, subject to limitation, is not taken away.
Civil suit is not a declaratory suit, but one to redeem the mortgage and to recover possession of mortgage property.
[621B C] In the instant case, applying the principle of Justice, Equity and Good conscience though section 60 of the Transfer of Property Act, per se, did not apply, the principles in section 60 would apply.
[622G] Though the application for redemption was dismissed under section 11 of the Act and and became conclusive under section 12, the mortgagor 's right to redemption is not barred.
A suit for redemption under section 60 of the Transfer of Property Act will be maintainable and civil court has jurisdiction to grant the decree of redemption.
[622G] The suits for redemption are admittedly within limitation either under the old Limitation or under the new .
The bar of section 12 of the Act does not oust the jurisdiction of the civil court to entertain and grant decree of redemption.
[623B] Raghunath Singh & Ors.
vs Mt. Hansraj Kanwar and Ors.
A.I.R. 1934 P.C. 205; Tulsi Dass @ Nirmal Das Ors., vs diala Ram AIR 1943. ; Sheo Lal & Ors.
vs Sultan and Ors.
; ; Mussammat Bhagwan Devi vs Mussammat Bunyadi Khanum ; Safdar Ali vs Ghulam Mohi ud din Ors., ; Mian Nizam & Din Mohammed vs Lala Ramsukh Das, ; Milkha Singh vs Mst.
Shankari & Ors., AIR (34) Lahore 1;Ms.
Ram Gopal Dula Singh vs Sardar Gurbux Singh Jiwan Singh and Ors., ; Atma Singh & Gian Singh vs Mangal Singh and Ors., ILR 1957 Jan. June (Vol. 10) 79; Ganesh Lal vs Jyoti Pershad, , Suryanarayan vs Sri ramulu, [1913] (25) M L.J.P.16; Referred to.
Gangu & Ors., vs Maharaj Das & Ors., ILR 15 Lahore 380; Kaura vs Ram Chand, , Lah.206 Distinguished.
Bhagat Ram & Ors.
vs Jamna Ram and Ors., [1928] 114 I.C. 447 Not approved.
|
section 176, 177 and 253 of 1956; 34, 35, 51 53, 69, 70, 75, 94 & 137 of 1957 ; 34, 58, 72, 90, 92, 106, 109 & 115 of 1958.
Petitions under Article 32 of the Constitution of India for.
enforcement of Fundamental rights.
C.B. Aggarwal and Naunit Lal, for the petitioner (In Petition No. 176 of 1956).
Achhru Ram and Naunit Lal, for the petitioner (In Petition No. 177 of 56).
Naunit Lal, for the petitioner (In Petitions Nos.
253/ 56; 34, 35, 51 53, 69, 70, 75, 94 and 137/57; 34, 58, 92, 106, 109 & 115/58).
750 Radhey Lal Aggarwal and A. G. Ratnaparkhi, for the petitioner (In Petition No. 90/58).
H. N. Sanyal, Additional Solicitor General of India, S.M. Sikri, Advocate General for the State of Punjab, Gopal Singh and T. M. Sen, for respondent No. 1 (In Petition No. 176/56).
S.M. Sikri, Advocate General for the State of Punjab, and T. M. Sen, for respondent No. 1 (In Petitions Nos. 177 & 253/56; 34, 35, 51 53, 69, 70, 75, 94 & 137/57; 34, 58, 72, 90, 92, 106, 109 & 115/58).
R.S. Gheba, for respondent No. 3 (In Petition No. 90/58).
Dipak Dutta Chowdhury, for respondent No. 3 (In Petition No. 176/56).
Udai Bhan Chowdhury, for respondent No. 7 (In Petition No. 59/57) and respondent No. 3 (In Petition No. 70/57).
Harnam Singh and Sadhu Singh, for the Interveners (In Petition No. 176/56).
December 8.
The Judgment of the Court was delivered by SINHA, J.
These petitions under article 32 of the Constitution impugn the constitutionality of the Punjab Security of Land Tenure Act (Punj.
X of 1953) (which will be referred to hereinafter as the Act), as amended by Act XI of 1955.
The petitioners are land owners of the lands affected by the provisions of the impugned Act.
The State of Punjab and its officers, besides persons claiming benefits under the Act, are the respondents in these several petitions.
The impugned Act has a history which may shortly be set out.
With a view to providing for the security of tenure to tenants, the Punjab Tenants (Security of Tenure) Ordinance IV of 1950, was promulgated with effect from May 13, 1950.
That Ordinance was replaced by the Punjab Tenants (Security of Tenure) Act XII of 1950, which came into force on November 6, 1950, on the date on which it was first published in the Punjab Government Gazette.
The Act prescribed a limit of one hundred standard acres of land (equivalent to two hundred ordinary acres) which could be 751 held by a land owner for his " self cultivation "; and it was termed" permissible limit " (section
2(3) ).
Any landowner having land in excess of the " permissible limit was authorized by section 3 to select for " self cultivation land out of the entire area held by him in the State of.
Punjab, as land owner, and reserve it for his own use to the extent of the " permissible limit ".
This " right of reservation " had to be exercised, first, in respect of land in his self cultivation; and if the extent of such land fell short of the " permissible limit ", he could, under section 4, make up the deficiency by ejecting tenants under him in respect of such lands as fell within his reserved area.
Section 5 fixed the minimum period of tenancy as four years, subject to certain exceptions set out in section 6.
These were some of the salient features of the Act of 1950, which itself was amended by the Punjab Tenants (Security of Tenure) Act (Punj.
V of 1951), which came into force on December 24, 1951.
By the amending Act, the " permissible limit " was reduced to 50 standard acres equivalent to 100 ordinary acres, and the minimum period of tenancy was raised to five years.
It also made provisions for preferential right of pre emption (section
12A), and conferred a right of purchase on the tenant in respect of land in his possession (section
12B), subject to certain exceptions(s. 12C).
Another legislation in this series was the Prevention of Ejectment (Temporary Powers) Ordinance No. 1 of 1952, which came into force on June 11, 1952.
Then, came the Punjab Security of Land Tenure Act (Punj.
X of 1953), now impugned, which repealed the aforesaid Acts XII of 1950 and V of 1951.
It came into force on April 15, 1953.
This Act itself was amended by Act LVII of 1953 and Act XI of 1955.
Though.
this Act has undergone subsequent amendments in 1957 and 1958, we are not concerned with those amendments, because they came into existence after this Court was moved under article 32 of the Constitution.
We are concerned with the state of the law as it stood after the amendment of 1955, aforesaid.
Before dealing with the grounds of attack urged against the impugned Act, it is convenient to set out, 752 in a nut shell, the salient provisions of the Act, which have given rise to the present controversy, and which give an idea of the scope and nature of the legislation now under examination.
The Act has a short Preamble, namely, " to provide for the security of land tenure and other incidental matters ".
The Act further reduces the " permissible area " (section 2(3) ) in relation to a landlord or a tenant, to 30 standard acres equivalent to 60 ordinary acres, thus, releasing a larger area for re settlement of tenants ejected or to be ejected under the provisions of the Act.
So to say, it creates a pool of "surplus area" (section 2(5 a)), meaning thereby the area other than the"reserved area"in excess of the "permissible area" as aforesaid.
"Reserved area" means the area lawfully reserved by the landlord under the provisions of the two Acts aforesaid, which were repealed by the Act (section
2(4)).
The definition of a tenant under the Act, includes a sub tenant and a self cultivating lessee (section
2(6)).
As already indicated, a tenant also may be liable to be ejected from any area which he holds in any capacity whatever in excess of the " permissible area ".
Section 10 A authorizes the State Government or any officer empowered by it in this behalf, to utilize any " surplus area " for re settlement of tenants ejected or to be ejected under the provisions of section 9(1).
But a tenant inducted on to such " surplus area ", holds the land under the land owner, who, thus, becomes entitled to receipt of rent from the tenant.
Section 12 lays down the maximum rent payable by a tenant.
Section 17 recognizes the rights of certain tenants to pre empt sales or fore closure of land.
Section 18, which formed the subject matter of the most vehement attack on behalf of the petitioners, confers upon the tenants of the description given in the several clauses of the Act, the right to purchase from the land owner the land held by them, subject to certain exceptions, and subject to the payment in a lump sum or in six monthly instalments not exceeding ten, of the purchase price to be determined in accordance with cls.
(2) and (3) of section 18.
Section 23 invalidates any decree or order of any.
court or authority, or a notice 753 of ejectment, which is not consistent with the provisions of the Act.
Thus, the Act seeks to limit the area which may be held by a land owner for the purpose of self cultivation, thereby, releasing " surplus area " which may be utilized for the purpose of resettling ejected tenants, and affording an opportunity to the tenant to become the land owner himself on payment of the purchase price which, if anything, would be less than the market value.
It, thus, aims at creating what it calls a class of " small land owners " meaning thereby, holders of land not exceeding the " permis sible area " (section
2(2)).
The utmost emphasis has been laid on self cultivation which means " cultivation by a land owner either personally or through his wife or children, or through such of his relations as may be prescribed, or under his supervision " (section
2(9) ).
The arguments at the Bar, on behalf of the petitioners may be put under three main heads, namely, (1) that the Legislature had no legislative competence to enact the Act, (2) that the provisions of the Act contravene the petitioners ' fundamental rights enshrined in articles 14, 19(1)(f) and 31 of the Constitution, and (3) that certain specified provisions of the Act amount to unreasonable restrictions on the petitioners ' rights to hold and dispose of property.
At the outset, it is necessary to deal with the question of legislative competence, which was raised on behalf of some of the petitioners, though not on behalf of all of them.
This argument of want of legislative competence goes to the root of the impugned Act, and if it is well founded, no other question need be gone into.
It has been argued that Entry 18 in List II of the Seventh Schedule to the Constitution, should not be read as authorizing the State Legislature to enact a law limiting the extent of the land to be held by a proprietor or a landowner.
Entry 18 is in these words: " 18.
Land, that is to say, rights in or over land tenures including the relation of landlord and tenant, and the collection of rents; transfer and alienation of agricultural land improvement and agricultural loans; colonization.
" 754 It will be noticed that the Entry read along with article 246(3) of the Constitution, has vested exclusive power in the State to make laws with respect to " rights in or over land tenures including the relation of landlord and tenant. .
The provisions of the Act set out above, deal with the landlord 's rights in land in relation to his tenant, so as to modify the landlord 's rights in land, and correspondingly, to expand the tenant 's rights therein.
Each of the expressions " rights in or over land " and " land tenures ", is comprehensive enough to take in measures of reforms of land tenures, limiting the extent of land in cultivating possession of the land owner, and thus, releasing larger areas of land to be made available for cultivation by tenants.
Counsel for some of the petitioners who challenged the legislative competence of the State Legislature, were hard put to it to enunciate any easily appreciable grounds of attack against Entry 18 in List II of the Seventh Schedule.
It was baldly argued that Entry 18 aforesaid, was not intended to authorize legislation which had the effect of limiting the area of land which could be directly held by a proprietor or a land owner.
It is difficult to see why the amplitude of the words " rights in or over land " should be cut down in the way suggested in this argument.
A similar argument was advanced in the case of The United Provinces vs Mst.
Atiqa Begum (1).
In that case, the United Provinces Regularization of Remissions Act, 1938 (U. P. XIV of 1938), was challenged.
One of the main provisions of that Act had validated remission of rent.
It had been argued that the United Provinces Legislature was not competent to legislate about the remission of rent, when the relevant words in Entry 21, relating to land in the Provincial List of the Seventh Schedule to the Constitution Act of 1935, were " collection of rents ".
Entry 21 relating to " land " bad added certain words by way of explanation and illustration of the intention of the Constitution makers, ,so as to indicate that the word " land " was meant to be used in its widest connotation.
A member of the (1)[1940] F.C.R. 110.
755 Full Bench of the Allahabad High Court, in his judgment which was the subject matter of the appeal to the Federal Court, had come to the conclusion that Item No. 21 aforesaid, including the words " collection of rents ", had not authorized the Provincial Legislature to validate remission of rent.
That conclusion was not upheld by the Federal Court which held that remission of rent was a matter covered by Item No. 21, and it was, therefore, within the competence of the Provincial Legislature to enact the impugned Act; and Gwyer, C. J., in the course of his judgment observed that the Items in the several lists of the Seventh Schedule, should not be read in a narrow or restricted sense, and that each general word should be held to extend to all ancillary and subsidiary matters which could fairly ' and reasonably be said to be comprehended in it.
The same Item 21 in List II (Provincial List) of the Seventh Schedule to the Constitution Act of 1935, came up for consideration before the Judicial Committee of the Privy Council on appeal from the Federal Court of India in Megh Raj vs Allah Rakhi (1), affirming the judgment of the Lahore High Court.
In that case, the Punjab Restitution of Mortgaged Lands Act (Punj.
IV of 1938) had been challenged as ultra vires.
By that Act, the Legislature had provided for redemption of mortgages on terms much less onerous than the terms of the mortgage deeds.
Their Lordships of the Judicial Committee of the Privy Council repelled the contention raised on behalf of the appellants that the words of Item No. 21, were not wide enough to comprehend the relationship of mortgagor and mortgagee in respect of agricultural land.
Their Lordships observed that Item 21 aforesaid, forming a part, as it did, of the Constitution, should, on ordinary principles, receive the widest construction, unless, for some reasons, it is cut down either by the terms of that item itself, or by other parts of the Constitution, which have, naturally, to be read as a whole; and then proceeded to make the following very significant observations : (1) (1946) L.R. 74 I.A. 12. 756 " As to item 21, " land ", the governing word, is followed by the rest of the item, which goes on to say, 'that is to say '.
These words introduce the most general concept ' rights in or over land '.
Rights in land ' must include general rights like full ownership or leasehold or all such rights.
Rights over land ' would include easements or other collateral rights, whatever form they might take.
Then follow words which are not words of limitation but of expla nation or illustration, giving instances which may furnish a clue for particular matters: thus there are the words relation of landlord and tenant, and collection ' of rents ".
Thus, their Lordships concluded that the Item 21 relating to land, would include mortgages as an incidental and ancillary subject.
Another branch of the same argument was that Entry 18 could not cover the determination of the relation of landlord and tenant, which is envisaged by some of the provisions of the Act, particularly section 18, which has the effect of converting the tenant into a land owner himself, by virtue of the purchase.
This argument is also disposed of by the judgment of the Federal Court in United Provinces vs Atiqa Begum (1).
It was next contended that Entry 18 has got to be read with article 19(5), in order to determine the legislative competence in enacting the impugned statute.
In other words, it was contended that cl.
(5) of article 19 of the Constitution, is in the nature of a proviso to the Entry ; and that the Entry so read along with article 19(5), lays down the test of the legislative competence.
This argument is easily disposed.
of with reference to the provisions of article 31 A of the Constitution.
If it is held that the provisions of the impugned statute lay down the law for the modification of rights in estates, as defined in sub article
(2) of article 31A, none of the grounds of attack founded on any of the provi sions of articles 14, 19 or 31, can avail the petitioners.
As will presently appear, the Act lays down provisions which are in the nature of modifications of rights in estates within the meaning of article 31A(1).
That being (1) 757 so, article 19(5) is wholly out of the way in this case.
In view of all these considerations, it must be held that there is no legal foundation for the contention that the impugned Act is beyond the legislative competence of the State Legislature.
Having dealt with the question of legislative competence, we have to deal with the several contentions raised on behalf of the petitioners, with reference to the provisions of articles 14, 19 and 31 of the Constitution.
On this part of the case, it has rightly been conceded on behalf of the petitioners that if the impugned Act comes within the purview of any of the clauses of article 31A, the law will be immune from attack on any of the grounds based on the provisions of articles 14, 19 and 31.
But it has been argued that the provisions of article 31A(1)(a), which are admittedly the only portions of the Article, which are relevant to the present inquiry, are not attracted to the impugned Act.
It has been conceded on behalf of the respondents that the Act does not provide for the acquisition by the State of any estate or of any rights in any estate.
Hence, the crucial words which must govern this part of the controversy, are the words " the extinguishment or modification of any such rights "; that is to say, we have to determine whether or not the impugned Act provides for the extinguishment or modification of any rights in " estates ".
article 31A(2) defines what the expression II estate " used in article 3 1 A means.
According to that definition, " the expression " estate " shall, in relation to any local area, have the same meaning as that expression or its local equivalent has in the existing law relating to land tenures in force in that area, and shall also include any jagir, inam or Muafi or other similar grant and in the States of Madras and Kerala, any janmam right".
It is common ground that we have to turn to the definition of an estate, as contained in the Punjab Land Revenue Act XVII of 1887.
Section 3(1) of that Act has the following definition: (1) " estate " means any area (a) for which a separate record of rights has been made; or 758 (b)which has been separately assessed to land revenue, or would have been so assessed if the land revenue had not been released, compounded for or redeemed ; or (c)which the (State) Government may, by general rule or special order, declare to be an estate ".
Clause (c) of the definition is out of the way, because it has not been claimed that the State Government has made any declaration within the meaning of that clause.
Estate, therefore, for the purposes of the present controversy, means any area or which a separate record of rights has been made, or which has been separately assessed to land revenue (omitting the unnecessary words).
In this connection, it is also necessary to refer to the definition of a holding in section 3(3) in the following terms: "(3) 'holding" means a share or portion of an estate held by one landowner or jointly by two or more landowners ".
It was not controverted at the Bar that in Punjab, there are very few estates as defined in section 3(1), quoted above, in the sense that one single land owner is seized and possessed of an entire estate which is equated with a whole village.
In other words, in Punjab, an estate and a village are inter changeable terms, and almost all villages are owned in parcels, as holdings by co sharers, most likely, descendants of the holder of a whole village which came to be divided amongst the co sharers, as a result of devolution of interest.
The parties were also agreed that the impugned Act deals with holdings, as defined in the Land Revenue Act, or shares or portions thereof.
The argument on behalf of the petitioners to get over the provisions of article 31A, is that the Act does not deal with any estate or any rights therein, but only with holdings or shares or portions thereof.
This argument proceeds on the assumption that holdings are not any rights in an estate.
If the petitioners are right in their contention that the immunity granted by article 31A of the Constitution, is available only in respect of entire estates and not portions of estates, then the argument on behalf of the respondents that the Act is saved by the 759 provisions of that Article fails in limine.
If, on the other hand, it is held that article 31A applies not only to entire estates or any rights therein, but also to shares or portions of an estate or rights therein, then all the arguments advanced on behalf of the petitioners, founded on the provisions of Arts 14, 19 and 31, are thrown overboard.
Therefore, it becomes necessary to consider the amplitude of the expression " any estate or of any rights therein " in article 31A(1)(a).
Rights in an estate may be either quantitative or qualitative.
That is to say, rights in an estate may be held by persons having different qualities of rights in lands constituting an estate, as a result of sub infeudation.
Generally speaking and omitting all references to different kinds of land tenures prevailing in different parts of India, it may be said that at the apex of the pyramid, stands the State.
Under the State, a large number of persons variously called proprietors, zamindars, malguzars, inamdars and jagirdars, etc., hold parcels of land, subject to the payment of land revenue designated as peshkash, quit rent or malguzari, etc., representing the Government demands by way of land tax out of the usufruct of the land constituting an estate, except where Government demands had been excused in whole or in part by way of reward for service rendered to the State in the past, or to be rendered in the future.
An estate, thus, is an area of land which is a unit of revenue assessment, and which is separately entered in the Land Revenue Collector 's register of revenue paying or revenue free estates.
A single estate, unless governed by the Rule of Primogeniture, would, in course of time, be hold by a number of persons in the same rights as co sharers in the estate.
Those several co sharers are all jointly and severally liable for the payment of the Government demands, if any, though, by an arrangement with the Revenue Department, they may have had a distribution made of the total Government demands as payable in respect of aliquot portions of the estate.
Generally speaking, in the first instance, each sharer in an estate is liable to pay his portion of the landrevenue, but if, for any reasons, the Government 760 demands cannot be realized from any defaulting share primarily liable for them, the entire estate, including the shares of those who may not be the defaulting proprietors, is liable to be sold or otherwise dealt with for the realization of those demands.
Thus, the unity of assessment of land revenue in respect of the entire estate remains intact.
In actual practice, the holder of each specified portion or share of an estate, holds his portion for his own exclusive use and occupation.
Such a sharer in an estate in Punjab is known as the land owner of a " holding ".
But such a holding still continues to be a portion or a share of the estate out of which it has been carved.
Such a division of an estate is quantitative or a vertical division of an estate.
But there may also be a horizontal or qualitative division of the lands in an estate, effected by the process of sub infeudation.
Continuing the illustration of the pyramid, generally speaking, the lands in an estate may in their entirety or in portions, be let out to what, in Eastern India, are known as tenure holders, for example, patnidars, in areas covered by the Permanent Settlement.
Tenure holders were persons who took lands of an estate not necessarily for the purpose of self cultivation, but also for settling tenants on the land, and realizing rents from them.
These patnidars may have darpatnidars under them, and darpatnidars sepatnidars, and in this way, the sub infeudation went on.
All these classes are included within the terms " tenure holders ", " sub proprietors " or " under proprietors ".
The persons who are inducted on to the land for bringing it under their direct cultivation, are generally known in Eastern India as raiyats with rights of occupancy in the land held by them.
But raiyats, in their turn, may have inducted tenants under them in respect of the whole or a portion of their holding.
The tenant holding under a raiyat is known as an under raiyat, and an under raiyat may induct a tenant under himself, and he will be an under raiyat of the second degree.
Thus, in each grade of holders of land, in the process of subinfeudation described above.
the holder is a tenant under his superior holder, the landlord, and also the 761 landlord of the holder directly holding under him.
Thus, in Eastern India, the interest of intermediaries between the proprietor of an " estate " at the top and the actual tiller of the soil at the bottom, is known as that of a " tenure holder ", and the interest of tenants other than tenure holders, is given the generic name of a " holding ".
A holding in Eastern India, thus, indicates the interest of the actual tiller of the soilraiyat or under raiyat unlike the " holding " in Punjab where, as indicated above, its signifies the interest of the holder of a share in an estate.
Thus, holdings in Punjab are vertical divisions of an estate; whereas in Eastern India, they represent a horizontal division, connoting a lesser quality of an estate in land than the interest of a tenure holder in his tenure, or of a land owner in his estate or portion of an estate.
It is not necessarily true that there should be intermedia ries in every estate or a portion of an estate.
Very often, the holder of an estate may be holding his entire estate directly in his possession by way of khudkasht, zeerat, kamath or neezjote, or it may be that the proprietor has only raiyats under him without the intermediation of tenure holders, and the raiyats may not have any under raiyats under them.
The process of sub infeudation described above, naturally, varies with the size of the estate.
It appears to be common ground in this case that in Punjab, an estate means the whole village, whereas in Eastern India, an estate may comprise a whole district or only a cluster of villages, or a single village, or even a part of a village.
The larger the size of an estate, the greater the process of sub infeudation and vice versa.
In Punjab, as there was no permanent settlement of Revenue as in Bengal, Bihar, Orissa and other parts of Eastern India, the unit of revenue assessment has been the village.
Thus, a holding in Punjab means a portion of a village either big or small.
That portion may be in the direct possession of the landowner himself, or he may have inducted tenants on a portion or the whole of his holding.
The interest of the tenant in Punjab, appears to have been a precarious tenure, even more precari ous than that of an under raiyat in Eastern India.
The 96 762 Punjab Legislature, realising that the interest of a tenant was much too precarious for him to invest his available labour and capital to the fullest extent so as to raise the maximum quality and quantity of money crops or other crops, naturally, in the interest of the community as a whole, and in implementation of the Directive Principles of State Policy, thought of granting longer tenures, and as we have seen above, the period has been progressively increased until we arrive at the stage of the legislation now impugned, which proposes to create a large body of small land owners who have a comparatively larger stake in the land, and consequently, have greater impetus to invest their labour and capital with a view to raising the maximum usufruct out of the land in their possession.
Keeping in view the background of the summary of land tenures in Punjab and elsewhere, we have to construe the amplitude of the crucial words " any estate or of any rights therein " in article 31A (1) (a).
Soon after the coming into effect of the Constitution, the different States in India embarked upon a scheme of legislation for reforming the system of land holding, so as (1) to eliminate the intermediaries, that is to say, those who hold interest in land in between the State at the apex and the actual tillers of the soil in other words, to abolish the class of rent receivers, and (2) to create a large body of small landholders who have a permanent stake in the land, and who are, therefore, interested in making the best use of it.
As the connotation of the term " estate " was different in different parts of the country, the expression " estate " described in el.
(2) of article 31 A, has been so broadly defined as to cover all estates in the country, and to cover all possible kinds of rights in estates, as shown by sub cl.
(b) of cl.
(2) of article 31A, which is in these terms: shall include any rights vesting in a proprietor, sub proprietor, under proprietor, tenure holder (raiyat, under raiyat) or other intermediary and any rights or privileges in respect of land revenue.
" The expression " rights " in relation to an estate has been given an all inclusive meaning, comprising both 763 what we have called, for the sake of brevity, the " horizontal " and " vertical " divisions of an estate.
A proprietor in an estate may be the proprietor holding the entire interest in a single estate, or only a co sharer proprietor.
The provisions aforesaid of article 31A, bearing on the construction of the expression " estate " or "rights" in an estate, have been deliberately made as wide as they could be, in order to take in all kinds of rights quantitative and qualitative in an area co extensive with an estate or only a portion thereof.
But it has been suggested that the several interests indicated in sub cl.
(b), quoted above, have been used with reference to the area of an entire estate, but knowing as we do, that a raiyat 's or an under raiyat 's holding generally is not co extensive with the area of an entire estate but only small portions thereof, it would, in our opinion, be unreasonable to hold that the makers of the Constitution were using the expression " estate " or " rights " in an estate, in such a restricted sense.
Keeping in view the fact that article 31A was enacted by two successive amendments one in 1951 (First Amendment), and the second in 1955 (Fourth Amendment) with retrospective effect, in order to save legislation effecting agrarian reforms, we have every reason hold that those expressions have been used in their widest amplitude, consistent with the purpose behind those amendments.
A piece of validating enactment purposely introduced into the Constitution with a view to saving that kind of legislation from attacks on the ground of constitutional invalidity, based on articles 14, 19 and 31, should not be construed in a narrow sense.
On the other hand, such a constitutional enactment should be given its fullest and widest effect, consistently with the purpose behind the enactment, provided, however, that such a construction does not involve any violence to the language actually used.
Another branch of the same argument was that if the makers of the Constitution intended to include within the purview of article 31A, not only entire estates but also portions thereof, nothing would have been easier than to say so in terms, and that in the absence of any specific mention of " portions of an estate 764 we should not read that article as covering " portions of an estate " also.
In our opinion, there is no substance in this contention, because they must be attributed full knowledge of the legal maxim that " the greater contains the less " Omne Majus continet in se minus.
In this connection, our attention was invited to the decision of a Full Bench of the Punjab High Court in the case of State of Punjab vs section Kehar Singh (1), to the effect that a holding being a part of an estate, was not within the purview of article 31A of the Constitution.
In this connection, it is necessary to state the conflict of views in that High Court itself.
In the case of Bhagirath Ram Chand vs State of Punjab (2), the validity of the very Act impugned before us, was challenged on grounds based upon Articles 14, 19 and 31 of the Constitution.
The learned Judges constituting the Full Bench, unanimously held that the impugned Act did not infringe those provisions of the Constitution, and the restrictions on the right of land holding, imposed by the Act, were reasonable, and that the classification did not exceed the permissible limit.
But they also held that the Act was saved by article 31A of the Constitution, which applied equally to an entire estate or to a portion thereof.
Besides giving other reasons, which may not bear close scrutiny, they made specific reference to the doctrine that the whole includes the part.
Thus, the Full Bench specifically held that article 31A of the Constitution applied equally to portions of estates also.
This decision of the Full Bench was followed by a Division Bench of the same High Court, consisting of Bhandari, C. J., and Dulat, J., in the case of Hukam Singh vs The State of Punjab (3).
That Bench was concerned with the provisions of another Act Punjab Village Common Lands (Regulation) Act, 1954.
In that case, the Division Bench, naturally, followed the decision of the Full Bench in so far as it had ruled that the I whole ' includes the part, and that where an Act provides for rights in an estate, it provides for rights in a part of an estate also.
The later Full (1) (1958) 60 P.L.R 461.
(2) A.I.R. 1954 Pun.
(3) 765 Bench case referred to above, was decided by three Judges, including Bhandari, C. J., who agreed with the judgment of the Court delivered by Grover, J.
Perhaps, the better course would have been to constitute a larger Bench, when it was found that a Full Bench of three Judges, was inclined to take a view contrary to that of another Full Bench of equal strength.
Such a course becomes necessary in view of the fact that otherwise the subordinate courts are placed under the embarrassment of preferring one view to another, both equally binding upon them.
In our opinion, the view taken by the earlier Full Bench is the correct one.
The learned Chief Justice who was a party to both the conflicting views on the same question, has not indicated his own reasons for changing his view.
The Full Bench has accepted the force of the legal maxim that the greater contains the less, referred to above, but has not, it must be said with all respect, given any good reasons for departing from that well established maxim.
The judgment of the Full Bench on this part of the case is based entirely upon the definition of an estate, as contained in the Punjab Land Revenue Act, set out above.
It has not stopped to consider the further question why a holding, which is a share or a portion of an estate, as defined in the Punjab Act, should not partake of the characteristics of an estate.
Keeping in view the background of the legislative history and the objective of the legislation, is there any rational reason for holding that the makers of the Constitution thought of abolishing only intermediaries in respect of an area constituting one entire estate but not of a portion thereof ? On the other hand, as indicated above, they have used the expression " estate" in an all inclusive sense.
They have not stopped at that; they have also added the words " or any rights therein ".
The expression " rights " in relation to an estate again has been used in a very comprehensive sense of including not only the interests of proprietors or sub proprietors but also of lower grade tenants, like raiyats or under raiyats, and then they added, by way of further emphasizing their intention, the expression " other intermediary ", thus, clearly showing that 766 the enumeration of intermediaries was only illustrative and not exhaustive.
If the makers of the Constitution have, thus, shown their intention of saving all laws of agrarian reform, dealing with the rights of intermediaries, whatever their denomination may be, in our opinion, no good reasons have been adduced in support of the view that portions or shares in an estate are not within the sweep of the expression " or any rights therein ".
A recent decision of this Court in the case of Ram Narain Nedhi vs The State of Bombay (1) dealt with the constitutionality of the Bombay Tenancy and Agricultural Lands (Amendment) Act, 1956, which contains similar provisions with a view to doing away with intermediaries, and establishing direct relationship between the State and tillers of the soil.
In that case also, the contention had been raised that the expression " estate " had reference to only alienated lands and not to unalienated lands, and this Court was invited to limit the meaning of the expression in the narrower sense.
This Court repelled that contention in these words: the context of the Code is thus clear and unambiguous as comprising both the types of lands, there is no reason why a narrower construction as suggested by the petitioners should be put upon the expression " estate. . . .
Even if there was any ambiguity in the expression, the wider significance should be adopted in the context of the objectives of the Act as stated above.
" These observations apply with full force to the contention raised on behalf of the petitioners in the present cases also.
Another branch of the same argument as to why the provisions of article 31A do not apply to the Act, is that the Act did not have the effect of either extinguishing or modifying any rights in any estate, assuming that the expression " estate " includes reference also to parts of an estate.
In this connection, it is contended that the provisions of the Act impugned in these cases, did not amount to the extinguishment of (1) [1959] SUPP.
(1) S.C.R. 489.
767 the interest of the land owners in estates or portions thereof, and that what the Act did was to transfer some of the rights of the land owners to their tenants.
In this connection, reliance was placed on the observations of this Court in the case of Thakur Raghubir Singh vs Court of Wards, Ajmer (1), where Mahajan, J. (as he then was, speaking for the Court, observed that the expressions " extinguishment " and " modification " used in article 31A of the Constitution, meant extinguishment or modification respectively of a proprietary right in an estate, and should not include, within their ambit, a mere suspension of the right of management of an estate for a time definite or indefinite.
Those observations must be strictly limited to the facts of that case, and cannot possibly be extended to the provisions of Acts wholly dissimilar to those of the Ajmer Tenancy and Land Records Act, XLII of 1950, which was the subject matter of the challenge in the case then before this Court.
This Court held, on a construction of the provisions of that Act, that they only suspended the right of management but did not amount to any extinguishment or modification of any proprietary rights in an estate.
The provisions of the Act then under consideration of this Court, have absolutely no resemblance to those of the Act now before us, and it is impossible to put a similar interpretation on these provisions.
In the recent decision of this Court (not yet reported*), this Court had been invited to apply the observations of this Court referred to above, to the provisions of the Bombay Act.
It was pointed out in that case that those observations of Mahajan, J. (as he then was), must be read as limited to an Act which only brings about a suspension of the right of management of an estate, and could not be extended to the provisions of an Act which either extinguishes or modifies certain rights of a proprietor in an estate or a portion thereof.
In this connection, it was further argued that extin guishment of a right, does not mean substitution of (1) ; , 1055, 1056.
Since reported as Sri Ram Narain Modhi vs The State of Bombay, [1959] SUPP (1) S.C.R. 489.
768 another person in that right, but total annihilation of that right.
In our opinion, it is not necessary to discuss this rather metaphysical argument, because, in our opinion, it is enough for the purpose of this case to bold that the provisions of the Act, amount to modification of the landowner 's rights in the lands comprised in his " estate " or " holding ".
The Act modifies the land owner 's substantive rights, particularly, in three respects, as indicated above, namely, (1) it modifies his right of settling his lands on any terms and to anyone he chooses; (2) it modifies, if it does not altogether extinguish, his right to cultivate the " surplus area" as understood under the Act; and (3) it modifies his right of transfer in so far as it obliges him to sell lands not at his own price but at a price fixed under the statute, and not to any one but to specified persons, in accordance with the provisions of the Act, set out above.
Thus, there cannot be the least doubt that the provisions of the Act, very substantially modi the land owner 's rights to hold and dispose of his property estate or a portion thereof.
It is, therefore clear that the provisions of article 31A save the impugned Act from any attack based on the provisions of articles 14, 19 and 31 of the Constitution.
That being so, it is not necessary to consider the specific provisions of the Act, which, it was contended, were unreasonable restrictions on the land owner 's rights to enjoy his property, or whether he had been unduly discriminated against,, or whether the compensation,if any, provided for under the Act, was illusory or, at any rate, inadequate.
Those grounds of attack are not available to the petitioners.
In the result, all these petitions are dismissed with costs, the State of Punjab and its officers being entitled to only one set of hearing fees in all the petitions.
Petitions dismissed.
| IN-Abs | The point in controversy in these petitions was the con stitutional validity of the Punjab Security of Land Tenure Act (Punj.
X Of 1953), as amended by Act XI of 1955, which sought to "provide for the security of land tenure and other incidental matters ".
The impugned Act which admittedly dealt with holdings as defined by the Punjab Land Revenue Act, 1887, limited the area which might be held by a land owner for the purpose of self cultivation and thereby released surplus area to be utilised for resettling ejected tenants ; and by section 18 conferred upon the tenants the right to purchase from the land owners the lands held by them and thus themselves to become the landowners on prices which would be below the market value.
It was contended on behalf of the petitioners, who were,landowners affected by the impugned Act, that under Entry 18 in List II of the Seventh Schedule to the Constitution, the State Legislature was incompetent to enact a law limiting the extent of the land to be held by a land owner and that the provisions of the impugned Act contravened the petitioners ' fundamental rights under articles 14, 19(1)(f)and 31 of the Constitution.
Held, that the contentions must fail.
The words " rights in or over land " and " land tenures occurring in Entry 18 in List 11 of Seventh Schedule to the Constitution were sufficiently comprehensive to include measures of land tenure reforms, such as the impugned Act, that sought to limit the extent of land in cultivating possession of the landowner in order to release larger areas of land to be made available for cultivation by tenants and that Entry read with article 246(3) of the Constitution gave the State Legislature exclusive power to enact such measures.
Such determination of the relation of landlord and tenant as was contemplated by section 18 and other provisions of the impugned Act, which sought to convert a tenant into a land owner, was well within the ambit of Entry 18.
749 The United Provinces vs Mst.
Atiqa Begum, and Megh Raj vs Allah Rakhi, (1946) L.R. 74 I.A. 12, referred to.
It was beyond doubt that the impugned Act substantially modified the land owner 's rights to hold and dispose of his property in any estate or portion thereof and thus fell within the purview of article 31A(1)(a) of the Constitution and was immune from any attack on the ground that it contravened articles 14, 19and 31 of the Constitution.
The observations made by this Court in Thakur Raghubir Singh vs Court of Wards, Ajmer, ; , in connection with another Act, with absolutely different provisions, must be limited to the facts of that case and were wholly inapplicable.
Thakur, Raghubir Singh vs Court of Wards, Ajmer, ; , distinguished and held inapplicable.
The words " any estate or of any rights therein " occurring in article 31A(1)(a) read in the light of article 31A(2) included any kinds of rights either quantitative or qualitative in the area encompassed by an estate or any portion of it and thus included holdings as defined by the Punjab Land Revenue Act, 1887, and any shares or portions thereof.
Regard being had to the legal maxim that the greater must include the less, it was, inappropriate to suggest that the Constitution should have specifically mentioned "portion of an estate" in article 31A if it intended to give that Article such a comprehensive construction.
Bhagirath Ram Chand vs State of Punjab, A.I.R. 1954 Pun. 167, approved.
State of Punjab vs section Kehar Singh, (1958) 60P.L.R. 461, dis approved.
Ram Narain Medhi vs The State of Bombay, [1959] SUPP.
(1) S.C.R. 489, applied.
Hukam Singh vs The State of Punjab, , referred to.
|
N: Civil Appeal No. 135 of 1991.
From the Judgment and order dated 16.6.1989 of the Madras High Court Crl.
M.P. No. 2717 of 1988.
T.S. Krishnamoorthy Iyer, K. Rajeswara, N.D.B. Raju and K.R. Chaudhary for the Appellant.
K.K. Lahiri, R.K. Jain (NP), Sreekant, N. Terdal, Mrs. Sushma Suri and A Subba Rao for the Respondent.
The Judgment of the Court was delivered by 745 K.N.SAIKIA, J.
Special leave granted.
The appellant Captain Subhash Kumar was the Master of the Merchant ship M.V. Eamaco owned by Eamaco Shipping Co. (P) Ltd. Singapore, hereinafter called `the ship '.
On 12.8.86 the ship went into distress due to the vessel 's hold Nos. 2 & 3 taking in water, the pumping operations being insufficient and though initially the appellant sent radio message for help he failed to launch the life boats and life crafts and to abandon the ship to enable M.V. Shoun World to pick them up and due to the failure of motor life boats and life crafts, when the ship sank, only 11 out of 28 persons were rescued resulting in loss of life to the remaining persons.
At about 18.25 Hrs.
that day Madras Radio, which was the communication centre between the land and seafaring ships, informed the office of the Principal Officer, Mercantile Marine Department, Madras, District Madras, hereinafter called as `Principal Officer ', that an urgent message had been received by the said Radio from the appellant and from that communication it was clear that the ship under the command of the appellant was posted at position 11 degrees 08 minutes North, 83 degrees 41 minutes East on 12th at 11.30 Greenwich meantime.
The said message further indicated that the vessel 's hold Nos. 2 & 3 were taking in water and the pumping out operation was not sufficient and it called the assistance from all ships in the vicinity.
At 20.28 Hrs.
the Madras Radio again contacted the Principle officer and said that the Radio had received SOS message (distress message) and he took necessary steps.
The Principal Officer filed a complaint in court of 14th Metropolitan Magistrate, Egmore, Madras 8 against the appellant for initiation of an inquiry proceeding under section 363 of the (Central Act No.4 of 1958), hereinafter called `the Act, complaining about the negligence of the appellant while he was the Master of the ship as aforesaid; and that at that time he was residing at Laxmi Niwas, 41, Marshal Road, Egmore, Madras 8 and further stating that the shipping casualty had occurred due to sheer negligence and gross incompetence on the part of the appellant in commanding the ship and the crew; and that the very fact that the life boats and life floats were not used and not even lowered so as to make use of that indicated that the appellant had not even thought about that which a Captain of the ship should have done, resulting in loss of the ship, the cargo and valuable lives of the sailors who had at no time doubted about the competency of the Master or revolted against him.
The complaint accordingly said that the Magistrate 's Court by the provisions of section 363 had got powers to make inquiry into the charges of 746 incompetence or of misconduct of the appellant therein.
It also said that the inquiry be commenced in accordance with the provisions of the Act so as to cancel the certificates of competency of the Master, namely, the appellant, which had been granted by the Central Government; and that cancellation might be recommended under the Act after holding the aforesaid inquiry.
The complaint also said that the appellant rendered himself liable to be proceeded against under the provisions of part XII of the Act which envisaged various modes of investigation and inquiry; and under section 363 the court had powers to make an inquiry into the charges of incompetency or misconduct of the appellant.
On 25.3.1988, the appellant received a notice stating that the inquiry proceedings were instituted against him before the 14th Metropolitan Magistrate under section 363 of the Act.
The appellant thereupon filed Cr.
M.P. No.2717 of 1988 in the High Court under section 482 of the Cr.
P.C. stating that the proceedings were by an abuse of process of the court and the Court had no jurisdiction to proceed with the complaint against the appellant when there was no negligence on his part.
It was also stated that the fact that the appellant was a holder of a Master certificate issued by the Director General of Shipping, Calcutta would not attract the provisions of the Act inasmuch as the ship was a foreign ship and the Master certificate had been issued by a foreign country and the casualty had occurred in the high seas nearly 232 nautical miles away from India and being in open sea the ship was subject to the jurisdiction and also to the protection of the State under whose maritime flag it sailed.
The appellant was, it was further stated, to be in command of the ship by virtue of the certificate issued by the Panamanian Government, the flag of the ship was of Panama and, therefore, the provisions of the Act would not at all apply, much less its section 363.
In other words the proceedings were allegedly intended to harass the appellant without jurisdiction and it amounted to an abuse of process of court.
The learned Single Judge who heard the petition rejected the contention that in view of the language of section 2 of the Act it would not be applicable and that it would not be a shipping casualty as defined in section 358 of the Act, and held that the Act was applicable in the instant case and the action of the petitioner amounted to sheer negligence and called for investigation and inquiry under the Act.
Hence this appeal.
Mr. T. Krishnamurthy Iyer, the learned cousel for the appel 747 lant, submits, inter alia, that the negligence complained of having occurred in respect of foreign ship flying foreign flag at a place 232 nautical miles away from India, and as such, outside the territorial waters of India the Act would not be applicable; and that even if it was applicable it would not amount to a shipping casualty as envisaged in part XII of the Act; and lastly that even assuming that chapter XII applied, the complaint could not have been filed by the Principal Officer in the court of the 14th Metropolitan Magistrate, Egmore, Madras 8 under section 363 of the Act.
Mr. K. Lahiri, the learned counsel for the respondents submits that the shipping casualty having occurred within the territorial waters of India which extended up to 200 nautical miles, the Act would be applicable and the complaint was rightly filed under section 363 of the Act; and that the High Court under section 482 of the Code of Criminal Procedure rightly refused to quash the proceedings.
Three questions, therefore, are to be decided in this appeal.
First, whether the Act would at all be applicable in the facts and circumstances of the case; secondly, if the Act was applicable whether part XII of the Act would apply; and thirdly, if both the Act and part XII were applicable whether the complaint made by the Principal Officer under section 363 of the Act would be maintainable.
Taking the first question first, the Act is one to foster the development and ensure the efficient maintenance of India Mercantile Marine in the manner best suited to serve the national interest and for that purpose to establish a National Shipping Board and Shipping National Fund to provide for registration of India ship and the law relating to Merchant shipping.
Section 2 of the Act deals with its application and says; "(1) Unless otherwise expressly provided, the provisions of this Act which apply to (a) any vessel which is registered in India; or (b) any vessel which is required by this Act to be so registered; or (c) any other vessel which is owned wholly by persons to each of whom any of the descriptions specified in clause (a) or in clause (b) or in clause (c), as the case may be, of 748 section 21 applies, shall so apply wherever the vessel may be.
(2) Unless otherwise expressly provided, the provisions of this Act which apply to vessels other than those referred to in sub section (1) shall so apply only while any such vessel is within India, including the territorial waters thereof." In the instant case the ship was not registered in India and was not required by this Act to be so registered.
Clause (c) refers so clauses (a), (b) and (c) of section 21 which defines Indian ships, and says: "For the purposes of this Act, a ship shall not be deemed to be an Indian ship unless owned wholly by persons to each to whom any of the following descriptions applies: (a) a citizen of India; or (b) a company which satisfies the following requirements, namely: (i) the principal place of business of the company is in India; (ii) at least seventy five per cent of the share capital of the company is held by citizens of India: Provided that the Central Government may, by notification in the official Gazette, alter such minimum percentage, and where the minimum percentage is so altered, the altered percentage shall, as from the date of the notification, be deemed to be substituted for the percentage specified in this sub clause; (iii) not less than three fourths of the total number of directors of the company are citizens of India; (iv) the chairmen of the board of directions and the managing director, if any, of the company are citizens of India; (v) the managing agents, if any, of the company are citizens of India or in any case where a company is the managing agent, the company satisfies the requirements specified in sub cls.
(i), (ii), (iii) and (iv).
or 749 (c) a co operative society which satisfies the following requirements, namely: (i) the co operative society is registered or deemed to be registered under the , or any other law relating to co operative societies for the time being in force in any State, (ii) every individual who is a member of the co operative society and where any other co operative society is a member thereof, every individual who is a member of such other co operative society, is a citizen of India.
" The ship was not a ship owned wholly by persons each of whom was a citizen of India or by a company satisfying the descriptions under clause (b) or (c).
Sub section (2) of section 2 makes the provisions of the Act applicable to vessels other than those referred to in sub section (1) only while any such vessel is within India, including the territorial waters thereof.
The ship a Panamanian ship registered in Panama would come within the purview of the Act only it is within India including the territorial waters.
This leads us to the question as to the extent of territorial waters of India.
The Territorial Waters, Continental shelf, Exclusive Economic Zone and other Maritime Zones Act, 1976 (Act No. 80 of 1976) is an Act to provide for certain matters relating to the territorial waters continental shelf, exclusive economic zone, and other maritime zones of India.
Section 2 of the Act defines "limit" in relation to the territorial waters, the continental shelf, the exclusive economic zone or any other maritime zones of India to mean the limit of such waters shelf or zone with reference to the mainland of India as well as the individual or composite group or groups of islands constituting part of the territory of India.
Section 3 deals with sovereignty over, and limits of, territorial waters and says: "(1) The sovereignty of India extends and has always extended to the territorial waters of India (hereinafter referred to as the territorial waters) and to the seabed and subsoil underlying, and the air space over such waters.
(2) The limit of the territorial waters is the line every point of which is at a distance of twelve nautical miles from the nearest point of the appropriate baseline.
750 (3) Notwithstanding anything contained in sub section (2), the Central Government may whenever it considers necessary so to do having regard to International Law and State practice, alter, by notification in the Official Gazette, the limit of the territorial waters.
(4) No notification shall be issued under sub section (3) unless resolutions approving the issue of such notification are passed by both Houses of Parliament." Thus sub section (2) clearly provides that the limit of the territorial waters is a line every point of which is at a distance of 12 nautical miles from the nearest point of the appropriate baseline.
Under Article 297 of the Constitution of India things of value within territorial waters or continental shelf and resources of the exclusive economic zone to vest in the Union.
It says: "(1) All lands, minerals and other things of value underlying the ocean within the territorial waters, or the continental shelf, or the exclusive economic zone, of India shall vest in the Union and be held for the purposes of the Union.
(2) All other resources of the exclusive economic zone of India shall also vest in the Union and be held for the purposes of the Union.
(3) The limits of the territorial waters, the continental shelf, the exclusive economic zone, and other maritime zone, of India shall be such as may be specified, from time to time, by or under any law made by Parliament.
" Sub section (3), thus, empowers the Central Government if it considers necessary so to do having regard to the International Law and State practice, alter, by notification in the Official Gazette, the limit of territorial waters.
Under sub section (4) no such notification shall be issued unless resolutions approving the issue of such notification are passed by both Houses of Parliament.
A proclamation was made by the President of India published on September 30, 1967 in the Gazette of India Extraordinary, Part III, section 2 Notification of the Government of India in the Ministry of External Affairs No. FL/III (1) 67.
By a Notification of the Government of India dated 15th 751 January, 1977 the exclusive economic zone of India has been extended upto a distance of 200 nautical miles into the sea from shore and other maritime zones, 1976 under the 40th Constitution Amendment Act, 1976.
The concepts of territorial waters, continental shelf and exclusive economic zone are different concepts and the proclamation of exclusive economic zone to the limit of 200 nautical miles into the sea from the shore baseline would in no way extend the limit of territorial waters which extends to 12 nautical miles measured from the appropriate baseline.
The submission that territorial waters extends to the limit of 200 nautical miles by virtue of the notification extending exclusive economic zone to 200 nautical miles has, therefore, to be rejected.
Admittedly the ship (M.V.Eamaco) at the time of the casualty was at a place beyond the territorial waters of India and even the exclusive economic zone of India.
If this be the position, the ship would not be covered by the provisions of section 2 of the Act and consequently the provisions of the Act would not apply to the instant casualty.
Taking the second question it is obvious that the Act itself having not been applicable Chapter XII being a part of the Act will also not be applicable.
This Chapter deals with investigations and inquiries and contain sections 357 to 389.
Section 357 defines "coasts" to include the coasts of creeks and tidal rivers.
Section 358 deals with shipping casualties and report thereof and says: "(1) For the purpose of investigations and inquiries under this Part, a shipping casualty shall be deemed to occur when (a) on or near the coasts of India, any ship is lost, abandoned, stranded or materially damaged; (b) on or near the coasts of India, any ship causes loss of material damage to any other ship; (c) any loss of life ensues by reason of any casualty happening to or on board any ship on or near the coasts of India; (d) in any place, any such loss, abandonment, stranding, material damage or casualty as above mentioned occurs to or on board any India ship and any competent witness thereof is found in India; 752 (e) any Indian ship is lost or is supposed to have been lost and any evidence is obtainable in India as to the circumstances under which she proceeded to sea or was last heard of.
(2) In the cases mentioned in clauses (a), (b) and (c) of sub section (1), the master, pilot, harbour master or other person in charge of the ship, or (where two ships are concerned) in charge of each ship at the time of the shipping casualty, and in the cases mentioned in clause (d) of sub section (1), where the master of the ship concerned or (except in the case of a loss) where the ship concerned proceeds to any place in India from the place where the shipping casualty has occurred, the master of the ship, shall, on arriving in India, give immediate notice of the shipping casualty to the officer appointed in this behalf by the Central Government.
" Clause (d) envisages shipping casualty in any place but occurring to or on board any Indian ship whether the Master of the ship concerned (except in the case of a loss) where the ship concerned proceeds to any place in India from the place where the shipping casualty of the ship has occurred, the Master of the ship.
Thus this provision will not cover the ship.
The conclusion, therefore, is inescapable that the casualty in the instant case would not be a shipping casualty envisaged in section 358.
Subsequent sections, namely, 359, 360, 361 and 362, relate to shipping casualties as envisaged in section 358.
The impugned complaint was ex facie made under section 363 of the Act which deals with power of Central Government to direct inquiry into the charges of incompetency or misconduct, it says: "(1) If the Central Government has reason to believe that there are grounds for charging any master, mate or engineer with incompetency or misconduct, otherwise than in the course of a formal investigation into shipping casualty, the Central Government.
(a) if the master, mate or engineer holds a certificate under this Act, in any case; 753 (b) if the master, mate or engineer holds a certificate under the law of any country outside India, in any case where the incompetency or misconduct has occurred on board an Indian ship; may transmit a statement of the case of any court having jurisdiction under section 361 which is at or nearest to the place where it may be convenient for the parties and witnesses to attend, and may direct that court to make an inquiry into that charge.
(2) Before commencing the inquiry, the court shall cause the master, mate or engineer so charged to be furnished with a copy of the statement transmitted by the Central Government.
" From the above provisions it appears that section 359 envisages the officers referred to in sub section (2) of section 358.
Receiving the information that a shipping casualty has occurred and reporting in writing the information to the Central Government and his proceeding to make a preliminary inquiry into the casualty and sending a report thereof to the Central Government or such other authority as may be appointed by it in that behalf.
Under section 360 the officer, whether he has made a preliminary inquiry or not, may, and, where the Central Government so directs, shall make an application to the court empowered under section 361 requesting it to make a formal investigation into any shipping casualty and the court shall thereupon make such investigation.
Thus the officer himself may or when directed by the Central Government shall make an application to the court requesting it to make a formal investigation into any shipping casualty.
Section 361 empowers the court to make a formal investigation under Part XII.
A Judicial Magistrate of the first class specially empowered in this behalf by the Central Government and a Metropolitan Magistrate shall have jurisdiction to make formal investigation into any shipping casualty under Part XII.
What has to be noted in this section is that the court on an application of the officer makes a formal investigation into shipping casualties and not a preliminary inquiry which could have been done by the officer referred to in sub section (2) of section 358, and under section 359 send a report to the Central Government.
Section 360 also envisages making of application to court by the officer whether he had made preliminary inquiry or not, requesting it to make formal investigation into any shipping casualty.
Thus under section 361 what is being envisaged is a formal investigation into a shipping 754 casualty and not a preliminary inquiry.
Section 362 deals with only formal investigation and says that while making such investigation into a shipping casualty the court may inquire, into any charge of incompetency or misconduct arising, in the course of the investigation, against any master, mate or engineer, as well as into any charge of a wrongful act or default on his part causing the shipping casualty.
Under sub section (2) a statement of the case has to be furnished to the Master, mate or Engineer.
Section 362 does not envisage inquiring into any charge of incompetency or misconduct otherwise than in the course of the formal investigation into a shipping casualty, Section 363 (1) envisages the Central Government, when it has reason to believe that there are grounds for charging any master, mate or engineer with incompetency or misconduct, otherwise than in the course of a formal investigation into shipping casualty, (b) if he holds a certificate under the law or any country outside India, in any case where the incompetency or misconduct has occurred on board an Indian ship, and the transmitting of the statement of the case to any court having jurisdiction under section 361 where it may be convenient for the parties and witnesses to attend, and the Central Government may direct that court to make an inquiry into that charge.
Under clause (a) the Central Government may exercise the power if the Master, mate or Engineer holds a certificate under the Act, in any case.
Thus under this section the Central Government must have reason to believe that there are grounds for charging any master etc.
with incompetency or misconduct, otherwise than in the course of a formal investigation into shipping casualty, in case of a master of a foreign ship who holds a certificate under the Act "in any case".
It also envisages the transmitting the statement of the case to any court having a jurisdiction under section 361.
The question is what would be the meaning of the words "in any case".
Would it mean any case of shipping casualty, or it would mean any case irrespective of shipping casualty.
In other words, under the above provisions if the appellant was the master of the ship and the casualty was outside the territorial waters of India and the ship involved was a foreign ship would the expression "in any case" cover the instanct case? If the preceding sections of Part XII dealt with only Shipping casualty, will it be permissible to interpret the words "in any case" irrespective of shipping casualty and anywhere outside the territorial waters of India and whoever is the owner of the Vessel? Will not the ejusdem generis rule apply? Again when the Act itself is not applicable to a case, can these words be given a meaning beyond the applicability of the Act? Verba secundum materiam subjectam intelligi nemo est qui nesciat.
There is no one who does not know that words are to be understood according to their subject matter.
The subject matter of 755 Part XII is investigations and inquiries into shipping casualty.
Would 'in any case" then mean in any case of shipping casualty? We have read the other relevant provisions of the Act.
Nemo aliquam partem recti intelligere potest, antequam totum interum atque itrerum parlegerit.
No one can properly understand any part of a statute till he had read through the whole again and again.
We find that Part VI of the Act deals with certificates of officers, namely, Masters, mates and Engineers, Section 76(1) provides: "Every foreign going Indian ship, every home trade Indian ship of two hundred tons gross or more when going to sea from any port or place in India and every ship carrying passengers between ports or places in India shall be provided with officers duly certificated under this Act according to the following scale, namely: (a) in every case, with a duly certificated master; (b) if the ship is a foreign going ship or a home trade passenger ship of one hundred and fifty tons gross or more, with at least one officer besides the master holding a certificate not lower than that of first mate in the case of a foreign going ship and of mate in the case of a home trade passenger ship; (c) if the ship is a home trade ship, not being a passenger ship, of four hundred and fifty tons gross or more, with at least one officer besides the master holding a certificate not lower than that of mate.
(d) if the ship is a foreign going ship and carries more than one mate, then with the second mate duly certificated.
" Section 79 deals with examination for, and grant of, certificate.
Section 82 provides that a note of all orders made for canceling, suspending, altering or otherwise affecting any certificate of competency, in pursuance of the powers contained in this Act, shall be entered on the copy of the certificate kept under section 81.
Section 87 empowers the Central Government to make rules, inter alia, to (f) prescribe the circumstances or cases if which certificates of competency may be canceled or suspended.
Section 363 of the Act does not refer to Part VI and the rules for 756 suspension or cancellation of certificates.
This would be consistent with the view that section 363 confines itself to cases of misconduct or incompetency associated with a shipping casualty.
Assuming that it covers a case of a foreign ship on high seas, it would only be to make an inquiry into that charge and not into the shipping casualty itself.
The question then arises, as has been submitted by Mr. Krishnamurthy Iyer, when the entire Act is not applicable to there instant casualty would it be consistent with the extent of applicability of the Act to pick up three words, namely, "in any case" and apply it to the prejudice of the appellant.
Mr Lahiri submits that the certificate of competency issued under the Act by the appropriate authorities under part VI are valuable certificates and if the holder of such a certificate of competency issued under the provisions of Part VI is alleged to have committed misconduct or acts of incompetency there is no reason why an inquiry into that misconduct or incompetency cannot be ordered by the Central Government to a court competent to exercise jurisdiction under section 361 of the Act.
Section 363 does not envisage the court acting on a statement transmitted by the Central Government to conduct a formal investigation into the shipping casualty but only the courts ' making an inquiry into the charge of incompetency or misconduct.
Section 364 provides giving of opportunity to the person to make defence.
Section 365 empowers the court to regulate its proceedings.
Section 369 provides that the court shall, in the case of all investigations or inquiries under this Part, transmit to the Central Government a full report or its conclusions which it has arrived at together with the evidence.
Under sub section (2) of that section where the investigation or inquiry affects master or an officer of a ship other than an Indian ship who holds a certificate under the law of any country outside India, the Central Government may tansmit a copy of the report together with the evidence to the proper authority in that country.
Section 370 deals with power of court as to certificates granted by Central Government.
A certificate can be canceled or suspended under clause (a) by a court holding formal investigation and under clause (v) by a court holding inquiry under this part into the conduct of the master, mate or engineer if the court finds that he is incompetent or has been guilty of any gross act of drunkenness, tyranny or other misconduct or in a case of collision has failed to render such assistance or gave such information as is required by section 348.
Under sub section (3), where the court 757 cancels or suspends a certificate, the court shall forward it to the Central Government together with the report which it is required by this Part to transmit to it.
Thus, this section deals with power of the court while holding a formal investigation into a shipping casualty under clause (a) and while holding an inquiry into the conduct of the master, mate or engineer i.e. otherwise than while holding a formal investigation into shipping casualty.
If the expression "In any case" is interpreted to cover a foreign ship by a foreign master but holding an Indian certificate having a shipping casualty outside the territorial water sections 363 and 370b) may be applicable.
If on the other hand the words "in any case" is not allowed to be interpreted to include such a master of such a ship and in such a casualty it may not be covered.
The question then is whether the instant complaint can be construed as a statement of the Central Government as envisaged in section 363.
One of the requisites of section 363 is that the Central Government must have reason to believe that there are grounds for charging any master etc.
with incompetency or misconduct; and such reason to believe must have been arrived at otherwise than in the course of a formal investigation into the shipping casualty and it is the Central Government who why transmit the statement of a case to a court having jurisdiction under section 361.
We have to examine whether the complaint is ex facie under section 363.
It nowhere mentions that the Central Government had such reason to believe.
It nowhere mentions that it was a transmission of the statement of a case to the court by the Central Government.
It also nowhere mentions that reason to believe had been found otherwise than in the course of a formal investigation into the shipping casualty.
On the other hand in para 2 it says that the complainant is the Principal Officer who is competent person appointed under the Act to complain about the negligence of the accused.
There is no doubt that he is not empowered under section 363.
In para 6 the complaint says that the court under section 363 has got powers to make an inquiry into the charges of incompetency or misconduct of the accused and para 8 mentions: "The inquiry so as to cancel the certificate of the competency of the master namely the accused which has been granted by the Central Government may be recommended under this Act after holding the above said inquiry and thus render justice." Therefore, prima facie the complaint does not disclose the ingredients required under section 363.
We enquired of the respondents as to whether there have been earlier instances of such an inquiry having ever been made; and the 758 answer is in the negative.
We feel that had such interpretation been given earlier the Act being an old one of 1958, some instances ought to have been available.
However, the instant appeal is from an order of the High Court refusing to quash the complaint and the proceedings.
Quashing of the complaint could have been done, if taken on its face value it failed to disclose any ingredient of the offence.
The High Court found as fact that the appellant had two certificates issued under section 78 of the Act from the Director General of Shipping, Calcutta and Bombay respectively.
The High Court correctly observed that section 363 enables the Central Government to transmit a case to the court which has jurisdiction under section 361 to make an inquiry against master, mate or engineer into the charges for incompetency or misconduct otherwise than in the course of formal investigation into shipping casualties but the High Court failed to notice that the complainant himself had no power under section 363.
High Court has not considered the extent of applicability of the Act and whether all ingredients required under section 363 were satisfied in the impugned complaint.
We accordingly set aside the Judgment of the High Court, quash the complaint and the proceedings before the 14th Metropolitan Magistrate, Egmore, Madras 8, but make it clear the it shall still be open for the Central Government to act under section 363 of the Act according to law if it so decides.
Appeal allowed.
R.S.S. Appeal allowed.
| IN-Abs | The appellant was the Master of the Merchant ship, M.V. Eamaco, when it sank in the high seas nearly 232 nautical miles away from India.
The appellant was holder of a Master 's certificate issued by the Director General of Shipping, Calcutta.
The ship was owned by a Singapore company and was flying Panamian flag.
The first respondent filed a complaint in the Court of 14th Metropolitan Magistrate, Egmore, Madras against the appellant for initiation of enquiry proceedings under section 363 of the Merchant Shiping Act, 1958 complaining about the negligence of the appellant while he was the Master of the ship and further stating that the shipping casualty had occurred due to sheer negligence and gross in competence of the Master when he failed to launch the life boats and life crafts which resulted in loss of the ship, the cargo and valuable lives of sailors.
The appellant filed a Criminal Miscellaneous Petition in the High Court under section 482 of the Cr.
P.C. stating that the proceedings were by an abuse of process of the court and the Court had no jurisdiction to proceed with the complaint against the appellant when there was no negligence on his part.
The High Court rejected the petition and held that the Shipping Act was applicable to the instant case and the action of the petitioner amounted to sheer negligence and called for investigation and inquiry under the Act.
The appellant has appealed to this Court.
In this court it was inter alia contended on behalf of the appellant that (i) the negligence complained of having occurred in respect of a foreign ship, flying foreign flag, at a place 232 natuical miles away from India, and as such, outside the territorial waters of India, the Act was 743 not applicable; (ii) even if the Act was applicable it would not amount to a shipping casualty as envisaged in part XII of the Act; and (iii) even assuming that Chapter XII applied the complaint could not have been filed by the appellant in the court of the 14th Metropolitan Magistrate, Egmore under Section 363 of the Act.
On behalf of the respondent it was contended that the shipping casualty having occurred within the territorial waters of India which extended up to 200 nautical miles, the Act would be applicable.
It was further submitted that the certificate of competentence issued under the provisions of Part VI of the Act was a valuable certificate and if the holder of such a certificate of competency was alleged to have committed misconduct or acts of incompetency there was no reason why an inquiry into that misconduct or incompetency could not be orderd by the Central Government to a court competent to exercise jurisdiction under section 361 of the Act.
Allowing the appeal, setting aside the judgment of the High Court, and quashing the complaint and the proceedings against the appellants, this Court.
HELD: (1) The ship was not a ship owned wholly by persons each of whom was a citizen of India or by a company satisfying the description under clause (b) or (c) of sub section (2) of Section 2 of the Act.
The ship being a Panamanian ship registered in Panama would come within the purview of the Act only while it was within India including its territorial waters.
[749C D] (2) By a notification of the Government of India dated 15th January, 1977 the exclusive economic zone of India had been extended upto a distance of 200 nautical miles into the sea from the shore and other maritime zones, under the 40th Constitution Amendement Act, 1976.
[750H 751A] (3) The concepts of territorial waters, continental shelf and exclusive economic zone are different concepts and the proclamation of exclusive economic zone to the limit of 200 nautical miles into the sea from the shore baseline would in no way extend the limit of territorial waters which extends to 12 nautical miles measured from the appropriate baseline.
[751B] (4) Admittedly the ship at the time of the casualty was at a place beyond the territorial waters of India and even the exclusive economic zone of India.
If this be the position, the ship would not be covered by the provisions of section 2 of the Act and consequently the provisions of 744 the Act would not apply to the instant casualty.
[751C] (5) The Act itself having not been applicable, Chapter XII being a part of the Act will also not be applicable.
[751D] (6) What is envisaged under section 361 is a formal investigation into a shiping casualty and not a preliminary inquiry.
Similarly section 262 does not envisage inquiring into any charge of incompetency or misconduct otherwise than in the course of the formal investigation into a shipping casualty.
[753H 754B] (7) Prima facie, the complaint does not disclose the ingredients required under section 363 of the Act.
It nowhere mentions that it was a transmission of the statement of a case to the court by the Central Government; it also nowhere mentions that the reason to believe had been founded otherwise than in the course of a formal investigation into the shipping casualty.
On the other hand in para 2 it says that the complainant is the Principal Officer who is competent person appointed under the Act to complain about the negligence of the accused.
There is however no doubt that he is not so empowered under section 363.
[757G,E F] (8) The High Court correctly observed that section 363 enabled the Central Government to transmit a case to the court which had jurisdiction under section 361 to make an inquiry against master, mate or engineer into the charges for incompetency or misconduct otherwise than in the course of formal investigation into shipping casualties, but the High Court failed to notice that the complainant himself had no power under section 363.
[758C D]
|
Civil Appeal No. 570 of 1976.
Appeal by Certificate from the Judgment and Order dated 9.2.1976 of the Madras High Court in Tax Case No. 104 of 1969.
T.A. Ramachandran, P.N. Ramaligam and A.T.M. Sampath for the Appellant.
628 V.Gauri Shanker, Manoj Arora, section Rajappa and Ms.
A.Subhashini for the Respondent.
The Judgment of the Court was delivered by RANGANATHAN, J.
This is the assessee 's appeal form a judgment of the Madras High Court dated 10.1.1975 answering three questions referred to it by the Income tax Appellate Tribunal in favour of the Revenue and against the assessee.
The reference related to the assessment year 1961 62, the previous year in respect of which commenced on 13.4.1960.
The judgment of the High Court is reported as (1976) 102 I.T.R.622.
The appellant assessee is a partnership firm.
Since 1949, it was carrying on, in Malaya, a money lending business and, as part of and incidental to the said business, a business in the purchase and sale of house properties, gardens and estates.
It had been reconstituted under a deed dated 26.3.1960.
The firm 's accounts for the year 1960 61, which commenced on 13.4.60, would normally have come to a close on or about the 13th April, 1961.
However, the firm closed its accounts as on 13.3.1961 with effect from which date it was dissolved.
Along with its income tax return for the assessment year 1961 62 filed on 10th April 1962, the assessee filed a profit and loss account and certain other statements.
In the profit and loss account, a sum of $ 1,01,248 was shown as "difference on revaluation of estates, gardens and house properties" on the dissolution of the firm on 13.3.61, such difference being $ 70,500 in respect of "house properties" and $ 30,748 in respect of estates and gardens.
In the memo of adjustment for income tax purposes, however, the above sum was deducted on the ground that it was not assessable either as revenue or capital.
A statement was also made before the officer that partner Ramanathan Chettiar, forming one group and the other partners forming another group, were carrying on business separately with the assets and liabilities that fell to their shares on the dissolution of the firm.
The Income tax Officer (I.T.O.) issued a notice under section 23(2) on the same day (10.4.1962) posting the hearing for the same day and completed the assessment also on the same day, after making a petty addition of Rs. 2083 paid as property tax in Malaya, and recording the following note: "Audit assessment Lakshmanan appears return filed I.T. 86 acknowledged in list of books scrutinised order dictated".
629 For the subsequent assessment year 1962 63, the assessee filed a return showing nil income along with a letter pointing out that the firm had been dissolved on 13.3.1961.
Thereafter, on 3.9.63, the I.T.O. wrote a letter to the assessee to the effect that the revaluation difference of $ 1,01,248 should have been brought to tax in the assessment year 1961 62 in view of the decision of the Madras High Court in Ramachari & Co. vs C.I.T., He called for the basis for the valuation and also for the assessee 's objections.
The assessee sent a reply stating that no profit or loss could be assessed on a revaluation of assets.
Relying on a circular of the Central Board of Revenue dated 21.6.1956, it was urged that the assessee was gradually winding up its business in Malaya and that therefore, the surplus would only be capital gains.
It was urged that the revaluation had been at a market price prevalent since 1.1.1954 and that, therefore, no capital gains were chargeable to tax.
The I.T.O. followed up his letter by a notice under section 148 read with section 147(b).
The assessee objected to the reassessment on two grounds: (1) that the circumstances did not justify the initiation of proceedings under section 147(b); and (2) that no assessable profits arose to the firm on the revaluation of assets on the eve of the dissolution of the firm.
Overruling these objections, the I.T.O. completed a reassessment on the firm after adding back the sum of Rs.1,58,057 (the equivalent of $ 1,01,248) to the previously assessed income.
The assessee 's successive appeals to the Appellate Assistant Commissioner and the Appellate Tribunal and reference, at its instance, to the High Court having failed,the assessee is before us.
Three questions of law were referred to the High Court by the Tribunal.
These were: "1.
Whether, on the facts and circumstances of the case, the reassessment made on the assessee firm for the assessment year 1961 62 under section 147 of the Income tax Act is valid in Law? 2.
Whether, on the facts and circumstances of the case, assessment of the sum of $ 1,01,248 as revenue profit of the assessee firm chargeable to tax for the assessment year 1961 62 is justified in law? 3.
Whether, on the facts, and circumstances of the case, the Appellate Tribunal is right in law in sustaining the assessment of the sum of $ 1,01,348 after having found that the Department Officers are bound by the Circular of the Central Board of Revenue?" 630 We may deal at the outset with the third question.
Though the High Court has dealt with this question at some length, we do not think any answer to this question can or need be furnished by us for the following reasons.
First, the assessee has not been able to place before us the circular of the Board on which reliance is placed.
It is not clear whether it is a circular or a communication of some other nature.
Second, the circular, to judge from its purport set out in the High Court 's judgment, seems to have been to the effect that the surplus arising from the sale of properties acquired by a money lender in the course of his business would be in the nature of capital gains and not of income.
Obviously such a proposition could not have been intended as a broad or general proposition of law, for the nature of the surplus on sale of assets would depend on the nature of the asset sold and this, in turn, would depend on the facts and circumstances of each case.
In this case, no material was placed at any stage to show that the assets in question constituted the capital assets of the firm and not its stock in trade.
Third, the plea of the assessee which was in issue all through was that there was no sale of assets by the firm when its assets are distributed among its partners and that no profits whether capital or revenue could be said to arise to the firm merely because, at the time of the dissolution, the firm revalued its assets on the basis of market value or any other basis, for adjusting the mutual rights and liabilities of the partners on the dissolution of the firm.
The terms of the circular, as set out in the order of the High Court, cannot therefore be of any assistance to the assessee in answering the issues in this case.
We, therefore, do not answer the third question posed by the Tribunal.
Turning now to the first question, the relevant facts have already been noticed.
The following relevant and material facts viz. (i) the dissolution of the firm, (ii) the revaluation of its assets, (iii) the distribution thereof among two groups of its partners, and (iv) the division and crediting of the surplus on revaluation to the partner 's accounts were not only reflected in the balance sheet, the profit and loss account and the profit and loss adjustment account but were also mentioned in the statement filed before the I.T.O. along with the return.
Clearly, action u/s 148 read with clause (a) of s.147 could not be initiated in these circumstances but is action under clause (b) of that section also impermissible? That is the question.
We may now set out the provisions of clause (b) of section 147 for purposes of easy reference.
This clause which corresponds to section 34(1)(b) of the Indian Income tax Act, 1922 (`the 1922 Act ') permits initiation of reassessment of proceedings, "notwithstanding 631 that there has been no omission or failure as mentioned in clause (a) on the part of the assessee" provided "the Income tax Officer has, in consequence of information in his possession, reason to believe that income chargeable to tax has escaped assessment".
In the present case, on the information already on record and in view of the decision in Ramachari & Co. vs C.I.T., , there can be no doubt that the I.T.O. could reasonably come to the conclusion that income, profits and gains assessable for the assessment year 1961 62 had escaped assessment.
But is that belief reached "in consequence of information in his posession"? The assessee 's counsel says "no", for, says he, it is settled law that the "information" referred to in clause (b) above, should be "information" received by the I.T.O. after he had completed the original assessment.
Here it is pointed out that all the relevant facts as well as the decision in Ramachari (supra) had been available when the original assessment was completed on 10.4.1962.
Action cannot be taken under this clause merely because the I.T.O., who originally considered the surplus to be not assessable, has on the same facts and the same case law which had been available to him when he completed the assessment originally, changed his opinion and now thinks that the surplus should have been charged to tax.
The validity of the assessee 's argument has to be tested in the light of the decisions of this Court which have interpreted section 147(b) of the 1961 Act or its predecessor section 34(1)(b) of the 1922 Act and expounded its parameters.
We may start with the decision in Maharaj Kumar Kamal Singh vs I.T.O., S.C.
In this case it was held that the word "information" would include information as to the true and correct state of the law and would also cover information as to relevant judicial decisions.
In that case the I.T.O. had re opened the assessment on the basis of a subsequent decision of the Privy Council and this was upheld.
Referring to the use of the word "escape" in the section, the Court observed.
"In our opinion, even in a case where a return has been submitted, if the income tax Officer erroneously fails to tax a part of asessable income, it is a case where the said part of the income has escaped assessment.
The appellant 's attempt to put a very narrow and artificial limitation on the meaning of the word "escape" in section 34(1)(b) cannot, therefore, succeed." (underlining ours) 632 The meaning of the word "information" was again explained thus in C.I.T. vs A. Raman & Co., [1968] 67 I.T.R. 11 SC: "The expression `information ' in the context in which it occurs must, in our judgment, mean instruction or knowledge derived from an external source concerning facts or particulars, or as to law relating to a matter bearing on the assessment. .
Jurisdiction of the Income tax Officer to reassess income arises if he has in consequence of information in his possession reason to believe that income chargeable to tax has escaped assessment.
That information, must, it is true, have come into the possession of the Income tax Officer after the previous assessment, but even if the information be such that it could have been obtained during the previous assessment from an investigation of the materials on the record, or the facts disclosed thereby or from other enquiry or research into facts or law, but was not in fact obtained, the jurisdiction of the Income tax Officer is not affected." (underlining ours) We may next refer to Kalyanji Mavji & Co. vs C.I.T., [1976 102] I.T.R. 287.
It is unnecessary to set out the facts of this case.
It is sufficient to refer to the enunciation of the law regarding the scope of section 34(1)(b) as culled out from the earlier decisions of this Court on the subject.
At page 296 the Court observed: "On a combined review of the decisions of this Court the following tests and principles would apply to determine the applicability of section 34(1)(b) to the following categories of cases: (1) where the information is as to the true and correct state of the law derived from relevant judicial decisions; (2) where in the original assessment the income liable to tax has escaped assessment due to oversight, inadvertence or a mistake committed by the Income tax Officer.
This is obviously based on the principle that the taxpayer would not be allowed to take advantage of an oversight or mistake committed by the taxing authority; 633 (3) where the information is derived from an external source of any kind.
Such external source would include discovery of new and important matters or knowledge of fresh facts which were not present at the time of the original assessment; (4) where the information may be obtained even from the record of the original assessment from an investigation of the materials on the record, or the facts disclosed thereby or from other enquiry or research into facts or law." Before applying the above principles to the facts of the present case, we may refer to two earlier decisions of the Madras High Court which have been followed in the judgment under appeal.
In Salem Provident Fund Society Ltd. vs C.I.T., , the Income tax officer, in calculating the annual profits of an insurance company, had, under the statute to work out the difference between the deficiencies as shown in the actuarial valuation of the company in respect of two successive valuation periods.
At the time of original assessment, the Income tax Officer, by mistake, added the two deficiencies instead of subtracting one from the another.
This mistake he committed not in one assessment year but in two assessment years.
Subsequently, he discovered his mistake and initiated proceedings under section 34(1)(b).
The contention urged on behalf of the assessee was that all the statements, on the basis of which the re assessment proceedings were taken, were already on record and that, in such a case, there was no `information ' which would justify the reassessment.
An argument was also raised that the rectification, if any, could have been carried out only under section 35 and not under section 34.
These contentions were repelled.
In regard to the former objection, the High Court pointed out: "We are unable to accept the extreme proposition that nothing that can be found in the record of the assessment, which itself would show escape of assessment or under assessment, can be viewed as information which led to the belief that there has been escape from assessment or under assessment.
Suppose a mistake in the original order of assessment is not discovered by the Income tax Officer himself on further scrutiny but it is brought to this notice by another assessee or even by a subordinate or a superior officer, that would appear to be information disclosed to the Income tax Officer.
if the mistake itself is not extraneous 634 to the record and the informant gathered the information from the record, the immediate source of information to the Income tax Officer in such circumstances is in one sense extraneous to the record.
It is difficult to accept the position that while what is seen by another in the record is `information ' what is seen by the Income tax Officer himself is not information to him.
In the latter case he just informs himself.
It will be information in his possession within the meaning of section 34.
In such cases of obvious mistakes apparent on the face of the record of assessment that record itself can be a source of information, if that information leads to a discovery or belief that there has been an escape of assessment or under assessment.
A similar question arose in CIT vs Rathinasabapathy Mudaliar, In that case the assessee, who was a partner in a firm, did not include in his return the income of his minor son admitted to the benefits of the partnership as required by section 16(3) of the 1922 Act.
The minor son submitted a separate return and was assessed on this income.
Subsequently, the Income tax Officer "discovered" his error in not assessing the father thereon and started re assessment proceedings.
The re assessment was upheld by the Madras High Court on the same logic as had been applied in Salem Provident Fund Society Ltd. case (supra).
The above line of thinking has not only held the field for about thirty years now but has also received approval in Anandji Haridas and Co. (P) Ltd. vs S.P. Kushare, Sales Tax Officer, [1968] 21 S.T.C. 326.
This issue has further been considered in the decision of this Court in the case of Indian and Eastern Newspaper Society vs C.I.T. (the IENS case, for short) [1979] I.T.R. 996.
In this case the income of the assessee derived by letting out certain portions of the building owned by it to its members as well as to outsiders was being assessed as business income.
In the course of audit, an internal audit party expressed the view that the money realised by the assessee on account of the occupation of its conference hall and rooms should have been assessed under the head "income from property" and not as business income.
The Income tax Officer thereupon initiated re assessment proceedings and this was upheld by the Tribunal.
On a direct reference under s.257 of the Act, this Court held that the opinion of the audit party on a point of law could not be regarded as "information" and that the initiation of the reassessment proceedings was not justified.
It was contended for the Revenue, that the reassessment proceedings would 635 be valid even on this premise.
Dealing with this argument, the Court observed: "Now, in the case before us, the ITO had, when he made the original assessment, considered the provisions of sections 9 and 10.
Any different view taken by him afterwards on the application of those provisions would amount to a change of opinion on material already considered by him.
The revenue contends that it is open to him to do so, and on that basis to reopen the assessment under section 147(b).
Reliance is placed on Kalyanji Mavji & Co. vs CIT, , where a Bench of two learned, Judges of this Court observed that a case where income had escaped assessment due to the "oversight, inadvertence or mistake" of the ITO must fall within section 34(1)(b) of the Indian Income Tax Act, 1922.
It appears to us, with respect, that the proposition is stated too widely and travels farther than the statute warrants in so far as it can be said to lay down that if, on re appraising the material considered by him during the original assessment, the ITO discovers that he has committed an error inconsequence of which income has escaped assessment, it is open to him to reopen the assessment.
In our opinion, an error discovere on a reconsideration of the same material (and no more) does not give him that power.
That was the view taken by this Court in Maharaj Kumar Kamal Singh vs CIT, [1959] 35 I.T.R. 1; CIT vs A. Raman & Co., and Bankipur Club Ltd. vs CIT and we do not believe that the law has since taken a different course.
Any observation in Kalyanji Mavji & Co. vs CIT, suggesting the contrary do not, we say with respect, lay down the correct law." (underlining ours) The Court proceeded further to observe: "A further submission raised by the revenue on section 147(b) of the Act may be considered at this stage.
It is urged that the expression "information" in section 147(b) refers to the realisation by the ITO that he has committed an error when making the original assessment.
It is said that, when upon receipt of the audit note the ITO discovers or realizes that a mistake has been committed in the original 636 assessment, the discovery of the mistake would be "information" within the meaning of section 147(b).
The submission appears to us inconsistent with the terms of section 147(b) Plainly, the statutory provision envisages that the ITO must first have information in his possession, and then in consequence of such information he must have reason to believe that income has escaped assessment.
The realisation that income has escaped assessment is covered by the words "reason to believe", and it follows from the "information" received by the ITO.
The information is not the realisation, the information gives birth to the realisation.
" Sri Ramachandran submits that these decisions support his contention that reassessment proceeding can be validly initiated only if there is some information received by the I.T.O. from an external source after the completion of the original assessment but not in a case like the present where there is nothing more before the I.T.O. than what was available to him when the original assessment was completed.
He also submits that the observations in the IENS case have cast doubts on the propositions enunciated in Kalyanji Mavji 's case (supra) and reiterates the proposition that reassessment proceedings cannot be availed of to revise, on the same material, the opinion formed or conclusion arrived at earlier in favour of the assessee.
On the other hand, Dr. Gaurisankar, appearing for the Revenue, mentioned that the decision in the IENS case holding that the opinion of an audit party would not constitute `information ' and qualifying the principles enunciated in Kalyanji Mavji is pending consideration by a larger Bench of this Court.
He, however, submitted that the reassessment in this case would be valid even on the strength of the observations in the IENS case.
We shall proceed to consider the correctness of this submission.
We have pointed out earlier that Kalyanji Mavji (supra) outlines four situations in which action under S.34(1)(b) can be validly initiated.
The IENS case has only indicated that proposition (2) outlined in this case and extracted earlier may have been somewhat widely stated; it has not cast any doubt on the other three propositions set out in Kalyanji Mavji 's case.
The facts of the present case squarely fall within the scope of propositions 2 and 4 enunciated in Kalyanji Mavji 's case.
Proposition (2) may be briefly summarised as permitting action even on a "mere change of opinion".
This is what has been doubted in the IENS case (supra) and we shall discuss its application to this case a 637 little later.
But, even leaving this out of consideration, there can be no doubt that the present case is squarely covered by proposition (4) set out in Kalyanji Mavji & Co. (supra).
This proposition clearly envisages a formation of opinion by the Income tax Officer on the basis of material already on record provided the formation of such opinion is consequent on "information" in the shape of some light thrown on aspects of facts or law which the I.T.O. had not earlier been conscious of.
To give a couple of illustrations, suppose an I.T.O., in the original assessment, which is a voluminous one involving several contentions, accepts a plea of the assessee in regard to one of the items that the profits realised on the sale of a house is a capital realisation not chargeable to tax.
Subsequently he finds, in the forest of papers filed in connection with the assessment, several instances of earlier sales of house property by the assessee.
That would be a case where the I.T.O. derives information from the record on an investigation or enquiry into facts not originally undertaken.
Again, suppose if I.T.O. accepts the plea of an assessee that a particular receipt is not income liable to tax.
But, on further research into law he finds that there was a direct decision holding that category of receipt to be an income receipt.
He would be entitled to reopen the assessment under s.147(b) by virtue of proposition (4) of Kalyanji Mavji.
The fact that the details of sales of house properties were already in the file or that the decision subsequently come across by him was already there would not affect the position because the information that such facts or decision existed comes to him only much later.
What then, is the difference between the situations envisaged in propositions (2) and (4) of Kalyanji Mavji (supra)? The difference, if one keeps in mind the trend of the judicial decisions, is this.
Proposition (4) refers to a case where the I.T.O. initiates reassessment proceedings in the light of "information" obtained by him by an investigation into material already on record or by research into the law applicable thereto which has brought out an angle or aspect that had been missed earlier, for e.g., as in the two Madras decisions referred to earlier.
Proposition (2) no doubt covers this situation also but it is so widely expressed as to include also cases in which the I.T.O., having considered all the facts and law, arrives at a particular conclusion, but reinitiates proceedings because, on a reappraisal of the same material which had been considered earlier and in the light of the same legal aspects to which his attention had been drawn earlier, he comes to a conclusion that an item of income which he had earlier consciously left out from the earlier assessment should have been brought to tax.
In other words, as pointed out in IENS case, it also 638 ropes in cases of a "bare or mere change of opinion" where the I.T.O. (very often a successor officer) attempts to reopen the assessment because the opinion formed earlier by himself (or, more often, by a predecessor I.T.O.) was, in his opinion, incorrect.
Judicial decisions had consistently held that this could not be done and the IENS case (supra) has warned that this line of cases cannot be taken to have been overruled by Kalyanji Mavji (supra).
The second paragraph from the judgment in the IENS case earlier extracted has also reference only to this situation and insists upon the necessity of some information which make the ITO realise that he has committed an error in the earlier assessment.
This paragraph does not in any way affect the principle enumerated in the two Madras cases cited with approval in Anandji Haridas, [1986] 21 S.T.C. 326.
Even making allowances for this limitation placed on the observations in Kalyanji Mavji, the position as summarised by the High Court in the following words represents, in our view, the correct position in law: "The result of these decisions is that the statute does not require that the information must be extraneous to the record.
It is enough if the material, on the basis of which the reassessment proceedings are sought to be initiated, came to the notice of the Income tax Officer subsequent to the original assessment.
If the Income tax Officer had considered and formed an opinion on the said material in the original assessment itself, then he would be powerless to start the proceedings for the reassessment.
Where, however, the Income tax Officer had not considered the material and subsequently come by the material from the record itself, then such a case would fall within the scope of section 147(b) of the Act.
" Let us now examine the position in the present case keeping in mind the narrow but real distinction pointed out above.
On behalf of the assessee, it is emphasised (a) that the amount of surplus is a very substantial amount,(b) that full details of the manner in which it had resulted had been disclosed, (c) that the profit and loss account, the profit and loss adjustment account and statement made before the I.T.O. had brought into focus the question of taxability of the surplus and (d) that decision in Ramachari 's case had been reported by 10.4.1962.
No Income tax Officer can be presumed to have completed the assessment without looking at all this material and the said decision.
No doubt, some doubt had been thrown as to whether a statement had been given at the time of original assessment that the amount 639 of surplus was not taxable as an income or a capital gain but the case has proceeded on the footing that such a statement was there before the officer.
This, therefore, is nothing but a case of "change of opinion".
On the other hand, the authorities and the Tribunal have drawn attention to the fact that the return, the section 143(2) notice and assessment were all on the same day and counsel for the Revenue urged that obviously, in his haste, the I.T.O. had not looked into the facts at all.
It is urged that no Income tax Officer who had looked into the facts and the law could have failed to bring the surplus to tax in view of then recent pronouncement in Ramachari 's case.
Dr. Gaurishankar submitted that the Tribunal has found that the I.T.O. "had acted mechanically in accepting the return without bringing his mind to play upon the entry in the statement with reference to the distribution of the assets".
He pointed out that there is no evidence of any enquiry with reference to this aspect and that, the amount involved being sufficiently large, the I.T.O., if he had been aware of the existence of the entry would certainly have discussed it.
He urged that the question whether the I.T.O. had considered this matter at the time of the original assessment or not is purely a question of fact and the Tribunal 's conclusion thereon having been endorsed by the High Court, there is no justification to interfere with it at this stage.
We think there is force in the argument on behalf of the assessee that, in the face of all the details and statement placed before the I.T.O. at the time of the original assessment, it is difficult to take the view that the Income tax Officer had not at all applied his mind to the question whether the surplus is taxable or not.
It is true that the return was filed and the assessment was completed on the same date.
Nevertheless, it is opposed to normal human conduct that an officer would complete the assessment without looking at the material placed before him.
It is not as if the assessment record contained a large number of documents or the case raised complicated issues rendering it probable that the I.T.O. had missed these facts.
It is a case where there is only one contention raised before the I.T.O. and it is, we think, impossible to hold that the Income tax Officer did not at all look at the return filed by the assessee or the statements accompanying it.
The more reasonable view to take would, in our opinion, be that the Income tax Officer looked at the facts and accepted the assessee 's contention that the surplus was not taxable.
But, in doing so, he obviously missed to take note of the law laid down in Ramachari which there is nothing to show, had been brought to his notice.
When he subsequently became aware of the decision, he initiated proceedings under section 147(b).
The material which constituted information and on 640 the basis of which the assessment was reopened was the decision in Ramachari.
This material was not considered at the time of the original assessment.
Though it was a decision of 1961 and the I.T.O. could have known of it had he been diligent, the obvious fact is that he was not aware of the existence of the decision then and, when he came to know about it, he rightly initiated proceedings for assessment.
We may point out that the position here is more favorable to the Revenue than that which prevailed in the Madras cases referred to earlier.
There, what the I.T.O. had missed earlier was the true purport of the relevant statutory provisions.
It seems somewhat difficult to believe that the I.T.O. could have failed to read properly the statutory provisions applicable directly to facts before him (though that is what seems to have happened).
Perhaps an equally plausible view, on the facts, could have been taken that he had considered them and decided, in one case, not to apply them and, in the other, on a wrong construction thereof.
In the present case, on the other hand, the material on which the I.T.O. has taken action is a judicial decision.
This had been pronounced just a few months earlier to the original assessment and it is not difficult to see that the I.T.O. must have missed it or else he could not have completed the assessment as he did.
Indeed it has not been suggested that he was aware of it and yet chose not to apply it.
It is therefore much easier to see that the initiation of reassessment proceedings here is based on definite material not considered at the time of the original assessment.
In the above view of the matter, we uphold the High Court 's view on the first question.
The second question raises a more difficult problem.
There can be no doubt that the decision of the Madras High Court in Ramachari squarely covers the situation.
Ramachari holds that the principle of valuing the closing stock of a business at cost or market at the option of the assessee is a principle that would hold good only so long as there is a continuing business and that where a business is discontinued, whether on account of dissolution or closure or otherwise, by the assessee, then the profits cannot be ascertained except by taking the closing stock at market value.
Ramachari has subsequently been followed by the Kerala High Court in Popular Workshops vs Commissioner of Income Tax, and in Popular Automobiles vs Commissioner of Income Tax, Shri Ramachandran contends that the decision in Ramachari 641 does not lay down the correct law.
He submits than, while it is no doubt true that the closing stock has to be valued, the well settled principle is that it should be valued, at cost or market whichever is lower and there is no justification for laying down a different principle for valuation of the closing stock at the point of discontinuance of business unless the goods are actually sold by the assessee at the time of discontinuance.
Further, it has been held by a series of decisions of this Court that when a firm is dissolved and the assets are distributed among the partners, there is no sale or transfer of the assets of the firm to the various partners: vide, Addanki Narayanppa vs Bhaskara Krishnappa, ; ; CIT vs Dewas Cine Corporation, ; CIT vs 2Bankey Lal Vaidya, ; Malabar Fisheries Co. vs C.I.T., and in Sunil Siddharthbhai vs C.I.T., He submits that, in logical sequence, dissolution comes first and distribution of assets comes later.
Therefore, revaluation of the assets of a firm, which is only for the division of the assets among the partners on a real and not a notional basis, is part of the division of the assets and therefore logically, in point of time, subsequent to the dissolution of the firm.
Since the revaluation takes place after the dissolution no profits can be said to have accrued to the firm by the process of revaluation.
The revaluation of the assets is not in the course of business and is not an activity which can partake of the nature of trade.
Assuming but not conceding that it is possible to have a revaluation of the assets, for example, stock in trade before dissolution, any excess which arises on the revaluation is only an imaginary or notional profit and cannot be brought to tax for the following reasons: (i) As a result of such revaluation, there can be no profit, because the firm cannot make a profit out of itself: Vide Kikabhai Premchand vs C.I.T., (ii) The process of revaluation of stock by itself cannot bring in any real profits: vide C.I.T. vs K.A.R.K. Firm, [1934]2 I.T.R. 183; Chainrup Sampatram vs C.I.T., [1953) and C.I.T. V. Hind Construction ltd., [1972] 83 I.T.R. 211; and (iii) It is well settled that what is taxable under the income tax law is only real income vide C.I.T. vs M/s Shoorji Vallabhdas and Co., [1962] 46 I.T.R. 144 and C.I.T. vs Birla Gwalior (P) Ltd., There is, therefor, no principle by which the stock in trade can be valued at market price so as to bring to tax the notional profits which might in future be realised as a result of the sale of the stock in trade.
642 The question posed before us is a difficult one.
We think, however, that the High Court was right in pointing out that the several decisions relied upon for the assessee as to the nature of the transaction by which a firm, on dissolution, distributes its assets among its partners, have no relevance in the present case.
As the High Court rightly observed, those cases relate to what happens after or in consequence of the dissolution of a firm whereas we are here concerned with a question that arises before or at the time of dissolution.
What we have to decide is the basis on which, in making up the accounts of a firm upto the date of dissolution, the closing stock with the firm as at a point of time immediately prior to the dissolution is to be valued.
It is this principle that has been decided in Ramachari and the High Court decisions following it (including the one under appeal) and the question is whether they lay down the correct law.
In the first place, it is settled law that the true trading results of a business for an accounting period cannot be ascertained without taking into account the value of the stock in trade remaining at the end of the period.
Though, as pointed out by this Court in Chainrup Sempatram vs C.I.T., it is a misconception to think that any profit arises out of the valuation of closing stock, it is equally true that such valuation is a necessary element in the process of determining the trading results of the period.
This is true in respect of any method of accounting and in C.I.T. vs Krishnaswamy Mudaliar, this Court pointed out that, even where the assessee is following the cash system of accounting, the valuation of closing stock cannot be dispensed with.
In this decision, this Court quoted with approval the following observations in C.I.R. vs Cock, Russel & Co. Ltd. "There is no word in the statutes or rules which deals with this question of valuing stock in trade.
There is nothing in the relevant legislation which indicates that in computing the profits and gains of a commercial concern the stock in trade at the start of the accounting period should be taken in and that the amount of the stock in trade at the end of the period should also be taken in.
It would be fantastic not to do it: it would be utterly impossible accurately to assess profits and gains merely on a statement of receipts and payments or on the basis of turnover.
It has long been recognised that the right method of assessing profits and gains is to take into account the value of the stock in trade at the beginning and the value of the stock in trade at the 643 end as two of the items in the computation.
I need not cite authority for the general proposition, which is admitted at the Bar, that for the purposes of ascertaining profits and gains the ordinary principles of commercial accounting should be applied, so long as they do not conflict with any express provision of the relevant statutes.
" Next the principles as to the method of valuation of the closing stock are equally well settled.
Lord President Clyde set these out in Whimster & Co. vs C.I.R., in the following words: "In computing the balance of profits and gains for the purposes of income tax,. two general and fundamental commonplaces have always to be kept in mind.
In the first place, the profits of any particular year or accounting period must be taken to consist of the difference between the receipts from the trade or business during such year or accounting period and the expenditure laid out to earn those receipts.
In the second place, the account of profit and loss to be made up for the purpose of ascertaining that difference must be framed consistently with the ordinary principles of commercial accounting, so far as applicable, and in conformity with the rules of the Income tax Act, or of that Act as modified by the provisions and schedules of the Acts regulating excess profits duty, as the case may be.
For example, the ordinary principles of commercial accounting require that in the profit and loss account of a merchant 's manufacturer 's business the values of the stock in trade at the beginning and at the end of the period covered by the account should be entered at cost or market price, whichever is the lower; although there is nothing about this in the taxing statutes.
" The principle behind permitting the assessee to value the stock at cost is very simple.
In the words of Bose, J. In Kikabhai Premchand vs C.I.T., [1953] 24 I.T.R. 506 S.C. it is this: "The appellant 's method of book keeping reflects the true position.
As he makes his purchases he enters his stock at the cost price on one side of the accounts.
At the close of the year he enters the value of any unsold stock at cost on the other side of the accounts thus cancelling out the entries relating to the sum unsold stock earlier in the 644 accounts; and then that is carried forward as the opening balance in the next year 's account.
This cancelling out of the unsold stock from both sides of the accounts leaves only the transactions on which there have been actual sales and gives the true and actual profit or loss on his year 's dealings.
" As against this, the valuation of the closing stock at market value invariably will create a problem.
For if the market value is higher than cost, the accounts will reflect notional profits not actually realised.
On the other hand, if the market value is less, the assessee will get the benefit of a notional loss he has not incurred.
Nevertheless, as mentioned earlier, the ordinary principles of commercial accounting permit valuation "at cost or market, whichever is the lower".
The rationale behind this has been explained by Patanjali Sastri, C.J. in Chainrup Sampatram vs C.I.T., , S.C. where an attempt was made to value the closing stock at a market value higher than cost.
The learned Chief Justice observed: "It is wrong to assume that the valuation of the closing stock at market rate has, for its object, the bringing into charge any appreciation in the value of such stock.
The true purpose of crediting the value of unsold stock is to balance the cost of those goods entered on the other side of the account at the time of their purchase, so that the cancelling out of the entries relating to the same stock from both sides of the account would leave only the transactions on which there have been actual sales in the course of the year showing the profit or loss actually realised on the year 's trading.
As pointed out in paragraph 8 of the Report of the Committee on Financial Risks attaching to the holding of Trading Stocks, 1919, "As the entry for stock which appears in a trading account is merely intended to cancel the charge for the goods purchased which have not been sold, it should necessarily represent the cost of the goods.
If it is more or less than the cost, then the effect is to state the profit on the goods which actually have been sold at the incorrect figure. .
From this rigid doctrine one exception is very generally recognised on prudential grounds and is now fully sanctioned by custom, viz., the adoption of market value at the date of making up accounts, if that value is less, than cost.
It is of course an anticipation of the loss that may be made on those goods in 645 the following year, and may even have the effect, if prices rise again, of attributing to the following year 's results a greater amount of profit than the difference between the actual sale price and the actual cost price of the goods in question" (extracted in paragraph 281 of the Report of the Committee on the Taxation of Trading Profits presented to British Parliament in April 1951).
While anticipated loss is thus taken into account, anticipated profit in the shape of appreciated value of the closing stock is not brought into the account, as no prudent trader would care to show increased profit before its actual realisation.
This is the theory underlying the rule that the closing stock is to be valued at cost or market price whichever is the lower, and it is now generally accepted as an established rule of commercial practice and accountancy.
" From the above passage, it will be seen that the proper practice is to value the closing stock at cost.
That will eliminate entries relating to the same stock from both sides of the account.
To this rule custom recognises only one exception and that is to value the stock at market value if that is lower.
But on no principle can one justify the valuation of the closing stock at a market value higher than cost as that will result in the taxation of notional profits the assessee has not realised.
The High Court in Ramachari has, however, outlined another exception and seems to have rested this on two considerations.
The first is the observation of Lord Buckmaster in C.I.T. vs Ahmedabad New Cotton Mills Co. Ltd., [1930] L.R. 57 I.A. 21 to the following effect: "The method of introducing stock into each side of a profit and loss account for the purpose of determining the annual profits is a method well understood in commercial circles and does not necessarily depend upon exact trade valuations being given to each article of stock that is so introduced.
The one thing that is essential is that there should be a definite method of valuation adopted which should be carried through from year to year, so that in case of any division from strict market values in the entry of the stock at the close of one year it will be rectified by the accounts in the next year.
" From these observations, the High Court inferred: "It is obvious from the above that the privilege of valuing 646 the opening and closing stock in a consistent manner is available only to continuing business and that it cannot be adopted where the business comes to an end and the stock in trade has to be the disposed of in order to determine the exact position of the business on the date of closure. " The second consideration which prevailed with the High Court is reflected in the following passage from the judgment: "It seems to us that none of these cases has any application to the facts of the present case .
There is no authority directly in point dealing with this question, where a partnership concern dissolves its business in the course of the accounting year, what is the basis on which the stock in trade has to be valued as on the date of dissolution.
We have accordingly to deal with the matter on first principles.
The case of a firm which goes into liquidation forms a close parallel to the present case.
In such a case all the stock in trade and other assets of the business will have to be sold and their value realised.
It cannot be controverted that it is only by doing so that the true state of the profits or losses of the business can be arrived at.
The position is not very different when the partnership ceases to exist in the course of the accounting year.
The fact that Ramachari, one of the ex partners, took over the entire stock and continued to run the business on his own, is not relevant at all, when we consider the profits or losses of the partnership ' which has come to an end.
It should, therefore, follow that in order to arrive at the correct picture of the trading results of the partnership on the date when it ceases to function, the valuation of the stock in hand should be made on the basis of the prevailing market price.
" We are not quite sure that the first of the considerations that prevailed with the High Court is relevant in the present case.
Even in a continuing business, the valuation at market value is permissible only when it is less than cost; it is not quite certain whether the rules permit an assessee if he so desires to value closing stock at market value where it is higher than cost.
But, in either event, it is allowed to be done because its effect can be offset over a period of time.
But here, where the business comes to a close, no future adjustment of an over 647 or under valuation is possible, In this context, it is difficult to see how valuation, at other than cost, can be justified on the principle of Ahmedabad Advance Mills case (supra).
We, however, find substance in the second consideration that prevailed with the High Court.
The decision in Muhammad Hussain Sahib vs Abdul Gaffor Sahib, [1950] 1 M.L.J.81 correctly sets out the mode of taking accounts regarding the assets of a firm.
While the valuation of assets during the subsistence of the partnership would be immaterial and could even be notional, the position at the point of dissolution is totally different: "But the situation is totally different when the firm is dissolved or when a partner retires.
The settlement of his account must be not on a notional basis but on a real basis, that is every asset of the partnership should be converted into money and the account of each partner settled on that basis. .
The assets have to be valued, of course, on the basis of the market value on the date of the dissolution . " This applies equally well to assets which constitute stock in trade.
There can be no manner of doubt that, in taking accounts for purposes of dissolution, the firm and the partners, being commercial man, would value the assets only on a real basis and not at cost or at their other value appearing in the books.
A short passage from Pickles on Accountancy (Third Edn), p. 650 will make this clear: "In the event of the accounts being drawn up to the date of death or retirement, no departure from the normal procedure arises, but it will be necessary to see that every revaluation required by the terms of the partnership agreement is made.
It has been laid down judicially that, in the absence of contrary agreement, all assets and liabilities must be taken at a "fair value," not merely a "book value" basis, thus involving recording entries for both appreciation and depreciation of assets and liabilities.
This rule is applicable, notwithstanding the omission of a particular item from the books, e.g. investments, goodwill (Cruikshank vs Sutherland).
Obviously, the net effect of the revaluation will be a profit or loss divisible in the agreed profit or loss sharing ratios.
" 648 The real rights of the partners cannot be mutually adjusted on any other basis.
This is what happened in Ramachari.
Indeed, this is exactly what the partners in this case have done and, having done so, it is untenable for them to contend that the valuation should be on some other basis.
Once this principle is applied and the stock in trade is valued at market price, the surplus, if any, has to get reflected as the profits of the firm and has to be charged to tax.
The view taken by the High Court has held the field for about thirty years now and we see no reason to disagree even if a different view were possible.
For these reasons, we agree with the answer given by the High Court to the second question as well.
The appeal fails and is dismissed.
But we would make no order regarding costs.
R.N.J. Appeal dismissed.
| IN-Abs | The Appellant Assessee, a partnership firm was engaged mainly, in Malaya, in money lending business since 1949 and incidental to this business was also doing the business of sale and purchase of house properties, gardens and estates.
It was reconstituted under a deed dated 26.3.1960.
The firm was dissolved on 13.3.1961 and closed its accounts with effect from that date.
In its income tax return filed on 10.4.1962 for the assessment year 1961 62 it had filed a profit and loss account wherein amount of $.1,01,248 equivalent of Rs.1,58,057 was shown as "difference on revaluation of the estates, gardens and house properties" on the dissolution of the firm.
In the memo of adjustment for income tax purposes this amount was deducted as being not assessable either as revenue or capital.
The Income Tax Officer issued notice under section 23(2) of the Act on that very day and completed the assessment also on the same day after making a petty addition of Rs.2088 paid as property tax in Malaya.
When for the subsequent year 1962 63, the assessee filed its return showing nil income stating in the forwarding letter that the Firm had been dissolved on 13.3.1961, the I.T.O. wrote to the assessee that the revaluation difference of Rs.1,58,057 should have been brought to tax in the previous year.
The assessee replied that no profit or loss could be assessed on a revaluation of assets, that the assessee was gradually winding up its business in Malaya, the surplus would be only capital 625 gains and that revalutation had been at the market price prevalent since 1954 and thus no capital gains were chargeable to tax.
Not satisfied, the I.T.O. issued a notice under section 148 read with Section 147(b) of the Income Tax Act, 1961.
The assessee filed objections.
Overruling all the objections, the Income Tax Officer completed reassessment of the assessee Firm adding back the sum of Rs. 1,58,057 to the previously assessed income.
Having failed right upto the High Court, the assessee came in appeal before this Court.
Dismissing the appeal, affirming the decision of the High Court, this Court.
HELD: (1) The proceedings u/s 147(b) were validly initiated.
The facts of this case squarely fall within the scope of propositions (2) and (4) enunciated in Kalyanji Mavji 's case.
Proposition (2) may be briefly summarised as permitting action even on a "mere change of opinion".
This is what has been doubted in the IENS case.
But, even leaving this out of consideration, there can be no doubt that the present case is squarely covered by proposition (4) set out in Kalyanji 's case.
This proposition clearly envisages a formation of opinion by the Income Tax Officer on the basis of material already on record provided the formation of such opinion is consequent on "information" in the shape of some light thrown on aspects of facts or law which the Income Tax Officer had not earlier been conscious of.
[636G 637B] The difference between the situations envisaged in propositions (2) and (4) of Kalyanji Mavji is this, that proposition (4) refers to a case where the Income Tax Officer initiates reassessment proceedings in the light of "information" obtained by him by an investigation into material already on record or by research into the law applicable thereto which has brought out an angle or aspect that had been missed earlier.
Proposition (2) no doubt covers this situation also but it is so widely expressed as to include also cases in which the Income Tax Officer, having considered all the facts and law, arrives at a particular conclusion, but reinitiates proceedings because, on a reappraisal of the same material which had been considered earlier and in the light of the same legal aspects to which his attention had been drawn earlier, he comes to a conclusion that an item of income which he had earlier consciously left out from the earlier assessment should have been brought to tax.
[637F H] It is true that the return was filed and the assessment was completed on the same date.
Nevertheless, it is opposed to normal human 626 conduct than an officer would complete the assessment without looking at the material placed before him.
It is not as if the assessment record contained a large number of documents or the case raised complicated issues rendering it probable that the Income Tax Officer had missed these facts.
It is a case where there is only one contention raised before the Income Tax Officer and it is, we think, impossible to hold that the Income Tax Officer did not at all look at the return filed by the assessee or the statements accompanying it.
The more reasonable view to take would, in our opinion, be that the Income Tax Officer looked at the facts and accepted the assessee 's contention that the surplus was not taxable.
But, in doing so, he obviously missed to take note of the law laid down in Ramachari which there is nothing to show, had been brought to his notice.
when he subsequently became aware of the decision, he initiated proceedings under section 147(b).
The material which constituted information and on the basis of which the assessment was reopened was the decision in Ramachari.
this material was not considered at the time of the original assessment.
Though it was a decision of 1961 and the Income Tax Officer could have known of it had he been diligent, the obvious fact is that he was not aware of the existence of that decision then and, when he came to know about it, he rightly initiated proceedings for reassessment.
[639E 640B] The material on which the Income Tax Officer has taken action is a judicial decision.
This had been pronounced just a few months earlier to the original assessment and it is not difficult see that the Income Tax Officer must have missed it or else he could not have completed the assessment as he did.
Indeed it has not been suggested that he was aware of it and yet chose not to apply it.
It is therefore, much easier to see that the initiation of reassement proceedings here is based on definite material not considered at the time of the original assessment.
[640D E] (2) The stock in trade of a firm at the time of its disolution, has to be assessed at a fair value.
there can be no manner of doubt that, in taking accounts for purposes of dissolution, the firm and the partners, being commercial men, would value the assets only on a real basis and not at cost or at their other value appearing in the books.
The real rights of the partners cannot be mutually adjusted on any other basis.
This is what happened in Ramachari.
Indeed, this is exactly what the partners in this case have done and, having done so, it is untenable for them to contend that the valuation should be on some other basis.
Once this principle is applied and the stock in trade is valued at market price, the surplus, if any, has to get reflected as the profits of the firm 627 and has to be charged to tax.
The view taken by the High Court has held the field for about thirty years now and we see no reason to disagree even if a different view was possible.
[642B D, 647E,648A C] Popular Automobiles vs Commissioner of Income Tax, ; Sunil Siddharthbhai vs Commissioner of Income Tax, ; Pupular Workshops vs Commissioner of Income Tax ; Malabar Fisheries Co. vs Commissioner of Income Tax, ; Indian & Eastern Newspaper Society vs Commissioner of Income Tax, ; Kalyanji Mavji & Co. vs Commissioner of Income Tax, [1976] 102 I.T.R. 287; M/s A.L.A. Firm vs The Commissioner of Income Tax, Madras ; Commissioner of Income Tax vs Hind Construction Ltd., ; Commissioner of Income Tax vs Birla Gwalior (P) Ltd., ; Anandji Haridas & Co. (P) Ltd. vs S.P. Kushare, Sales Tax Officer, [1968] 21 S.T.C. 326; Commissioner of Income Tax vs Dewas Cine Corporation, ; Ramachari & Co. vs Commissioner of Income Tax, ; Maharaj Kumar Kamal Singh vs Income Tax Officer, S.C.; Commissioner of Income Tax vs A Raman & Co., S.C.; Salem Provident Fund Society Ltd. vs Commissioner of Income Tax, ; Commissioner of Income Tax vs Rathinasabapathy Mudaliar, ; Addanki Narayanappa vs Bhaskara Krishnappa, ; ; Commissioner of Income Tax vs Bankey Lal Vaidya ; Kikabhai Premchand vs Commissioner of Income Tax, [1953] 24 I.T.R. 506 (S.C.); Commissioner of Income tax vs K.A.R.K. Firm, ; Chainrup Sampathram vs Commissioner of Income Tax, ; Commissioner of Income Tax vs M/s. Shoorji Vallabhadas & Co., , Commissioner of Income Tax vs Krishnaswamy Muldaliar, ; Commissioner of Income Tax vs Ahmedabad New Cotton Mills Co. Ltd., [1930] L.R. 57 I.A. 21; Muhammad Hussain Sahib vs Abdul Gaffor Sahib, reffered to.
|
ivil Appeal No. 3693 of 1982.
From the Judgment and Order dated 29.1.1982 of the Patna High court in C.W.J.C. No. 4087 of 1981.
Ranjit Kumar for the Appellant.
Ex Parti for the Respondents.
The Judgment of the Court was delivered by PUNCHHI, J.
This appeal by special leave is directed against the order of the High Court of Judicature at Patna dated 29 1 1982 passed in Civil Writ Number 4087 of 1981 dismissing the Writ Petition of the appellant in limine.
The appellant, Bihar State Road Transport Corporation, is a 669 State Transport Undertaking.
Under the provision of the (hereafter referred to as the 'Act '), the State Transport Authority invited applications for the grant of stage carriage permits for the route named Bhukunda Chaibasa via Patratu Pithoria Kanke Ranchi Chakradharpur part of which, that is, Ranchi Chaibasa is covered under a notified scheme dated 1 4 1960, duly in force, under the provisions of the Act.
On applications received in response to the invitation, the Corporation filed its objections before the State Transport Authority claiming that no private operator could be permitted to operate on the said route, as part of it, being Ranchi Chaibasa, was by itself a notified route and the grant of permits on the route in question would contravene a notified scheme.
The objection of the Corporation was rejected by the State Transport Authority in its meeting held on 23rd and 24th January, 1979 taking the view that the overlapping Ranchi Chaibasa route was restrictedly notified for direct services only and as such there could be no legal objection to the grant of permits on the Bhukunda Chaibasa route.
It accordingly granted permits to respondents 3 and 4 herein.
Appellant 's appeal before the State Transport Appellate Tribunal, Biharwas dismissed and the view of the State Transport Authority was upheld.
The Appellate Tribunal in support of its view placed reliance on a division bench of the Patna High Court in M/s Marwari Motor Service vs Chotanagpur Regional Transport Authority and others, AIR 1973 Patna (Vol 60) 273 in which such an objection as raised herein was negatived.
The appellant 's writ petition against the orders of the State Transport Appellat Tribunal, Bihar was dismissed in limine giving cause to the appellant to approach this Court for appropriate relief.
The notified scheme dated 1 4 1960, afore referred to, where under the Ranchi Chaibasa route was declared a nationalised route was the brain child of the Appellant Corporation itself.
Initially a draft scheme was published in the Bihar Gazette on 13 1 1960 under the provisions of Section 68 C of the Act.
Objections were invited to the proposed scheme and after considering the objections received, the State Government approved the scheme with some modifications under section 68 D(2) of the Act.
The approved scheme was then notified under section 68 D(3) of the Act in the Bihar Gazette on April 1, 1960.
The relevant extract of the scheme is reproduced below: "The Bihar State Road Transport Corporation shall run and operate stage carriage services relating to routes or portions thereof specified below to the complete exclusion of other persons except those who, on the dates, specified 670 below, hold permanent permits to run stage carriages in those routes and are hereby allowed to operate them until the dates of expiration of the existing permits.
Nature of Name of route Name of Date from which No. service service services as proposed to be plied 1.
Stage Ranchi Muri All 1st April, 1961 carriage or portions services thereof 2.
Ditto Hazaribagh Ditto 1st April, 1960 Ranchi or portions thereof 3.
Ditto Barhi Bagodar Ditto Ditto Dumri Gobind pur or portions thereof 4.
Ditto Giridih Dumri Ditto Ditto or portions thereof 5.
Ditto Giridih Jamua Ditto 1st April, 1961 Kedarma or portions thereof 6.
Ditto Jamua Chakai Ditto Ditto or portions thereof 7.
Ditto Ranchi Chaibasa Ditto 1st April,1960 (direct service) It is evident from the Entry in serial No. 7 that the name of the route is Ranchi Chaibasa and in this Entry alone that the bracketed words 'direct service ' finds mention whereas in the remaining serial nos.
1 to 6, the main routes or portions thereof are contrastingly 671 mentioned.
In Marwari Motor Service 's case (supra), the then writ petitioner stood already given a stage carriage permit for the route Hazaribag Hazaribag Road and when its renewal was objected to by the corporation on the ground that it would overlap Hazaribag Bagodar notified route, the words 'direct service ' occuring in the relevant entry of the notification under the notified route was required to be interpreted.
The contention of the said writ petitioner before the High Court was that though private operators stood ousted on the Hazaribag Bagodar route, it could not be ousted from operating on a longer or shorter route even though overlapping wholly or partially on the Hazaribag Bagodar route.
The corporation refuted the argument by contending that no private operator could be permitted to operate on any portion of the route even if he had tended to operate on a longer or a shorter route.
Confronted with this situation, the Patna High Court ventured, in the absence of any direct binding judicial precedent, to solve the question by adopting the interpretation given to the bracketed words 'direct service by the Transport Minister of the Bihar Government to mean the exclusion of private operators for direct transport services only and not to the exclusion of private operators thereon overlapping on longer or shorter routes.
Another factor which appealed to the High Court was that though the scheme had come into force in 1960 and Hazaribag Bagodar route had been nationalised still the then writ petitioner had thereafter been kept granted route permits on the Hazaribag Hazaribag Road route despite overlapping on the nationalised routes.
The High Court in these circumstances made the following observations: The correct meaning is that private operators who were operating directly on Hazaribag Bagodar route were excluded, private operators having these two termini were not allowed to operate but private operators having only one terminus out of these two termini or passing through this route having different termini were not excluded in the approved scheme".
Relying on the said ratio the Transport authorities overruled the objection of the Corporation.
We have had the advantage of hearing Mr. Ranjit Kumar, learned counsel for the appellant only since no one appeared either on behalf of the State of Bihar nor for the permit holders respondents 3 and 4.
The sole point for consideration is whether the view taken by the Patna High Court in Marwari Motor Service 's case (supras in any more rele 672 vant in view of the decision of the Constitution Bench of this Court in Adarsh Travels Bus Service & Another vs State of U.P. & Others, [1985] (Supp.) 3 SCR 661.
In Adarsh Travels 's case (supra), this Court ruled that if the route has been nationalised under Chapter IV A of the , a private operator with a permit to ply stage carriage for another route, which has a common overlapping sector with the nationalised route, can ply his vehicle over that part of the overlapping common sector if he does not pick up or drop passengers on the overlapping part of the route, and the question would really get the right answer on the terms of the scheme rather than on the provisions of the statute.
The word 'route ' was introduced to be defined in section 2(28A) of the Act by amendment from March 2, 1970 to mean 'the line of travel which specifies the highway which may be traversed by a motor vehicle between one terminus and another.
Spelling out the necessity for its so defining it was recorded: "The introduction of section 2(28A) defining the expression 'route ' appears to have been necessitated to dispel the confusion consequent upon the seeming acceptance by this Court in Nilkantha Prasad and Others vs State of Bihar, [1962] Supp. 1 SCR 728 of the suggested differences between 'route ' and 'highway ' by the Privy Council in Kelani valley Motor Transit Co. Ltd. vs Colombo Ratnapura Omnibus Co. Ltd., where it was said, 'A "highway" is the physical track along which an omnibus runs, whilst a "route" appears to their Lordships to be an abstract conception of line of travel between one terminus and another, and to be something distinct from the highway traversed . there may be alternative roads leading from one terminus to another but that does not make the route any highway the same. ' The present definition of route makes it a physical reality instead of an abstract conception and no longer makes it something distinct from the highway traversed.
" In the light of the above observations Ranchi Chaibasa route is identified as the line of travel on which State Transport Undertaking on nationalisation is allowed to run its vehicles.
The bracketed words 'direct service ' occuring in serial No. 7 when contrasted with entries in serial nos.
1 to 6 reveal that the total route of Ranchi Chaibasa, without leaving any portion, stood nationalised signifying by its name that 673 Ranchi Chaibasa route is a straight and direct line of travel which would be traversed by a vehicle by the State Transport Undertaking between two termini rendering all kinds of services.
Any further interpretation would frustrate the object of Chapter IV A whereunder the scheme is prepared.
It was observed in Adarsh Travel 's case (supra) as follows: "It is well known that under the guise of the so called 'corridor restrictions ' permits over longer routes which cover shorter notified routes 'overlapping ' parts of notified routes are more often that no misutilised since it is next to nigh impossible to keep a proper check at every point of the route.
Often times permits for plying stage carriages from a point a short distance beyond one terminus to a point at a short distance beyond another terminus of a notified route have been applied for and granted subject to the so called 'corridor restrictions ' which are but mere ruses or traps to obtain permits and to frustrate the scheme.
If indeed there is any need for protecting the travelling public from inconvenience, the State Transport Undertaking and the Government will have to make sufficient provision in the scheme itself to avoid inconvenience being caused to the travelling public.
" If the interpretation put by the Patna High Court in Marwari Motor Service 's case (supra) to the bracketed words 'direct service ' is to be kept valid, it would frustrate the very purpose of nationalisation, for any person in that event could operate on a nationalised route by adding thereto, or substracting therefrom, some kilometerage and keep one terminus as a point of start, or a point of ending, on an un notified route and put forward his willingness to submit himself to the discipline called 'corridor restrictions ' which practice has been deprecated by this Court.
For the views afore expressed, we are of the view that Marwari Motor Service 's case (supra) militates against the principles settled in Adarsh Travel 's case (supra) and thus it should be left to be confined to the facts of that case and not any more a binding precedent.
Having taken that view, we come to the conclusion that the State Transport Authority and State Transport Appellate Tribunal were in error in rejecting the objections of the appellant and High Court too was in error in dismissing the writ petition in limine.
Accordingly, instead of remanding the matter to the High Court, we allow this appeal and 674 quash the aforesaid three orders but without any order as to costs.
Since there was no opposition, we permit respondents 3 and 4 to keep plying vehicles on their permits, subject of course to their being subsisting and valid till date, uptill 31st March, 1991, and not any further, to avoid abrupt disruption of transport facilities.
We also leave it open to the State Government to take such steps as are further necessary to avoid inconvenience to the travelling public and for that purpose it may coordinate with the appellant corporation by making suitable amendment and provisions in the scheme to further that cause.
R.N.J. Appeal allowed.
| IN-Abs | The State Transport Authority, Bihar invited application for grant of Stage Carriage permits for the route named, Bhukunda Chaibasa via Patratu Pithoria Kanke Ranchi Chakradharpur part of which, that is, Ranchi Chaibasa is covered under a notified Scheme dated 1.4.1960, duly in force, under the Act.
The Bihar State Road Transport Corporation, a State Undertaking, filed its objections claiming that no private operator could be permitted to operate the said route as part of the route being Ranchi Chaibasa was itself a notified route and grant of permits on the route in question would contravene the notified Scheme.
Taking the view that the over lapping Ranchi Chaibasa route was restrictedly notified for direct services only, the objections raised by the Corporation were rejected and permits for the route in question granted to respondents 3 and 4.
Corporation 's appeal to the State Transport Appellate Tribunal and thereafter Writ Petition before the Patna High Court being unsuccessful, it has come in appeal by special leave against the judgment of the High Court dismissing the Writ Petition in limine.
Allowing the appeal and quashing all the three orders, this Court.
HELD: In the light of the observations made in Constitution 668 Bench decision of this Court in Adarsh Travels ' case defining the word 'route ', the Ranchi Chibasa route is identified as the line of travel on which State Undertaking on nationalisation is allowed to run its vehicles.
The bracketed words 'direct service ' occuring in seriol No. 7 when contrasted with entries in serial nos.
1 to 6 reveal that the total route of Ranchi Chaibasa, without leaving any portion, stood nationalised signifying by its name that Ranchi Chaibsa route is a straight and direct line of travel which would be traversed by a vehicle by the State Transport Undertaking between two termini rendering all kinds of services.
Any further interpretation would frustrate the object of Chapter IV A whereunder the scheme is prepared.
[672G 673B] If the interpretation put by the Patna High Court in Marwari Motor Service 's case to the bracketed words 'direct service ' is to be kept valid, it would frustrate the very purpose of nationalisation, for any person in that event could operate on a nationalised route by adding thereto, or substracting therefrom, some kilometerage and keep one terminus as a point of start, or a point of ending, on an un notified route and put forward his willingness to submit himself to the discipline called 'corridor restictions ' which practice has been deprecated by this Court.
[673E F] M/s Marwari Motor Service vs Chotanagpur Regional Transport Authority and Others, AIR 1973 Patna (Vol. 60) 273, referred to.
Adarsh Travels Bus Service & Another vs Stat of U.P. & Others, [1985] (Suppl.) 3 SCR 661, followed.
|
: Criminal Appeal Nos. 4 & 5 of 1979.
From the Judgment and Order dated 21.3.1978 of the Gujarat High Court in Criminal Revision Application Nos. 98 and 97 of 1978.
S.K. Kulkarani and P.C. Kapur (NP) for the Appellant.
Arun Jetley, Additional Solicitor General, Ms. Indu Malhotra, M.N. Shroff, P. Parmeshwaran, Ms. A. Subhashini, Ms. Ayesha Karim and P.K. Mullick for the Respondents.
The Judgment of the Court was delivered by section RATNAVEL PANDIAN J.
These criminal appeals by special leave granted under Article 136 of the Constitution of India are preferred by the appellant questioning the correctness of the judgment of the Gujarat High Court in Criminal Revision Application Nos. 98 and 97 of 1978 whereby the High Court set aside the judgment and orders dated 2.1.1978 of the Sessions Judge, Kutch at Bhuj made in Criminal Revision Application Nos. 46 and 45 of 1976 confirming the orders dated 19.6.76 passed by the Judicial Magistrate, First Class, Kutch in Application Exh.
Nos. 94 and 98 in Criminal Case Nos. 929 and 930 of 1973 respectively.
The factual matrix that have relevance to the questions, raised and canvassed at the hearing may be briefly stated.
A raid conducted by the officers of the Customs Department in the business cum residential premises of the appellant on 17.9.1971 resulted in the seizure of some gold Lagadis bearing foreign marks, primary gold, gold ornaments and silver bricks, coins etc.
to the value of about Rs.8,48,422.
During the said raid a sum of Rs.79,000 was also seized.
In respect of this incident, the Assistant Collector of Customs filed two separate complaints on 26.11.1973 against the appellant in the court of the Judicial Magistrage, First Class, Anjar, being criminal cases Nos. 929 and 930 of 1973 for offences punishable (1) under the 715 provisions of the and (2) under the Gold Control Act 1968.
After examination of the prosecution as well as the defence witnesses and recording of the statements of the appellants under Section 342 of the old Code of Criminal Procedure (hereinafter referred to as the Code ') arguments were advanced on behalf of the appellant/accused.
The prosecution at this stage before commencing its arguments filed two applications both the cases under Section 540 of the old Code (corresponding to Section 311 of the new Code) requesting the Trial Court to recall Mr. Mirchandani (the Seizing Officer) for further examination and to issue summons to two more witnesses, namely, Mr. K.K. Das, Assistant Collector of Customs and the Deputy Chief Officer (Assayer) of Mint Master, Bombay for examination either as prosecution witnesses or as court witnesses as cotemplated under the said provision.
The learned Judicial Magistrate passed two orders rejecting the applications which orders, on revision by the respondents were confirmed by the session 's Judge on being aggrieved by the said revisional orders, the Union of India (the first respondent herein) preferred two Criminal Revision Applications Nos.
97 and 98 of 1978.
The second respondent, namely, the State of Gujarat also preferred two other Criminal Revision Application Nos. 124 and 125 of 1978.
The High Court by its Common Judgment, though heavily criticised the conduct of the prosecution for its deplorable and lethargic attitude in not carefully and promptly conducting the proceedings allowed all the Criminal Revisions for the reasons assigned therein holding thus: "In view of what has been stated above, I accept the four petitions filed in this court by the Union of India, and the State of Gujarat, and direct the Union of India to examine the aforesaid three witnesses within a period of fortnight after the receipt of the order of this court to the trial court.
After the Union of India examines the aforesaid three witnesses as aforesaid, it will be open to the accused to cross examine all the witnesses examined by the Union of India before the learned Magistrate.
Feeling aggrieved by the judgment of the High Court, these two appeals are preferred by the appellant.
In this context, it is pertinent to note that the appellant has not directed any appeal against the judgment of the High Court in allowing the two other Revision Application Nos. 124 and 126 of 1978 filed by the Gujarat Government which were also allowed by the High Court.
716 The learned counsel appearing on behalf of the appellant vigorously challenged the legality of the impugned judgment inter alia contending that the High Court has gravely erred in allowing the second revision petitions filed by the respondent by ignorning the weighty reasons given by the Trial Magistrate and the Section Judge (before whom the first revision was filed) and thereby in permitting the respondent the Union of India to examine the three witnesses as prayed by it, notwithstanding that the case was pending before the Trial Court for considerable length of time and the defence argument was concluded and that the High Court, by the impugned order has permitted the prosecution to bolster up its case by filling up the lacuna and plugging the loopholes which if carried out would be detrimental and prejudicial to the appellant.
The next legal submission made on behalf of the appellant is that the entertainment of the second revision by the High Court is in violation of sub sections (2) and (3) of Section 397 of the new Code since the order passed by the Magistrate was an interlocutory order and that even assuming that it was not so, the second revision by the same affected party is not entertainable.
Before adverting to the arguments advanced on behalf of the appellant, we would examine in general the scope and intent of Section 540 of the old Code (corresponding to Section 311 of the new Code).
Section 540 was found in Chapter XLVI of the old Code of 1898 under the heading "Miscellaneous '.
But the present corresponding Sections 311 of the new Code is found among other Sections in Chapter XXIV under the heading 'General Provisions as to Enquiries and Trials '.
Section 311 is an almost verbatim reproduction of Section 540 of the old Code except for the insertion of the words 'to be ' before the word 'essential ' occurring in the old Section.
This section is manifestly in two parts.
Whereas the word 'used ' in the first part is 'may ' the word used in the second part is 'shall '.
In consequence, the first part which is permissive gives purely discretionary authority to the Criminal Code and enables it 'at any stage of enquiry ' trial or other proceedings ' under the Code to act in one of the three ways, namely, (1) to summon any person as a witness or (2) to examine any person in attendance, though not summoned as a witness, or (3) to recall and re examine any person already examined.
717 The second part which is mandatory imposes an obligation on the Court (1) to summon and examine, or (2) to recall and re examine any such person if his evidence appears to be essential to the just decision of the case.
The very usage of the words such as 'any court ', 'at any stage ', or 'of any enquiry, trial or other proceedings ', 'any person ' and 'any such person ' clearly spells out that this section is expressed in the widest possible terms and do not limit the discretion of the Court in any way.
However, the very width requires a corresponding caution that the discretionary power should be invoked as the exigencies of justice require and exercised judically with circumpection and consistently with the provisions of the Code.
The second part of the Section does not allow for any discretion but it binds and compels the Court to take any of the aforementioned two steps if the fresh evidence to be obtained is essential to the just decision of the case.
It is a cardinal rule in the law of evidence that the best available evidence should be brought before the Court to prove a fact or the points in issue.
But it is left either for the prosecution or for the defence to establish its respective case by adducing the best available evidence and the Court is not empowered under the provisions of the Code to compel either the prosecution or the defence to examine any particular witness or witnesses on their sides.
Nonetheless if either of the parties with holds any evidence which could be produced and which, if produced, be unfavorable to the party withholding such evidence, the court can draw a presumption under illustration (g) to Section 114 of the Evidence Act.
In such a situation a question that arises for consideration is whether the presiding officer of a Court should simply sit as a mere umpire at a contest between two parties and declare at the end of combat who has won and who has lost or is there not any legal duty of his own, independent of the parties, to take an active role in the proceedings in finding the truth and administering justice? It is a well accepted and settled principle that a Court must discharge its statutory functions whether discretionary or obligatory according to law in dispensing justice because it is the duty of a Court not only to do justice but also to ensure that justice is being done.
In order to enable the Court to find out the truth and render a just decision, the salutary provisions of Section 540 of the Code (Section 311 of the New Code) are enacted whereunder any 718 Court by exercising its discretionary authority at any stage of enquiry, trial or other proceeding can summon any person as a witness or examine any person in attendance though not summoned as a witness or recall or re examine any person in attendance though not summoned as a witness or recall and re examine any person already examined who are expected to be able to throw light upon the matter in dispute; because if judgments happen to be rendered on inchoate, inconclusive and speculative presentation of facts, the ends of justice would be defeated.
There are various other provisions in the new Code corresponding to the provision of the old Code empowering the court specified therein to recall any witness or witnesses already examined or summon any witness, if it is felt necessary in the interest of justice at various stages mentioned in the concerned specific provisions.
A Judge under Section 236 (Section 310 old Code) or a Magistrate under Section 248(3) (Section 251 A(13) and 255 A old Code) is empowered to take evidence in respect of the previous convictions of the accused person concerned if he is charged with the previous conviction under sub section (7) of Section 211 and if he does not admit the previous conviction.
Under Section 367 (Section 375 old Code) if, when sentence of death passed by the Court of Sessions is submitted for confirmation to the High Court under Section 366(1) (Section 374 of the old Code), the High Court thinks that a further enquiry 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 Session.
Under Section 391 (Section 428 of old Code) the Appellate Court while dealing with any appeal under Chapter XXIX, if thinks additional evidence to be necessary, may after recording its reasons either take such evidence itself or direct it to be taken by a subordinate Court as the case may be.
Under Section 463(2) (Section 533 old Code) if any Court of Appeal, Reference and Revision before which confession or other statement of an accused recorded or purporting to be recorded under Section 164 or Section 281 (Section 364 of the old Code) is tendered, or has been received in evidence, finds that any of the provisions of either such sections have not been complied with by the Magistrate recording the statement, the Court may notwithstanding anything contained in Section 91 of the Indian Evidence Act take evidence in regard to such non compliance and may, if satisfied that 719 such non compliance has not injured the accused in his defence on the merits and that he duly made the statement recorded, admit such evidence.
Analogous to the above provisions of the Code of Criminal Procedure there are various provisions in the civil Procedure Code also enabling the civil Court to summon witnesses and examine them in the interest of justice.
Under Order X Rule 2 of the Civil Procedure Code, the Court at the first hearing of the suit or at any subsequent hearing may examine any party appearing in person or present in Court or any person able to answer any material questions relating to the suit by whom such party or his pleader is accompanied.
Under Order X Rule 14 the Court may of its own motion summon as a witness any person including the party to the suit for examination and the said Rule is under the caption "Court may of its own accord summon as witnesses strangers to suit" and Order XVIII Rule 17 empowers the Court to recall any witness who has been examined and may subject to Law of Evidence for the time being in force put such questions to him as it thinks fit.
The powers of the Court under this Rule 17 are discretionary and very wide.
Besides the above specific provisions under the Cr.
P.C. and C.P.C. empowering the criminal and civil courts as the case may be, to summon and examine witnesses, a Judge in order to discover or to obtain proof of relevant facts is empowered under Section 165 of the Indian Evidence Act to exercise all the privileges and powers subject to the proviso to that section which power he has under the Evidence Act.
Section 540 of the old Code (Section 311 of the new Code) and Section 165 of the Evidence Act may be said to be complementary to each other and as observed by this Court in Jamatraj Kewalji Govani vs State of Maharashtra, ; "these two sections between them confer jurisdiction on the Judge to act in aid of justice.
" The second part of Section 540 as pointed out albeit imposes upon the Court an obligation of summoning or recalling and re examining any witness and the only condition prescribed is that the evidence sought to be obtained must be essential to the just decision of the case.
Though any party to the proceedings points out the desirability some evidence being taken, then the Court has to exercise its power under this provision either discetionary or mandatory depending on the facts and circumstances of each case, having in view that the most paramount principle underlying this provision is to discover or to obtain proper proof of relevant facts in order to meet the 720 requirements of justice.
In this connection we would like to quote with approval the following views of Lumpkin, J. in Epps vs section, , which reads thus: ". . it is not only the right but the duty of the presiding judge to call the attention of the witness to it, whether it makes for or against the prosecution; his aim being neither to punish the innocent nor screen the guilty, but to administer the law correctly . . . . . . . . . . . . . .
Counsel seek only for their client 's success; but the judge must watch that justice triumphs.
" The law is clearly expounded in the case of Jamatraj Kewalji Govani (referred to above) wherein Hidayatullah, J as he then was, while speaking for the Bench about the unfettered discretionary power of the court as envisaged under Section 540 of the Code has stated thus: "It is difficult to limit the power under our Code to cases which involve something arising ex improviso which no human ingenuity could foresee, in the course of the defence.
Our Code does not make this a condition of the exercise of the power and it is not right to embark on judicial legislation.
Cases that go far are of course not quite right.
Indeed they could be decided on fact because it can always be seen whether the new matter is strictly necessary for a just decision and not intended to give an unfair advantage to one of the rival sides . . . . . . . . . . . . . . . . . . . . . . .
It would appear that in our criminal jurisdiction, statutory law confers a power in absolute terms to be exercised at any stage of the trial to summon a witness or examine one present in court or to recall a witness already examined, and makes this the duty and obligation of the Court provided the just decision of the case demands it.
In other words, where the court exercises the power under the second part, the inquiry cannot be whether the accused has brought anything suddenly or unexpectedly but whether the court is right in thinking that the new evidence is needed by it for a just decision of the case.
If the court has acted without the requirements of a just decision, the 721 action is open to criticism but if the court 's action is supportable as being in aid of a just decision the action cannot be regarded as exceeding the jurisdiction.
" The next important question is whether Section 540 gives the court carte blanche drawing no underlying principle in the exercise of the extra ordinary power and whether the said Section is unguided, uncontrolled and uncanalised.
Though Section 540 (Section 311 of the new Code) is, in the widest possible terms and calls for no limitation, either with regard to the stage at which the powers of the court should be exercised, or with regard to the manner in which they should be exercised, that power is circumscribed by the principle that underlines Section 540, namely, evidence to be obtained should appear to the court essential to a just decision of the case by getting at the truth by all lawful means.
Therefore, it should be borne in mind that the aid of the section should be invoked only with the object of discovering relevant facts or obtaining proper proof of such facts for a just decision of the case and it must be used judicially and not capriciously or arbitrarily because any improper or capricious exercise of the power may lead to undesirable results.
Further it is incumbent that due care should be taken by the court while exercising the power under this section and it should not be used for filling up the lacuna left by the prosecution or by the defence or to the disadvantage of the accused or the cause serious prejudice to the defence of the accused or to give an unfair advantage to the rival side and further the additional evidence should not be received as a disguise for a retrial or to change the nature of the case against either of the parties.
Fazal Ali, J in Rameshwar Dayal vs State of U.P., ; while expressing his views about the careful exercise of its power by the court has stated: "It is true that under Section 540 of the Criminal Procedure Code the High Court has got very wide powers to examine any witness it likes for the just decision of the case, but this power has to be exercised sparingly and only when the ends of justice so demand.
The higher the power the more careful should be its exercise . . . .
The words, "Just decision of the case" would become meaningless and without any significance if a decision is to be arrived at without a sense of justice and fair play.
" In State of West Bengal vs Tulsidas Mundhra, at 207, it has observed: 722 "It would be noticed that this section confers on criminal Courts very wide powers.
It is no doubt for the Court to consider whether its power under this section should be exercised or not.
But if it is satisfied that the evidence of any person not examined or further evidence of any person already examined is essential to the just decision of the case, it is its duty to take such evidence.
The exercise of the power conferred by section 540 is conditioned by the requirement that such exercise would be essential to the just decision of the case.
" At the risk of repetition it may be said that Section 540 allows the court to invoke its inherent power at any stage, as long as the court retains seisin of the criminal proceeding, without qualifying any limitation or prohibition.
Needless to say that an enquiry or trial in a criminal proceeding comes to an end or reaches its finality when the order or judgment is pronounced and until then the court has power to use this section.
The answer to the question like the one that has arisen in the present case is whether the court would be justified in exercising its power under Section 540 is found in Kewalji 's case (albeit).
In that case the appellant was prosecuted on two counts under Section 135(a) and (b) of the .
The appellant did not lead any evidence on his behalf but filed a written statement, claiming inter alia that no offence had been disclosed against him, since no witness had deposed that the contraband had been seized from him under the Act in the reasonable belief that they were smuggled goods.
The day after the statement was filed, the prosecution applied for examination of the customs officer who was incharge of the search as a court witness in the interest of justice.
The Magistrate ordered the examination of the officer under Section 540 of the Code rejecting the objections raised by the appellant.
Though an opportunity was given to the appellant to lead defence evidence, the appellant stated that he had nothing further to add and no evidence to lead.
The Trial Court convicted the appellant who being aggrieved by the judgment of the Trial Court preferred an appeal to the High Court which dismissed the appeal.
Before this Court it was contended that the evidence of the officer was improperly received.
That contention has been repelled by this court observing "This power is exercisable at any time and the Code of Criminal Procedure clearly so states" and thereafter concluded "it cannot be said that the Court had exceeded its jurisdiction in acting the second part of Section 540 of the Code of Criminal Procedure.
" Gajendragadkar, J. speaking for the Bench in Tulsidas Mundhra 723 (cited supra) has pointed out as follows: "Section 540 in terms applies at any stage of any enquiry, trial or other proceeding under this Code.
This section is wide enough to include a proceeding under section 207 A and so, it would be unreasonable to contend that the scheme of section 207 A makes section 540 inapplicable to the proceeding governed by section 207 A.
The power of the Court under section 540 can be exercised as much in regard to cases governed by section 207 A as in regard to other proceedings governed by the other relevant provisions of the Code." (It may be noted that section 207 A of the old Code in Chapter XVIII under the caption "Enquiry into cases triable by the court of Session or the High Court" dealt with the procedures to be adopted in proceedings instituted on police report and this provision is omitted in the new Code.) This Court in Kewalji 's case (albeit) held that Chapter XXI of Cr.
P.C. (old) under the heading "Of the Trail of Warrant cases by Magistrates" does not restrict the powers of criminal court under Section 540.
In Masalti vs State of U.P., ; wherein the defence did not opt to examine some witnesses who have been left out by the prosecution on the bona fide belief that those witnesses had been won over and the court also after due deliberation refused to exercise its power under Section 540; this Court while examining a submission that the Trial Court should have exercised its power under Section 540 and examined those witnesses expressed its opinion that "that is one aspect of the matter which we have to take into account" that is in considering whether the accused were prejudiced or not.
It has been held by this Court in Rajeswar Prasad Mora vs State of West Bengal & Anr.,[1966] 1 SCR 178 while dealing with the ample power and jurisdiction of the court in taking additional evidence as follows: "Additional evidence may be necessary for a variety of reasons which it is hardly necessary (even if it was possible) to list here.
We do not propose to do what the Legislature 724 has refrained from doing, namely, to control discretion of the appellate Court to certain stated circumstances.
It may, however, be said that additional evidence must be necessary not because it would be impossible to pronounce judgment but because there would be failure of justice without it.
The power must be exercised sparingly and only in suitable cases.
Once such action is justified, there is no restriction on the kind of evidence which may be received.
It may be formal or substantial.
" The above view has been reiterated in R.B. Mithani vs Maharashtra, AIR 1971 S.C. 1630.
The principle of law that emerges from the views expressed by this court in the above decisions is that the Criminal Court has ample power to summon any person as a witness or recall and re examine any such person even if the evidence on both sides is closed and the jurisdiction of the court must obviously be dictated by exigency of the situation, and fair play and good sense appear to be the only safe guides and that only the requirements of justice command and examination of any person which would depend on the facts and circumstances of each case.
What falls for determination now is whether the person indicated should be given an opportunity to rebut the evidence of the witness or witnesses summoned and examined under Section 540.
This question came for determination in Rameshwar Dayal 's case and this court answered that question thus: "It was argued by counsel for the State that there is no provision in the Criminal Procedure Code which requires the court to allow the appellant an opportunity to rebut the evidence of witnesses recommended under Section 540 Cr.
This argument, in our opinion, is based on a serious misconception of the correct approach to the cardinal principles of criminal justice.
Section 540 itself incorporates a rule of natural justice.
The accused is presumed to be innocent until he is proved guilty.
It is, therefore, manifest that where any fresh evidence is admitted against the accused the presumption of innocence is weakened and the accused in all fairness should be given an opportunity to rebut that evidence.
The right to adduce evidence in rebuttal is one of the inevitable steps in the defence of a case by 725 the accused and a refusal of the same amounts not only to an infraction of the provisions of the Criminal Procedure Code but also of the principles of natural justice and offends the famous maxim audi alteram partem . . . . . . . . . . . . . .
A careful perusal of this provision manifestly reveals that the statute has armed the Court with all the powers to do full justice between the parties as full justice cannot be done until both the parties are properly heard the condition of giving an opportunity to the accused to rebut any fresh evidence sought to be adduced against him either at the trial or the appellate stage appears to us to be implicit under Section 540 of the Cr.
P.C." See also Kewalji 's case (cited above).
This was the view taken by various High Court such as in Channu Lal vs R., AIR 1949 All. 692; Rengaswami Naicker vs Muruga Naicker, AIR 1954 Mad. 169; Shugan Chand vs Emperor, AIR 1925 Lah 531 and The Queen vs Assanoolah, 13 SWR (Crl.
The views expressed in the above judgments of the various High Courts have been approved by this Court in Rameshwar Dayal 's case.
We are in full agreement with the above view of Fazal Ali, J and hold that whenever any additional evidence is examined or fresh evidence is admitted against the accused, it is absolutely necessary in the interest of justice that the accused should be afforded a fair and reasonable opportunity to rebut that evidence brought on record against him.
With this legal background let us now turn to the challenge posed by the appellant in these appeals.
The Trial Court and the First Revision Court rejected the request of the prosecution on three grounds, namely, first that the prosecution has attempted to fabricate evidence at a belated stage to fill up the lacuna in the prosecution case and secondly that the request of the prosecution for taking additional evidence was after the closure of the defence and thirdly a substantial prejudice would be caused to the appellant if the prosecution is allowed to adduce fresh evidence.
As pointed out by the High Court in its impugned order, gold, silver ornaments of the value of Rs.8,48,482 and currency notes of Rs.79,000 have been seized from the premises, searched on the strength of the search warrant issued by Shri K.K. Das.
What the appellant now contends is that the order of the High Court permitting the prosecution to recall one of the witnesses already examined and to summon two other new witnesses to prove 726 the foreign makings on the legadis is in violation of the principle underlying Section 540.
We waded through the entire records inclusive of the copies of depositions, search warrant and the application filed by the prosecution under Section 540 which are available in the file, forwarded by the High Court though those documents are not annexed with the SLP.
The prosecution filed the petition for examination of the three witnesses stating that foreign ingots (lagadis) have been sized from the possession of the appellant and that warrant for search of the premises of the appellant/accused was issued in this regard by the Assistant Collector of Customs, namely Shri K.K. Das and hence fresh evidence is necessary for a just decision of the case.
After perusing the depositions of the witnesses already examined that are found on the file, we think that the appellant/accused cannot be said to be prejudiced in any way by examination of these three witnesses.
PW 2 who was then working as Superintendent of Customs in the office of the Assistant Collector of Customs at Adipur during the relevant period has stated that Shri K.K. Das who was the then Assistant Collector of Customs issued the warrant dated 7.9.1971 authorising Shri Mirchandani, Superintendent of Customs, Adipur to search for the prohibited and dutiable goods and documents in the premises mentioned in the warrant.
It is elicited from the same witness in the cross examination that the gold ornaments were seized since the sizing authority doubted that they are smuggled gold and procured by contriving the Gold Control Act.
It is seen from the evidence of PW 3 that he and others inclusive of Superintendent Mirchandani went to the house of the appellant and they seized the gold ornaments Dhalia, that is, primary gold under Panchnama and search list Exts.
24 and 25.
Therefore, the appellant 's grievance that he has been taken by surprise on the request of the prosecution for taking fresh evidence; that the evidence sought to be obtained is only for filling up the lacuna and the judgment, impugned is prejudicial to him cannot be countenanced.
Of the three witnesses, permitted to be summoned and examined on the side of the Union of India, the Mint Master is only an assayer.
In our considered opinion, the facts and circumstances of the case require the examination of these three witnesses for a just decision of the case as held by the High Court.
In the light of the proposition of law which we have derived in the preceding portion of the judgment there is no illegality in summoning the witnesses after the closure of the defence arguments.
It is seen from the order of the Trial Court that the argument of the prosecution has not yet begun.
Since we feel that any further observation of ours in justification of this order may prejudice the defence of the appellant 727 before the Trial Court, we are not inclined to discuss the evidence any further.
A decision of this Court in Mir Mohd. Omar and Other vs State of West Bengal, was relied upon to show that after the examination of the accused under Section 313 of the new Code (corresponding to Section 342 of the old Code) the prosecution should not move the Trial Judge for recalling a witness already examined, but the observation made in that decision has no application to the present case because in that case the said observation was made in a different context by this court while examining the plea of the prosecution in making corrections of the evidence already recorded under Section 272 of the Code and that decision does not deal with the ambit of Section 540 of the Code.
The other contention raised on behalf of the appellant is that the order of the Magistrate rejecting the application of the prosecution under Section 540 is not a revisable order under Section 397(1) as it being an interlocutory order and even if it is not so, the second revision by the same party i.e. Union of India is not entertainable in view of the statutory bar under Section 397(3) of the new Code as the Union of India has already availed the revision under Section 397(2) before the Session Judge.
We may straightaway reject this plea on the simple ground that the prosecution in the present case was launched under the old Code and as such the only provision of the old Code have to be applied as per Section 484 of the new Code.
The fervent plea of the appellant is though the prosecution was instituted under the old Code he should not be denied the benefit and advantage of Section 397(2) and (3) of the new Code.
We are afraid that we could accede to this inexorable request of the appellant for two reasons, namely, that the appellant has not challenged the maintainability of the second revision, filed and heard after the commencement of the new Code before the High Court, claiming advantage of Section 397(3) of the new Code and secondly he participated in the revision proceedings throughout under the old Code.
Having failed in the revision he has no justification to raise this point before this Court, especially when the proceedings under the old Code are saved by Section 484 of the new Code.
As far as the question whether an order under Section 540 of the old Code is an inerlocutory order or a final order, need not be gone into as that question does not arise in these proceedings.
We would like to point out before parting with this judgment that though the High Court by its impugned judgment directed the Union of India to 728 examine the three witnesses, in fact it has allowed all the four revision applications inclusive of the revision application Nos. 124 and 125 of 1978 filed by the State of Gujarat seeking the same prayer as that of the Union of India.
The appellant as we have pointed out in the prefatory portion of this judgment that that part of the judgment of the High Court allowing the two revisions filed by the State Government remains unchallenged.
Further we would like to point out that the High Court in its concluding paragraph of its judgment instead of using the words "I . direct" ought to have used the word "I . . permit".
For all the reasons stated above we hold that the judgment of the High Court does not suffer from any illegality or perversity calling for an interference at the hands of this Court and as such the appeals are liable to be dismissed as devoid of any merit.
However, we direct the Trial Court to afford a fair opportunity to the appellant/accused to cross examine the witnesses sought to be examined by the Union of India and also to lead rebuttal evidence if the appellant so desires.
Accordingly these two appeals are dismissed.
Y.L. Appeals dismissed.
| IN-Abs | Appellant 's business and residential premises were raided by the Customs Department as a result whereof gold ingots with foreign marks, gold ornaments, silver bricks, coins and a cash of Rs.79,000 was seized.
The Assistant Collector of Customs filed two separate complaints relating to the said incident against the appellant before the Judicial magistrate, one for violating the provisions of and the other under the Gold Control Act, 1968.
In the trial, after the close of evidence by both sides, prosecution as also defence, arguments were advanced on behalf of the accused appellant.
The prosecution at that stage before commencing its arguments filed two applications in both the cases, under Section 540 of the Old Code (corresponding to section 311 of the new Code) requesting the trial court to recall one witness viz., the Seizing officer, and issue summons to two more witnesses for examination either as prosecution witnesses or as court witnesses.
The trial magistrate rejected both the application and the revision petitions preferred by the respondents against that order failed before the Sessions Judge.
The Union of India thereupon preferred two revision applications before the High Court.
The State of Gujarat also preferred separate revision applications before the High Court.
The High Court allowed the revision petitions and directed examination of the three witnesses sought to be summoned.
Being aggrieved the appellant has filed these appeals after obtaining special leave against the decision of the High Court, in the revision applications filed by the Union of India.
No appeal has been filed against the order passed by the High Court in the revision applications filed before it, by the State of Gujarat.
The main contention of the appellant is that the High Court erred in allowing the second revision application in view of the provisions of section 397(3) of the new Code thus permitting the prosecution to fill up the lacuna and plug the loopholes in its case which is prejudicial to the appellant.
713 Dismissing the appeals, this Court, HELD: Though Section 540 (Section 311 of the new Code) is, in the widest possible terms and calls for no limitation, either with regard to the stage at which the powers of the court should be exercised, or with regard to the manner in which they should be exercised, that power is circumscribed by the principle that underlines section 540, namely, evidence to be obtained should appear to the court essential to a just decision of the case by getting at the truth by all lawful means.
The aid of the section should be invoked only with the object of discovering relevant facts or obtaining proper proof of such facts for a just decision of the case and it must be used judicially and not capricicously or arbitrarily.
Due care should be taken by the court while exercising power under this section and it must not be used for filling up the lacuna left by the prosecution or by the defence or to the disadvantage of the accused or to cause serious prejudice to the defence of the accused or to give an unfair advantage to the rival side and further the additional evidence should not be received as a disguise for a retrial or to change the nature of the case against either of the parties.
[721B E] Whenever any additional evidence is examined or fresh evidence is admitted against the accused, it is absolutely necessary in the interests of justice that the accused should be afforded a fair and reasonable opportunity to rebut that evidence brought on record against him.
[725E] The Criminal court has ample power to summon any person as a witness or recall and re examine any such person even if the evidence on both sides is closed and the jurisdiction of the court and must obviously be dictated by exigency of the situation, and fair play and good sense appear to be the only safe guides and that only the requirements of justice command the examination of any person which would depend on the facts and circumstances of each case.
[724C D] The facts and circumstances of the case require the examination of these three witnesses for a just decision of the case as held by the High Court.
[726G] Jamatraj Kewalji Govni vs State of Maharashtra, ; ; Rameshwar Dayal vs State of U.P., ; ; State of West Bengal vs Tulsidas Mundhra, at 207; Masalti vs State of U.P., AIR 1965 S.C.202; Rajeshwar Prasad Misra vs State of West Bengal and Anr.
, ; R.B. Mithani vs 714 Maharashtra, AIR 1971 S.C. 1630; Channu Lal vs R., AIR 1949 All 692; Rengaswami Naicker vs Muruga Naicker, AIR 1954 Mad 169; Shugan Chand vs Emperor, AIR 1925 Lah 531 and The Queen vs Assanoolah, 13 SWR (Crl.) 15, referred to.
Mir Mohd. Omar and Others vs State of West Bengal, , distinguished.
|
ivil Appeal No. 2597 of 1983.
From the Judgment and Order dated the 27th October, 1980 of the Allahabad High Court in Second Appeal No. 567 of 1973.
K.V. Vishwanathan, S.R. Setia, K.V. Venkataraman and C.S. Vaidyanathan for the Appellants.
Yogeshwar Prasad, P.K. Bajaj, Ms. Rachna Gupta, Ms. Rani Chhabra for the Respondents.
The Judgment of the Court was delivered by K.N. SAIKIA, J.
This appeal is from the Judgment of the Allahabad High Court dated 27.10.1980 in Second Appeal No. 567 of 1973 allowing the appeal and decreeing the suit of the first respondent for specific performance of contract dated 5.4.1966, wherein it was stipulated that the defendant No. 1 (second respondent) had executed a fictitious sale deed dated 2.9.1966 for Rs.1,000 in favour of defendant No. 2 Kalawati, in respect of half of the suit chak and another sale deed dated 21.12.1966 for Rs.2,000 in favour of defendant No.3 Mithilesh Kumari.
Accordingly the plaintiff (first respondent) prayed for directing the defendants 2 & 3 (appellants herein) to execute the required sale deed in case it was not possible for the court to get it executed by defendant No. 1.
The first respondent Feteh Bahadur sued the second respondent 703 Jang Bahadur and the appellants in O.S. No. 278 of 1970, for specific performance of his contract whereunder the second respondent Jang Bahadur had agreed to sell his chak No. 249 admeasuring 10 bighas, 12 biswas and 10 biswansis to the first respondent of Rs. 5,000 out of which Rs. 4,000 were paid and the balance Rs. 1,000 to be paid within 5 years whereafter second respondent Jang Bahadur was to execute a sale deed in favour of the first respondent Fateh Bahadur.
The Court of Munsif, Fatehpur decrced the suit only for recovery of Rs. 4,850 plus pendent lite and future interest on Rs. 4,000.
Fateh Bahadur 's apeal therefrom having been dismissed by the Civil Judge he preferred second appeal No. 567 of 1973 in the High Court of Judicature at Allahabad, contending that the transfers in favour of defendant NOs.
2 & 3, the appellants herein, by Jang Bahadur were in contravention of the provision of Section 168 A of the U.P. Zamindari Abolition and Land Reforms Act, 1950 (U.P. Act No. 1 of 1951) hereinafter referred to as `the Act ', and thus were void and that the view taken by the lower court that the title of Jang Bahadur came to an end since void transfers were made in favour of appellants Kalawati and Mithlesh Kumari, and thus, Jang Bahadur was no longer the holder of any title which could be conveyed to Fateh Bahadur was erroneous in law.
Reliance was placed on a decision of the High Court in Parmanand vs Board of Revenue, U.P., Allahabad reported in The defendants 2 & 3 who are appellants herein, contended that the two transfers made by Jang Bahadur in their favour were not hit by the provision of Section 168 A of the Act inasmuch as the transfers were of a portion of the shares of Jang Bahadur in the plot in dispute.
It was urged that for a transfer being hit by provision of Section 168 A of the Act the same should be in respect of a specific piece of land and not a share in a holding.
Reliance was placed on a decision of the same High Court in Bibhuti vs Kashi Ram, 1977 AWC 491.
It was not disputed that the area of land transferred under the two sale deeds in favour of appellants Kalawati and Mithlesh Kumari amounted to fragments under the Act.
The High Court considered the question as to whether a transfer which had been made not of the entire share of a holder in a holding but of a fragment would be hit by the provisions of Section 168 A of the Act and took the view that the two transfers made in favour of Kalawati and Mithlesh Kumari were clearly hit by the provisions of Section 168 A of the Act in view of the provisions of sub clause (2) of that section and that the benefit of Kalawati and Mithlesh Kumari only if the sale deeds executed in their favour could be looked into and as those sale deeds were void in the 704 eye of law it would be presumed as if no legal transfer took place in their favour and there being no legal transfer no question of applicability of Section 43 of the Transfer of Property Act arose.
As Jang Bahadur executed the agreement of sale in favour of Fateh Bahadur and as the sale deeds in favour of Kalawati and Mithlesh Kumar were held to have been void, Fateh Bahadur, according to the High Court, was entitled to a decree of specific performance against Kalawati and Mithlesh Kumari on payment of Rs. 1,000 within a period 2 months from the date of receipt of the record in the trial court failing which the court would execute the sale deed in favour of the plaintiff.
The appeal was accordingly allowed and the suit decreed as above.
Mr. K.V. Vishwanathan, the learned counsel for the appellants submits that the sale made by Jang Bahadur to the 2nd appellant Kalawati on 2.9.1966 being hit by the provisions of Section 168 A of the Act the subject matter of transfer i.e. 5 bighas, 6 biswas and 5 biswansis of Plot No. 249 in village Kichakpur got vested in the Government and the interest of Jang Bahadur in that part of the holding stood extinguished on the date of transfer i.e. 2.9.1966; that the sale made to Kalawati being void, Jang Bahadur was left only with 5 bighas, 6 biswas and 5 biswansis in Plot No. 249 of village Kichakpur.
Jang Bahadur having transferred that whole or entire portion to the first appellants Mithlesh Kumari by sale deed dated 21.12.1966 such transfer being a transfer of the whole area of the Bhumidhar it would be covered by the proviso under Section 168 A and as such, the sale would not be hit by the provisions of Section 168 ; that Sections 166, 167,168, 168 A and 189 (aa) form a scheme and if the sale is hit by the provision of 168 A, the result would be that on the date of sale, the interest of the vendor in the subject matter of sale would stand extinguished under Section 189 (aa) and hence 189 (aa) is the provision which extinguishes the right of the vendor in that part of the holding which he contracted to sell in violation of Section 168 A and that the interest of the transferee would stand extinguished under Sections 167 & 168 when the Gaon Sabha or the landholder ejects the transferee from the premises.
According to counsel, harmoniously construing Sections 168 and 189(aa), it would be amply clear that while 189(aa) extinguishes the interest of the vendor on that part of the property which he contracted to sell in violation of 168 A on the date of transfer itself, the interest of the transferee would be extinguished on ejectment from the suit premises; and the High Court erred in directing the appellants to specifically execute the sale deed in favour of the first respondent.
Ms. Rachna Gupta, the learned counsel for the first respondent.
705 submits that as the sale deeds in favour of the two appellants have been held to be void the High Court rightly decreed the suit for specific performance against them on payment of the balance or Rs.1,000 and that he having been in possession of the land and the second respondent 's fragmented sales having been found to be void, even if the land would vest in the State, the first respondent would not be divested automatically and the State has to seek possession in accordance with the law.
The only question that falls for determination is what would be the effect of the two fragmented sales in favour of the appellants.
In other words, whether as a result of the two sales the entire holding of the bhumidhar Jang Bahadur would vest in the State or only the half in the first sale would vest in the State and the remaining half would thereafter constitute the whole in the hand of the bhumidhar Jang Bahadur and the second sale being of the whole of his remnant holding would be valid so as to convey and transfer right to the vendee Mithlesh Kumari.
There is no dispute that the land of 10 bighas, 12 biswas and 10 biswansis was itself a fragment as defined in clause 8(a) of Section 3 of the Act being less than 3.125 acres.
There is also no dispute that the suit land is in a consolidated area and that the appellants were not tenure holders.
It would, therefore, follow that the two halves sold to the appellants were fragments of a fragment.
The Act was passed as it was considered expedient to provide for the abolition of the Zamindari system which involved intermediaries between the tiller of the soil and the State in Uttar Pradesh and for the acquistion of their rights, title and interest and to reform the law relating to land tenure consequent upon such abolition and acquisition and to make provision for other matters connected therewith.
The original Act did not define fragment.
The definition of `fragment ' was added by Section 2 of the U.P. Act XVIII of 1956 with a view to prevent fragmentation and promote consolidation of holdings in order to avoid uneconomic units.
Sections 152 to 175 of the Act dealt with transfer.
Section 152 provided: "The interest of a bhumidhar with tranferable rights shall subject to the conditions hereinafter contained, be transferable.
(2) Except otherwise expressly permitted by this Act or 706 any other law for the time being in force, the interest of a bhumidhar with non transferable rights shall not be transferable.
(3) A bhumidhar referred to in sub section (2) may, in such circumstances as may be prescribed, mortgage, without possessions his interest in his holding, as security for a loan taken from the State Government by way of taqavi, or from a cooperative society or from the State Bank of India, or from any other bank, which is a scheduled bank within the meaning of clause (e) of Section 2 of the , or from the Uttar Pradesh State, Agro Industrial Corporation Limited, and may also transfer by way of gift, the interest in his holding, except the part thereof which has been so mortgaged, to a recognised educational institution for any purpose connected with instructions in agriculture, horticulture and animal husbandry.
" The interests of sirdar or asami were originally not transferable as Section 153 said: "Except as expressly permitted by this Act, the interest of a sirdar and asami shall not be transferable.
" Sections 154 to 170 dealt with transfer of land by bhumidhar.
Section 166 originally provided that any transfer made by or an behalf of a sirdar or asami in contravention of the provisions of that chapter was to be void.
Section 166 has undergone amendments.
The section was substituted by the present section by U.P. Act No. XX of 1982 with effect from 3.6.1981.
The present section says: "Every transfer made in contravention of the provisions of this Act shall be void.
" What was the position in 1966 on the dates of the instant sales has to be known and correctly applied.
Section 167 earlier provided for the consequences of void transfers in the following language: 167.
(1) Where a sirdar or asami has made any transfer in contravention of the provision of this Act, the transferee and every person who may have thus obtained possession of the whole or part of the holding shall be liable to ejectment on the suit of the Gaon Sabha or the landholder, as the case may be.
(2) A decree for ejectment under sub section (1) may direct the ejectment of the sirdar or asami from the whole or part of the holding as the Court may, having regard to 707 the circumstances of the case, direct." This section was also substituted by the same Act No. XX of 1982 with effect from 3.6.1981.
Section 167 now says: "167.(1) the following consequences shall ensue in respect of every transfer which is void by virtue of Section 166, namely (a) the subject matter of transfer shall with effect from the date of transfer, be deemed to have vested in the State Government free from all encumbrances; (b) the trees, crops and wells existing on the land on the date of transfer shall, with effect from the said date, be deemed to have vested in the State Government free from all encumbrances; (c) the transferee may remove other movable property or the materials of any immovable property existing on such land on the date of transfer within such time as may be prescribed.
(2) Where any land or other property has vested in the State Government under sub section (1), it shall be lawful for the Collector to take over possession over such land or other property and to direct that any person occupying such land or property be evicted therefrom.
For the purposes of taking over such possession or evicting such unauthorised occupants, the Collector may use or cause to be used such force as may be necessary.
" The position before the amendment has been shown to us to enable us to apply the relevant law to the facts of the case.
Section 168 which dealt with consequences of ejectment under Section 167 has been omitted by U.P. Act No. VIII of 1977 with effect from 28.1.1977.
What was the provision in 1966 is not clear to us.
We are told that the section stood as follows in 1966: "section 168.
Consequences of ejectment under section 167.
All the rights and interests of the sirdar and asami upon ejectment in a suit under section 167 in the holding (or part thereof) or in any improvement made therein or to get compensation for such improvements shall be extinguished.
" But we have not been shown the enactment.
708 Section 168 A was added by Section 9 of U.P. Act XVIII of 1956, subject to the saving contained in Section 23 thereof.
This section now says: "168 A. Transfer of fragments.
Notwithstanding the provisions of any law for the time being in force, no person shall transfer whether by sale, gift or exchange any fragment situate in a consolidated area except where the transfer is in favour of tenure holder who has a plot contiguous to the fragment or where the transfer is not in favour of any such tenure holder the whole or so much of the plot in which person has bhumidhari rights, which pertains to the fragment is thereby transferred.
(2) The transfer of any land contrary to the provisions of sub section (1) shall be void.
(3) When a bhumidhar has made any transfer in contravention of the provisions of sub section (1) the provisions of Section 167 shall mutatis mutandis apply." Section 168 A has undergone amendment by Section 2 of U.P. Act XXVIII of 1961 when for the words "whole of the plot to which the fragment pertains is hereby transferred", the present words "the whole or so much of the plot in which the person has bhumidhari rights which pertains to the fragment is hereby transferrd" were substituted.
This amendment would not affect the instant case.
Some words between `167 ' and `shall ' were omitted by U.P. Act XIII of 1977, with effect from 28.1.1977.
It may be necessary to know what those were.
Sub section (1) of Section 168 A begins with a non obstante clause and it over rides the provisions of any law for the time being in force.
The expession `no person ' would include the bhumidhar.
The object of the section is to prevent fragmentation of land situated in a consolidated area and transfers that would result in fragmentation or further fragmentation shall be void and to such transfers Section 167 will mutatis mutandis be applicable.
This section comes into play only when a fragment situated in a consolidated area is transferred.
If transfer of a fragment is made in favour of tenure holder who has a plot contiguous to the fragment, the purpose of law is not defeatd inasmuch as it will be consolidated with the contiguous plot of the transferee.
When the land held by a person in a consolidated area is already a fragment then as was provided previous to the amendment in 1961 the whole of the plot to which the fragment pertained was to be 709 transferred.
After the amendment, the invalidity and applicability of Section 167 is limited to a case where the transfer is not in favour of any such tenure holder and to the whole or so much of the plot in which the person has bhumidhari rights which pertains to the fragment is thereby transferred.
If the transferor had bhumidhari rights on the whole of the fragment the whole has to be transferred.
If the person has bhumidhari rights only in a part of the plot that part on which he has bhumidhari rights can be transferred.
The part on which the person has not bhumidhari rights is not covered by the provisions not because that would not result in further fragmentation but because he had transferable bhumidhari rights only on that portion and not on the other portion.
There is no doubt that under sub section (2) transfer of any land countrary to the provisions of sub section (1) shall be void and under sub section (3) the provisions of section 167 shall mutatis mutandis apply.
Section 189 deals with extinction of the interest of a bhumidhar with transferable rights and Section 190 deals with extinction of the interest of a bhumidhar with non transferable rights.
Section 189 earlier provided: "189.
The interest of a bhumidhar in his holding or any part thereof shall be extinguished (a) when he died intestate leaving no heir entitled to inherit in accordance with the provisions of this Act; (b) when the land compromised in the holding has been acquired under any law for the time being in force relating to the acquisition of land, or (c) when he has been deprived of possession and his right to recover possession is barred by limitation" The words "bhumidhar with transferable rights" were substituted in the first sentence by U.P. Act XVIII of 1977 with effect from 28.1.1977.
Clause (aa) was added by Section 50 of U.P. Act XXXVII of 1958, so that the amended section now reads: "189.
Extinction of the interest of a bhumidhar with transferable rights.
The interest of a bhumidhar with transferable rights in his holding or any part thereof shall be extinguished 710 (a) when he dies intestate leaving no heir entitled to inherit in accordance with the provisions of this Act; (aa) when the holding or part thereof has been transferred or let out in contravention of the provisions of this Act; (b) when the land comprised in the holding has been acquired under any law for the time being in force relating to the acquisition of land; or (c) when he has been deprived of possession and this right to recover possession is barred by limitation.
" The substitution of the words "bhumidhar with transferable right" for the word "bhumidhar" would not make any difference when the bhumidhar had transferable rights but would make a difference where the bhumidhar has also lands with non transferable rights.
Thus, under the amended provisions the interest of a bhumidhar with transferable rights in his holding or in part thereof shall be extinguished when the holding or part thereof with bhumidhari rights has been transferred or let out in contravention of the provisions of the Act.
In other words when he had bhumidhari rights on the entire holding and the same is transferred or let out in contravention of the provisions of the Act his interest shall be extinguished.
If he had bhumidhari right only on a part thereof and it has been transferred or let out in contravention of the provisions of the Act his interest in bhumidhari right in that part shall be extinguished.
The reason behind the provisions to make fragmentation is the need to prevent further fragmentation if the bhumidhar with his bhumidhari rights over a fragment tries to transfer the fragment, his right over the fragment is extinguished.
Will the same by the result if instead of transferring the entire fragment he transfers a fragment of a fragment? If only a fragment of a fragment is so transferred would the whole fragment be vested in State? Applying the law to the facts of the case in hand we find that the bhumidhar Jang Bahadur 's land admeasuring 10 bighas, 12 biswas and 10 biswansis was itself admittedly a fragment.
Jang Bahadur entered into an agreement to sell the land on 5.4.1966 and the first respondent Fateh Bahadur on payment of advance of Rs. 4000 is stated to have had possession of the land.
That sale would attract the provisions of Section 168 A if it resulted in transfer of the fragment.
The sales to the appellants.
Kalawati defendant No. 2 was dated 2.9.1966 and to Mith 711 lesh Kumari defendant No. 3 was dated 21.12.1966.
These two sales would be covered by the old provisions of sections 166 and 167, which sections did not deal with the case of bhumidhar but only by sirdar or asami.
But Section 168 A would be attracted and the provisions of Section 167 would mutatis mutandis be applicable.
The High Court did not examine the facts of the case in light of the laws prevailing at the time of the sales.
If the sales were in contravention of the provisions of law so as to entail invalidity of the sale and vesting of the land sold in the State, the question whether in such a case specific performance of the contract would be justified or not would also be germane.
While holding both the sales to the appellants to have been void, the High Court did not take into consideration the exception as to transfer of "the whole or so much of the plot in which the person has bhumidhari rights.
" The High Court also failed to notice and apply clause (aa) of Section 189 which was added by Section 50 of U.P. Act XXXVII of 1958 and was applicable to the case.
Festinatio justitiae est noverea informateeni.
(Hob. 97) Hasty justice is stepmother of misfortune.
Injustum est nisi tota lege inspecta, de una aliqua ejus particula proposita judicare vel respondere.
It is unjust to decide or respond to any particular part of a law without examining the whole of the law.
But we are in time constraint.
By consensus with the learned counsel for the parties, we set aside the impugned order and remand this case to the High Court for disposal in accordance with the law applicable to the facts of the case expeditiously.
The appeal is disposed of accordingly.
We leave the parties to bear their own costs.
V.P.R. Appeal disposed of.
| IN-Abs | The respondent No. 1 sued the second respondent (defendant No. 1) and the appellants (defendant Nos. 2 and 3) for specific performance of a contract whereunder the second respondent had agreed to sell his lands to the first respondent for Rs. 5,000 out of which Rs.4,000 were paid, and the balance Rs.1,000 was to be paid within 5 years whereafter the second respondent was to execute a sale deed in favour of the first respondent.
The Munsif decreed the suit only for recovery of Rs,4,850 plus pendente lite and future interest on Rs.4,000 and this order was confirmed by the Civil Judge by dismissing the appeal of respondent No.1.
A second appeal was preferred to the High Court by respondent N. 1 contending that the transfers in favour of the appellants, by respondent No. 2 were void being in contravention of Section 168 A of the U.P. Zamindari Abolition and Land Reforms Act, 1950.
The appellants contested the appeal contending that for a transfer being hit by Section 168 A of the Act should be in respect of a specific piece of land and not a share in a holding and that the transfers were of a portion of the shares of respondent No. 1 in the disputed plot.
The High Court allowed the appeal holding that the two transfers made were clearly hit by the provisions of Section 168 A(2) of the Act and that the benefit of Section 43 of the Transfer of property Act could not be availed of by the appellants as the sale deeds were void in the eye of law.
700 The appellant in their appeal to this Court contended that the sale made by respondent No. 2 to the 2nd appellant being hit by the provisions of Section 168 A of the Act, the subject matter of transfer got vested in the Government and the interest of respondent No. 2 in that part of the holding stood extinguished on the date of transfer and that the sale being void, he was left only with the subject matter of transfer, and that the respondent No. 2 having transferred that whole portion to the first appellant by sale deed such transfer being a transfer of the whole area it would be covered by the proviso under Section 168 A and as such, the sale would not be hit by the provisions of Section 168 A.
The first respondent contended that as the sale deeds in favour of the two appellants have been held to be void, the High Court rightly decreed the suit; that he having been in possession of the land and the second respondent 's fragmented sales having been found to be void, even if the land would vest in the State, the first respondent would not be divested automatically and the State has to seek possession in accordance with the law.
On the question as to what would be the effect of the two fragmented sales in favour of the appellants, setting aside the order of the High Court and remanding the matter, this Court, HELD: 1.
The U.P. Zamindari Abolition and Land Reforms Act was passed as it was considered expedient to provide for the abolition of the Zamindari system which involved intermediaries between the tiller of the soil and the State in Uttar Pradesh and for the acquisition of their rights, title and interest and to reform the law relating to land tenure consequent upon such abolition and acquisition and to make provision for other matters connected therewith.
[705E F] 2.
The original Act did not define fragment.
The definition of 'fragment ' was added by Section 2 of the U.P. Act XVIII of 1956 with a view to prevent fragmentation and promote consolidation of holdings in order to avoid uneconomic units.
[705F G] 3.
The object of the section 168 A(1) was to prevent fragmentation of land situated in a conolidated area and transfers that would result in fragmentation or further fragmentation shall be void and to such transfers, Section 167 will mutatis mutandis be applicable, when a fragment situated in a consolidated area is transferred.
If transfer of a fragment is made in favour of tenure holder who has a plot contiguous to the fragment, the purpose of law is not defeated inasmuch as it will be 701 consolidated with the contiguous plot of the transferee.
When the land held by a person in a consolidated area is already a fragment then as was provided previous to the amendment in 1961 the whole of the plot to which the fragment pertained was to be transferred.
[708F 709A] 4.
After the amendment, the invalidity and applicability of Section 167 is limited to a case where the transfer is not in favour of any such tenure holder and to the whole or so much of the plot in which the person has bhumidhar rights which pertains to fragment is thereby transferred.
If the transferor has bhumidhari rights on the whole of the fragment the whole has to be transferred.
If the person has bhumidhari rights only in a part of the plot that part on which he has bhumidhari rights can be transferred.
The part on which the person has not bhumidhari rights is not covered by the provisions not because that would not result in further fragmentation but because he had transferable bhumidhari rights only on that portion and not on the other portion.
[709A C] 5.
The substitution of the words "bhumidhar with transferable rights" for the word "bhumidhar" would not make any difference when the bhumidhar had transferable rights but would make a difference where the bhumidhar had also lands with non transferable rights.
[710C D] 6.
Under the amended provisions the interest of a bhumidhar with transferable rights in his holding or in part thereof shall be extinguished when the holding or part thereof with bhumidhar rights has been transferred or let out in contravention of the provisions of the Act.
In other words, when he had bhumidhar rights on the entire holding and the same is transferred or let out in contravention of the provisions of the Act his interest shall be extinguished.
If he had bhumidhari rights only on a part thereof and it has been transferred or let out in contravention of the provisions of the Act his interest in bhumidhari rights in that part shall be extinguished.
The reason behind the provision to make fragmentation is the need to prevent further fragmentation if the bhumidhar with his bhumidhari rights over a fragment tries to transfer the fragment, his right over the fragment is extinguished.
[710D E] 7.
In the instant case, the bhumidhar respondent No. 2 's land measuring 10 bighas, 12 biswas and 10 biswansis was a fragment.
He entered into an agreement to sell the land on 5.4.1966 and the first respondent on payment of advance of Rs.4,000 is stated to have had possession of the land.
That sale would attract the provisions of Section 702 168 A, if it resulted in transfer of the fragment.
The sales to the appellant No. 1 was dated 2.9.1966 and to appellant No. 2 was dated 21.12.1966.
These two sales would be convered by the old provisions of sections 166 and 167, which section did not deal with the case of bhumidhar but only by sirdar or asami.
But section 168 A would be attracted and the provisions of Section 167 would mutatis mutandis be applicable.
[710G 711B] 8.
The High Court did not examine the facts of the case in light of the laws prevailing at the time.
Festination justiate est noverea informateeni.
Hasty justice is step mother of misfortune.
Injustuim est nisitota lege inspecta, de una aliqua ejus particula proposita judicare vel respondere.
It is unjust to decide or respond to any particular part of a law without examining the whole of the law.
[711B, 711D E]
|
: Criminal Appeals Nos. 251 & 307 of 1990.
From the Judgment and Order dated 11.8.1989 of the Allahabad High Court in Crl.
A. No. 1239 of 1978.
687 S.C. Maheshwari, Y.C. Maheshwari, Miss Sandhya Goswami and P.K. Chakraborty for the Appellants.
Prithvi Raj, Prashant Chaudhary and Dalveer Bhandari for the Respondent.
The Judgment of the Court was delivered by section RATNAVEL PANDIAN, J.
The appellants in criminal appeal No. 251 of 1990 were accused Nos. 3 and 4 before the trial court, namely, the VIIth Additional Sessions Judge, Meerut, whereas the appellants in criminal appeal No. 307 of 1990 were accused Nos. 1 and 2 before the said court.
These four appellants along with one Braham Singh (since acquitted) took their trial for offences under Sections 302 read with section 149 IPC and 323 read with section 149 IPC.
Besides, these four appellants were also charged for offence under section 147 IPC whilst Braham Singh under section 148 IPC.
The trial court, on appreciation of the evidence adduced by the prosecution, found the 5th accused, Braham Singh, not guilty of any charges and acquitted him.
However, these four appellants were found guilty of offences under section 302 read with section 34 IPC and under section 323 read with section 34 IPC and sentenced to undergo imprisonment for life and to six months ' rigorous imprisonment respectively.
The High Court on appeal preferred by all the appellants, for the reasons mentioned in its judgment, held that the prosecution has not made out a case punishable under section 302 read with section 34 IPC but only under section 304, Part II, IPC read with section 34 and consequently set aside the conviction and the sentence imposed for the offence under section 302 read with section 34 IPC and instead convicted them under section 304 Part II, read with section 34 IPC and sentenced each of them to undergo rigorous imprisonment for a period of five years.
The conviction of all the appellants under section 323 read with 149 IPC was altered into one under section 323 read with 34 IPC and the sentence of six months ' rigorous imprisonment was retained.
The facts of the case which have given rise to the present appeals as unfolded by the evidence, can be briefly stated thus: Appellants in criminal appeal No. 307/90 are brothers.
Similarly appellants in criminal appeal No. 251/90 and Braham Singh (who was arrayed as accused No. 5 before the trial court) are also brothers among themselves.
PWs 1 and 5 are the brother and wife respectively of one Bali 688 (the deceased herein).
PW 1 and the deceased Bali had a common 'Chak '.
The appellants belonged to a village named Kaulbhandora, which is at a distance of about four furlongs from the Chak, situated just adjacent to the road and 'Rajbaha '.
The appellants used to take the 'Rajbaha ' Patri in auction for grazing their cattle.
It seems that there was strained relationship between the appellants and the deceased for a considerable length of time.
According to the prosecution the cattle belonging to the appellants, when allowed to enter the 'Patri ' (grazing field) used to stray into the field of Bali and cause damage to the standing crops.
Although Bali made a protest, it did not yield any result.
On account of this, there was simmering feeling between the parties.
Added to that, there were certain criminal prosecutions between the parties, pending for over a period of two years.
On 23.12.1976 at about 1 p.m. when Bali along with PWs 1 and 5 was in his field, these appellants each armed with a Lathi along with Braham Singh armed with a 'Ballam ' came there.
On the exhortation of Chandroo, all other appellants and Braham Singh attacked Bali with their respective weapons and caused injuries to him.
While PW 3 tried to save her husband, she too was injured.
When PW 1 along with PWs 3 and 4 rushed to the scene of occurrence, the assailants took to their heels.
Injured Bali was removed to the Hastinapur hospital for treatment.
PW 6, the medical officer attached to the said hospital examined Bali and found on his person as many as fifteen injuries of which injury No. 15 was a stab wound and most of the other injuries were contusions.
PW 6 prepared a medical report, Exhibit Ka 6 and on the same day he examined PW 5 and found on her person 2 contusions in respect of which he prepared the injury report (exhibit Ka 7).
However, Bali succumbed to his injuries on the same day at about 7.45 p.m. PW 1 lodged a written report (exhibit Ka 1) at about 8 p.m. before PW 2 a Head Constable attached to the Hastinapur Police Station.
PW 2 prepared Exhibit Ka 2 on the basis of exhibit Ka 1 and made G.O. entry i.e. exhibit Ka. 3.
PW 9, the then sub Inspector of Police attached to the Police Station took up the investigation and examined PW 1 and others.
He held the inquest over the dead body of the deceased and prepared exhibit Ka 11, PW 5 could not make any statement as she was unconscious.
The PW 9 inspected the spot and prepared a site plan exhibit Ka. 14 and seized certain material objects including a piece of wood and blood stain earth.
PW 7, yet another Medical Officer, conducted the post mortem examination on the dead body of the deceased Bali on 24.12.1976 and found a number of injuries, as noted in his post mortem report 689 exhibit Ka 8.
According to PW 7, the death was due to shock and haemorrhage as a result of the injuries sustained by the deceased.
PW 9, after completing the investigation, laid the chargesheet against all the five accused.
Though the appellants admitted the earlier criminal prosecutions between the parties, totally denied their complicity with the offence of murder.
Of the witnesses examined, PWs 4 and 5 corroborated the testimony of PW 1 but PW 3 was declared hostile as this witness mentioned only the name of the first appellant and denied participation of rest of the appellants and Braham Singh and also the presence of the ocular witnesses except PW 5.
The trial court, however, found accused Nos. 1 to 4 (all the appellants herein) alone guilty of the offence, convicted and sentenced them as aforementioned and acquitted the 5th accused Braham Singh.
On appeal, the High Court accepted the testimony of PWs 1, 4 and 5 holding that they are giving a consistent version in regard to the participation of the appellants in attacking the deceased and agreed with the finding of the trial court that these appellants were responsible for inflicting the injuries on the deceased Bali and PW 5.
But coming to the nature of the offence perpetrated on the deceased, the High Court held the offence as one punishable under section 304 Part II but not under section 302 IPC and consequently altered the conviction and the sentence as indicated above while retaining the conviction under section 323 against all the appellants for causing injuries to PW 5.
Hence, the present appeals are directed by the appellants who were accused Nos. 1 to 4 before the trial court.
Mr. Maheshwari, Senior Counsel appearing on behalf of the appellants in both the appeals, forcibly contended that since both the courts below have overlooked the glaring infirmities and ignored the material evidence supporting the defence theory as well as the manifest errors appearing in the evidence, this Court would be justified in interfering with the concurrent findings of both the courts, otherwise substantial injustice would be caused to the appellants.
According to the learned counsel, the prosecution has shifted the scene of occurrence, changed the time of occurrence, unduly delayed the registration of the case and put forth a false explanation for its tardiness both in the matter of registration and investigation of the case; that PW 9; the investigating officer, has deliberately feigned ignorance of the receipt of exhibit Kha 1 in order to shield his indolence and failure in immediately and promptly taking up the investigation; that PW 1 and 4 in order to ventilate their grievance which they were bearing against the appellant 's party on account of the previous 690 animosity and simmering feelings that existed between them and to settle their personal scores; that the credibility of these two witnesses is impaired and their testimony is successfully impeached.
The learned defence counsel further states that a thorough and strict scrutiny of the evidence furnished by PWs 1, 3 and 4 shows that the entire prosecution story in concocted, fanciful and incredible and, as such, it deserves to be rejected with scorn and that both the courts below have completely pretermitted all the pitfalls in the prosecution and have summarily disposed of the case without subjecting the evidence under the usual test of scrutiny.
Before we analyse the above contentions with reference to the evidence adduced by the prosecution and see whether the prosecution case suffers from any illegality and the conclusion of the courts below from perversity, we shall deal with the scope of interference of this Court in an appeal arising from concurrent findings of fact.
This Court in The State of Madras vs A. Vaidyantha Iyer, ; at 588 while interpreting the scope of Article 136 of the Constitution has ruled as follows: "In article 136 the use of the words "Supreme Court may in its direction 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" shows that in criminal matters no distinction can be made as a matter of construction between a judgment of conviction or acquittal.
Having made the above rule, it has been said that the interference by the Supreme Court will be called for even with the findings of fact given by the High Court, if the High Court has acted perversely or otherwise improperly.
Jaganmohan Reddy, J. agreeing with the view taken in Vaidyanatha Iyer 's case has observed in Himachal Pradesh Administration vs Shri Om Prakash, thus: "In appeals against acquittal by special leave under Article 136, this Court has undoubted power to interfere with the findings of fact, no distinction being made between judgments of acquittal and conviction, though in the case of acquittals it will not ordinarily interfere with the appreciation of evidence or on findings of fact unless the High Court "acts perversely or otherwise improperly".
691 Again in Balak Ram vs State of U.P., ([1975] 3 SCC 219 at page 227) this Court held as follows: "The powers of the Supreme Court under Article 136 are wide but in criminal appeals this Court does not interfere with the concurrent findings of fact save in exceptional circumstances.
" In Arunachalam vs P.S.R. Sadhananthan. ; at page 487 this Court while reinstating the principles laid down in Vaidyanatha Iyer & Om Prakash, cases, has stated thus: "The power is plenary in the sense that there are no words in Article 136 itself qualifying that power.
But the very nature of the power has led the Court to set limits to itself within which to exercise such power.
It is now the well established practice of this Court to permit the invocation of the power under Article 136 only in very exceptional circumstances, as when a question of law of general public importance arise or a decision shocks the conscience of the Court.
But within the restrictions imposed by itself, this Court has the undoubted power to interfere even with findings of fact making no distinction between judgment of acquittal and conviction, if the High Courts in arriving at those findings, has acted "perversely or otherwise improperly".
See also State of U.P. vs Hamik Singh & Ors., and State of U.P. vs Pheru Singh & ORs.
, [1989] Supp. 1 SCC 288 to which one of us (section Ratnavel Pandian, J.) was a party.
Bearing the above proposition of law, we shall now examine the evidence and see whether the concurrent findings of fact call for an interference.
With regard to the place of occurrence, learned counsel drew our attention to the first information report and to the evidence of the witnesses including that of PW 9, and pointed out that the prosecution had changed the scene of occurrence.
In the first information report under column 'place of occurrence ', it is mentioned as 'Jungle Village, Ganeshpur '.
PW 1 in his cross examination has admitted that the 'Chak ' in which the murder took place is situated in the jungle of village Bhandora and not in the jungle of village Ganeshpur.
A suggestion, though denied, has also been made by the defence to PW 1 that 692 they have changed the place of occurrence from Ganeshpur to Bhandora.
PW 2 who was then the Head Constable attached to Hastinapur Police Station, states that on submission of exhibit Ka 1 by PW 1 he prepared a chik report exhibit Ka 2 and that he mentioned the place of occurrence as jungle of village Ganeshpur only on the basis of the written report.
It is the evidence of PW 9 that he reached village Bhandora and did spot inspection thereby admitting that the place of occurrence was village Bhandora and not Ganeshpur.
a scrutiny of exhibit KA 1 shows that PW 1 did not give the specific place of occurrence in that earliest document.
It appears from the evidence of PWs 1 and 9 as well as the entry under column No. 2 of the First Information Report that the prosecution was probing in darkness even in respect of the place of occurrence.
Even in exhibit Ka 3 a memo prepared by PW 9 for seizure of the blood stained earth, the place of occurrence is not mentioned.
Hence, we hold that the submission made on behalf of the defence even at the threshold that the place of occurrence is changed or at any rate not specifically fixed, cannot be said to be without force.
We shall then scrutinise the evidence with regard to the time of occurrence.
According to the prosecution, the occurrence took place at about 1.00 p.m. on 23.12.1976.
Immediately, after the occurrence, the injured Bali & PW 5 were brought to the hospital which is at a distance of three miles from the scene of occurrence.
exhibit Kha 1 was prepared by the Medical Officer i.e. PW 6 on examing Bali.
exhibit Ka 7 is a report prepared by medical officer PW 6 relating to the injuries found on PW 5.
This document exhibit Ka 7 reveals that PW 5 was examined at about 3.30 p.m.
Therefore, the injured Bali could have been examined by PW 6 earlier to 3.30 p.m.
It may be mentioned here what PW 1 has stated that they reached the hospital approx, between 2 and 3 p.m.
The medical officer has opined that the injuries found on the injured could have been caused within six hours.
When a specific question had been addressed to this medical officer (PW 6) as to whether the injuries could have been caused at about 5/6 a.m. he would say: "It could have been caused at 8 'O clock".
We are not rejecting the case of the prosecution on this admission of the medical officer stating that the probable time of the causation of the injuries could be 8 a.m.
But the question would be, even admitting that the occurrence took place at about 1 p.m., whether the prosecution convincingly and satisfactorily established the guilt of the appellants by leading cogent and reliable evidence.
693 The next important point for determination is whether the case has been promptly registered and the investigation proceeded without causing undue delay thereby giving no room enabling the prosecution party to deliberately concoct a case against these four appellants.
It transpires from the evidence of PW 6 that he sent the information under exhibit Kha 1 to the Police Station through his peon intimating the fact of Bali having been bought to the hospital with a number of bleeding injuries in a very serious condition and also of PW 5 having been admitted in the hospital for treatment of the injuries sustained by her and the said document exhibit Kha 1 was sent by 4.30 p.m. on 23.12.1976 itself and the hospital 's peon had brought the Receipt evidencing the handing over of the intimation to the police.
It is only thereafter that PW 1 prepared exhibit ka 1 and handed it over to PW 2 at about 8 p.m. on 23.12.1976.
According to PW 2, after registration of the case, a death memo was received at the Police Station at about 8.15 p.m. saying that Bali had expired in the hospital at about 7.40 p.m.
According to PW 1, the distance between the hospital and the police station is about 1 or 2 furlongs and that the police station is not situated near the hospital.
Nonetheless PW 1 would admit when confronted further that the distance between the gates of the hospital and the police station would be about 50 steps.
Be that as it may, the fact ramains that both the hospital and the police station are situated within a very short distance.
Admittedly, neither PW 1 nor any of PWs 3 and 4 went to the police station to inform about the occurrence though they reached the hospital even by 2 p.m.
The only explanation given by PW 1 is that he was busy enquiring about the condition of his brother.
This explanation of PW 1 is totally unacceptable because after both injured persons, namely, Bali & PW 5 were brought to the hospital they were examined only by the medical officer, PW 6.
There was nothing preventing either PW 1 or any of the other witnesses in going to the police station and informing the police, if really they were eye witnesses to the occurrence and were in the hospital from 2 p.m. onwards, leaving apart PW 5 who was undergoing treatment in the hospital.
The delayed preparation of exhibit Ka 1 by PW 1 at the hospital after seven hours of the occurrence and that too after the death of his brother, leads to an indelible impression that PW 1 and other interested persons who were enimically disposed towards the appellants should have prepared exhibit Ka 1 after due deliberation and consultation.
The abortive explanation for not going to the police station for six hours after reaching the hospital is unworthy of credence.
694 The next and even more important point for consideration is the much delayed investigation.
The conduct of PW 9 in not taking an immediate action even after exhibit Kha 1 was handed over at the police station by 4.30 p.m. or at any rate after receipt of Ka 1 and the death intimation creates a suspicion in the veracity of the prosecution case.
Though PW 2 admits that he received the death intimation by about 8.15 p.m., PW 9, the investigating officer, has feigned total ignorance about exhibit Kha 1 stating thus: "Before this F.I.R. no intimation was received at the police station about this occurrence that Bali was injured and admitted in the hospital and his condition was critical.
It is wrong that any information was received at the Police Station before this F.I.R. which I am concealing.
I do not know whether exhibit Kha 1 was received in the police station or not.
During the investigation exhibit Kha 1 never came to my knowledge.
This paper came to my knowledge during the investigation and I made a copy of this in the case Diary.
I do not know whether this Letter was recorded in the General Diary or not.
No copy of G.D. is recoorded in my case diary in connection with exhibit Kha 1.
No such note is there in my case diary that I had seen any G.D. which is related to Ex Kha 1.
I have not recorded any statement of the H.M. relating to exhibit Kha 1.
" We shall examine whether PW 9 took up the investigation at least after registration of the case without causing further delay.
PW 2 states that the investigating officer took up the investigation at about 8 p.m. on 23.12.1976 and went to the hospital and returned to the police station only on the next day i.e. 24.12.1976 at 9.50 p.m. PW 9 has lodged in his presence by PW 1 and that he immediately took up the investigation during the course of which he examined PW 1 and then come to the hospital where he examined the medical officer Dr. B.D. Goel (PW 6) and saw the dead body lying in the male ward.
He continues to state that as PW 5 was in an unconscious condition, he could not examine her and as the light went off, he could not prepare even the Panchnama.
This piece of evidence of PW 9 that he took up the investigation even at 8 p.m. is not only contradicted but also falsified by the testimony of PW 1 according to whom after lodging the report he immediately came back to the hospital and remained there till next morning and that the Sub Inspector (PW 9) came to the hospital for the first time in the morning of 24.12.1976 and only thereafter he was 695 examined.
PW 4 also states that the investigating officer came to the hospital only in the next morning.
PW 6, the medical officer, does not speak of the Sub Inspector having came to the hospital on the night of occurrence and has stated that he did not remember of the Sub Inspector or any constable reaching the hospital after receipt of the death intimation or any one examining him on that date.
The said pieces of evidence, namely, the total unawareness of PW 9 about the existence of exhibit Kha 1 as well as the entry in the general diary made thereon and the diametrically contradictory evidence of PW 9 on the one hand and that of PWs 1,4 and 6 on the other, clearly indicate that either PW 9 did not have any knowledge about the incident till the next morning or even if he had such knowledge, he deliberately delayed the investigation; and his present version is nothing but a deliberate perjury and as such his evidence has to be thrown overboard as unworthy of credence.
In the cross examination, it is admitted by PW 9 that he did not write the names of the appellants/accused in the Panchnama and that he did not try to know the kinds of weapons that had been used by the assailants.
On the basis of this admission a suggestion had been addressed to him that the FIR relating to this incident, was prepared and lodged only after preparation of the Panchnama thereby indicating that the FIR was anti dated.
We shall now scan the evidence of PWs 1, 3 and 4 examine whether their evidence could be accepted and acted upon.
Admittedly, there was deep rooted animosity between the prosecution party and the appellants over a period of some years and they have developed bad blood.
It is the evidence of PW 1 that there were a number of criminal cases against deceased Bali along with one Birbal Kishore and Omi who were persons of notorious character in that village.
Besides, there were some more cases and counter cases between the parties.
A suggestion has been addressed to PW 1 that his brother Bali was having close connection with one Ramanand who was a known decoit belonging to their village but PW 1 has denied the relationship of Bali with Ramanand.
PW 4 admits that there was a dispute between Bali and the appellants in which Bali had beaten them and in that case he was a co accused along with PW 1 and deceased Bali.
PW 3 who has been treated as a hostile witness since he did not implicate all the appellants by their names except Chandroo has admitted that there was a case against Bali and Birbal Kishore in which he was a witness on the side of Bali and that there was a double murder case in which he (PW 3) was an accused and convicted.
In that murder case one Roop 696 Ram, cousin of appellant Chndroo was a witness on the prosecution side.
Thus it comes out of the evidence of these witnesses that all was not well between the parties and each one was having grudge against the other.
As pointed out by Mr. Maheshwari, learned counsel appearing for the appellants, the conduct of PW 1 belies his presence at the sence of occurrence as he did not intervene when his brother (deceased) and sister in law (PW 5) were attacked by the appellants and another and if PW 1 had really been at the scene, he having been a co accused along with his brother in previous case, would not have been standing as a mute spectator without taking any part in the occurrence in which case he would also have received injuries.
In exhibit Ka 1 he has mentioned PWs 3 and 4 as eye witnesses who were enemically disposed of towards the appellants and who were interested in the prosecution.
As seen from the evidence of these three witnesses, they all belong to one group either having been co accused in one case or other along with Bali or taking up the cause of Bali when the latter was involved in other criminal cases.
In fact, one sentence in exhibit Ka 1 would indicate that PWs 1, 3 and 4 were not at the scene at the time of occurrence but came to the spot later on.
The relevant version in exhibit Ka 1 reads: "On alarm, I and my uncle Chotte Lal and Shiv Charan of the village reached the spot and saved them" Of course, he at the next breath would claim to have witnessed the occurrence.
We have also noted that the place of occurrence is not satisfactory fixed; and that the evidence of PW 1 giving the reasons for the presence of his deceased brother with PW 5 in the field, is also falsified by the evidence of PW 9.
According to PW 1, his deceased brother and PW 5 were harvesting sugarcane in the field at the time of occurrence.
But PW 9 has deposed that at the time of spot inspection he did not find any Bugi, Dokra, Phawara, Dranti or harvested sugarcane.
This contradictory evidence when taken along with our finding with regard to the fixation of the scene of occurrence goes to show that PW 1 could not have been present at the scene of occurrence and only after a deliberation he has posed himself as one of the eye witnesses and projected PWs 3 and 4 as other eye witnesses along with him.
PW 4 during the course of cross examination has admitted that except himself, PWs 1 & 5, none reached the scene and people came to the scene of occurrence later on.
After reaching the hospital along with injured, PW 4 states that all of them remained in the hospital near the dead body and that he went to the police station in the morning of the next day at about 7.00 a.m. As we have pointed out earlier, PW 3 has not implicated all the appellants except Chandroo by name and as such, he has been treated 697 as a hostile witness.
PW 3 is none other than the uncle of PW 1 and the deceased, therefore, in view of the inherent infirmities adversely affecting the testimony of these eye witnesses, it would not be safe to convict the appellants on the scanty evidence.
The author of the earliest document exhibit Ka 1, namely, PW 1 seems to be a man of dubious character and his evidence is completely tarnished.
A thorough scrutiny of the evidence shows that the testimony of the eye witness is ambulatory and vacillating and compels this Court not to place any safe reliance.
Lastly, we are left with the evidence of PW 2 who is an injured witness.
The presence of PW 2 at the scene is fortified by the injuries found on her person.
After scanning her evidence very carefully, we are unable to safely accept her evidence since it is not only tainted with highly interestedness but also a coloured version, falling in line with that of PW 1.
She states that she was unconscious for 2 days and that it was she who told PWs 1 and 4 as to who were the assailants.
Immediately in the next breath, PW 5 comes forward to say that on the next day she told all the facts to the investigating officer and again became unconscious after coming to know the death of her husband.
To a Court question, she gives a prevaricating answer that she was conscious for some time and then became unconscious.
Though at one time, she testifies that she was beaten with sticks, she suddenly changes her evidence giving a contradictory version that she did not know whether she was beaten or not.
Though all the witnesses in a parrot like manner deposed that these 4 appellant along with Braham Singh armed with ballam attacked the deceased, their evidence when subjected to strict examination becomes unworthy of credence.
The Trial Court on entertaining a grave doubt about the participation of Braham Singh with a ballam, acquitted him despite the fact that PW 6 has noted a stab wound on the inner side of left thigh measuring 2 x 1 x 1.5 cms which injury in the opinion of the medical officer could have been caused by a sharp edged weapon like 'ballam!.
The acquittal of Braham Singh was not challenged by the prosecution before the High Court, and therefore, we are not called upon to discuss on this aspect of the case.
However, it is clear that the trial Court was not inclined to accept a part of the evidence of these 3 witnesses i.e. PWs 1, 4 & 5 relating to the participation of Braham Singh.
In our considered opinion, the evidence, adduced by the prosecution, falls short of the test of reliability and acceptability and as such it is highly unsafe to act upon it.
698 A thorough and scrupulous examination of the facts and the circumstances of the case leads to an irresistible and inescapable conclusion that the prosecution has miserably failed to establish the charges levelled against these appellants by producing cogent, reliable and trustworthy evidence.
Both the Courts below instead of dealing with the intrinsic merits of the evidence of the witnesses, have acted perversely by summarily disposing of the case, pretermitting the manifest errors and glaring infirmities appearing in the case.
For all the aforementioned reasons, we allow the appeals by setting side the convictions and the sentence, imposed by the High Court and acquit the appellants.
The bail bonds, executed by the appellants, are discharged.
R.S.S. Appeals allowed.
| IN-Abs | On 23.12.1976 at about 1 p.m. when Bali (deceased) along with PWs 1 and 5 was in his field, the four appellants each armed with a Lathi, along with Braham Singh armed with a 'Ballam ', came there.
On the exhortation of Chandroo, all other appellants and Braham Singh attacked Bali with their respective weapons and caused injuries to him.
While PW 3 tried to save her husband, she too was injured.
When PW 1 along with PWs 3 and 4 rushed to the scene of occurrence, the assailants took to their heels.
Injured Bali was removed to the hospital.
He succumbed to his injuries on the same day at about 7.45 p.m.
It seems that there was trained relationship between the appellants and the deceased for a considerable length of time over grazing of cattle, resulting in damage to the standing crops.
On account of this, there was simmering feeling between the parties.
Added to that, there were certain criminal prosecutions between the parties, pending for over a period of two years.
The four appellants along with Braham Singh (since acquitted by the Trial Court) took their trial.
The Trial Court found the four appellants guilty of offences under section 302 read with section 34 and under section 323 read with section 34 IPC and sentenced them to undergo imprisonment for life and to six months ' rigorous imprisonment respectively.
The 5th accused, Braham Singh, was acquitted.
On appeal, the High Court held that the prosecution had not made out a case punishable under section 302 read with section 34 IPC but only under section 304, Part II, IPC read with section 34 IPC.
The High Court sentenced each of them to undergo rigorous imprisonment for a period of five years.
The conviction of all the appellants under section 323 read with 149 IPC was altered into one under section 323 read with 34 IPC and the sentence of six months ' rigorous imprisonment was retained.
686 Before this Court it was contended on behalf of the appellants that since both the courts below had overlooked the glaring infirmities and ignored the material evidence supporting the defence theory as well as the manifest errors appearing in the evidence, this Court would be justified in interfering with the concurrent findings of both the courts.
According to the learned counsel, the prosecution had shifted the scene of occurrence, changed the time of occurrence, unduly delayed the registration of the case and put forth a false explanation for its tardiness both in the matter of registration and investigation of the case.
Allowing the appeals by setting aside the convictions and the sentence imposed by the High Court, this Court, HELD: (1) Under Article 136, Interference by the Supreme Court will be called for even with the findings of fact given by the High Court, if the High Court has acted perversely or otherwise improperly.
[690F] The State of Madras vs A. Vaidyanatha Iyer, ; ; Himachal Pradesh Administration vs Shri Om Prakash, ; Balak Ram vs State of U.P., ; ; Arunachalam vs P.S.R. Sadhananthan, ; State of U.P. Hamit Singh & Ors., ; State of U.P. vs Pheru Singh & Ors., [1989] Suppl.
1 S.C.C. 288, referred to.
(2) The evidence adduced by the prosecution falls short of the test of reliability and acceptability and as such it is highly unsafe to act upon it.
[697H] (3) A thorough and scrupulous examination of the facts and the circumstances of the case leads to an irresistible and inescapable conclusion that the prosecution has miserably failed to establish the charges leveled against these appellants by producing cogent, reliable and trustworthy evidence.
Both the Courts below instead of dealing with the intrinsic merits of the evidence of the witnesses, have acted perversely by summarily disposing of the case, pretermitting the manifest errors and glaring infirmities appearing in the case.
[698A B]
|
Civil Appeal No. 848 of 1991 etc etc.
From the Judgment and Order dated 14.12.1990 of Madhya Pradesh High Court in M.A. No. 227 of 1990.
Kapil Sibal, H.N. Salve, J.B. Dadachanji, Mrs A.K. Verma and section K. Mehta for the Appellants.
K.K. Venugopal, P. Chidambaram, S.S. Ray and P.P. Tripathi for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, CJ.
The Olympic games are ancient in origin.
According to the Encyclopaedia Britannica they commenced some 3,500 years ago and the name came from its association with the place known as Olympia in Greece.
These games were played once in every four years and were abolished in 393 AD by the Roman Emperor Theodosius I.
In recent times, they were revived in 1896 and have until now been held at the turn of every four years excepting during the first and the second world wars.
The Olympic games are one of the biggest international events and provide great opportunities to amateur sportsmen in the different classifications.
Indian participation in the Olympic games dates back to 1900 when a single representative had joined the Olympics at Paris.
Gradually, such participation became more systematic and broad based.
While the Ministry of Youth Affairs and Sports of the Union Government looks after development of sports within the country, the management of the Olympic participation has been entrusted to a society registered under the Societies Registration Act (21 of 1860) known by the name 'Indian Olympic Association ' (for short IOA ') The Memorandum of Association of this society indicates that the principal objects of the society, inter alia, are: (i) to develop and promote the Olympic movement and amateur sport, (2) to promote and encourage the physical, moral and cultural education of the youth of the nation for the development of character, good heath and good 662 citizenship, (3) to enforce all rules and regulations of the International Olympic Committee (hereinafter referred to as 'IOC ') and the IOA; (4) to be the official organisation in complete and sole charge of all Olympic matters in the country, (5) to educate the public of the country as to the value of amateurism in sports; (6) to maintain the highest ideals of amateurism and to promote interest therein, particularly in connection with the Olympic games and other games under the patronage of the IOC as well as the IOA, (7) to have full and complete jurisdiction over all matters pertaining to the participation of India in the Olympic games and other games under the patronage of the IOC as well as the IOA, (8) to assist in cooperation with National Sports Federations/Associations the selection, training and coaching of the teams that will represent Indian in the Asian, Commonwealth, Olympic and other international competitions and tournaments, under the patronage of the teams in the said competitions and tournaments after selection, (9) to undertake with the assistance of National Sports Federations/Associations the financing, management, transportation, maintenance and welfare of teams from India taking part in the Olympic games and other games under the patronage of the IOC as well as the IOA; and (10) to timulate the interest of the people of the country in the promotion of sports and games in the Olympic programme, and to that end the formation of State Olympic Association for the development of sports and games within a State and National Sports Federations for games and sports in the Olympic programme.
We have quoted most of the important objectives to bring it to the forefront that the I.O.A. has been brought into existence to sponsor, supervise, finance, regulate and control all aspects of sports activity in relation to the Asian, Commonwealth, Olympic and international competitions and tournaments under the patronage of the IOC.
While its funding is partially out of membership fee, bulk of it comes from Government contribution.
The society has a set of rules and regulations.
There are five categories of members as described in rule 3.
The management of the affairs of the Association is entrusted to an Executive Council defined in rule 1(v).
Rule 8 provides that the Executive Council shall have (i) a President (ii) 9 Vice Presidents (iii) a Secretary General (iv) 6 Joint Secretaries (v) a Treasurer (vi) 7 Members elected from among representatives of State Olympic Associations and (vii) 12 members elected from among the representatives of National Sports Federation/Association/ SSCB.
Rule 8 provides the manner of elections to be held 663 for the Executive Council.
The term of the Executive Council is 4 years.
Rule 11 provides the voting procedure.
Clause (b) of that rule requires that voting if necessary in the IOA Executive Council, IOA Emergency Executive Council and/or at the annual general or special general meetings of the IOA shall be by show of hand.
However, if in a particular case the procedure has to be changed, the same will be done by a resolution of the concerned body passed by majority vote.
The very rule provides as to the voting power of the different units composing the IOA.
Rule 12 deals with the office bearers like the President, the Vice President, the Secretary General, the Joint Secretaries, the Treasurer etc.
For the resolution of the dispute before us perhaps reference to the other rules is not necessary.
The IOA was reconstituted with effect from 28th of October, 1984, with appellant Shri V.C. Shukla as the President.
K. Murugan, appellant in C.A. No. 848 of 1991 (arising out of SLP 1064/91) was one of the 6 Joint Secretaries.
In November, 1988, Shri B.S. Adityan, one of the vice President of the 1984 Executive Council was elected as President for a term of four years.
On 16th of May, 1990, there was a requisition of 17 Members for a special general meeting for considering the move of a no confidence motion against Shri Adityan and his Executive Council.
With this started a period of confrontation between the two groups in the Association.
In May, 1990, the Executive Council overruled the requisition as invalid and President Adityan called a meeting of the General assembly at Madras for 15th of June, 1990.
For the same day the other group summoned a meeting of the general assembly at New Delhi.
This led to Court proceeding and the Delhi High Court restrained the requisitionists from holding their meeting at New Delhi and appointed a retired Judge of the Delhi High Court as an observer for the meeting to be held at Madras.
In the convened meeting of 15th of June, minutes of the proceedings whereof have been seriously disputed Shri Shukla claimed to have been elected.
A little before the meeting of the 15th of June at Madras, further proceedings were taken in Court which have been labelled as collusive and manipulations for obtaining an order for the manner of voting.
The warring factions lost sight of the laudable goals of the IOA and the purpose for which the Association had been set up and put their entire attention on winning control over the affairs of the IOA in their grip through litigation.
664 A Single Judge of the Madras High Court having decided in favour of Shri Adityan, the matter ultimately came before a Full Bench which by its order dated 3rd of January, 1991, remitted the matter to the learned Single Judge and appointed Justice Natarajan, a retired Judge of this Court, to discharge the functions of the President of the IOA as an interim measure.
This order is challenged in the appeal by Shri Murguan and Shri V.C. Shukla by two different appeals being Civil Appeals Nos. 852.853 of 1991 (arising SLPs 1599 and 1787/91).
Not content with the litigation in the Delhi and Madras High Courts, the Fencing Association of India filed a civil suit at Jabalpur asking for declaration that Shri Shukla had been duly elected as President.
An application for injunction in support of Shri Shukla having been rejected by the trial Judge an appeal had been taken before the High Court where a learned Single Judge made a status quo order.
The other two appeals arise out of proceedings including contempt taken therein.
Long arguments have been advanced before us by Mr. Venugopal for Shri Adityan and by Mr. Sibal for Shri Shukla.
The main contention of Mr. Venugopal is that under the rules the terms of the President and the Executive Council is four years and in the absence of a clear provision for a vote of No. confidence, which would curtail the period, there could be no reduction of the period of office.
It has also been contended that the entire Executive Council could not be voted out of office by a motion of no confidence and, therefore, Shri Adityan had rightly overruled the requisition.
Serious challenge has been advanced by Mr. Sibal against the proceedings taken before the Madras High Court and particularly, the learned Judge making an order changing the manner of voting from show of hands to one by ballot in what is stated to be a collusive proceeding.
This does not appear to us to be a matter where individual rights in terms of the rules and regulations of the Society should engage our attention.
Sports in modern times has been considered to be a matter of great importance to the community.
International sports has assumed greater importance and has been in the focus for over a few decades.
In some of the recent Olympic games the performance of small States has indeed been excellent and laudable while the performance of a great country like India with world 's second highest populations has been miserable.
It is unfortunate that the highest body in charge of monitoring all aspects of such sports has got involved in group fight leading to litigation and the objectives of the Society have been lost sight of.
The representation of India in the IOA has been in jeopardy.
665 The grooming of amateurs has been thrown to the winds and the responsibility placed on the Society has not been responded.
This, therefore, does not appear to us to be a situation where rights to office will have to be worked out by referring to the provisions of the law relating to meetings, injunction and rights appurtenant to elective office.
What seems to be of paramount importance is the healthy conditions must be restored as early as possible into the working of the Society and a fresh election has to be held as that seems to be the only way to get out of the malady.
The entire nation is looking up to the results of the competitions at the international games when they are held.
As we have already pointed out, IOA has great responsibities to discharge in organising and streamlining the national sport activities intended for international events.
The monitoring has to be a continuous one and unless the scheme is ongoing and is made result oriented, the international performance cannot be up to any appreciable level.
The question for consideration, therefore, is not as to which of the two factions should succeed.
On the other hand, it is appropriate that all the litigations now pending should abate.
In the interest of the appropriate functioning of the Society the litigation outside the headquarters of the Society should not be permitted.
We accordingly direct that any litigation, if at all, should only be within the jurisdiction of the Delhi High Court and no Court in India would entertain litigations relating to the functioning of IOA in any aspect.
A fresh Executive Council should be set up and for that purpose elections should be held within two months hence.
The general assembly should be convened to meet at Calcutta on 28th of April, 1991.
We appoint Mr. Justice A.D. Koshal, a retired Judge of this Court to conduct the elections keeping the provisions of the rules and regulations of the IOA in view.
Voting shall be by secret ballot.
The list of voters should be finally settled within four weeks from now and if it is necessary to have any hearing in the matter we authorise such hearing to be undertaken by Mr. Justice Koshal.
Until then, Mr. Justice Natarajan will continue to exercise his powers as conferred by the order of the Madras High Court.
Once the results of the elections are announced, Mr. Justice Natarajan would cease to be in office and the Association would take over.
To enable Mr. Justice Koshal to discharge the obligations cast upon him by this decision, the Ministry of Youth Affairs and Sports is directed to place at his disposal a sum of Rs.25,000 (Twenty five thousand) within two weeks and a small group of assistants as he may need.
Payment of remuneration for the work done shall be fixed by the Court later.
666 All the proceedings in the different High Courts abate; the suit in the Jabalpur High Court shall stand dismissed.
The contempt proceedings now pending shall not be proceeded with.
In the course of arguments some criticism was advanced against the order of the High Court providing monthly remuneration to Mr. Justice Natarajan.
We leave this aspect to be considered by Mr. Justice Natarajan himself and do not propose to deal with it in our order.
Before we leave this matter we would like to point that the Union of India should take greater interest in organising sports both for national and international purposes.
Sports have a role to play in building up good citizens.
That aspect should be kept in view.
We have a feeling that while a lot of money is allotted for the purpose of improvement of sports, the result has been considerably poor and deceptive.
We hope and trust that this aspect of the criticism heard from everywhere in this country shall also be given due consideration.
V.P.R. Appeals disposed of.
| IN-Abs | The Indian Olympic Association was a society registered under the Societies Registration Act, with the principal object to sponsor, supervise, finance, regulate and control all aspects of sports activity in relation to the Asian, Commonwealth, Olympic and International competitions.
The Society had a set of rules and regulations.
There are five categories of members described in Rule 3.
The management of the affairs of the Association is entrusted to an Executive Council defined in Rule 1(v).
Rule 8 provided that the Executive Council shall have (i) a President, (ii) 9 Vice Presidents, (iii) a Secretary General, (iv) 6 Joint Secretaries, (v) a Treasurer and (vi) 19 Members.
The terms of the Executive Council was to be 4 years, while Rule 11 provides the voting procedure.
The Indian Olympic Association was reconstituted with effect from 28 of October, 1984, with the appellant in C.A. No. 852 of 1991, Shri V. C. Shukla as the President, K. Murugan, the appellant in C.A. No. 848 of 1991 as one of the 6 Joint Secretaries.
In November, 1988, one of the Vice President of the 1984 Executive Council, Shri B.S. Adityan, the appellant in C.A. No. 849/91 was elected as President for a term of four years.
On 16th of May, 1990, there was a requisition of 17 Members for a special general meeting for considering the move of a no confidence 659 motion against the aforesaid Shri B.S. Adityan and his Executive Council.
This initiated a period of confrontation between the two groups in the Association.
In May 1990, the Executive Council overruled the aforesaid requisition as invalid and President Adityan called a metting of the General Assembly at Madras for 15th of June, 1990.
For the same day the other group summoned a meeting at New Delhi.
This aforesaid situation led to Court proceedings, and the Delhi High Court restrained the requisitionists from holding their meeting at New Delhi and appointed a retired Judge of the Delhi High Court as an observer for the meeting to be held at Madras.
At this meeting Shri V.C. Shukla, the appellant in C.A. No. 852/91 claimed to have been elected.
The matter was taken to Court and a Single Judge decided in favour of Shri B.S. Adityan, the appellant C.A.No. 8549/91, but when the matter came up before the Full Bench of the High Court, it remitted the matter to a Single Judge who appointed a retired Judge of this Court to discharge the function of the President of the Association as an interim measure.
This Order has been challenged by the appellants in Civil Appeals Nos.
852 853/91.
The Fencing Association of India filed a civil suit at Jabalpur for the declaration that Shri V. C. Shukla had been duly elected.
The application for injunction from having been rejected by the Trial Judge, an appeal had been taken to the High Court where the Single Judge ordered status quo.
Two Civil Appeals were also filed against this order.
It was contended on behalf of the appellants that under the rules the term of the President and the Executive Council was four years and in the absence of a clear provision for a vote of no confidence which would curtail the period, there could be no reduction of the period of office, and that the entire Executive Council could not be voted out of office by a motion of no confidence.
Disposing of the appeals, this Court, HELD: 1. Sports in modern times has been considered to be a matter of great importance to the community.
International sports has assumed greater importance and has been in the focus for over a few decades.
[664D E] 660 2.
It is unfortunate that the highest body incharge of monitoring all aspects of such sports has got involved in group fight leading to litigation and the objectives of the I.O.A. have been lost sight of.
The representation of India in the I.O.A. has been in jeopardy.
[664E F] 3.
The grooming of amateurs has been thrown to the winds and the responsibility placed on the Society has not been responded.
This, therefore, does not appear to be a situation where rights to office will have to be worked out by referring to the provisions of the law relating to meetings, injunction and rights appurtenant to elective offices.
[664F G] 4.
What seems to be of paramount importance is that healthy conditions must be restored as early as possible into the working of the Society and a fresh election has to be held as that seems to be the only way to get out of the malady.
[644G H] 5.
The entire nation is looking up to the results of the competitions at the international games when they are held.
I.O.A. has great responsibilities to discharge in organising and streamlining the national sport activities intended for international events.
The monitoring has to be a continuous one and unless the scheme is ongoing and is made result oriented, the international performance cannot be up to any appreciable level.
[664G 665B] 6.
This does not appear to be a matter where individual rights in terms of the rules and regulations of the Society should engage attention.
[664D E] 7.
It is appropriate that all the litigations now pending should abate, and for appropriate functioning of the Society the litigation outside the headquarters of the Society should not be permitted.
[665B C] 8.
A fresh Executive Council should be set up and for that purpose, elections should be held within two months hence; a retired Judge of this Court is appointed to conduct the elections keeping the provisions of the rules and regulations of the I.O.A. in view.
All the proceedings in the different High Courts abate.
[665C D, G] 9.
It is directed that the Union of India should take greater interest in organising sports both for national and international purposes.
Sports have a role to play in building up good citizens.
That 661 aspect should be kept in view, while a lot of money is allotted for the purpose of improvement of sports, the result has been considerably poor and deceptive.
This aspect of the criticism hear from everywhere in this country shall also be given due consideration.
[666A B]
|
ivil Appeal No. 4974 of 1990.
From the Judgment and Order dated 20.6.1990 of the Bombay High Court in W.P. 2403 of 1989.
G.L. Sanghi, Mrs. Jayshree Wad, Dhruv Mehta and Ms. Tamali Das Gupta for the Appellant S.V. Deshpande, V.N. Patil and A. section Bhasme (NP), for the Respondents.
The Judgment of the Court was delivered by K.N. SAIKIA, J.
Pursuant to the Notification issued in June 1986 the elections of Directors to the District Central Cooperative Bank, Chandrapur, hereinafter referred to as 'the Bank ' the appellant filed his nomination papers in July 1986, and he was elected on 18.8.1986 as one of the Directors of the Bank from the Brehmapuri Agricultral Sales and Purchase Society.
His election was not called in question according to the procedure prescribed by the Maharashtra Cooperative Societies Act, 1960, hereinafter referred to as 'the Act '.
On 8.1.1987, the District Deputy Registrar of the Cooperative Societies, Chandrapur, hereinafter referred to as 'the Deputy Registrar ', issued a notice to the appellant under section 78(1) of the Act to show cause within 15 days as to why he should not be removed from the Board of Directors of the Bank as per the provisions of section 73FF, and directed him to remain present on 2.2.1987 at 11 678 A.M. in the Deputy Director 's office.
The notice stated that the appellant had borrowed a loan of total Rs. 10,000 (Rs. 7,000 as debt and Rs. 3,000 subsidy) from the Bank and he kept the loan constanty in arrears till 21.10.1986, and being elected as Director of the Bank on 18.8.1986.
till then he was working as the Director of the Bank.
The notice further said: "Because you have remained in arrars of the loan instalments as referred above to the Maharashtra State Cooperative Land Development Bank, under Section 73FF(i)(b) of the Maharashtra State Cooperative Societies Act, 1960, you are disqualified to be elected or to continue as Director or Executive Committee Member of the Executive Committee of a Cooperative Society and u/s 73FF(2) of Maharashtra State Cooperative Societies Act, 1960 a person committing defaults ceased to be the Executive Committee (member) or Director.
From the information above given because the loan instalments of Maharashtra State Cooperative Land Development Bank remained due from you on the date of filing nomination papers for the election of post of Director of Chandrapur District Central Cooperative Bank and also on the date of your election and thereafter, you are disqualified to contest the election to the post of Director of Chandrapur District Central Cooperative Bank as also to be elected and to continue as Director.
And therefore under powers given to me by Section 78(1) of Maharashtra State Cooperative Societies Act, 1960 and order No. CSL/1481/24982/15 C(87) dated 1.7.81 of Agriculture and Cooperation Department of Maharashtra State Government.
I, K.M. Deshpande, District Dy, Registrar, Cooperative Societies, Chandrapur hereby ask you to show cause in writing as to why you should not be removed from the Board of Directors of Chandrapur District Central Cooperative Bank and from the Executive Committees of the other cooperative societies in the District.
Your explanation in writing should be submitted to this office within 15 days from the receipt of this notice.
" The appellant showed cause and also filed an additional reply on 10.11.87 stating that he "had not committed any default after the 679 amended section 73FF came into existence.
" The Assistant Regisrar, Cooperative Societies, Chandrapur by his order dated 7.12.1987 removed the appellant from the Committee of Directors of the Bank holding that appellant was defaulter on 31.1.1986, on 31.3.1986 and he became defaulter under the provisions of section 73FF(1) of the Act, and rejected the appellant 's contention that section 73FF became applicable from 6.8.1986 as per the Government Notification issued on 18.4.1986 and that as he had accepted that he paid the dues on 21.10.1986, on 18.8.1986 when he was elected as Director, he was defaulter under section 73FF(1) of the Act.
The order of the Assistant Registrar dated 7.12.1987 was served on the appellant on 8.12.87.
The appellant 's appeal against that order was dismissed by the Divisional Joint Registrar of the Cooperative Societies, Nagpur on 15.2.1988, holding, inter alia, that section 73FF of the Act came into force on 12.5.1986 and the appellant could be treated as a defaulter under that section; and the mere making of payment on 21.10.86 did not mean that the disqualification on account of his being defaulter which continued from 18.8.1986 to 21.10.1986 was extinguished and hence the appellant was not at all eligible to contest the election.
The appellant 's revision petition therefrom under section 154 of the Act was dismissed on 30.8.89 by the Cooperation and textile Department, State of Maharashtra, Bombay holding that the appellant was defaulter under section 73FF of the said Act on 18.8.1986 i.e. the date when he was declared elected as Director.
The appellant 's writ petition in the High Court filed on 1.9.1989 challenging the above order dated 30.8.89 was dismissed by the impugned Judgment and Order dated 20.6.90, holding that the dues calculated on 31.1.86 became recurring dues every following day and on 12.5.1986 when section 73FF came into force the outstanding dues continued even on 18.8.1986 when the appellant contested the election; and that the question of giving retrospective effect to the section did not arise because the appellant was a defaulter when he contested the election and though he paid all the debts on 21.10.1986 yet he could not be "absolved of the disqualification on the day he contested the election".
Hence this appeal by special leave.
Mr. G. L. Sanghi, the learned counsel for the appellant submits, inter alia, that the impugned order of the Assistant Registrar removing the appellant from the Committee of the Directors is without jurisdiction inasmuch as the Act prescribes a separate procedure for calling in 680 question the appellant 's election as a Director of the Bank and that procedure having not been followed the Assistant Registrar could not have acted under section 78(1) of the Act which did not envisage the setting aside of an election as has been done by the impugned order;that the appellant having repaid the entire loan before the impugned notice under section 78(1) of the Act was issued, he was surely not a defaulter in presenti on the date of the notice and the provisions of section 78(1) were not attracted; and that even assuming that the disqualification on the ground of default is common both for election and for continuation as a Director in the Committee, the special provision for setting aside an election must prevail over section 78 as there would be apparent conflict between the two and the maxim generalia specialibus non derogant general words do not derogate from special, would apply, Mr. V. N. Patil, the learned counsel for the State of Maharashtra, submits that the disqualification as defaulter continued after the election of the appellant and section 78 envisaged such a default and the appellant having continued to be a defaulter was lawfully removed and the fact that he repaid the loan before the notice was issued would not be material for the purpose of taking action under section 78.
Chapter XI A of the Act deals with election of committees and officers of certain societies.
Admittedly this Chapter applies to the Bank.
Section 144E deals with disqualification for membership.
Under sub section (1) thereof a person shall be disqualified for being elected as, and for being a member, of the committee of any specified society, . (e) if he is so disqualified by or under any other provision of this Act.
Section 144T deals with desputes relating to election and provides in sub section (1) that notwithstanding anything contained in section 91 or any other provisions of this Act, any dispute relating to an election shall be referred to the Commissioner of the Division in which such election is held or to an officer not below the rank of Additional Commissioner of division authorised by the State Government in this behalf.
The procedure for an election petition is prescribed by the subsequent section of that Chapter.
Admittedly the appellant 's election was not called in question under the above provision.
Section 144E, as have noted, over and above the other specified disqualifications in sub section (e) included disqualifications by or under any other provisions of the Act.
Section 78(1) which deals with powers of removal of committees or member thereof provides as follows: 681 "78(1) If, in the opinion of the Registrar, the committee of any society or any member of such committee makes default, or is negligent in the performance of the duties imposed on it or him by this Act or the rules or the bye laws, or commits any act which is prejudicial to the interests of the society or its members, or wilfully disobeys interests of the society or its members, or wilfully disobeys directions issued by the State Government, or by the Registrar for the purposes of securing proper implementation of cooperative policy and development programme approved or undertaken by the State Government or is otherwise not discharging its or his functions properly and diligently and the business of the society has or is likely to come to a standstill, or where any member of such committee stands disqualified by or under this Act for being a member, the Registrar may, after giving the committee or the member, as the case may be, an opportunity of stating its or his objections, if any, within 15 days from the date of receipt of notice, and after consultation with the federal society to which the society is affiliated, by order (a) (i) remove the committee, and (ii) appoint a committee consisting of three or more members (who shall not be the members of the committee so removed) of the society in its place, or appoint one or more Administrators who need not be the members of the society, but who shall not be the members of the committee so removed, to manage the affairs of the society for a period not exceeding six months, which period, at the discretion of the Registrar, be extended by a further period not exceeding three months so, however, that the total period does not exceed nine months in the aggregate: Provided that, the Registrar shall have the power to change the committee or any member thereof or the Administrator or Administrators appointed under paragraph (ii) at his discretion even before the expiry of the period secified in the order made under this sub section; (b) xxx xxx xxx" Section 78(1) empowers the Registrar to remove a member of a committee who "makes default" or where any member of such committee 682 "stands disqualified by or under this Act for being a member".
Section 73FF deals with disqualification for membership of committee.
Sub section (1) provides: "Without prejudice to the other provisions of this Act or the rules made thereunder in relation to the disqualification of being a member of a committee, no person shall be eligible for being appointed, nominated, elected, co opted or, for being a member of a committee, if he (i) is a defaulter of any society; Explanation For the purposes of this clause, the term "defaulter" includes (a) in the case of a primary agricultural credit society, a member who defaults the repayment of the crop loan on the due date; (b) in the case of term lending society, a member who defaults the payment of any instalment of the loan granted to him; xxx xxx xxx xxx xxx xxx Sub section (2) says: "A member who has incurred any disqualification under sub section (1), shall cease to be a member of the committee and his seat shall thereupon be deemed to be vacant." This section was inserted by Maharashtra Act, XX of 1986 with effect from 12.5.86.
If the impugned order is found to have been passed by way of setting aside the election of the appellant the order would be bad as the appellant 's election had not been called in question in accordance with the procedure prescribad by the Act.
However, the notice has ex facie been issued under section 78 of the Act.
No doubt there is reference to the appellant 's having been a defaulter and disqualified for being elected but it has been addressed to the appellant as Director of the Bank and also stated: "You have been elected as Director on the Board of Directors of Chandrapur District Central Cooperative Bank on 18.8.1986 and today on this date you are working as the Director of the said Bank.
" It also refers to the appellant 's being disqualified or to continue as Director or Executive Committee member of the Executive Committee ' under 683 section 73FF of the Act and about ceasing too be a Director by committing default.
From the above contents, there is no room for holding that the appellant 's election has been set aside by the impugned order; on the other hand, the emphasis is on the appellant 's being disqualified to continue as Director or creasing to be Director on account of his having committed default.
The question of generalibus specialia derogant special things take from general or generalia specialibus non derogant general words do not derogate from special, therefore, does not arise.
What was stated in para 36 of the report in Hundraj Kanayalal Sajnani vs Union of India, ; at 1121 will not be relevant.
The question of repugnancy involved in Zaverbhai Amaidas.
vs The State of Bombay, [1955] 1 SCR 799 does not arise in this case.
The decision in Maharashtra State Board of Education vs Paritosh Sheth, ; is also not apposite.
The provisions relating to election have to be interpreted harmoniously with other provisions of the Act such as in section 78(1).
Interpretare concordare leges legibus est optimus interpretendi modus.
To interpret and in such a way as to harmonize laws with laws is the best mode of interpretation.
Mr. Sanghi does not dispute that the appellant was in arrear in respect of instalments on the date of his election and till 21.10.1986 i.e. both prior and posterior to his election on 18.8.1986.
Admittedly the instalment was not paid on due date.
There was of course some dispute as to the amount of interest payable and appropriation of the amount paid against interest instead of capital but all this would not exonerate the appellant from being in default on non payment of instalment on due date.
Mr. Sanghi, however, submits that the expression, "makes default" or "stands disqualified" being in present the default must have been committed after the coming into force of section 73FF and that his default even, if any, was prior to that date and not after that date.
We are unable to persuade ourselves to accept this submission.
The day an instalment falls due on its due date failure to pay results in default and that default continues from day to day until it is repaid.
Every day thereafter until payment results in making of default and, therefore, it could not be said that default could be on the due date only and thereafter no default but only liability.
Considered by this principle the appellant can be said to have made default on the first day of his directorship and on every subsequent day till the instalment or instalments were paid.
The submission, has therefore, to be rejected.
684 Similarly the submission that the defalult must have been one committed after the Act came into force has also to be rejected on the same ground that immediately on the Act coming into force the appellant was a defaulter and so long that default continued he must be taken to have made default until repayment.
What then would be the consequence of such a default.
Sub section (2) of section 73FF says that a member who has incurred any disqualification under sub section (1) shall cease to be a member of the Committee and his seat shall thereupon be deemed to be vacant.
Therefore, the moment the appellant after election continued to be in default, and, therefore, must be taken to have made default, stood disqualified and thereby ceased to be a member of the committee and his seat deemed to have fallen vacant.
In this view of the matter the notice of the Deputy Registrar was in effect to say that the appellant had already ceased to be a Director and his seat already fell vacant.
In Keshaorao Narayanrao Patil vs District Deputy Registrar reported in Bombay High Court held that section 73FF(2) did not operate automatically and that passing of an order of removal was necessary.
This has to be interpreted in the context of the provisions in the section.
In this view of the matter there could not be any infirmity either in the notice or in the impugned order of removal.
The result is that this appeal fails and is dismissed.
The interim orders, if any, stand vacated.
No. costs.
R.N.J. Appeal dismissed.
| IN-Abs | The appellant was elected on 18.8.1986 as one of the Directors of the District Central Co operative Bank, Chandrapur, Maharashtra from the Brehmapuri Agricultural Sales and Purchase Society.
On 8.1.1987 the District Deputy Registrar of the Co operative Societies, Chandrapur issued a notice to him under section 78(1) of the Act to show cause as to why he should not be removed from the Board of Directors of the Bank and from the Executive Committees of other Co operative Societies in the District for having remained in arrears of the loan instalments due from him on the date of filing of nomination papers for election to the post of Director of the Bank and thereafter till 21.10.1986 when he actually repaid the dues thereby incurring the disqualification as contemplated by section 73FF of the Act.
The appellant showed cause and by additional reply took the stand that he had not committed any default after the amended section 73FF came into existence.
This was rejected and by Order dated 7.12.1987 passed by the Assistant Registrar Co operative Societies, Chandrapur he was removed from the post of Director holding him to be a defaulter under section 73FF of the Act.
Appeal against that order was dismissed by the District Joint Registrar and his revision therefrom made under section 154 of the Act too met the same fate at the hands of the Cooperative & Textile Department, State of Maharashtra, Bombay Dismissing his Writ Petition filed thereafter, the High Court of Bombay held that when the appellant contested the election he was a defaulter and even though he had paid all the debts on 21.10.1986 yet he could not be absolved of the disqualification on the day he contested the election.
In the appeal before this Court it was argued on behalf of the appellant that the impugned order of the Assistant Registrar removing him from the Board of Directors was without jurisdiction in as much as 676 the Act prescribes separate procedure for calling in question the election and that procedure having not been followed the Assistant Registrar could not have acted under section 78(1) of the Act; that the entire loan having been repaid before the issue of notice under section 78(1) he was not a defaulter in presenti and lastly even assuming that the disqualification on the ground of default is common both for election and continuation as Director in the Committee, the special provision for calling in question an election mut prevail over section 78.
Rejecting the contentions and dismissing the appeal, the Court.
HELD: If the impugned order is found to have been passed by way of setting aside the election of the appellant, it would be bad as his election had not been called in question in accordance with the procedure prescribed by the Act.
However, the notice has ex facie been issued under section 78 of the Act.
No doubt there is reference to his having been a defaulter and disqualified for being elected but it has been addressed to him as Director on the Board of Directors.
It also refers to his being disqualified "to be elected or to continue as Director or Executive Committee member of the Executive Committee" under section 73FF of the Act and about ceasing to be a Director by committing default.
From the above contents, there is no room for holding that the appellant 's election has been set aside by the impugned order.
On the other hand, the emphasis is on his being disqualified to continue as Director or ceasing to be Director on account of his having committed default.
[682F 683A] The day an instalment falls due on its due date, failure to pay results in default and this default continues day after day until it is repaid.
The appellant can be said to have made default on the first day of his directorship and on every subsequent day till instalments were paid.
The appellant was a defaulter immediately on the coming into force of section 73FF and so long that default continued he must be taken to have made default until repayment.
[683G 684A] Sub section (2) of Section 73FF says that a member who has incurred any disqualification under sub section (1) shall cease to be a member of the committee and his seat shall thereupon be deemed to be vacant.
Therefore, the moment the appellant after election continued to be in default and must be taken to have made default, stood disqualified and thereby ceased to be a member of the Committee and his seat deemed to have fallen vacant.
In this view of the matter the notice of the Deputy Registrar was in effect to say that the appellant had already ceased to be a director and his seat already fell vacant.
In Keshaorao 677 Narayanrao Patil vs District Deputy Registrar, reported in , Bombay High Court held that section 73FF(2) did not operate automatically and that passing of an order of removal was necessary.
This has to be interpreted in the context of the provisions in the section.
[684B D] Hundraj Kanayalal Sajnani vs Union of India, A.I.R. at 1121; Zaverbhai Amaidas vs The State of Bombay, [1955] 1 S.C.R. 799; Maharashtra State Board of Education vs Paritosh Sheoth, ; , distinguished.
Keshaorao Narayanrao Patil vs District Deputy Registrar, , approved.
|
ivil Appeal No. 2589 of 1979.
From the Judgement and Order dated 8.8.1977 of the Bombay High Court in Special Civil Application No. 983 of 1972.
V.M. Tarkunde, Ms. section Janani and Mrs. Urmila Kapoor for the Appellant.
S.B. Bhasme, U.R. Lalit, D.N. Misra, R.A. Gupta and Ms. Shefali Khanna for the Respondents.
The Judgement of the Court was delivered by THOMMEN.
This appeal arises from the judgement of the Bombay High Court in Special Civil Application No. 983 of 1972 setting 834 aside the order made by the appellate officer, (the Principal Judge of the City Civil Court, Bombay) under section 105F of the Bombay Municipal Corporation Act, 1888 ( 'The Act ' whereby he allowed the appellant 's appeal against the order of eviction made against it under section 105B of the Act by the enquiry officer, acting in terms of section 68 of the Act as a delegate of the Commissioner of the Municipal Corporation of Greater Bombay, the first respondent, ("the Corporation").
By the impugned judgement, the High Court has confirmed the order of eviction made against the appellant, the principal occupant of two godowns belonging to the Corporation.
the original occupant of the godowns, Glenfield & Co., had on 1.10.1963 granted to the appellant a licence in respect of these premises and subsequently by a deed of assignment dated 13.8.1966 assigned all its rights, title and interest in the premises in favour of the appellant.
The appellant thereafter requested the Corporation on the ground that Ghatge & Patil (Transport) Pvt. Ltd., the second respondent, had been already in occupation of the premises, and after satisfying itself as to those terms, the Corporation transferred the occupancy right from Glenfield & Co. to the appellant on the appellant executing a formal agreement dated 17.6.1967.
The Corporation was thus fully aware of the terms and conditions of occupation of the premises by the second respondent, and, with the full knowledge of those terms, the appellant was recorded in the Corporation 's book as the principal occupant in the place of Glenfield & Co. the second respondent was thus understood and accepted by the Corporation to be in occupation of the premises under the appellant.
All this was in 1967.
A notice dated 25.7.1969 terminating tenancy purporatedly in terms of the agreement dated 17.6.1967 was served on the appellant.
This was followed by an enquiry under the Act which commenced in 1970 and resulted in the order of eviction dated 6.1.1971.
The order of eviction refers to the appellant as the principal tenant and the second respondent as a sub tenant.
The enquiry officer, acting as a delegate in terms of section 68 and exercising the power of Commissioner 835 under section 105B, ordered eviction of the appellant on the ground of sub letting the premises.
She held that the appellant had sub let the premises contrary to the terms or conditions of occupation and had thus become an unauthorised occupant liable be evicted from the premises.
The enquiry officer, on inspection, found that that the second respondent was in occupation of the premises as sub lessee.
She noticed the terms and conditions of the agreement dated 27.3.1964 under which the premises had been allowed to be occupied by the second respondent.
She concluded that the appellant had, by reason of sub letting contrary to the terms or conditions of occupation, become liable to be evicted in terms of section 105B.
Accordingly, she passed an order of eviction against the appellant.
This order was, on appeal, set aside by the appellate officer.
On appreciation of the evidence on record, including the terms of the relevant agreements, the appellate officer held that the agreement dated 27.3.1964, under which the second respondent occupied the premises, had been well known to the Corporation, and the Corporation, having satisfied itself as to the full implication and significance of that occupation, approved and recorded the assignment and transfer of the right, title and interest of Glenfied & Co. to the appellant, and recognised the appellant as the principal occupant.
The Corporation was thus at all material times aware of the appellant 's relationship with the second respondent and the occupation of the premises by the second respondent under the appellant.
Accordingly the appellate officer held that, in the absence of any material to show that the relationship between the appellant and the second respondent had so altered since the appellant 's agreement with the Corporation as to violate the terms or conditions of occupation, the eviction of the appellant solely on the ground of sub letting was unwarranted.
The reasoning of the appellate officer thus appears to be that the Corporation having allowed the transfer of the occupancy right of Glenfield & Co. to the appellant with the full knowledge of the terms and conditions under which the second respondent was already let into the premises by the appellant, whatever be the nature of their relationship whether it be a lease or licence the Corporation was estopped from now contending that the alleged sub letting was contrary to the terms or conditions of the appellant 's occupation of the premises and that the appellant had for that reason become liable to be evicted.
836 This is what the appellate officer stated on the point: ".
There is no allegation that after the tenancy was transferred in the name of the applicant,with the full knowledge and consent of the Municipal Corporation as to the terms and conditions on which the premises were occupied by the 2nd respondent, there has been any change in the nature of the 2nd respondent 's occupation of the part of the premises and also in the terms and conditions of the occupation.
Although the subsequent agreement was entered into between the appellants and the 2nd respondent, it was on the same terms and conditions as the first agreement which was produced before the ward officer before the transfer of tenancy in favour of the appellants . .
In this case, therefore, even if the agreement between the appellants and the 2nd respondent is interpreted as a sub tenancy agreement and under the said agreement the appellants are said to have sublet the premises to the 2nd respondent, the said subletting was prior to the transfer to tenancy in favour of the appellants and was with the full knowledge and consent of the Municipal Corporation: and, therefore, that cannot be considered to be subletting in breach of the agreement of tenancy so as to enable the Municipal Corporation to evict the appellants on that ground. " This is essentially a finding of fact.
The order of the appellate officer is final and is not ordinarily liable to be called in question (see section 105G).
Nevertheless, this finding was set aside by the High Court by the impugned judgment in exercise of its jurisdiction under Article 227 of the Constitution.
The High Court held: ".
Even otherwise, in our view, respondent No.1 was liable to be evicted under section 105B(1) clause (a) subclause (ii).
We are unable to agree with the finding given by the learned Principal Judge that no change in the circumstances under which the tenancy had been transferred in the name of respondent No. 1 has taken place after the grant of the lease and, therefore, the Corporation would be stopped from alleging that respondent No. 1 had sublet the premises. " The High Court thus held that the appellate officer was wrong in 837 saying that the circumstances had not altered so as to warrant an order of eviction on the ground or sub lease.
The High Court also held that the lease in favour of the appellant had been duly determined by the Corporation in terms of the contract, and the appellant having thus become an "unauthorised" occupant was as such liable to be evicted under clause (b) of sub section (1) of section 105B.
The High Court stated: ". . if a tenancy is terminated in accordance with terms of the tenancy agreement, it must be held to be duly terminated.
Such a person was liable to be evicted under the provisions of section 105B(1) of the Act.
" The Corporation has indeed the power to order eviction on the ground of sub letting which is contrary to the terms or conditions of occupation.
But it cannot be gainsaid that, when by specific agreement dated 17.6.1967 the Corporation recognised the assignment of all rights, title and interest made by Glenfield & Co. on 13.8.1966 in favour of the appellant in respect of the premises in question, and thus treated the appellant as the principal occupant, the Corporation was fully aware of the terms and conditions of the agreement dated 27.3.1964 under which the second respondent was already in occupation of the premises.
Nevertheless, the Corporation entered into the agreement dated 17.6.1967 accepting the appellant as the principal occupant in the place of Glenfield & Co. In the absence of any evidence to show that the relationship between the appellant and the second respondent has since altered so as to violate the terms of the agreement of occupation dated 17.6.1967.
It is not open to the Corporation to order eviction of the appellant on the ground of sub letting which is alleged to be contrary to the terms or conditions of occupation.
The High Court, in our view, wrongly reversed the finding of fact on that question by the appellate officer.
Whether the circumstances had changed or not was a question then is, whether, as found by the High Court,it is open to the Corporation to have recourse to clause (b) of sub section (1) of section 105B to order eviction of the appellant as an unauthorised occupant.
Is clause (b) attracted where eviction is sought to be made by determination of authority otherwise than in terms of the statute? Mr. V.M. Tarkunde, appearing for the appellant, submits that the appellate officer having found that the Corporation was, when it 838 entered into an agreement of occupation with the appellant on 17.6.1967, fully aware of the terms and conditions under which the second respondent was in occupation of the premises in question under the appellant, the High Court was not justified in upholding the eviction of the appellant on the very same ground.
The application of clause (b) of sub section (1) of section 105B, counsel says, is confined to persons in unauthorised occupation.
Persons in occupation of premises under authority are not liable to be evicted otherwise than on any one of the statutorily specified grounds.
Mr. S.B. Bhasme, appearing for the Corporation, submits that in view of the finding that the sub lease granted or renewed by the appellant was contrary to clause (6) of its agreement dated 17.6.1967 which provided. ". .I agree that this godown will not be assigned or sub let or allowed to be occupied by any person and if it or any part of it is assigned or sub let to any other party, I will be liable to be ejected immediately".
and also in view of clause (2) of the said agreement which reads: "Each party may terminate the tenancy at the end of any English Calendar month by giving to the other party one month 's notice in writing".
the appellant has, after the expiry of the period stipulated in the notice dated 25.7.1969, become an unauthorised occupant, and is liable to be evicted in terms of clause (b) of sub section (1) of section 105B of the Act.
According to Mr. Bhasme, the agreement under which the appellant occupied the premises has expired or has been duly determined by order of the competent authority.
Further continuance by the appellant is an unauthorised occupation so as to attract the provisions of section 105B.
Apart from the grounds mentioned in sub clauses (i), (ii), (iii) and (iv) of clause (a) of sub section (1) of section 105B, the Corporation is also empowered under clause (b) of sub section (1) of that section to evict any person whose authority to occupy has expired or has been duly determined and who thereafter remains in occupation of the premises.
The authority to occupy, he says, is duly determined even if the determination is sought to be founded on the ground of sub letting contrary to the terms and 839 conditions of occupation, or on any other ground specified in clause (a) or clause (c) of sub section (1) 105B, and that ground is subsequently held to be not proved and the order of eviction on that ground is accordingly found to be invalid.
This invalidity, according to counsel, is only as far as it related to the alleged ground.
Nevertheless, he says, such order determining authority to occupy is sufficiently efficacious to make further occupation 'unauthorised ', so as to attract clause (b) of sub section (1), provided the determination of authority can otherwise be justified in terms of the agreement of occupation.
In such circumstances, he says, clause (b) of sub section (1) is a potent weapon in the hands of the Corporation.
We shall now examine the relevant provisions.
Section 105A to section 105H of chapter VA were inserted in the Act in 1961 so as to provide for speedy eviction of persons in 'unauthorised occupation of Corporation premises.
Section 105A (d) defines 'unauthorised occupation ' in the following words: "(d) 'unauthorised occupation in relation to any corporation premises; means the occupation by any person of corporation premises without authority for such occupation; and includes the continuance in occupation by any person of the premises after the authority under which he was allowed to occupy the premises has expired, or has been duly determined.
" The definition shows that occupation of Corporation premises without authority for such occupation is an unauthorised occupation.
Such occupation includes continuance in occupation by a person after the authority under which he occupied the premises has "expired" or it has been "duly determined".
The definition thus includes not only a trespasser whose initial and continued occupation has never been under any valid authority, but it also includes in equal measure a person whose occupation at its commencement was under authority, but such authority has since expired, or, has been duly determined Which means validly determined.
The expiry of authority to occupy occurs by reason of the terms or conditions of occupation.
On the other hand, the determination of authority to occupy to be due or valid must be founded on one of the grounds specified by the statute.
Any order of eviction on the ground of either "expiry" or "due determination" has to be made in accordance with the procedure prescribed by the statute.
840 Section 105B, in so far as it is material, reads: "section 105B (1) Where the Commissioner is satisfied (a) that the person authorised to occupy any corporation premises has, whether before or after the commencement of the Bombay Municipal Corporation (Amendment) Act, 1960, (i) not paid for a period of more than two months, the rent or taxes lawfully due from him in respect of such premises; or (ii) sub let, contrary to the terms or conditions of his occupation, the whole or any part of such premises; or (iii) committed, or is committing, such acts of waste as are likely to diminish materially the value, or impair substantially the utility, of the premises; or (iv) otherwise acted in contravention of any of the terms, expreses or implied, under which he is authorised to occupy such premises; (b) that any person is in authorised occupation of any corporation premises; (c) that any corporation premises in the occupation of any person are required by the corporation in the public interest.
the Commissioner may notwithstanding anything contained in any law for the time being in force, by notice (served by post, or by affixing a copy of it on the outer door or some other conspicuous part of such premises, or in such other manner as may be provided for by regulations), order that that person, as well as any other person who may be in occupation of the whole or any part of the premises, shall vacate them within one month of the date of the service of the notice.
(2) before an order under sub section (1) is made against 841 any person, the Commissioner shall issue, in the manner hereinafter provided, notice in writing calling upon all persons concerned to show cause why an order of eviction should not be made.
The notice shall, (a) specify the grounds on which the order of eviction is proposed to be made, and (b) require all persons concerned that is to say, all persons who are or may be in occupation of, or claim interest in, the corporation premises, to show cause against the proposed order, on or before such date as is specified in the notice.
. . . . (3) If any person refuses or fails to comply with an order made under sub section (1), the Commissioner may evict that person and any other person who obstructs him and take possession of the premises; and may for that purpose use such force as may be necessary." (emphasis supplied) Clause (a) of sub section (1) of this section contains various grounds upon which a person is liable to be evicted.
Clause (b) says that unauthorised occupation itself is a ground for eviction.
Clause (c) provides that requirement in the public interest is a ground for eviction.
Sub section (2) speaks of show cause notice before an order of eviction by notice is made under sub section (1).
Sub section (3) has conferred sufficient power on the Commissioner to enforce an order of eviction made by him under sub section (1).
For the purpose of holding an enquiry under the Act, the commissioner is invested with all the powers of a Civil Court (section 105E).
An appeal lies from every order of the Commissioner under section 105B or section 105C to the appellate officer, namely, the Principal Judge of the City Civil Court of Bombay (section 105F), whose orders are final and not liable to be "called in question in any original suit, application or execution proceeding" (section 105G).
The satisfaction of the Commissioner, which is the condition precedent to the exercise of power of eviction by the summary procedure 842 prescribed by the Act, may be in respect of any of the circumstances falling under clauses (a), (b) or (c) of sub section (1) of section 105B.
Clause (a) contemplates eviction of any person on any one of the grounds mentioned in sub clauses (i) to (iv) thereof.
These grounds relate only to a person in authorised occupation of Corporation premises.
They have no application to a trespasser.
This is clear from the grounds themselves as well as from the wording of clause (a) which reads "that the person authorised to occupy. ".
Likewise, clause (c) presumably applied to authorised occupation of Corporation premises, which the Commissioner is empowered to terminate by ordering eviction of the occupant otherwise than on any of the grounds specified under clause (a), provided the Commissioner is satisfied that the premises in question are required by the Corporation in the public interest.
All that the Commissioner has to satisfy himself in a case falling under clause (c) is as regards the public interest requiring eviction.
Construction of parks, playgrounds, hospitals, colleges, markets, destitute homes and the like will indeed qualify for invoking the Commissioner 's power under clause (c), Clause (b), on the other hand, is a powerful weapon for eviction of an unauthorised occupant.
This clause is applicable equally to a trespasser as it is to a person whose occupation has ceased to be an authorised occupation by reason of expiry of authority in terms thereof or due determination of authority under clause (a) or clause (c) of sub section (1) of section 105B.
If a person is in occupation without authority, as in the case of a trespasser, or if the authority under which a person has been in occupation has expired in terms thereof and he continues to remain in occupation of the premises, he will be liable to be evicted on the ground mentioned in clause (b) of sub section (1) of section 105B, but in accordance with the procedure laid down in that section and on the satisfaction of the Commissioner, expressed by an order, as to the lack or expiry of authority.
It must however, be remembered that, except in the case of a trespasser or a person remaining in occupation even after the expiry of the period of authority, clause (b) can be invoked only where the Commissioner is satisfied and has so found be an order that any one of the grounds falling under clause (a) or clause (c) of sub section (i) for determination of authority has been established.
In the absence of such a valid order invoking clause (a) or clause (c), a person in occupation under authority, which has not expired, is not liable to be evicted under section 105B.
We do not accept Mr. Bhasme 's argument to the contrary on this point.
It is not the case of the Corporation that the authority under 843 which the appellant has been in occupation has expired in terms thereof.
That was not the basis upon which the enquiry was conducted and the order of eviction was made.
If that was the ground and that ground was rightly invoked, the position might well be different.
The specific ground upon which eviction was sought, as seen in the order of the enquiry officer and as categorically found by the High Court, was one of sub letting contrary to the terms or conditions of occupation.
No other ground, as the High Court says, was relied upon by the Corporation.
In the circumstances, the Commissioner (or his delegate) must be understood to have restricted the scope of the enquiry to the ground falling under clause (a) (ii) of sub section (1) of section 105B for the purpose of invoking the summary power of eviction vested in him under the statute.
Sub letting as such, without more, is not a ground for eviction under clause (a) (ii).
What attracts eviction in terms of that provision is sub letting which is contrary to the terms or conditions or occupation.
The appellate officer has found that the occupation of the premises by the second respondent under the appellant was well known to the Corporation; the terms and conditions of that occupation were closely scrutinised by the Corporation before recognising the transfer of rights and interest from the previous principal occupant to the appellant; and, it was on that basis and with that knowledge that the Corporation authorised the occupation of the premises by the appellant in terms of the agreement dated 17.6.1967.
In such circumstances, whatever right of occupation which the second respondent enjoyed under the appellant must be deemed to have been incorporated as a term of the authority granted by the Corporation in favour of the appellant.
The appellate officer has categorically found that there was no evidence whatsoever to indicate that the circumstances in which the premises had been occupied by the second respondent had in any manner, or at any time, altered so as to affect the terms or conditions under which the appellant was recognised as the principal occupant.
The Corporation is, accordingly on the facts found, stopped from having recourse to the ground falling under clause (a) (ii) of sub section (1) of section 105B.
As stated by the High Court, this was the only ground on which eviction was sought, and that ground, as found by the appellate officer, has not been established.
In proceedings under Article 227 of the Constitution, the High Court was not, in our view, justified in interfering with the finding of 844 fact rendered against the Corporation by the appellate officer.
Accordingly, we set aside the impugned judgement of the High Court and restore the order of the appellate officer.
This appeal is allowed in terms of what is stated above.
The parties shall, however, bear their respective costs.
N.V.K. Appeal allowed.
| IN-Abs | The original occupant of the suit godowns had on 1.10.1963 granted to the appellant a licence in respect of the premises and subsequently by a deed of assignment dated 13.8.1966 assigned all its rights, title and interest in the premises in favour of the appellant.
The appellant had in the meantime by agreement dated 27.3.1964 permitted the second respondent to store goods in the premises.
The appellant thereafter requested the Corporation to recognise it as the principal occupant of the premises by means of a formal agreement.
This request was at first rejected by the Corporation on the ground that the second respondent, had been already in occupation of the premises.
Subsequently the Corporation examined the terms and conditions of the agreement dated 27.3.1964 and after satisfying itself the Corporation transferred the occupancy right to the appellant on the appellant executing a formal agreement dated 17.6.1967.
A notice dated 25.7.1969 terminating tenancy in terms of the agreement dated 17.6.1969 was served on the appellant.
This was followed by an enquiry under the Bombay Municipal Corporation Act 1888 which resulted in the order of eviction dated 6.1.1971, the appellant being the principal tenant and the second respondent as a sub tenant.
The enquiry officer, acting as a delegate in terms of section 68 and exercising the power of Commissioner of the Municipal Corporation of Greater Bombay, the first respondent under section 195B, ordered eviction of the appellant on the ground of sub letting the premises.
The enquiry officer, on inspection, found that the second respondent was in occupation of the premises as a sub lessee that the appellant 830 had sub let the premises contrary to the terms of the conditions of occupation and had thus become an unauthorised occupant liable to be evicted from the premises in terms of section 105B, and passed an order of eviction against the appellant.
This order was, on appeal, set aside by the appellate officer, on appreciation of the evidence and the terms of the agreements, the appellate officer held that the agreement dated 27.3.1964, approved and recorded the assignment and transfer of the right, title and interest of the original occupant to the appellant, and recognised the appellant as the principal occupant, and that the Corporation was at all material times aware of the appellant 's relationship with the second respondent and the occupation of the premises by the second respondent under the appellant.
The eviction of the appellant solely on the ground of sub letting was therefore unwarranted.
The High Court in exercise of its jurisdiction under Article 227 of the Constitution held that the appellate officer was wrong in saying that the circumstances had not altered so as to warrant an order of eviction on the ground of sub lease, and that the lease in favour of the appellant had been duly determined by the Corporation in terms of the contract, and the appellant having thus become an "unauthorised" occupant was as such liable to be evicted under clause (b) of sub section (1) of section 105B.
The High Court accordingly set aside the order made by the appellate officer under section 105B and restored the order of eviction made under section 105B by the Enquiry Officer.
In the appeal to this Court it was submitted on behalf of the appellant that persons in occupation of premises under authority are not liable to be evicted otherwise than on any one of the statutorily specified grounds, and that the application of clause (b) of sub section (1) of section 105B, is confined to persons in unauthorised occupation, and that the appellate officer having found that the Corporation when it entered into an agreement of occupation with the appellant on 17.6.1967 fully aware of the terms and conditions under which the second respondent was in occupation of the premises under the appellant, the High Court was not justified in upholding the eviction of the appellant on the very same ground.
On behalf of the respondent No. 1 Corporation it was submitted that in view of the finding that the sub lease granted or renewed by the appellant was contrary to clauses (6) and (2) of the agreement dated 17.6.1967 the appellant has, after the expiry of the period stipulated in 831 the notice dated 25.7.1969, become an unauthorised occupant, and is liable to be evicted in terms of clause (b) of sub section (1) of section 105B.
On the question: whether it is open to the Corporation to have recourse to clause (b) of sub section (1) of section 105B to order eviction of the appellant as an unauthorised occupant, and whether clause (b) is attracted where eviction is sought to be made by determination of authority otherwise than in terms of the statute.
Allowing the appeal, the Court, HELD: 1.
Section 105A to section 105H of Chapter VA were inserted in the Act in 1961 to provide for speedy eviction of persons in unauthorised occupation of Corporation premises.
(839C) Section 105A(d) defines 'unauthorised occupation '.
This definition shows that occupation of Corporation premises without authority for such occupation is an unauthorised occupation.
Such occupation includes continuance in occupation by a person after the authority under which he occupied the premises has "expired" or it has been "duly determined".
the definition thus includes not only a trespasser whose initial and continued occupation has never been under any valid authority, but it also includes in equal measure a person whose occupation at its commencement was under authority, but such authority has since expired, or, has been duly determined Which means validly determined.
The expiry of authority to occupy occurs by reason of the terms or conditions of occupation.
On the other hand, the determination of authority to occupy to be due or valid must be founded on one of the grounds specified by the statute.
Any order of eviction on the ground of either "expiry" or due determination" has to be made in accordance with the procedure prescribed by the statute.
[839D H] 3.
Clause (a) of sub section (1) of section 105B contains various grounds upon which a person is liable to be evicted.
Clause (b) says that unauthorised occupation itself is a ground for eviction.
Sub section (2) speaks of show cause notice before an order of eviction by notice is made under sub section (1).
Sub section (3) has conferred sufficient power on the Commissioner to enforce an order of eviction made by him under sub section (1).
For the purpose of holding an enquiry under the Act, the Commissioner is invested with all the powers of a Civil Court (Section 105E) An appeal lies from every order of the Commissioner 832 under section 105B or section 105C to the appellate officer, namely the Principal Judge of the City Civil Court of Bombay (section 105F), whose orders are final and not liable to be "called in question in any original suit, application or execution proceeding" (Section 105G).
[841E G] 4.
The satisfaction of the Commissioner, which is the condition precedent to the exercise of power of eviction by the summary procedure prescribed by the Act, may be in respect of any of the circumstances falling under clauses (a), (b) or (c) of sub section (1) of section 105B.
Clause (a) contemplates eviction of any person on any one of the grounds mentioned in sub clauses (i) to (iv) thereof.
These grounds relate only to a person in authorised occupation of Corporation premises.
They have no application to a trespasser.
[841H 842B] 5.
Likewise, clause (c) presumably applies to authorised occupation of Corporation premises, which the Commissioner is empowered to terminate by ordering eviction of the occupant otherwise than on any of the grounds specified under clause (a), provided the Commissioner is satisfied that the premises in question are required by the Corporation in the public interest.
All that the Commissioner has to satisfy himself in a case falling under clause (c) is as regards the public interest requiring eviction.
Construction of parks, playgrounds, hospitals, colleges, markets, destitute homes and the like will indeed qualify for invoking the Commissioner 's power under clause (c).
[842C] 6.
Clause (b) is a powerful weapon for eviction of an unauthorised occupant.
This clause is applicable equally to a trespasser as it is to a person whose occupation has ceased to be an authorised occupation by reason of expiry of authority in terms thereof or due determination of authority under clause (a) or clause (c) of sub section (1) of section 105B. [842D] 7.
If a person is in occupation without authority, as in the case of a trespasser, or if the authority under which a person has been in occupation has expired in terms thereof and he continues to remain in occupation of the premises, he will be liable to be evicted on the ground mentioned in clause (b) of sub section (1) of section 105B, but in accordance with the procedure laid down in that section and on the satisfaction of the Commissioner, expressed by an order, as to the lack or expiry of authority.
[842E F] 8.
Sub letting as such, without more, is not a ground for eviction 833 under clause (a) (ii).
What attracts eviction in terms of that provision is sub letting which is contrary to the terms or conditions of occupation.
[843C] In the instant case, the appellate officer has found that the occupation of the premises by the second respondent under the appellant was well known to the Corporation; the terms and conditions of that occupation were closely scrutinised by the Corporation before recognising the transfer of rights and interest from the previous principal occupant to the appellant; and, it was on that basis and with that knowledge that the Corporation authorised the occupation of the premises by the appellant in terms of the agreement dated 17.6.1967.
In such circumstances, whatever right of occupation which the second respondent enjoyed under the appellant must be deemed to have been incorporated as a term of the authority granted by the Corporation in favour of the appellant.
The appellate officer has categorically found that there was no evidence whatsoever to indicate that the circumstances in which the premises had been occupied by the second respondent had in any manner, or at any time, altered so as to affect the terms or conditions under which the appellant was recognised as the principal occupant.
The Corporation is, accordingly on the facts found, estopped from having recourse to the ground falling under clause (a) (ii) of sub section (1) of section 105B. [843D G] 9.
In proceedings under Article 227 of the Constitution, the high Court was not justified in interfering with the findings of fact rendered against the Corporation by the appellate officer.
[843H 844A]
|
Appeal Nos.
491 544 of 1991.
From the Judgement and Order dated 12.12.1990 of the Bombay High Court in W.P. Nos.
2646, 2659, 2651, 2649, 2657, 2664, 2648, 2647, 2666, 2658, 2662, 2663, 2667, 2665, 2691, 2693, 2694, 4091, 4098, 4155, 2743, 2789, 2791, 2790, 2740, 4290, 2824, 2858, 2848, 3052, 2863, 2848, 2844, 2843, 2832, 2852, 4846, 4844, 3312, 5101, 5102, 3313, 3207, 3064, 3005, 3335, 3188, 5123, 3514 and 4844 of 1990.
T.R. Andhyarujana, S.N. Wakharia, P.H. Parekh, D.Y. Chandrachud and Ms. Shalini Soni for the Appellant.
P. Chidambaram, Arun Jaitley, I.R. Joshi, M.N. Shroof, Ms. Indu Malhotra, Ms. Alka Mukhija, Harish N. Salve, Ms. Shireen Jain, J.P. Cama, Mukul Mudgal, Mrs. Urmila Sirur, Dileep Pillai, P. Kesava Pillai, Kailash Vasdev and Vimal Dave for the Respondents.
The Judgement of the Court was delivered by K. RAMASWAMY, J. We have heard the learned counsel on either side and grant special leave to appeal in all the cases.
The quest for just result to save the precious academic years to the students while maintaining the unsullied examination process is the core problem which the facts have presented for solution.
The appeals arise from the common judgement of a Division Bench of the Bombay High Court in Writ Petition No. 2646 of 1990 and batch.
The appellant for short 'the Board ' conducted secondary examinations in the month of March 1990, whereat the marks awarded, after the formalities of valuation by the examiners of the answer sheets in each subject; the random counter check by the moderators and further recounting at the Board, Moderators ' mark sheets sent to Pune for feeding the computer to declare the results were found tampered with the appellant.
Thereon, admittedly, it was found that moderators ' mark sheets relating to 283 examinees which include 53 respondents in these appeals were tampered, in many a case in more than 2 to 8 subjects, and in few cases in one subject.
As a result, 214 examinees have improved their ranking, which would be in some cases exceptionally good.
The declaration of their results were 780 withheld pending further enquiry and the rest declared on June 30, 1990.
Several writ petitions were filed in the High Court against non declaration of the results and the High Court directed to take expeditious action to declare the results of the examination within the specified time.
The Board appointed seven enquiry officers to conduct the enquiry.
Show cause notices were issued to the students on July 30, 1990 informing them of the nature of tampering, the subjects in which the marks were found tampered with, the marks initially obtained and the marks increased due to tampering, and also indicated the proposed punishment, if in the enquiry it would be found that marks were tampered with the knowledge or connivance or at the instance of the candidates or parents or guardians.
They were also informed that they would be at liberty to inspect the documents at the Divisional Board at Bombay.
They were entitled to adduce documentary and oral evidence at the hearing.
They will also be permitted to cross examine the witnesses of the Board, if any.
They would not be entitled to appear through an Advocate, but the parents or guardians would be permitted to accompany the students at the time of enquiry, but they are not entitled to take part in the enquiry.
The candidates submitted their explanations denying the tampering and appeared before the Enquiry Officers on August 8, 9, 10, 20, 21 and 22, 1990.
At the enquiry, each student inspected the record.
A questionnaire was given to be filled in writing.
Every candidate was shown his answer book, marks awarded in the subject/subjects and the tampered marks in the moderators ' mark sheets.
All the candidates admitted that the marks initially awarded by the examiner were tampered in the moderators mark sheets; due to tampering the marks were increased and the increase was to their advantage.
However, they denied that either they or their parents or guardians were privy to the tampering.
The Enquiry Officers submitted their reports holding that the moderators mark sheets have been fabricated and submitted the reports to the Board.
The Standing Committee constituted in this regard considered the records and the reports on August 29, 1990, discussed pros and cons and expressed certain doubts about the possibility of the candidates/parents/guardians committing fabrication.
They sought for and obtained legal opinion in that regard.
On August 30, 1990 the standing committe resolved to with hold, as a measure of punishment, the declaration of the results of their examinations and to debar the 283 students to appear in the supplementary examination to be held in October, 1990 and March, 1991.
The notification was published on August 31, 1990 and submitted the report to the High Court.
There after the High Court considered the cases on merits.
The learned Judges by separate but concurrent judgements allowed the writ petitions.
781 Sugla, J. held that the Standing Committee of the Divisional Board under the Maharashtra Secondary and Higher Secondary Education Board Act of 1965 for short 'the Act ' was devoid of power.
It did not obtain the approval of the Divisional Board, and therefore, the impugned notification was without authority of law.
On merits also it was held that the Standing Committee did not apply its mind in the proper perspective to the material facts.
Therefore, the finding that tampering was done at the instance of the examinees/parents/guardians is perverse.
Bharucha, J. without going into the jurisdictional issue agreed with Sugla, J. and held that the preponderance of the probabilities would show that the examinees were not guilty of the malpractices.
The guilt has not been established.
The examinees might well be innocent.
Accordingly, the impugned notification dated August 31, 1990 was quashed.
Mandatory injunction was issued to Board to declare the results of 253 examinees within two weeks from the date of the judgement and marks were directed to be communicated to the examinees within a period of two weeks thereafter.
The admitted facts are that the mark sheets of the examiners were not tampered.
Only the moderators ' mark sheets were tampered.
As per the procedure, after the marks were scrutinized at the State Board and found the marks tallied and to be correct, the moderators ' mark sheets were sent to the computer at Pune, obviously in sealed packets, for feeding the results.
After the date of recounting the marks in the office of the State Board at Bombay and before the d ate of taking them to feed the computer, moderators ' mark sheets, were tampered.
The individual students were put on notice of the marks they originally obtained and the tampered marks in the subject/subjects concerned.
They were also given the opportunity to lead evidence on their behalf and if the witnesses were examined on behalf of the Board they would be permitted to cross examine them.
They inspected the records.
The questionnaire given to all the examinees at the enquiry were before us at the hearing including the 53 respondents in the appeals.
We have persued the questionnaire.
It is clear from the answers given to the questionnaire that all the examinees admitted the marks they originally got and the tampered marks on the moderators ' mark sheets.
They also admitted that the tampering was to their advantage.
Everyone denied the complicity of either of the candidates or the parents or the guardians.
Thus it is clear that at the enquiry there is no dispute that the moderators ' mark sheets were tampered, though the candidates, obviously and quite expectedly, denied their complicity in that regard.
Due to tampering 214 would have been passed and 69 accelerated their ranking and percentage to seek admis 782 sion into prestigious institutions.
The racket of large scale tampering wading through 80,000 moderators ' mark sheets obviously was done by concerted action.
It is clear that from large body of moderators ' mark sheets, it is not possible to pick the marks sheets of the concerned examinee alone unless there is concerted and deliberate efforts, in conspiracy with some members of the staff entrusted with the duties in this regard, for illegal gratification.
It is also not an innocent act of mere corrections as is sought to be made out by Sri Chidambaram, the learned counsel for the respondents.
We have no manner of doubt that unfair means were used at the final Secondary Examination held in March 1990, by fabricating the Moderators ' mark sheets of 283 examinees, in a concerned manner, admittedly, to benefit the students concerned.
The first question, therefore, is whether the Standing Committee of the concerned Divisional Board has power under the Act and Regulations to enquire into the use of unfair means committed at the final examination conducted under the Act.
Section 4 of the Act declares that the State Board of Secondary and Higher Secondary Education is a body corporate.
Section 18 enumerates the powers and duties of the State Board.
Clause (t) of Sec.
18 empowers the Board to make regulations for the purpose of carrying into effect the provisions of the Act.
Clause (g) empowers the Board to give to the candidates certificates after passing final examination.
Clause (m) empowers to recommend measures and to prescribe conditions of discipline.
Clause (w) gives residuary power to do all such acts and things as many be necessary to carry out the purposes of the Act.
Section 19 gives powers and entrust duties to the Divisional Board of each division.
Clause (f) postulates, "to conduct in the area of its jurisdiction the final examination on behalf of the State Board.
" Clause (1) provides, "to deal with cases of use of unfair means according to the procedure laid down by the State Board.
" Section 23 provides that power of appointments of the Committees by the State Board.
Sub Section (2) thereof provides that: "The State Board may appoint such other Committees as it thinks necessary for the efficient performance of its functions." Equally sub section (3) of Sec.
23 empower thus: "Each Divisional Board shall appoint Committees designated as follows: (d) Examination Committee.
783 Sub Section (5) states thus: "The constitution of every committee appointed by the State Board or a Divisional Board, the term of office of its members and the duties and functions to be discharged by it shall be such as may be prescribed.
" Section 36 empowers the State Board to make regulations for the purpose of carrying into effect the provisions of the Act.
Sub section (2) thereof states that: "In particular and without prejudice to the generally of the foregoing power, such regulations may provide for all or any of the following matters, namely: (a) the constitution, powers and duties of the Committees.
appointed under section 23; . . (f) the arrangement for the conduct of final examinations by the Divisional Board and publication of results; . . (n) any other matter which is to be or may be prescribed under this Act.
" Sub section (3) provides: "No regulation made under this section shall have effect until the same has been sanctioned by the State Government" Thus it is clear that the State Board is empowered to constitute the Divisional Boards and the Standing Committees.
The State Board is also empowered to make regulations to conduct examinations and also to deal with the use of unfair means at the final examination conducted by the Board.
The Divisional Board is empowered to conduct within its area the final examinations on behalf of the State Board.
The Divisional Board is also empowered to deal with the cases of unfair means according to the procedure laid down by the State Board.
The State Board made regulations named as Maharashtra Secondary and Higher Secondary Education Board Regulations 1977 which came into force with effect from July 11, 1977.
Regulation 9(2) (xviii) read thus: 784 "to lay down the procedure and specify the penalties to be followed by the Divisional Boards, in dealing with cases of use of unfair means by persons seeking admission to or appearing at the examinations conducted under the authority of the State Board.
" Under Regulations 14 the Standing Committee of the Divisional Board was to be constituted under sub regulation (1) thereto.
Sub regulation (2) provides: "Subject to the provisions of the Act and the Regulations, the Standing Committee shall have the following duties and functions, namely . . (x) to deal with cases of use of unfair means by persons seeking admission to or appearing at the final examinations, according to the procedure laid down by the State Board.
" By a resolution passed at the meeting of the State Board held on October 26, 1985, Exhibit 'z ' provides the procedure for enquiry.
Clause 3(f) defines 'misconduct ' as follows: "Misconduct" shall mean any illegal or wrongful act or conduct which is alleged to have been resorted to by any candidate and/or any member of staff, at, for or in respect of the final examination and, without prejudice to the generality of the foregoing, shall include. . tampering with the documents issued by the Board or otherwise howsoever changing a candidate 's results in any manner whatsoever and generally acting in such a manner so as to affect or impede the conduct of the final examinations and fair declaration of results thereof.
" Clause (4) empowers to conduct an enquiry either suo moto or on a complaint about any misconduct and the procedure in that regard so that the Chairman of the Divisional Board may entrust the enquiry into the alleged misconduct to any member or members of the Divisional Board other than the members of the Standing Committee.
Clause (5) empowers to entrust the enquiry.
The Enquiry Officer shall give a notice in writing to the candidate . setting forth the nature of the misconduct alleged against the candidate and call upon the candi 785 date to show cause within the time specified therein.
It also empowers to set out the punishment proposed to be imposed on a candidate.
Clause 5(b) gives an opportunity to the candidates to inspect the relevant documents proposed to be relied upon at the enquiry.
Clause 6 gives opportunity to the delinquent to submit an explanation; to produce his witnesses as well as documentary evidence and to be heard in person, if he/she so desires, but shall not be entitled to be represented by an Advocate or any other persons.
The delinquent shall be bound to answer truthfully to all questions relevant to the subject of enquiry that may be put to him/her by the Enquiry Officer .
Clause (10) provides that the concerned Enquiry Officer shall submit the report in writing including the findings and the proposed punishment.
Clause 11 provides thus: "The Standing Committee shall consider the report and decide the case as it may deem fit.
The Standing Committee will take the decision in the same meeting.
" Clause (12) states thus: "The Standing Committee shall not be bound to give detailed reasons in support of its order or decision but shall record its reasons if it disagrees with the findings of recommendations of the inquiry officer and under such circumstances the Standing Committee need not give hearing to the delinquent concerned." Other clauses are not relevant for the purpose of this case.
Hence omitted.
The Board also in its meeting held on October 26, 1985 framed rules in Appendix 'A ' providing under different heads the nature of the offence and the quantum of punishment, the relevant item 16 reads thus: "Tampering with the Secondary/Higher Secondary School Certificate and/or statement of marks or their copies and any other documents issued by the Board.
" Cancellation of performance of the Examination and debarring the candidate for five more examinations and/or to lodge complaint by the concerned institution/Authority to Police Department.
Thus a conspectus of these relevant provisions of the Act, regulations 786 and resolutions clearly cover the entire field of operation regarding the use of unfair means at the final examinations specified the competent authorities and the procedure to deal with the same.
The Divisional Board undoubtedly has been empowered under Sec.
19 of the Act to deal with the use of unfair means at the final examination.
It may be made clear at this juncture that the Standing Committee consists of six members of the Divisional Board and none of them associated with the enquiry.
Enquiry Officers are also the members of the Divisional Board.
The regulations provide the procedure in this regard.
It is undoubtedly true as contended by Shri Chidambaram, that the Act empowers the Divisional Board to deal with the use of unfair means at the final examination.
But to give acceptance to the contention that the Standing Committee is an alien body to the Divisional Board is to do violence to the scheme of the Act and Regulations.
It is seen that under the scheme of the Act and Regulations the State Board is empowered to constitute the Standing Committee.
Equally the Divisional Board is empowered to constitute the committees which include the Examination Committee.
The members thereof are only members of the Divisional Board.
Equally the Inquiry Officers are also the members of the Divisional Board other than the members of the Education Standing Committee.
The Standing Committee is an executive arm of the Divisional Board for the efficient and expeditious functioning of the Board as adumbrated under the Act itself.
It is not a foreign body.
Therefore, when the Divisional Board is acting in conducting the examinations and dealing with the use of unfair means at the final Examination, it is acting on behalf of the State Board as its agent.
When the enquiry was conducted by some members and the Standing Committee was taking the decision thereon, it is acting on behalf of the Divisional Board.
There is no dichotomy but distribution of the functions.
Therefore, when the Standing Education Committee takes the decision its decision is on behalf of the Divisional Board to which they are members and the decision of the Divisional Board to which they are members and the decision of the Divisional Board in turn is on behalf of the State Board.
This is the integral scheme woven by the Act and Regulations.
Thus under the scheme of the Act, for the efficient and expeditious function of the concerned Boards; implementation of the provisions of the Act, and to prevent use of unfair means at the final examination including tampering the result of the examination, the Standing committee is clearly within its power to take final decision.
On a fair and harmonious reading of the relevant provisions and given their due scope and operational efficiency, we are of the considered view that the Examination Standing Committee of the Divisional Board itself a statutory body acted on behalf of the Divisional Board and is not a delegate of the Divisional Board.
787 In State of U.P. vs (Batuk Deo Pati Tripathi & Anr.,) the respondent was appointed as a Munsif in the State Judicial Service and was later promoted as a District Judge.
The Administrative Committee of the High Court reviewed the service and the Committee recommended to the State Government and communicated to all the Judges of the recommendation to compulsarily retire the respondent from service.
The Govt.
accordingly retired the respondent compulsarily which was challenged in a writ petition.
A Full Bench of the Allahabad High Court held that the District Judge cannot be retired from service on the opinion formed by the Administrative Committee and all the Judges should have considered and made recommendation.
Accordingly, the order was set aside.
On appeal, the Constitution Bench of this Court held that article 235 of the Constitution provides control over the District Judges and the Court subordinate thereto shall be vested in the High Court.
It is open to the High Court to make rules to exercise the power of control feasible, convenient and effective.
Accordingly the High Court regulated the manner of appointment of a Committee to screen the service record.
Thus, the rules framed prescribed the manner in which the power has to be exercised.
Truely, it is regulatory in character and the powers were exercised by the Committee and recommended to the State Govt.
to compulsarily retire the respondent and it amounts to taking a decision on behalf of the High Court.
In (Khargram Panchayat Samiti vs State of West Bengal & Ors.,) [1987] 3 SCC 82 at p. 84 the facts were that the cattle fairs run by the two rival organisations would be held on specified different dates which were impugned in the jurisdiction to pass such a resolution.
The High Court held that the Samiti was vested with power to grant licence to hold the fair under Sec. 117 of West Bengal Panchayat Act, 1973.
In the absence of any rules framed in that regard it had no power to specify dates on which such Hat or fair shall be held.
While reversing the High Court 's judgement, this Court held that the general administration of the local area vested in the Samiti which had power to grant licences to held fair or hat under Sec. 117 of the Act.
Necessarily it carries with it the power to supervise, control and manage such a hat or fair within its territorial jurisdiction.
The conferment of the power to grant a licence for holding of a hat or a fair includes the power to make incidental or consequential order for specification of a date on which such a Hat or fair shall be held.
Accordingly, the resolution of the Samiti was upheld.
In (Baradakanta Misra,) vs (High Court of Orissa & Anr.,) [1976]B Suppl.
SCR 561 relied on by Sri Chidambaram, the facts were that then appel 788 lant while acting as a District Judge, an enquiry into certain charges was held against him, and was reduced to Addl.
District Magistrate (Judicial).
He refused to join the duty.
Fresh proceedings were initiated against him and after enquiry the High Court dismissed him on the ground that he was convicted on a charge of a criminal attempt.
An appeal was filed to the Governor and a Writ petition followed thereafter filed in the High Court were dismissed, while allowing the appeal filed under Article 136.
The scope of the words "control" and "deal" used in Article 235 were interpreted at page 576 P&G and held that the word 'control ' includes something in addition to the disciplinary jurisdiction.
The control is with regard to conduct and discipline of the District Judges and Subordinate Courts and includes right to appeal against the order of the High Court in accordance with the condition or service includes an order passed thereon.
The word 'deal ' also includes the control over disciplinary and not mere administrative jurisdiction.
The control which is vested in the High Court is complete control subject only to the power of the Governor in the matter of appointment including initial posting and promotion of the District Judge and dismissal, removal and reduction in rank of the District Judges within the exercise of the control vested in the High Court.
The High Court can hold enquiries, impose punishments other than dismissal or removal subject, however, to the conditions of service to a right of appeal, if granted by the conditions of service, and to the giving of an opportunity of showing cause as required by Clause (2) of article 311 unless such an opportunity is dispensed with by the Governor acting under the provisos (b) and (c) to that clause.
The High Court alone could make enquiries into disciplinary conduct.
It was held that the High Court had no jurisdiction to dismiss the District Judge.
Accordingly it was quashed.
That ratio has no application to the facts in this case since the Act, Regulations and the Resolutions empowered the Divisional Board and its Standing Committee to deal with use of unfair means at final examinations including fabrication of documents issued by the Board as an integral part of the power of the Divisional Board.
Similarly, the ratio in (Taj Pal Singh (dead) through Lrs) vs State of U.P. & Anr., also is inapplicable to the facts of this case.
In that case, the facts were that while the appellant was working as the District and Sessions Judge, the Stage Govt.
moved the High Court to his premature retirement.
The Administrative Judge agreed with Government 's proposal to retire the appellant after giving him three months ' notice, the Governor passed the impugned order compulsorily retiring the appellant.
Three days thereafter the Administrative Committee had approved the opinion of the Administrative Judge which was transmitted to the Government.
789 Assailing the action of the Government the writ petition was filed which was dismissed by the High Court, but on appeal this Court held that the Administrative Judge was not competent to recommend to the Governor or compulsorily retire the District and Sessions Judge and the order of the Government made pursuant thereto was declared illegal.
This Court reiterated that the High Court has power under article 235 to make rules for its administrative convenience, but since the impugned action was not in pursuance of that rule, the action was not upheld.
That ratio also renders little assistance to the respondents for the reasons that the Standing Committee, as stated earlier is an integral part of while exercising the powers, under article 226 or article 136 of the Constitution, by the High Court or of this Court, are not sitting Committees (domestic enquiry body), nor have power to evaluate the evidence as an appellate Court and to come to its own conclusions.
If the conclusions reached by the Board can be fairly supported by the evidence on record then the High Court or this Court has to uphold the decision, though as appellate Court of facts, may be inclined to take different view.
The contention of M/s. Chidambaram, Jaitley, Salve and Cama, the learned counsel for the students, is that the students were minors; neither the parents nor anybody like an Advocate was permitted to assist the students.
Answers to the questionnaire were extracted from the students to confess their guilt.
No adequate opportunity was given to the students at the enquiry.
No one on behalf of the Board acquainted with the Divisional Board.
Accordingly the Board must be deemed to have passed the impugned notification as per the scheme of the provisions of the Act and the Regulations.
Therefore, the finding of the learned Judge Sugla, J. that the Standing Committee had no power to take the impugned decision, etc.
without approval of the Divisional Board is clearly illegal and cannot be sustained.
The question then is whether the candidates or their parents or guardians are privy to the fraudulent fabrication.
Since we are informed that investigation in this regard by the Police is in progress, we refrain to express any final opinion in this regard.
Suffice to state that the records clearly establish that there was a fraudulent fabrication of the moderators ' marks sheets of 283 candidates including the respondents herein.
The question, therefore, emerges whether the conclusion reached by the Standing Committee that the fabrication was done at the behest of either the candidate or the parents or the guardians to 790 their advantage is based on records.
We remind ourselves that the facts was examined to explain as to how the moderators ' sheets were dealt with after the board screened the marks, but before taking to Pune to feed the computer, nor an opportunity was given to cross examine them.
The evidence without subjecting it to cross examination is of no value.
Enquiry report is not a report in the eye of law.
It does not contain any statement of facts, nor reasons recorded.
It merely records conclusions.
When seven members were appointed it is not expected that all of them would submit uniform stereo typed reports to the Standing Committee.
The Standing Committee did not apply its mind to the facts, nor recorded reasons in support of its conclusions that the examinees/parents/guardians were parties to the fabrication and the fabrication was done at their behest.
Sri Chidambaram further contended that the Board should establish the guilt of the examinees beyond all reasonable doubts.
Shri Jaitley, Sri Cama and Sri Salve though did not support Sri Chidambaram that the standard of proof must be beyond all reasonable doubt, they argued that Standard of proof must be a high degree akin to trial in a criminal case.
The Board did not discharge its duty, on the other hand the Board had presumed that fabrication was done for the benefit of the examinees.
The test of benefit to an examinee is preposterous.
There is no presumption that the fabrication was done at the behest of either the examinees/parents/guardians.
It must be established by the Board as of fact that the examinees/parents/guardians were responsible for fabricating the Moderators ' mark sheets.
Thus no evidence was placed on record, nor wait proved; that, therefore, the findings of the Standing Committee are clearly based on no evidence.
The learned Judges of the High Court were justified in reaching the conclusion that the Board had not established that the fabrication was done at the behest of the examinees/parents/guardians.
This was resisted by Sri T.R. Andhyarujana, learned counsel appearing for the Board.
It was his contention that all the examinees admitted in answers to the questionnaire that tampering was done and it was to their advantage.
In view of the admission, the need to examine any person from the concerned section was obviated.
Fabrication cannot be done except to benefit the examinees.
The fabricator had done it for reward in concert with outside agencies.
Therefore, the inference from these facts drawn by the Standing Committee that the examinees/parents/guardians were responsible to fabricate the moderators ' marks sheets is based on evidence.
Proper enquiry was conducted giving reasonable opportunity to the candidates.
Show cause notices set out the material facts on which the Board intends to place reliance.
The examinees submitted their explanations and also answered the questionnaire.
On consideration 791 thereof the Standing Committee had reached the conclusions of the guilt of the examinees/parents/guardians.
This is based on record.
It is not open to High Court to evaluate the evidence to come to its own conclusions.
Thereby the High Court has committed manifest error of law warranting interference by this Court.
article 51A of the Constitution enjoins every citizen, as a fundamental duty, to promote harmony and spirit of common brotherhood among the people, to develop the scientific temper, humanism and the spirit of inquiry and reform; to strive towards excellence in all spheres of individual and collective activity so that the nation constantly rises to higher levels of endeavour and achievement.
article 29(2) declares education as fundamental right.
The native endowments of men are by no means equal.
Education means a process which provides for intellectual, moral and physical development of a child for good character formation; mobility to social status; an opportunity to scale equality and a powerful instrument to bring about social change including necessary awakening among the people.
According to Bharat Ratna Dr. Ambedkar education is the means to promote intellectual, moral and social democracy.
In D.M.K. Public School vs (Regional Joint Director of Hyderabad,) AIR 1936 (A.P.) 204 one of us (K. Ramaswamy, J.) held that education lays foundation of good citizenship and a principal instrument to awaken the child to intellectual and cultural pursuits and values in preparing the child for latter professional training and help him to adjust to the environment.
In nation building activities, education is a powerful level to uplift the poor.
Education should, therefore, be co related to the social, political or economic needs of our developing nation fostering secular values breaking the barriers of casteism, linguism, religious bigotry and it should act as an instrument of social change.
Education system should be so devised as to meet these realities of life.
Education nourishes intellectual advancement to develop dignity of person without which there is neither intellectual excellence nor pursuit of happiness.
Education thus kindles its flames for pursuit of excellence, enables and ennobles the young mind to sharpen his/her intellect more with reasoning than blind faith to reach intellectual heights and inculcate in him or her to strive for social equality and dignity of person.
Teacher occupies pride of place next below the parents as he/she imparts education and disciple the students.
On receiving salary from public exchequer he/she owes social responsibility and accountability 792 to disciple the students by total dedication and sincere teaching.
It would appear that their fallen standards and rectitude is also a contributory factor to the indiscipline among the students.
The students, too, instead of devoting his or her precious time to character building and to pursue courses of study studiously and diligently in the pursuit of knowledge and excellence, dissipate their precious time and many indulge in mass copying at the final examinations or use unfair means.
Some even do not hesitate to threaten the dutiful invigilators with dir consequences.
In G.B.S. Omkar vs Shri Venkateswara University, AIR 1981 A.P. 163 P.A. Choudhary, J., in the context of finding the student guilty of mal practices held, that "I regretfully note that standards of discipline and education presently detaining in many Universities in our country leave a good lot to be desired.
They are low and falling lower every day.
the fall out of these low standards of university education on liberal profession is proving to be nearly catastrophic . .
It is no wonder that some of our Universities have ceased to be centres of learning and have grown into battle fields for warring Caste groups.
" It was held that what the Writ Court under article 226 need to consider is whether fair opportunity had been given to a petitioner and he had been treated squarely and whether the student had a fair deal with the University.
Once the procedural formalities are complied with, in the absence of any allegation of mala fide, it must be presumed that the University had acted bona fide and honestly so long as there is the evidence justifying the inference arrived at without there being a serious procedural irregularity.
The Writ Court would not interfere with an order of educational institution.
Therefore, what the writ court needs to do is to find whether fair and reasonable opportunity has been given to the students in the given facts.
From this background the question emerges whether the impugned notification is vitiated by any procedural irregularity under the provisions of the Act, regulations and the Resolutions referred hereinbefore or violative of the principles of natural justice.
The students involved at the examination of secondary education are by and large minors but that by itself would not be a factor to hold that the students were unfairly treated at an inquiry conducted during the domestic inquiry.
Assistance of an Advocate to the delinquent at a domestic enquiry is not a part of the principles of natural justice.
It depends on the nature of the inquiry and the peculiar circumstances and facts of a particular case.
The regulations and the rules of enquiry 793 specifically excluded the assistance of an Advocate at the inquiry.
Therefore, the omission to provide the assistance of a counsel at the inquiry is not violative of the principles of natural justice.
The show cause notice furnished wealth of material particulars on which the tampering was alleged to be founded and given the opportunity to each student to submit the explanation and also to adduce evidence, oral or documentary at the inquiry.
Each student submitted the explanation denying the allegation.
At the inquiry the questionnaire in the proforma was given to each student.
It is undoubted that the allegation of fabrication was stated to have been done at the behest of either the student/parents or guardians and the parents or guardians were not permitted to participate in the inquiry.
Inspection of documents was given.
Their answer sheets and marks secured were perused by the students and were asked to testify whether the answer books belongs to him or her and to identify the marks awarded by the examiner to each answer to the question and the total marks awarded.
It was also asked to verify and state whether the moderator 's mark sheets were tampered in the concerned subject or subjects as the case may be.
The student could easily identify and in fact identified his or her answer books and verified the marks awarded and answered positively that the marks were fabricated in the moderators ' mark sheets.
The questionnaire was also given to indicate their educational background in the previous school years and also the marks they expected at the final examinations.
The need of the assistance of the parents/guardians was thus absolutely nil.
Further question in the proforma was to ascertain from the students, due to tampering, whether or not the marks were increased to his or her advantage.
It could be answered by a mere look at the marks.
No outside assistance is needed.
All the students have admitted that the answer books belong to them.
They also admitted the marks initially awarded by the examiner or added or subtracted, if any, by the moderators.
They also admitted that the fabrication in the moderators ' mark sheets in the subject or subjects and the marks were increased to their advantage.
They also denied the complicity of him or her or of parents or guardians.
It is not the case of the respondents that they were coerced to answer the questions in a particular manner.
It is obvious from the record that they had prior consultations with the counsel.
Thus it could be seen that the procedure adopted at the inquiry is fair and just and it is not vitiated by any procedural irregularity nor is violative of the principles of natural justice.
The absence of opportunity to the parents or guardians, in this background does not vitiate the legality or validity of the inquiry conducted or decision of the Committee.
794 It is true, as contended by Sri Chidambaram and reiterated by other counsel, that the Inquiry Report does contain only conclusions bereft of the statement of facts and reasons in support thereof.
As pointed out by Sri Cama that in some of the reports, the body was written in the hand writing of one or other person and it was signed by the Inquiry Officer concerned.
But when an inquiry against 283 students was conducted, it is not expected that each Inquiry Officer alone should write the report under his/her hand.
In the circumstances the Inquiry Officer obviously had the assistance of the staff in the office to write the body or the conclusions to his/her dictation and he/she signed the report.
The reports cannot be jettisoned on the ground that the Inquiry Officer mechanically drew the conclusions in the reports without applying his/her mind to the facts.
The Enquiry Reports are not, therefore, bad in law.
In (Union of India) vs (Mohan Lal Capoor & Ors.,) this court speaking through M.M. Beg, J., for a Bench of two Judges held in paragraph 28 at page 854 that the reasons are the links between the materials on which certain conclusions are based to the actual conclusions.
They disclose how mind is applied to the subject matter for a decision, whether it is purely administrative or quasi judicial.
They would reveal nexus between the facts considered and the conclusions reached.
This view was reiterated in (Gurdial Singh Fijji) vs (State of Punjab & Ors.,) ; Those two cases relied on by Sri Chidambaram, the rules/regulations required recording of reasons in support of the conclusion as mandatory.
Unless the rule expressly or by necessary implications, excludes recording of reasons, it is implicit that the principles of natural justice or fair play does require recording of reasons as a part of fair procedure.
In an administrative decision, its order/decision itself may not contain reasons.
It may not be the requirement of the rules, but at the least, the record should disclose reasons.
It may not be like a judgement.
But the reasons may be precise.
In S.N. Mukherjee vs Union of India, J.T. the Constitution Bench of this Court surveyed the entire case law in this regard, and we need not burden the Judgement to reiterate them once over and at page 643 in paragraph 40 it held that except in cases where the requirement has been dispensed with expressly or by necessary implication, an administrative authority exercising judicial or quasi judicial functions is required to record the reasons for its decision.
In para 36 it was further held that recording of reasons excludes changes of arbitrariness and ensure a degree of fairness in the process of decision making.
The said principle would apply 795 equally to all decisions and its applications cannot be confined to decisions which are subject to appeal, revision or judicial review.
"It is not required that the reasons should be as elaborate as in the decision of a Court of law.
" The extent and nature of the reasons would depend on particular facts and circumstances.
What is necessary is that the reasons are clear and explicit so as to indicate that the authority has given the consideration to the points in controversy.
The need for recording reasons is greater in a case where the order is passed at the original stage.
The appellate or revisional authority, if it affirms such an order, need not give separate reasons.
If the appellate or revisional authority disagrees, the reasons must be contained in the order under challenge.
Thus it is settled law that the reasons are harbinger between the mind of the maker of the order to the controversy in question and the decision or conclusion arrived at.
It also exclude the chances to reach arbitrary, whimsical or capricious decision or conclusion.
The reasons assure an inbuilt support to the conclusion/decision reached.
The order when it effects the right of a citizen or a person, irrespective of the fact, whether it is quasi judicial or administrative fair play requires recording of germane and relevant precise reasons.
The recording of reasons is also an assurance that the authority concerned consciously applied its mind to the facts on record.
It also aids the appellate or revisional authority or the supervisory jurisdiction of the High Court under article 226 or the Appellate jurisdiction of this Court under article 136 to see whether the authority concerned acted fairly and justly to meet out justice to the aggrieved person.
From this perspective, the question is whether omission to record reasons vitiates the impugned order or is in violation of the principles of natural justice.
The omnipresence and omniscience of the principle of natural justice acts as deterrence to arrive at arbitrary decision in flagrant infraction of fair play.
But the applicability of the principles of natural justice is not a rule of thumb or a straight jacket formula as an abstract proposition of law.
It depends on the facts of the case nature of the inquiry and the effect of the order/decision on the rights of the person and attendant circumstances.
It is seen from the record and is not disputed, that all the students admitted, the factum of fabrication and it was to his or her advantage and that the subject/subjects in which fabrication was committed belong to him or her.
In view of these admissions the Inquiry Officer, obviously did not find it expedient to reterate all the admissions made.
If the facts are disputed, necessarily the authority or the Inquiry Officer, on consideration of the material on record, should record reasons in support of the conclusion reached.
Since the facts are admitted, the need to their 796 reiteration was obviated and so only conclusions have been stated in the reports.
The omission to record reasons in the present case is neither illegal, nor is violative of the principles of natural justice.
Whether the conclusions are proved or not is yet another question and would need detailed consideration.
In Khardah Co. Ltd. vs Their Workmen, ; at p. 514 the ratio that the Enquiry Report must contain reasons in support of the findings drawn neatly and briefly is of no assistance for the aforestated facts of this case.
The ratio in A.K. Roy, etc.
vs Union of India & Ors.
, ; that the aid of friend could be taken to assist the detenu and in Pett vs Grehound Racing Association Ltd., [1968] 2 All Eng.
Reports 545 the right to appoint an Agent to represent the case of the petitioner are also of no assistance since the rule expressly excluded such a representation.
The ratio in Union of India vs H.C. Goel, ; also does not help the respondents for the reason that it is not a case of no evidence and the conclusions were reached on the basis of the admission made by the respondents.
The ration in M/s. Bareilly Electricity Supply Co. Ltd. vs The Workmen & Ors., ; also does not apply to the facts of this case for the reasons that the need to examine the witnesses on behalf of the Board was obviated by the admissions made by the examinees.
The ratio in Shanti Prasad Jain vs The Director of Enforcement, is equally of no assistance to the respondents since the contention that the circumstances under which the fabrication of the moderators ' mark sheets came to be made is not a relevant fact.
Therefore, there is no need to examine the concerned officials in the State Board to explain as to how and who dealt with the papers from the time recounting was done in the office till the moderators ' mark sheets were sent to Pune to feed the computer.
The ratio in Merla Ramanne vs Nallaparaju & Ors, and Kashinath Dikshita vs Union of India & Ors., also do not assist the respondents for the reason that the answer books of the concerned students, the marks awarded by the examiners or addition or alteration, if any, made by the moderators and fabrication of the moderators ' mark sheets were admittedly given for personal inspection to the concerned students and given them an opportunity to inspect the record and thereafter they made admission.
The further contention of Sri Cama that the Standing Committee did not deal individually the answers given by each student and the decision was not based on evidence is without force as the conclusions are based on the admissions.
Equally the need to consider each case on merits is obviated by the admission made by every student.
The ratio in (Government medi 797 cal Store Depot, Karnal) vs (State of Haryana & Anr.,) ; at p. 454 that the charges are vague is also of no assistance to the facts of this case.
The ratio in (M/s. Kesoram Cotton Mills Ltd.,) vs (Gangadhar & Ors.,) ; at p. 825 that the documents must be supplied at least 48 hours in advance is also of no help to the respondents in view of the admissions made by the respondents.
The ratio in Tej pal Singh 's case (supra) that mere inspection of the documents will not cure the defect of procedure or violation of principles of natural justice also does not apply to the facts of his case.
The ratio in (State of Punjab) vs (Bhagat Ram) ; that the supply of synopsis of the material is not sufficient compliance with the principle of natural justice, also does not render any assistance to the respondents.
The ratio in (Gujarat Steel Tubes Ltd.,) vs (Gujarat steel Tubes Mazdoor Sabha,) ; at p. 202 that the conclusion and the findings are in different hand writings, which would show the non application of the mind to the facts and it violates the principle of natural justice also does not apply to the facts of this case.
The ratio in (Union of India & Ors.) vs (Mohd. Ramzan Khan,) JT also does not apply to the facts in this case as the report is solely based on the admission made by the examinees and no new material has been relied upon by the Enquiry Officers.
Undoubtedly, it is settled law that the right to life includes right to reputation and livelihood and that the individual as an entity is entitled to the protection of article 21, but in view of the facts of this case the ratio in (Vishwa Nath) vs (State of Jammu & Kashmir,) and (Ogla tellis & Ors.,) etc.
vs (Bombay Municipal Corporation & Ors., etc.,) ; also do not help the respondents.
The further contention of Sri Salve that the order must be a speaking order preceded by a fair enquiry and the report must be based on cogent evidence, and in this case all the requirements are lacking is also an argument of despair.
Therefore, for the reasons given earlier, the argument stands rejected.
The next contention that the notification is vitiated for the reasons that the Standing Committee itself did not record any reason in support of its conclusion that the examinees or the parents or the guardians are parties to the fabrication cannot be sustained for the reason that the regulation itself postulates that if the Committee disagrees with the Inquiry Officer then only it is obligatory to record reasons.
Since the Committee agreed with the report, there is no need, on their part, to record the reasons.
The impugned notification, therefore, is not vitiated by violation of rules of natural justice.
The crucial question, therefore, is whether the conclusions 798 reached by the authorities that the examinees, their parents or guardians were parties to the fabrication and whether their complicity was established from record and whether the evidence was sufficient to support such conclusion reached by the Standing Committee or the Enquiry Officer.
Counsel on either side generated considerable debate on "the standard of proof" in a domestic enquiry.
Mr. Jaitely placed reliance on paragraph 18 of Vol.
17 of Halsbury 's Law of England, Fourth Edition, at page 16, which reads thus "To succeed on any issue the party bearing the legal burden of proof must (1) satisfy a judge or jury of the likelihood of the truth of his case by adducing a greater weight of evidence than his opponent, and (2) adduce evidence sufficient to satisfy them to the required standard or degree of proof.
The standard differs in criminal and civil cases.
In civil cases the standard of proof is satisfied on a balance of probabilities.
However, even within this formula variations in subject matter or in allegations will affect the standard required; the more serious the allegation, for example fraud, crime or professional misconduct, the higher will be the required degree of proof, although it will not reach the criminal standard.
In criminal cases, the standard required of the prosecution is proof beyond reasonable doubt.
This standard is also requisite in case of committal for contempt, and in pension claims cases.
In matrimonial cases it seems that proof on balance of probabilities is sufficient.
Once a matter is established beyond reasonable doubt it must be taken for all purposes of law to be a fact, as there is no room for a distinction between what is found by inference from the evidence and what is found as a positive face." and contended that the standard of proof of fabrication of record in a domestic inquiry does not differ from criminal charge and it must be of a higher degree.
In the Board of High School and Intermediate Education U.P. vs Bagleshar Persad & Ors., relied on by Sri Andhyarjuna the facts were that the appellant Board accepting the findings of the committee that the respondents used unfair means in answering the subjects, cancelled the declaration of the results of the respondent in the High School Certificate Examination held in 1960.
The charges were based on the facts that in the Hindi paper the 799 respondent gave wrong answers to a particular question in the same way in which the answers have been given by another candidate who was having consecutive number.
The High Court held that the findings of the Committee were based on no evidence and quashed the cancellation of the results.
On appeal, this Court held that the respondent admitted that the mistakes in answers in the two papers were identical and he pleaded that he could not say anything as to why this happened.
The proof of charges was inferred that as either the respondent copied from the answer book of the candidate or that both of them had copied from any other source.
It was accordingly held that is would amount to the adoption of unfair means.
The High Court, therefore, committed error in assuming that there is no evidence in proof of it.
At page 774 this Court further held that in dealing with question as to whether the Committee was justified in arriving at its conclusion against the respondent it would not be reasonable to exclude from the consideration of the circumstances on which the whole enquiry came to be held and the general background of the atmosphere in the examination hall.
It was also further held at page 775 that educational institutions like the universities set up enquiry committees to deal with the problem of adoption of unfair means by candidate and normally it is within the jurisdiction of such domestic tribunals to decide all relevant questions in the light of the evidence adduced before them.
In the matter of the adoption of unfair means direct evidence may sometime be available but cases may arise where direct evidence is not available and the question will have to be considered in the light of the probabilities and circumstantial evidence.
This is the problem with the educational institution.
How to face it, is a serious problem and unless there is justification to do so, court should be slow to interfere with the decisions of domestic tribunal appointed by the education body like universities.
In dealing with the validity of the impugned order passed by the universities under article 226 the High Court is not sitting in an appeal over the decision on this question.
Its jurisdiction is limited and though it is true that if the impugned order is not supported by any evidence, the High Court may be justified to quash the order.
But the conclusion that the impugned order is not supported by any evidence must be reached after considering the question as to whether the probabilities and circumstantial evidence do not justify the said conclusion.
The enquiry held by domestic tribunals in such cases must, no doubt be fair and the students must be given adequate opportunity to defend themselves and holding such enquiries, the tribunal must follow the rules of natural justice.
Accordingly, it was held that the appeal was allowed and the order of the High Court was set aside and 800 that of the domestic tribunal was confirmed.
In (Bihar School Examination Board) vs (Subhash Chandra Sinha & Ors.,) ; this Court emphasised that the essence of an examination is that the worth of every person is appraised without any assistance from an outside source.
The academic standards require that the authority 's appreciation of the problem must be respected.
A full fledged judicial inquiry was not required.
It is not necessary to conduct an inquiry in each individual case to satisfy itself who are the candidates that have adopted unfair means when the examination as whole had to go.
It was further held at p. 968 E to H that "while we do not wish to whittle down the requirement of natural justice and fair play in case where such requirement may be said to arise, we do not want that this court should be understood as having stated that an enquiry with a right to representation must always precede in every case, however, different.
The universities are responsible for their standard and conduct of the examination.
The universities are responsible for their standard and conduct of the examination.
The essence of the examination is that the worth of every person is appraised without any assistance from an outside source.
It cannot be held that a detailed quasi judicial enquiry with right to its alumini to plead and lead evidence, etc. is preceded before the result are withheld or examinations cancelled.
If there is sufficient material on which it could be demonstrated that the Authority was right in its conclusion that the examination ought to be cancelled then academic standards require that the Authority 's appreciation of the problem must be respected.
It would not be for the courts to say that we should have examined all the candidates or even their representatives with a view to ascertaining whether they had received assistance or not.
To do this, would encourage indiscipline, if not also prejury.
It is true as stated by Sri Chidambaram that the above ratio was laid in the context of the cancellation of examination of the entire centre.
But the general principles must be kept in view while dealing with the problem faced by the academic institutions.
In (Seth Gulabchand) vs (Seth Kudilal and Ors.,) ; this Court held that there is no difference between cases in which charges of a fraudulent or criminal character are made and cases in which such charges are not made.
While striking the balance of probability, the court would keep in mind the presumption of honesty and innocence or the nature of the crime or fraud charged.
The rules applicable to circumstantial evidence in criminal cases would not apply to civil cases.
The ordinary rules governing civil cases of balance of probabilities will continue to apply.
801 In (Ghazanfar Rashid) vs (Board, H.S. & I. Edn. U.P. & Ors.,) AIR 1970 Allahabad 209 a full Bench, speaking through ours learned brother K.N. Singh, J. (as he then was) dealing with the standard or proof of the charge of use of unfair means at the examination, it was held that it was the duty of the Examination Committee, etc., to maintain purity of examination and if examinee is found to have used unfair means at the examination, it is the duty of the Examination Committee to take action against the erring examinees to maintain the educational standard.
Direct evidence is available in some cases but in a large number of cases, direct evidence is not available.
In that situation the Examination Committee as of necessity to rely on circumstantial evidence which may include the answer given by the examinee, the report of the Superintendent of the centre, the invigilator and the report of the experts and other attending circumstances.
The Examination Committee, if relies upon such evidence to come to the conclusion that the examinee has used unfair means in answering questions then it is not open to the High Court to interfere with that decision, merely because the High Court may take a different view on re assessment of those circumstances.
While it is open to the High Court to interfere with the order of the quasi judicial authority, if it is not supported by any evidence or if the order as passed in contravention of the statutory provisions of the law or in violation of the principles of natural justice, the court has no jurisdiction to quash the order merely on the ground that different view could possibly be taken on the evidence available on the record.
The Examination Committee has jurisdiction to take decision in the matter of use of unfair means not only on direct evidence but also on probabilities and circumstantial evidence.
There is no scope for importing the principles of criminal trial while considering the probative value of probabilities and circumstantial evidence.
the Examination Committee is not bound by technical rules of evidence and procedure as are applicable to Courts.
We respectfully agree with the ratio.
In Miller vs Minister of Pensions, [1947] All Eng.
Law Reports 372 at p. 374 Denning J., as he then was, reiterated that the evidence against the petitioner must have the same degree of cogency as is required to discharge a burden in a civil case.
It must carry a reasonable degree of probability, but not so high as is required in a criminal case.
If the evidence is such that the tribunal can say: "We think it more probable than not the burden is discharge but, if the probabilities are equal, it is not discharged." 802 In State of Uttar Pradesh vs Chet Ram & Ors., relied on by Sri Chidambaram, this Court dealt with the proof of guilt of the accused at a criminal trial.
This Court held that when two views are plausible, the view being taken must have some content of plausibility in it and without the same, the other view cannot be countenance in law as a plausible alternative.
It must be remembered that at a criminal trial the burden of proof is always on the prosecution.
It must establish the guilt of the accused beyond all reasonable doubts.
If there exist a plausible alternative view, its benefit must be extended only to the accused and not to the prosecution.
Therefore, the ratio therein is inapplicable to a proceeding either in the civil case or in an enquiry before a domestic tribunal.
State of U.P. vs Krishna Gopal & Anr., ; at p. 314 also relates to criminal trial.
In paragraph 26 in assessing the evidence adduced by the prosecution, this Court laid that the concept of probability, and the degrees of it, cannot obviously be expressed in terms of units to be mathematically enumerated as to how many of such units constitute proof beyond reasonable doubt.
There is an unmistakable subjective element in the evaluation of the degree of probability and the quantum of proof.
Forensic probability must, in the last analysis, rest on the robust common sense and, ultimately, on the trained institutions of the Judge.
In evaluating the circumstantial evidence in Hanumant vs The State of Madhya Pradesh, [1952] SCR 1091 at p. 1097 the Court approved the statement of Baron Alderman in Reg vs Hodge, that: "The mind was 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 was it, 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.
" It was held that in evaluating the evidence of circumstantial nature it is the duty of the prosecution that all the circumstances must be fully established circumstances should be consistent only with the hypothesis of the guilt of the accused.
This standards of proof also is not relevant not to be extended to consider the evidence in an inquiry by the domestic tribunal.
The ratio in (Bank of India vs J.A.H. Chinoy,) AIR 1950 PC 90 that the appellate court would be reluctant to differ from conclusion of the trial Judge if his conclusion is based on 803 the impression made by a person in the witness box is also not germane for the purpose of this case.
It was laid therein that inferences and assumptions founded on a variety of facts and circumstances which, in themselves, offer no direct or positive support for the conclusion reached, the right of the appellate court to review this inferential process cannot be denied.
While dealing with proof of fraud it was held that speculation is not enough to bring home a charge of fraudulent conspiracy.
In Khwaja vs Secretary of State, [1983] 1 All Eng.
Law Reports 785 (H.L.) dealing with the functions of the Immigration Authorities and of the Courts, Lord Wilberforce at p. 7877, laid the law that the allegation that permission to enter into the country by an immigrant was obtained by fraud or deceit being of a serious character and involving issues of personal liberty requires a corresponding degree of satisfactory evidence.
If the Court is not satisfied with any part of the evidence, it may remit the matter for reconsideration or itself receive further evidence.
It should quash the detention order where the evidence was not such as the authority should have relied on or where the evidence received does not justify the decision reached or, of course, for any serious procedural irregularity.
At p.784 Lord Scarman held that it is not necessary to import in the civil proceedings of judicial review the formula devised by Judges for the guidance of juries in criminal cases.
The reviewing court will, therefore, require to be satisfied that the facts which are required for the justification of the restraint put on liberty do exist.
The flexibility of the civil standard of proof suffices to ensure that the court will require the high degree of probability which is appropriate to what is at stake.
The nature and gravity of an issue necessarily determines the manner of attaining reasonable satisfaction of the truth of the issue.
Therefore, the civil standard of flexibility be applied to deal with immigration cases.
In Sodhi Transport Co. & Anr., etc.
vs State of U.P. & Anr., etc.
, [1986] 1 SCR 939 at p. 954 this Court dealing with rebutable presumption held that: "A presumption is not in itself evidence but only makes a prima facies case for party in whose favour it exists.
It is a rule concerning evidence.
It indicates the person on whom the burden of proof lies.
When presumption is conclusive, it obviates the production of any other evidence to dislodge the conclusion to be drawn on proof of certain facts.
But when it is rebuttable it only points out the party on whom 804 lies the duty of going forward with evidence on the facts presumed, and when that party has produced evidence fairly and reasonably tending to show that the real fact is not as presumed, the purpose of presumption is over.
Then the evidence will determine the true nature of the fact to be established, the rules of presumption are reduced from enlightened human knowledge and experience and are drawn from the connection, relation and coincidence of facts and circumstances.
" Bhandari vs Advocates Committee, [1956] All Eng.
Law Reports 742 (PC) is also a case concerning the professional misconduct.
In proof of the charge it was held that it is the duty of the professional domestic tribunal investigating the allegation to apply a high standard of proof and not to condemn on a mere balance of probabilities.
In Glynn) vs (Keele University & Anr., [1971] 2 All Eng.
Law Reports, 89 (Chancery Division) relied on by Sri Salve, the question arose whether failure to give an opportunity to the students before the suspension is violative of the principles of natural justice.
It was held that the student did not deny commission of the offence, therefore, it was held that the student suffered no injustice by reason of the breach of the rules.
Further while dealing with the scope of the inquiry by the domestic tribunal, it was held that the society is charged with the supervision and upbringing of the pupil under tution, be the society, a university or college or a school.
Where this relationship exists it is quite plain that on the one hand in certain circumstances the body or individual acting on behalf of the society must be regarded as acting in a quasi judicial capacity expulsion from the society is the obvious example.
On the other hand, there exists a wide range of circumstances in which the body or individual is concerned to impose penalties by a way of domestic discipline.
In those circumstances the body or individual is not acting in a quasi judicial capacity at all but in a ministerial capacity, i.e. in the performance of the rights and duties vested in the society as to the upbringing and supervision of the members of the society.
No doubt there is a moral obligation to act fairly, but this moral obligation does not, lie within the purview of the court in its control over quasi judicial acts.
The ratio relied on by Shri Salve, far from helping the respondents, is consistent withour view.
The ration in In Re: An Advocate ; also concerned with professional misconduct of an Advocate and higher standard of proof of the charge of misconduct was insisted upon.
Equally so in Shri Krishan vs The Kurukshetra University, Kurukshetra.
; , These decisions relied on by Sri Jaitley also do not assist us.
805 The contention of Sri Cama placing any reliance on Shivajirao Nilangekar Patil vs Dr. Mahesh Madhav Gosavi & Ors. and vice versa, that the Vice chancellor would not have done what he did except with the instructions of the Chief Minister who was to be benefitted by getting his daughter passed in M.D. was not accepted by this Court and that it was further contended that the benefit test is preposterous one and the preponderence of probabilities is not possible to be deduced from the test, does not appear to be sound.
This Court noted that the Chief Minister was not prepared, as suggested by the Division Bench, to face an inquiry and that, therefore, substituted to the findings of the Division Bench, in the penultimate paragraph of the judgment that the court would be cognizant of the steep decline of public standards, public moral and public morale which have been contaminating the social environment and emphasised that "where such situation cry out the Court should not and cannot remain mute and dumb" and it is necessary to cleanse public life.
It is thus well settled law that strict rules of the Evidence Act, and the standard of proof envisaged therein do not apply to departmental proceedings or domestic tribunal.
It is open to the authorities to receive and place on record all the necessary, relevant, cogent and acceptable material facts though not proved strictly in conformity with the Evidence Act.
The material must be germane and relevant to the facts in issue.
In grave cases like forgery, fraud, conspiracy, misappropriation, etc.
seldom direct evidence would be available.
Only the circumstantial evidence would furnish the proof.
In our considered view inference from the evidence and circumstances must be carefully distinguished from conjectures or speculation.
The mind is prone to take pleasure to adapt circumstances to one another and even in straining them a little to force them to form parts of one connected whole.
There must be evidence direct or circumstances to deduce necessary inference in proof of the facts in issue.
There can be no inferences unless there are objective facts, direct or circumstantial from which to infer the other fact which it is sought to establish.
In some cases the other facts can be inferred with as much practical as if they had been actually observed.
In other cases the inferences do not go beyond reasonable probability.
If thee are no positive proved facts, oral, documentary or circumstantial from which the inferences can be made the method of inference fails and what is left is mere speculation on conjecture.
Therefore, when an inference of proof that a fact in dispute has been held established there must be some material facts or circumstances on record from which such an inference could be drawn.
The standard of proof is not proof beyond reasonable doubt 806 "but" the preponderance of probabilities tending to draw an inference that the fact must be more probable.
Standard of proof cannot be put in a straight Jacket formula.
No mathematical formula could be laid on degree of proof.
The probative value could be gauged from facts and circumstances in a given case.
The standard of proof is the same both in civil cases and domestic enquiries.
From this legal setting we have to consider whether the inference deduced by the Education Standing Committee that the fabrication of moderators ' mark sheets was done at the behest of either the examinee or the parent or guardian is based on the evidence on record.
It is already found that the examinees admitted the forgery of their concerned moderators ' mark sheets resulting the increase of marks to their advantage.
The fabrication of the moderators 'mark sheets was done after the scrutiny by the concerned officials in the office of the State Board at Bombay and before the moderators ' mark sheets were taken out to Pune to feed the computer.
Why one is expected or interested to wade through eighty thousand moderators ' marks sheets to locate only the 283 examinees mark sheets and add marks by fabrication? Unless either the examinee or parent or guardian approached the fabricator; given the number and instructed him/them to fabricate the marks, it would not be possible to know their number to fabricate.
The act of fabrication is an offence.
Merely it was done in one subject or more than one makes little difference.
Its gravity is not mitigated if it is committed in one subject alone.
This is not an innocent act or a casual mistake during the course of performance of the official duty as is sought to be made out.
It was obviously done as a concerted action.
In view of the admitted facts and above circumstances the necessary conclusion that could unerringly be drawn would be that either the examinee o r the parent or guardian obviously was a privy to the fabrication and that the forgery was committed at his or her or parent 's or guardian 's behest.
It is, therefore clear that the conclusion reached by the Education Standing Committee that the fabrication was done at the instance of either the examinees or their parents or guardians is amply borne out from the record.
The High Court in our view over stepped is supervisory jurisdiction and trenched into the arena of appreciation of evidence to arrive its own conclusions on the specious plea of satisfying 'conscience of the court '.
The question then is whether the rules relating to mode of punishment indicated inthe Appendix 'A ' to the resolution are invalid.
We have given our anxious thought to the contention and to the view of the High Court.
In our view the punishments indicated in 807 the last column is only the maximum from which it cannot be inferred that it left no discretion to the disciplinary authority.
No axiomatic rule can be laid that the rule making authority intended that under no circumtances, the examination Committee could award lesser penalty.
It depends on the nature and gravity of the misconduct to be dealt with by the disciplinary authority.
In a given case, depending on the nature and gravity of the misconduct lesser punishment may be meted out.
So by mere prescription of maximum penalty rules do not become invalid.
We have no hesitation to conclude that when the evidence justified the examination Standing Committee to record the finding that the examinees, parents or guardians are parties to the fabrication, it is not open to the High Court under article 225 to itself evaluate the evidence and to interfere with the finding and to quash the impugned notification.
This Court under article 136 has to correct the illegalities committed by the High Court when it exceeded its supervisory jurisdiction under article 226.
In view of the fair attitude adopted by the counsel for the Board, it is not necessary to go into the question of quantum of punishment.
In the light of the above finding, normally the appeals are to be allowed, the judgement of the High Court is set aside and the impugned notification dated August 31, 1990 upheld in toto.
But we modify the High Court 's order as per the directions given in our order dated January 30, 1991, wherein we accepted the signed statement by the counsel for the Board without prejudice to their contention and directed the Board (a) to allow all the candidates referred to in the Notification of August 31, 1990 to appear at the S.S.C. examination to be conducted in March, 1991 by the Board; and (b) to declare the untampered results of nine named candidates therein.
The failed candidates covered by the notification and willing to appear in ensuing examination of March 1991, there applications will be accepted if the same are submitted on or before 13th February, 1991 through Heads of their respective schools.
So far as the other candidates are concerned, their results shall not be declared, but they will be permitted to appear in the ensuing examination of the Board to be held in March, 1991 in case their applications are received before 13th February, 1991, through Heads of their respective schools.
In this regard the Board shall inform all the concerned schools and will also give due publicity in the two local newspapers within 3 days.
The Board was further directed to consider the cases of such candidates out of 283 who are similar to the nine named candidates other than respondent 808 No. 17, Deepa V. Agarwal and in their cases also the untampered result shall be declared on or before 6th February, 1991 and we are informed that results of 18 more candidates were declared.
The notification dated August 31, 1990 is upheld subject to above modification and shall be operative between the parties.
Before parting with the case we impress upon the appellant to have indepth investigation made expeditiously, if need be, with the assistance of C.B.C.I.D., of the racket of fabrication and bring the culprit to justice.
The appeals are allowed accordingly, but in the circumstances parties are directed to bear their own costs.
R.S.S. Appeals allowed.
| IN-Abs | The appellant Board conducted secondary examinations in the month of March 1990.
During recounting of the marks obtained by the candidates it was found that moderators mark sheets relating to 283 examinees, which included the 53 respondents, had been tampered with.
The declaration of their results was withheld pending enquiry.
Several writ petitions were filed against non declaration of the results and the High Court directed the appellant to the expeditious action to declare the results.
The Board appointed seven enquiry officers to conduct the enquiry.
Show cause notices were issued to the students informing them of the nature of tampering, the subjects in which the marks were found tampered with, the marks initially obtained and the marks increased due to tampering, and also indicated the proposed punishment, if in the enquiry it would be found that marks were tampered with the knowledge or connivance or at the instance of the candidates or parents or guardians.
They were also informed that they would be at liberty to inspect the documents at the Divisional Board at Bombay; they were entitled to adduce documentary and oral evidence at the hearing; they would also be permitted to cross examine the witnesses of the Board, if any; they would not be entitled to appear through an advocate, and the parents or guardians would be permitted to accompany the students at the time of enquiry, but they would not be entitled to take part in the enquiry.
All the candidates admitted that the marks initially awarded by 773 the examiners had been tampered with in the moderators mark sheets; and due to tampering the marks were increased and the increase was to their advantage.
However, they denied that either they or their parents or guardians were privy to the tampering.
The Enquiry Officers submitted their reports holding that the moderators mark sheets had been fabricated and submitted the reports to the Board.
The Standing Committee constituted in this regard considered the records and the reports and resolved to withhold, as a measure of punishment, the declaration of the results of their examinations and to debar the students to appear in the supplementary examination.
The notification to that effect was published on 31.8.1990 and the report submitted to the High Court.
The High Court allowed the writ petitions.
One Hon 'ble Judge held that the Standing Committee was devoid of power, and because it did not obtain the approval of the Divisional Board, the impugned notification was without authority of law.
On merits, the learned Judge held that the Standing Committee did not apply its mind in the proper perspective to the material facts, and therefore, the finding that tampering was done at the instance of the examinees/parents/guardians was perverse.
The other Hon 'ble Judge held that the examinees were not guilty of the mal practices and their guilt had not been established.
Before this Court, it was contended on behalf of the respondents that the Act empowered that Divisional Board to deal with the use of unfair means at the final examination, and the Standing Committee was an alien body to the divisional Board; the students were minors and neither the parents nor anybody like an advocate was permitted to assist the students; answers to the questionnaire were extracted from the students to confess their guilt: no adequate opportunity was given to the students at the enquiry; the evidence without subjecting it to cross examination was of no value; the Standing Committee did not apply its mind to the facts, nor recorded reasons in support of its conclusion that the examinee/parents/guardians were parties to the fabrication; the Board should establish the guilt of the examinees beyond all reasonable doubts; the standard of proof ought to be of a high degree akin to trial in a criminal case; the test of benefit to an examinee was preposterous; no evidence was placed on record, nor was it proved and hence the findings of the Standing Committee were clearly based on no evidence; the Enquiry Report contained only conclusions bereft of the statement of facts and reasons in support thereof; and the order ought to have been a speaking order preceded by a fair enquiry and the report must 774 be based on cogent evidence.
On behalf of the Board, it was inter alia contended that all the examinees admitted in answers to the questionnaire that tampering was done and it was to their advantage, and that in view of the admission, the need to examine any person from the concerned section was obviated.
Allowing the appeals, upholding the notification subject to modifications, this Court, HELD: (1) there is no manner of doubt that unfair means were used at the final Secondary Examination by fabricating the Moderators ' mark sheet of the examinees, in concerted manner, admittedly to benefit the students.
[782C] (2) The State Board is empowered to constitute the Divisional Boards and the Standing Committees.
The State Board is also empowered to make regulations to conduct examinations and also to deal with the use of unfair means at the final examination conducted by the Board.
The Divisional Board is empowered to conduct within its area the final examination on behalf of the State Board.
The Divisional Board is also empowered to deal with the cases of unfair means according to the procedure laid down by the State Board.
[783F G] (3) The Standing Committee is an executive arm of the Divisional Board for the efficient and expeditious functioning of the Board as adumberated under the Act itself.
It is not a foreign body.
When the Standing Education Committee takes the decision its decision is on behalf of the Divisional Board, and the decision of the Divisional Board in turn is on behalf of the State Board.
[786E F] (4) On a fair and harmonious reading of the relevant provisions of the Act and the Maharashtra Secondary and Higher Secondary Education Board, Regulation, 1977 the Examination Committee of the Divisional Board is itself a statutory body which acted on behalf of the Divisional Board and is not a delegate of the Divisional Board.
[786H] State of U.P. vs Batuk Deo Pati Tripathi & Anr., ; Kargram Panchayat Samiti & Anr.
vs State of West Bengal & Ors., [1987] 3 S.C.C. 82; Baradakanta Misra vs High Court of Orissa & Anr., and Tej Pal Singh (dead) through L.rs.
vs State of U.P. & Anr., , referred to.
775 (5) The Standing Committee is an integral part of the Divisional Board and its acts are for and no behalf of the Divisional Board.
Accordingly, the Board must be deemed to have passed the impugned notification as per the scheme of the provisions of the Act and the Regulations.
Therefore, the finding of the learned Judge that the Standing Committee had no power to take the impugned decision, etc.
without approval of the Divisional Board is clearly illegal and cannot be sustained.
[789B C,F] (6) While exercising the powers under Article 226 or Article 136 of the Constitution, the High Court or this Court, is not sitting as a Court of Appeal on the findings of facts recorded by the Standing Committee (Domestic Enquiry Board) nor have power to evaluate the evidence as an appellate Court and to come to its own conclusions.
If the conclusions reached by the Board can be fairly supported by the evidence on record then the High Court or this Court has to uphold the decision, though as appellate Court of facts, it may be inclined to take a different view.
[789C] (7) Fabrication cannot be done except to benefit the examinees.
The fabricator had done it for reward in concert with outside agencies.
Therefore, the inference from these facts drawn by the Standing Committee that the examinees/parents/guardians were responsible to fabricate the moderators ' mark sheets is based on evidence.
[790G] (8) It is not open to the High Court to evaluate the evidence to come to its own conclusions.
Thereby the High Court has committed manifest error of law warranting interference by this Court.
[791A] (9) The Writ Court would not interfere with an order of educational institution.
Therefore, what the writ Court needs to do is to find whether fair and reasonable opportunity has been given to the students in the given facts.
[792F] D.M.K. Public School vs Regional Joint Director of Hyderabad, A.I.R. 1986 A.P. 204; G.B.S. Omkar vs Shri Venkateswara University, A.I.R. 1981 A.P. 163.
(10) Assistance of an Advocate to the delinquent at a domestic enquiry is not a part of the principles of natural justice.
It depends on the nature of the inquiry and the peculiar circumstances and facts of a particular case.[792H] 776 (11) The regulations and the rules of enquiry specifically excluded the assistance of an advocate at the inquiry.
Therefore, the omission to provide the assistance of a counsel at the inquiry is not violative of the principles of natural justice.
[793A] (12) The procedure adopted at the inquiry was fair and just and it was not vitiated by any procedural irregularity nor was violative of the principles of natural justice.
The absence of opportunity to the parents or guardians, in this background, did not vitiate the legality or validity of the inquiry conducted or decision of the Committee.
[793G H] (13) Unless the rule expressly or by necessary implications, excluded recording of reasons, it is implicit that the principles of natural justice or fair play does require recording of reasons as a part of fair procedure.
In an administrative decision, its order/decision itself may not contain reasons.
It may not be the requirement of the rules, but at the least, the record should disclose reasons.
It may not be like a judgement.
But the reasons may be precise.
[794F] Union of India vs Mohan Lal Capoor & Ors. ; Gurdial Singh Fiji vs State of Punjab & Ors. ; and S.N. Mukherjee vs Union of India, J.T. , referred to.
(14) The omnipresence and omniscience of the principle of natural justice acts as deterrence to arrive at arbitrary decision in flagrant infraction of fair play.
But the applicability of the principles of natural justice is not a rule of thumb or a straight jacket formula as an abstract proposition of law.
It depends on the facts of the case, nature of the inquiry and the effect of the order decision on the rights of the person and attendant circumstances.
[795F] (15) In the instant case, since the facts are admitted, the need to their reiteration was obviated and so only conclusions have been stated in the reports.
The omission to record reasons is neither illegal, nor is violative of the principles of natural justice.
[795H 796A] Khardah Co. Ltd. vs Their Workmen, ; ; A.K. Roy etc.
vs Union of India & Ors.
[1982] 1 S.C.C. 271; Pett vs Grehound Racing Association Ltd., [1968] 2 ALL Eng.
Reports 545; Union of India vs H.C. Goel, ; ; M/s. Bareilly Electricity Supply Co. Ltd. vs The Workmen & Ors. ; ; Shanti Prasad Jain vs The Director of Enforcement, ; Merla Ramanna vs Nallaparaju & Ors., ; 777 Kashinath Dikshita vs Union of India & Ors., [1986] 3 S.C.C. 229; Government Medical Store Depot, Karnal vs State of Haryana & Anr.
, ; ; M/s. Kesoram Cotton Mills Ltd. vs Gangadhar & Ors., ; ; State of Punjab vs Bhagat Ram, ; Gujarat Steel Tubesl Ltd. vs Gujarat Steel Tubes Mazdoor Sabha,, ; ; Union of India & Ors.
vs Mohd. Ramzan Khan, J.T. ; Vishwa Nath vs State of Jammu & Kashmir, ; Olga Tellis & Ors.
vs Bombay Municipal Corporation, etc.; , , referred to.
(16) Court should be slow to interfere with the decisions of domestic tribunals appointed by the education bodies like universities.
[799F] (17) In dealing with the validity of the impugned order passed by a University under Article 226 the High Court is not sitting in an appeal over the decision on this question.
Its jurisdiction is limited and though it is true that if the impugned order is not supported by any evidence the High Court may be justified to quash the order but the conclusion that the impugned order is not supported by any evidence must be reached after considering the question as to whether the probabilities and circumstantial evidence do not justify the said conclusion.
The enquiry held by domestic tribunals in such cases must no doubt be fair and the students must be given adequate opportunity to defend themselves and holding such enquiries, the tribunal must follow the rules of natural justice.
[799F G] Board of High School and Intermediate Education U.P. vs Sagleshar Persad & Ors., and Bihar School Examination Board vs Subhas Chandra Sinha & Ors. ; referred to.
(18) The examination committee has jurisdiction to take decision in the matter of use of unfair means not only on direct evidence but also on probabilities and circumstantial evidence.
There is no scope for importing the principles of criminal trial while considering the probative value of probabilities and circumstantial evidence.
The Examination committed is not bound by technical rules of evidence and procedure as are applicable to Courts.
[801E F] Seth Gulabchand vs Seth Kudilal & Ors., [1966] 3 S.C.R. 623; Ghazanfer Rashid vs Board H.S. & I. Edn.
U.P., A.I.R. 1970 Allahabad 209; Miller vs Minister of Pensions, [1947] All.
E.L.R. 372; State of Uttar Pradesh vs Chet Ram & Ors., , referred to.
778 (19) There is an unmistakable subjective element in the evaluation of the degree of probability and the quantum of proof.
Forensic probability must, in the last analysis, rest on the robust common sense and, ultimately, on the trained institutions of the Judge.
[802D] (20) Strict rules of the Evidence Act, and the standard of proof envisaged therein do not apply to departmental proceedings of domestic tribunals.
It is open to the authorities to receive and place on record all the necessary, relevant, cogent and acceptable material facts though not proved strictly in conformity with the Evidence Act, the material must be germane and relevant to the facts in issue.
In grave cases like forgery, fraud, conspiracy, misappropriation, etc.
seldom direct evidence would be available.
Only the circumstantial evidence would furnish the proof.
Inference from the evidence and circumstances must be carefully distinguished from conjectures or speculation.
[805D E] State of U.P. vs Krishna Gopal & Anr.,, ; ; Hanumant vs The State of Madhya Pradesh, [1952] S.C.R. 1091; Reg.
vs Hodge, ; Bank of India vs J.A.H. Chinoy, A.I.R. 1950 P.C. 90; Khwaja vs Secretary of State, [1983] 1 All E.L.R. 765 (H.L.); Sodhi Transport Co. & Anr.
vs State of U.P. & Anr.
etc., [1986] 1 S.C.R. 939; Bhandari vs Advocates Committee, [1956] A.E.L.R. 742 (P.C.); Glynn vs Keale University & Anr.
; In Re: An Advocate; , ; Shri Krishan vs The Kurukshetra University, Kurukshetra, A.I.R. and Shivajirao Nilangekar Patil vs Dr. Mahesh Madhav Gosavi & Ors. & Vice Versa, ; , referred to.
(21) The standard of proof is not beyond reasonable doubt "but" the preponderance of probabilities tending to draw and inference that the fact must be more probably.
Standard of proof cannot be put in a straight jacket formula.
No mathematical formula could be laid on degree of proof.
The probative value could be gauged on facts and circumstances in a given case.
The Standard of proof is the same both in civil cases and domestic enquiries.
[805H 806B] (22) The conclusion reached by the Education Standing Committee that the fabrication was done at the instance of either the examinees or their parents or guardians is amply borne out from the record.
The High Court over stepped its supervisory jurisdiction and trenched into the arena of appreciation of evidence to arrive its own conclusion on the specious plea of satisfying 'conscience of the Court '.
[806G]
|
Appeal No.208 of 1958.
Appeal by special leave from the order dated January 29, 1958, of the Commissioner of Income tax,Delhi & Rajasthan at New Delhi, under section 8A(2) of the 532 Taxation on Income (Investigation Commission) Act, 1947.
Harnam Singh and Sadhu Singh for the appellant.
M. C. Setalvad, Attorney General for India, C. K. Daphtary, Solicitor General of India, B. Sen and R. H. Dhebar for the respondents.
A. C. Mitra and B. P. Maheshwari, for the interveners.
November 19.
The Judgment of Das, C. J., and Kapur, J.,, was delivered by Das, C. J. Bhagwati, section K. Das and Subba Rao, JJ., delivered separate judgments.
DAS, C. J.
This appeal by special leave filed by one Shri Besheshar Nath hereinafter referred to as ",the assessee " calls in question the validity of a settlement made under section 8A of the Taxation on Income (Investigation Commission) Act, 1947 (30 of 1947), hereinafter referred to as " the Investigation Act ".
This Act, which came into force on May 1, 1947, by a notification issued by the Central Government under section (1) (3) thereof, has had a short but chequered career, as will appear from the facts hereinafter stated.
In order to appreciate the several questions canvassed before us it is necessary to refer to the provisions of the impugned Act.
Section 3 authorised the Central Government to constitute an Income Tax Investigation Commission (hereinafter called the Commission) and imposed on it the following duties: " (a) to investigate and report to the Central Government on all matters relating to taxation on income, with particular reference to the extent to which the existing law relating to, and procedure for, the assessment and collection of such taxation is adequate to prevent the evasion thereof; (b) to investigate in accordance with the provisions of this Act any case or points in a case referred to it under section 5 and make a report thereon (including such interim report ' s as the Commission may think fit) to the Central Government in respect of all or any of the assessments made in relation to the case 533 before the date of its report or interim report, as the case may be.
" We may skip over section 4 which dealt with the composition of the Commission.
Section 5, which is of importance was as follows: " 5.
(1) The Central Government may at any time ' before the 30th day of June, 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 30th day of June, 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.
(2) The Commission may, after examining the material submitted by the Central Government with reference to any case or points in a case and making such investigation as it considers necessary, report to the Central Government that in its opinion further investigation is not likely to reveal any substantial evasion of taxation on income and on such report being made the investigation shall be deemed to be closed.
(3) No reference made by the Central Government under sub section (1), at any time before the 30th day of June, 1948, shall be called in question, nor shall the sufficiency of the material on which such a reference has been made be investigated in any manner by any Court.
(4) If in the course of investigation into any case or points in a case referred to it under sub section (1), the Commission has reason to believe (a)that some person other than the person whose case is being investigated has evaded payment of taxation on income, or (b) that some points other than those referred to 534 it by the Central Government in respect of any case also require investigation, it may make a report to the Central Government stating its reasons for such belief and, on receipt of such report, the Central Government shall, notwithstanding anything contained in sub section (1), forthwith refer to the Commission for investigation the case of such other person or such additional points as may be indicated in that report.
" The date " 30th day of June, 1948 " appearing in sub sections
(1) and (3) was, by Act 49 of 1948, substituted by the words " 1st day of September, 1948 ".
Section 6 set out the various powers conferred on the Commission and section 7 prescribed the procedure of the Comission.
It is not necessary to set out the various powers and the details of the procedure in extenso and it will suffice to say that they have been considered by this Court and pronounced to be much more drastic and harsh than the powers to be exercised and the procedure to be followed by the income tax authorities acting under the provisions of the Indian Income Tax Act, 1922.
The relevant portions of section 8 ran as follows: " 8.
(1) Save as otherwise provided in this Act, the materials brought on record shall be considered by all the three members of the Commission sitting together and the report of the Commission shall be in accordance with the opinion of the majority.
(2) After considering the report, tile Central Government shall by order in writing direct that such proceedings as it thinks fit under the Indian Income Tax Act, 1922, the Excess Profits Tax Act, 1940, 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 31st day of December, 1938; and, upon such a direction being given, such proceedings may be taken 'and completed under the appropriate law notwithstanding the restrictions contained in section 34 of the Indian Income Tax Act, 1922, or section 15 of the Excess Profits Tax Act, 1940, or any other law and notwithstanding any lapse of time or any decision to a different effect given 535 in the case by any Income tax authority or Income Tax Appellate Tribunal.
(3). . . . . . . . . . (4) In all assessment or re assessment proceedings taken in pursuance of a direction under sub section ' (2), the findings recorded by the Commission on the case or on the points referred to it shall, subject to the provisions of sub sections (5) and (6), be final; but no proceedings taken in pursuance of such direction shall be a bar to the initiation of proceedings under section 34 of the Indian Income Tax Act, 1922.
(5). . . . . . . . . . (6). . . . . . . . . . (7) Notwithstanding anything to the contrary contained in this Act or in any other law, for the time being in force, any evidence in the case admitted before the Commission or an authorised official shall be admissible in evidence in any proceedings directed to be taken under sub section (2).
(8). . . . . . . . . .
Section 9 barred the jurisdiction of Courts to call in question any act or proceeding of the Commission or any authorised official appointed under section 6.
Section 10 gave power to the Central Government to make rules by notification in the official gazette.
On July 22, 1948, the case of the assessee was referred to the Commission in the following terms: " Ministry of Finance (Revenue Division) New Delhi, the 22nd July, 1948.
Under section 5 (1) of the Taxation on Income (Investigation Commission) Act, 1947, the cases of the following persons are hereby referred to the Investigation Commission for investigation and report, as the Central Government has prima facie reasons for believing that each such person has either alone or in combination with the other persons mentioned below, evaded payment of taxation on income to a substantial 536 extent.
The material available in support of 'such belief accompanies.
No. Name EP.
829/1 Beshashar Nath and Co. 829/2 Lala Beshashar Nath.
Sd./ Pyare Lal, Deputy Secretary, Ministry of Finance (Revenue Division).
The Secretary,Income tax, Investigation Commission, New Delhi.
" It is not necessary to set out the annexures that accompanied this Orders It appears that the total wealth statement of the assessee was filed on November 10, 1948, and was forwarded to the authorised official.
It also appears that from January 8, 1949, to October 14, 1949, the authorised official was engaged in the collection of assessment records of the assessee from the territorial income tax offices and of materials from the Civil Supplies Directorate regarding the assessee.
In the meantime by a. 33 of Act 67 of 1949 the following section was inserted in the Act as section 8A: " 8A. Settlement of cases under investigation:(1) Where any Person concerned in any case referred to or pending before the Commission for investigation applies to the Commission at any time during such investigation to have the case or any part thereof settled in so far as it relates to him, the Commission shall, if it is of opinion that the terms of the settlement contained in the application may be approved, refer the matter to the Central Government, and if the Central Government accepts the terms of such settlement, the Commission shall have the terms thereof recorded and thereupon the investigation, in so far as it relates to matters covered by such settlement, shall be deemed to be closed.
(2) For the purpose of enforcing the terms of any, settlement arrived at in pursuance of sub section (1), 537 the Central Government may direct that such proceedings as may be appropriate under the Indian Income tax Act, 1922 (XI of 1922), the Excess Profits Tax Act, 1940 (XV of 1940), or any other law may be taken against the person to whom the settlement relates, and in particular the provisions of the second proviso to clause (a) of sub section (5) of section 23, section 24B, the proviso to sub section 2 of section 25A, the proviso to subjection 2 of section 26 and sections 44 and 46 of the Indian Income tax Act, 1922, shall be applicable to the recovery of any sum specified in such settlement by the, Income Tax Officer having jurisdiction to assess the person by whom such sum is payable as if it were income tax or an arrear of income tax within the meaning of those provisions.
(3) Subject to the provisions of sub section (6) of section 8, any settlement arrived at under this section shall be conclusive as to the matters stated therein, and no person whose case has been so settled be entitled to re open in any proceeding for the recovery of any sum under this section or in any subsequent assessment or reassessment proceeding relating to taxation on income or in any other proceeding before any Court or other authority any matter which forms part of such settlement.
(4) Where a settlement has been accepted by Government under sub section (1), no proceedings under section 34 of the Indian Income Tax Act, 1922 (XI of 1922), or under section 15 of the Excess Profits Tax Act, 1940 (XV of 1940), shall be initiated in respect of the items of income covered by the settlement, unless the initiation of such proceedings is expressly allowed by the terms of the settlement." On July 5, 1949, the total wealth statement was received back from the authorised official.
Our Constitution came into force on January 26, 1950.
The order sheet shows that the authorised official on May 26, 1950, issued a notice to the assessee fixing the hearing for June 10, 1950, which indicates that the authorised official was proceeding with the investigation set in motion by the reference of the assessee 's 68 538 case to the Commission.
The assessee appears to have attended on June 6, 1950, with an application for extension of time which apparently was given.
On September 30, 1950, the assessee supplied certain statements of his firm.
The entry in the order sheet ,,,against the date October 31, 1950, shows that the assessee asked for further extension of time.
There appears to be a hiatus of about 3 years and evidently nothing was done until June 9, 1953, when the authorised official fixed the hearing of the case on June 15, 1953.
The authorised official submitted his interim report to the Commission on June 9. 1953.
The assessee was examined on October 9, 10 and 13, 1953, and the authorised official submitted his final report on October 19, 1953.
On January 30, 1954, notice was issued to the assessee to appear before the Commission on February 15, 1954.
Presumably to get ready for the hearing the assessee, on February 5, 1954, asked for inspection of certain assessment orders concerning his case , for the return of his lease deed filed by him and a copy of the statement of one L. Kalidas and for production of certain documents before the Commission.
The hearing, which had been fixed for February 15, 1954, was adjourned till March 4, 1954.
Witness Kalidas was examined on March 4,.
On March 29, 1954, the assessee asked for a, copy of the deposition given by the witness Durgadas before the Commission.
After the evidence was closed notice was issued to the assessee on May 1, 1954, asking him to appear before the Commission on May 19, 1954.
On that date the assessee attended, arguments were heard and orders were reserved.
Learned counsel for the assessee states that at the close of the arguments on May 19, 1954, the Commission announced its view that the income, profits and gains that had escaped assessment in the hands of the assessee for the period beginning with April 1, 1939, and ending March 31, 1947, were the sum of Rs. 4,47,915, that the Commission also threw a hint that should the assessee accept the said finding he would be granted the benefit of a settlement on the lower concessional basis of.
payment of 75% and a small penalty of Rs. 14,064 539 other alternative than to make the best of the bad job by proposing a settlement under section 8A offering to pay Rs. 3,50,000 by way of tax and penalty.
This sequence of events is amply borne out by paragraphs 3 and 4 of the settlement application filed by the assessee on May 20, 1954, a copy of which has been produced before us by the respondents.
The Commission on May 24, 1954, made a report under section 8A (1) to the Central Government that it was of opinion that the terms of settlement contained in the application might be approved.
The Central Government having accepted the proposed settlement, the Commission had the terms thereof recorded.
The Central Government by its Order C No. 74 (9 IT) 54 made on July 5, 1954, under section 8A (2) of the Investigation Act directed that demand notice in accordance with the said terms be served immediately by the Income Tax Officer and that all such other proceedings under the Indian Income Tax Act or other law as may be necessary be taken with a view to enforce the payment of the demand and that the entire sum of Rs. 3,50,000 be demanded in one sum.
It appears, however, that the assessee was allowed to make payments by instalments of Rs. 5,000, per month.
In the meantime on May 28, 1954, this Court delivered judgment in Suraj Mall Mohta and Co. vs A. V. Visvanatha Sastri (1).
In that case in the course of investigation of the case of Messrs. Jute and Gunny Brokers Ltd. which had been referred to the Commission under section 5 (1) of the Investigation Act, it was alleged to have been discovered by the Commission that Suraj Mall Mohta and Co. had made large profits which they had not disclosed and had thus evaded taxation.
A report to that effect having been made on August 28, 1953, by the Commission to the Central Government under section 5 (4) of the Investigation Act the Central Government on September 9, 1953, referred the case against Suraj Mall Mohta and Co. to the Commission under the provisions of section 5 (4).
On September 15, 1953, the Commission notified Suraj Mall [1955] 1 S.C.R.448 540 Mohta and Co. that their cases had been referred for investigation and called upon them to furnish certain materials, details of which were set out in annexure to the petition.
On April 12, 1954, Suraj Mall Mohta and Co. filed a petition under article 32 of the Constitution asking for an appropriate writ restraining the, Commission from taking any action on the ground that the provisions of the Investigation Act had become void being discriminatory in character.
By that judgment this Court held that both section 34 of the Indian Income Tax Act, 1922, as it then stood, and sub section
(4) of section 5 of the Investigation Act dealt with persons who had similar characteristics of being persons who had not truly disclosed their income and had evaded payment of tax on their income but that as the procedure prescribed by the Investigation Act was substantially more prejudicial than the procedure under the Indian Income Tax Act, 1922, sub section
(4) of section 5 and the procedure prescribed by the Investigation Act, in so far as it affected persons proceeded against under that sub section was a piece of discriminatory legislation which offended the provisions of article 14 of the Constitution and was, therefore, void and unenforceable.
Sub section (4) of section 5 of the Investigation Act having been declared void, Parliament passed the Indian Income Tax Amendment Act (33 of 1954) amending section 34 of the Indian Income Tax Act, 1922.
Paradoxical as it may seem, the result of this amendment was that persons who originally, fell only within the ambit of section 5 (1) of the Investigation Act and formed a distinct class of substantial tax evaders also came within the amended section 34 of the Indian Income Tax Act, 1922.
The position after the amendment, therefore, was that the Income Tax Officers could pick out some of these persons and refer their cases under section 5 (1) of the Investi gation Act and thereby subject them to the drastic and harsh procedure of that Act, while they could deal with other persons similarly situate under section 34 as amended and apply to them the comparatively more beneficial procedure laid down in the Indian Income Tax Act, 1922.
Promptly several applications were 541 made under article 32 of the Constitution complaining that after the amendment of section 34 of the Indian Income Tax Act, section 5 (1) of the Investigation Act became discriminatory in that the persons falling within it could be dealt with under the drastic, prejudicial and harsh procedure prescribed by the Investigation Act, while other persons similarly situate and belonging to the same category could at the whim or pleasure of the Income Tax authorities be proceeded against under the more beneficial procedure prescribed under the Indian Income Tax Act.
All those applications were disposed of by a common judgment reported as Shree Meenakshi Mills Ltd. vs Sri A. V. Visvanatha Sastri (1) This Court held that section 34 of the Income Tax Act, as amended by the Indian Income Tax Amendment Act, 1954 (33 of 1954), operated on the same field as section 5 (1) of the Investigation Act, and, therefore, section 5 (1) had become void and unenforceable as the procedure applied to persons dealt with thereunder became discriminatory in character.
It should be noted that in none of those petitions disposed of by that judgment had any assessment been made under the Investigation Act and this Court only prohibited further proceedings before the Commission under the Investigation Act.
The assessee appellant now before us who had entered into a settlement under section 8 of the Investigation Act and had been assessed in accordance with the terms of the settlement continued to pay the tax by monthly instalments of Rs. 5,000 as before.
Finally on December 20, 1955, came the decision of this Court in M. CT.
Muthiah vs The Commissioner of Income Tax, Madras (2).
In that case the Central Government had under section 5 (1) of the Investigation Act referred the case to the Commission.
The Commission after holding an enquiry recorded its findings and held that an aggregate sum of Rs. 10,07,322 4 3 represented the undisclosed income during the period under investigation.
The Commission having submitted its report to the Central Government, the latter acting under section 8 (2) of the Investigation Act directed that appropriate action under the (1) (2) ; 542 Indian Income Tax Act, 1922, be taken against that assessee with a view to assess or re assess the income which had escaped assessment for the period 1940 41 to 1948 49.
The Income Tax Officer accordingly issued notices and made the re assessment for the years 1940 41, 1941 42 and 1943 44 to 1948 49 based upon the finding of the Commission, which was treated as final and conclusive.
These assessment orders were served on that assessee.
There was, however, no re.
assessment order for the year 1942 43.
In regard to the assessment orders which had been served the assessee concerned applied to the Commissioner of Income Tax under section 8 (5) of the Investigation Act for reference to the High Court on questions of law arising out of those re assessment orders.
During the pendency of those proceedings the assessee, in that case on December 6, 1954, filed a petition contending that the provisions of the Investigation Act were illegal, ultra vires and unconstitutional.
The majority of this Court held that different persons, though falling under the same class or category of substantial evaders of income.
tax, were being subjected to different procedures, one a summary and drastic procedure and the other the normal procedure which gave to the assessees various rights which were denied to those who were specially treated under the procedure prescribed by the Investigation Act and, therefore, the assessments made under section 8 (2) were void and unenforceable.
That was a case of assessment under section 8 (2) in invitum after an investigation under the Investigation Act.
The assessee appellant before us, who had at the end of the investigation entered into a settlement and been assessed in accordance with the terms of such settlement, however, went on making payments in discharge of the balance due under the terms of settlement right up to September 8, 1957, when he made the last payment of Us.
8,000 bringing the aggregate payment up to Rs. 1,28,000.
In the meantime the Income Tax Officer had sent a certificate requesting the Collector of Delhi for the recovery of the balance due by the assessee under the settlement.
In execution of that certificate some of 543 the properties belonging to the assessee situate in Dharamsalla and Hissar were attached.
On December 27, 1957, the assessee made an application to the Income Tax Commissioner.
After pointing out that between July 5, 1954, and December 27, 1957, the petitioner had paid in all Rs. 1,28,000 towards the ' discharge of his liability under the settlement and referring to the decisions of this Court in suraj Mall Mohta 's case (1) and Muthiah 's case (2) the assessee submitted that the settlement under a. 8A of the Investigation Act had no force and did not bind the petitio ner and that the settlement had been made under the pressure of the situation and in view of the coercive machinery of the Investigation Act and that from either point of view the settlement was not binding.
His contention was that when section 5(1) of the Investigation Act had been held unconstitutional the settlement under section 8A could not be enforced, for the foundation of the proceedings under section 8A was the reference under section 5(1) and the foundation having crumbled down the superstructure must fall with it.
Under the circumstances the assessee submitted that the attached properties be released and the amount already recovered under the settlement be refunded.
On January 29, 1958, the Income Tax Commissioner sent the following communication to the assessee: No. L 228(1)/54 55/17590 Office of the Commissioner Income Tax Delhi and Rajasthan, New Delhi.
Dated, New Delhi the 29th January, 1958.
Shri Besheshar Nath, 9, Barakhamba Road, New Delhi.
Dear Sir, Sub: Taxation on Income (Investigation Commission) Act, 1947 Order u/s 8A(2) Your petition dated 27th December, 1957.
With reference to your petition dated 27th December, 1957, regarding the settlement arrived at (1) ; (2) ; 544 under section 8A(2) of the Taxation on Income (Investigation Commission) Act, 1947, I am to inform you that the settlement is valid and binding on you.
You are, therefore, requested to make good arrears of instalments which you have not paid recently by 5th February, 1958, and also to continue making the payments in accordance with the instalments scheme agreed to, failing which the recovery proceedings will be vigorously pursued through the usual recovery channels.
Your 's faithfully, Sd./ section K. Gupta, Commissioner of Income tax, Delhi & Rajasthan, New Delhi.
Being aggrieved by the above decision the assessee thereupon moved this Court and obtained special leave to appeal against that order.
The appeal has now come up for final disposal before us.
It may be mentioned here that as the respondents are anxious to have the matters of controversy raised in this appeal decided and set at rest by a decision of this Court, the respondents, for the purposes of this appeal, have not insisted on their objection that an appeal does not lie under article 136 of the Constitution against an order of the Commissioner of Income Tax.
Learned counsel for the assessee also has not pressed his claim for refund of the amounts already paid and has pressed the appeal regarding the balance that remains to be paid under the settlement which is characterised as invalid.
Model Knitting Industries Ltd. which has a case pending in the High Court of Calcutta where the same questions as are in issue in the appeal before us, are also in issue has been.
permitted to intervene and we have heard counsel appearing for that intervener.
In view of the three decisions referred to above learned Attorney General does not seriously contend that the powers conferred on the Commission by section 6 and the procedure laid down by section 7 of the Investigation Act are not discriminatory, but what he urges is that none of the said decisions has held that section 5(1) is 545 wholly void and inoperative.
He says that section 5(1) only authorises the Central Government to refer certain cases to the Commission.
Upon such a reference two lines of procedure are clearly indicated by the Investigation Act, namely, (1) that an investigation may be held in invitum following the procedure prescribed and exercising the powers conferred by the lnvestigation Act and (2) that a settlement may be made under section 8A. If the first procedure is followed and an assessment is made under section 8(2) such assessment will undoubtedly be invalid as has been held in Muthiah 's case (1), but if on a case being referred the settlement procedure is followed then the consequential order of assessment under section 8A cannot be questioned.
We are unable to accept this line of argument as permissible in view of the provisions of the Investigation Act.
It will be recalled that when the case of the assessee was referred to the Commission under section 5(1) on July 22, 1948, there was no provision for settlement in the Act at all.
Therefore, that reference, when it was made, consigned the assessee to the only procedure of investigation that was then prescribed by the Act.
In the next place it should be remembered that after section 8A was added in the Investigation Act by section 33 of Act 67 of 1949 an authorised official was appointed under section 6(3) to investigate the affairs of the assessee and to examine the books and to interrogate any person or obtain any statement from any person and under sub section
(4) the authorised official was empowered to exercise the same powers as had been vested in the Commission under sub sections
(1) and (2) of section 6.
Further, by its own terms section 8A made it clear that the person concerned in any case referred to the Commission for investigation might apply to the Commission at any time during such investigation to have the case settled.
Therefore this provision for settlement was an integral part of the entire investigation procedure.
It was not a separate or independent procedure apart from the investigation procedure.
It is true that there was nothing to prevent the assessee from straightaway (1) ; 69 546 making a proposal for settlement before any actual step towards investigation was taken by the Income Tax authorities, but before the Commission could refer the proposal for settlement to the Central Government it had to be satisfied that the terms of settlement contained in the application were such as might be approved.
For the purpose of satisfying itself the Commission had obviously to go into the facts either by itself or through an authorised official and to consider the materials collected by the authorised official and in the process of doing so had to hold an investigation of some sort and that investigation had neces sarily to be made in accordance with the procedure prescribed by the Investigation Act itself.
It is, therefore, not correct to say that there could be a pro ceeding for settlement without any investigation at all.
In our opinion section 8A did not provide for a separate procedure at all.
When a case was referred under section 5(1) it was really for investigation and a settlement was something which could crop up in the process of that investigation just as in the course of a suit parties may arrive at some compromise.
In recording the compromise and passing a judgment in accordance with the compromise thereof, the court exercises the same jurisdiction as it exercises in entertaining and disposing of the suit itself.
Likewise in entertaining a proposal for settlement the Commission exercised its jurisdiction of investigation under section 5, followed the procedure prescribed by section 7 and exercised all its powers under section 6.
As already stated the language of s.8A itself shows that a settlement can be proposed only during such investigation.
In our judgment, therefore, the contention of the learned Attorney General that the Investigation Act prescribed two procedures is not well founded.
Learned Attorney General then points out that the Investigation Act was a pre Constitution Act and that before the commencement of the Constitution when there was no such thing as a fundamental right, its provisions could not be questioned however discriminatory the procedure may have been.
He urges that after the commencement of the Constitution the 547 assessee has not been subjected to the coercive procedure laid down by the Investigation Act, but voluntarily proposed a settlement which was accepted by the Central Government on the recommendation of the Commission.
In that situation he was in the same position as Qasim Razvi had been in and the observations to be found in the judgment of Mukherjea, J., who delivered the majority judgment in Syed Qasim Razvi vs The State of Hyderabad (1) applied to the present appeal.
We do not think it is necessary, for the purpose of this appeal, to go minutely into the facts of Qasim Razvi 's case (1) with reference to which the observations relied on had been made, or to analyse the correctness of the reasoning adopted in that case, for that can only be done by a larger Bench.
We are definitely of opinion, however, that the observations made in the majority judgement should not be extended but must be kept strictly confined to the special facts of that case.
In our judgement those observations have no ~application to the facts of the present appeal before us, for here even after the commencement of the Constitution, the process of investigation continued in that the authorised official went on collecting materials by following the procedure prescribed by section 7 and exercising the powers conferred on him by section 6 of the Investigation Act.
The last argument advanced by the learned Attorney General is that if there had been a breach of the assessee 's fundamental right by subjecting him to a discriminatory procedure laid down in the Investigation Act, the asessee, by voluntarily entering into a settlement, must be taken to have waived such breach and cannot now be permitted to set up his fundamental right.
Immediately two questions arise for consideration, namely, (1) whether the assessee could waive the breach of the fundamental right in question and (2) whether in the facts and circumstances of this case he had actually done so.
(1): In Behram Khurshed Pesikaka vs State of Bombay (2) there was a general discussion whether a (1) (2) 548 fundamental right could be waived.
At page 638 Venkatarama Aiyar, J., observed: " The question is, what is the legal effect of a statute being declared unconstitutional.
The answer to it depends on two considerations firstly does the constitutional prohibition which has been infringed affect the competence of the Legislature to enact the law or does it merely operate as a check on the exercise of a power which is within its competence; and secondly, if it is merely a check, whether it is enacted for the benefit of individuals or whether it is imposed for the benefit of the general public on grounds of public policy.
If the statute is beyond the competence of the Legislature, as for example, when a State enacts a law which is within the exclusive competence of the Union, it would be a nullity.
That would also be the position when a limitation is imposed on the legislative power in the interests of the public, as, for instance, the provisions in Chapter XIII of the Constitution relating to inter State trade and commerce.
But when the law is within the competence of the Legislature and the unconstitutionality arises by reason of its repugnancy to provisions enacted for the benefit of individuals, it is not a nullity but is merely unenforceable.
Such an unconstitutionality can be waived and in that case the law becomes enforceable.
In America this principle is well settled.
(Vide Cooley on Constitutional Limitations, Volume 1, pages 368 to 371 ; Willis on Constitutional Law at pages 524, 531, 542 and 558 ; Rottschaefer on Constitutional Law at pages 28 and 29 30).
" After referring to three decisions of the American Supreme Court which are also now relied on by the learned Attorney General, the learned Judge concluded as follows: " The position must be the same under our Constitution when a law contravenes a prescription intended for the benefit of individuals.
The rights guaranteed under article 19 (1) (f) are enacted for the benefit of owners of properties and when a law is found to infringe that provision, it is open to any person whose rights have been infringed to waive it and when there 549 is waiver there is no legal impediment to the enforcement of the law.
It would be otherwise if the statute was a nullity; in which case it can neither be waived nor enforced.
If then the law is merely unenforceable and can take effect when waived it cannot be treated as non and as effaced out of the statute book.
It is scarcely necessary to add that the question of waiver is relevant to the present controversy not as bearing on any issue of fact arising for determination in this case but as showing the nature of the right declared under article 19 (1) (f) and the effect in law of a statute contravening it.
" When the case came up before the court on review Mahajan, C. J., with the concurrence of Mukherjea, Vivian Bose, and Ghulam Hassan, JJ., said at page 653: " In our opinion, the doctrine of waiver enunciated by some American Judges in construing the American Constitution cannot be introduced in our Constitution without a fuller discussion of the matter.
No inference in deciding the case should have been raised on the basis of such a theory.
The learned Attorney General when questioned about the doctrine did not seem to be very enthusiastic about it.
Without finally expressing an opinion on this question we are not for the moment convinced that this theory has any relevancy in construing the fundamental rights conferred by Part III of our Constitution.
We think that the rights described as fundamental rights are a necessary consequence of the declaration in the preamble that the people of India have solemnly resolved to constitute India into a sovereign democratic republic and to secure to all its citizens justice, social, economic and political; liberty of thought, expression belief, faith and worship; equality of status and of opportunity.
These fundamental rights have not been put in the Constitution merely for individual benefit, though ultimately they come into operation in considering individual rights.
They have been put there as a matter of public policy and the doctrine of waiver can have no application to provisions of law which have been enacted as a matter of constitutional policy.
550 Reference to some of the Articles, inter alia, articles 15 (1), 20, 21, makes the proposition quite plain.
A citizen cannot get discrimination by telling the State " You can discriminate ", or get convicted by waiving the protection given under articles 20 and 21.
" On that occasion one of us preferred not to express any opinion on this subject and said at page 670: " In coming to the conclusion that I have, I have in a large measure found myself in agreement with the views of Venkatarama Aiyar, J., on that part of the case.
1, however, desire to guard myself against being understood to agree with the rest of the observations to be found in his judgment, particularly those relating to waiver of unconstitutionality, the fundamental rights being a mere check on legislative power or the effect of the declaration under article 13(1) being " relatively void ".
On those topics I prefer to express no opinion on this occasion.
" It will, however, be noticed that the observations of the learned judges made in that case did not relate to the waiver of a breach of the fundamental right under article 14.
The fundamental right, the breach whereof is complained of by the assessee, is founded on article 14 of the Constitution.
The problem, therefore, before us is whether a breach of the fundamental right flowing from article 14 can be waived.
For disposing Of this appeal it is not necessary for us to consider whether any of the other fundamental rights enshrined in Part III of our Constitution can or cannot be waived.
We take the view that this court should not make any pronouncement on any question which is not strictly necessary for the disposal of the particular case before it.
We, therefore, confine our attention to article 14 and proceed to discuss the question on that footing.
Article 14 runs as follows: " The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India.
" It is the first of the five Articles grouped together under the heading " Right to Equality".
The underlying object of this Article is undoubtedly to secure to 551 all persons, citizen or non citizens, the equality of status and of oppotunity referred to in the glorious preamble of our Constitution.
It combines the English doctrine of the rule of law and the equal protection T. clause of the 14th Amendment to the American Federal Constitution which enjoins that no State shall deny to any person within its jurisdiction the equal protection of the laws ".
There can, therefore, be no doubt or dispute that this Article is founded on a sound public policy recognised and valued in all civilised States.
Coming then to the language of the Article it must be noted, first and foremost that this Arti cle is, in form, an admonition addressed to the State and does not directly purport to confer any right on any person as some of the other Articles, e.g., article 19, do.
The obligation thus imposed on the State, no doubt, enures for the benefit of all persons, for, as a necessary result of the operation of this Article, they all enjoy equality before the law.
That is, however, the indirect, though necessary and inevitable, result of the mandate.
The command of the Article is directed to the State and the reality of the obligation thus imposed on the State is the measure of the fundamental right which every person within the territory of India is to enjoy.
The next thing to notice is that the benefit of this Article is not limited to citizens, but is available to any person within the territory of India.
In the third place it is to be observed that, by virtue of article 12, " the State " which is, by article 14, forbidden to discriminate between persons includes the Government and Parliament of India and the Government and the legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India.
Article 14, therefore, is an injunction to both the legislative as well as the executive organs of the State and the other subordinate authorities.
As regards the legislative organ of the State, the fundamental right is further consolidated and protected by the provisions of article 13.
Clause (1) of that Article provides that all laws in force in the territories of India immediately before the commencement of the Constitution, in so 552 far as they are inconsistent with the provisions of Part III shall, to the extent of the inconsistency be void.
Likewise el.
(2) of this Article prohibits the State from making any law which takes away or abridges the rights conferred by the same Part and follows it up by saying that any law made in contravention of this clause Shall, to the extent of the contravention, be void.
It will be observed that so far as this Article is concerned, there is no relaxation of the restriction imposed by it such as there are in some of the other Articles, e.g., article 19, cls.
(2) to (6).
Our right to equality before the law is thus completely and without any exception secured from all legislative discrimination.
It is not necessary, for the purpose of this appeal to consider whether an executive order is a " law" within the meaning of article 13, for even without the aid of article 13 our right to the equal protection of the law is protected against the vagaries, if any, of the executive Government also.
In this connection the observations of Lord Atkin in Eshugbayi Eleko vs Officer Administering the Government of Nigeria (1) are apposite.
Said his Lordship at page 670 that in accordance with British jurisprudence no member of the executive can interfere with the liberty or property of a British subject except when be can support the legality of his act before a court of justice That apart, the very language of article 14 of the Constitution expressly directs that " the State ", which by article 12 includes the executive organ, shall not deny to any person equality before the law or the equal protection of the law.
Thus article 14 protects us from both legislative and executive tyranny by way of discrimination.
Such being the true intent and effect of article 14 the question arises, can a breach of the obligation imposed on the State be waived by any person ? In the face of such an unequivocal admonition administered by the Constitution, which is the supreme law of the land, is it open to the State to disobey the constitutional mandate merely because 'a person tells the State that it may do so ? If the Constitution asks the State as (1) L.R. [1931] A,.
C. 662.
553 to why the State did not carry out its behest, will it be any answer for the State to make that " true, you directed me not to deny any person equality before the law, but this person said that I could do so, for he had no objection to my doing it.
" I do not think the State will be in any better position than the positions in which Adam found himself when God asked him as to why he had eaten the forbidden fruit and the State 's above answer will be as futile as was that of Adam who pleaded that the woman had tempted him and so he ate the forbidden fruit.
It seems to us absolutely clear, on the language of article 14 that it is a command issued by the Constitution to the State as a matter of public policy with a view to implement its object of ensuring the equality of status and opportunity which every welfare State, such as India, is by her Constitution expected to do and no person can, by any act or conduct, relieve the State of the solemn obligation imposed on it by the Constitution.
ever breach of other fundamental right a person or a citizen may or may not waive, he cannot certainly give up or waive a breach of the fundamental right that is indirectly conferred on him by this constitutional mandate directed to the State.
The learned Attorney General has relied on various passages in text books written by well known and eminent writers, e.g., Cooley, Willoughby, Willis and Rottschaefer and on eight American decisions.
In considering the statements of law made by American writers and judges the following observations of Patanjali Sastri, C. J., in The State of Travancore Cocochin and others vs The Bombay Co. Ltd. (1) should conatantly be borne in mind: scope and purpose, and a varying body of doctrines and tests have grown around them interpreting, extending or restricting, from time to time, their operation and application in the context of the expanding American commerce and industry, and we are of opinion that not much help can be derived from them (1) ; ,112O, 1121.
70 554 in the solution of the problems arising under article 286 of the Indian Constitution.
" (See also The State of Bombay vs R.M.D. Chamarbaugwala(1)).
The American authorities cited by the Attorney General relate to waiver of obligations under a contract, of the deprivation of right to property without due process of law or of the constitutional right to trial by jury and the like.
They have no bearing on the question of the waiver of the equal protection clause of the 14th Amendment which, like our article 14, is a mandate to the State.
It is signifi cant that no American decision is forthcoming which upholds the waiver of the breach of that clause.
When a case of breach of any of the fundamental rights akin to what are dealt with in the American authorities will come before us it will, then, be the time for us to discuss those authorities and to consider their applicability in the matter of the interpretation of the corresponding provisions of our Constitution.
For the moment we prefer to confine our observations to a consideration of waiver of the breach of the fundamental right under article 14.
Learned Attorney General has relied on three decisions of this Court: (1) Laxmanappa Hanumantappa Jamkhandi vs The Union of India (2), (2) Dewan Bahadur Seth Gopal Das Mohta vs The Union of India (3) and (3) Baburao Narayanrao Sanas vs The Union of India(4) in support of his thesis that a breach of article 14 may well be waived by a person.
In none of those cases, all of which were disposed of on the same day (October 21, 1954) was the question of waiver specifically or seriously discussed.
As learned counsel appearing for the intervener points out, the first of the above mentioned cases proceeded on the footing that as article 265 was not a fundamental right conferred by Part III, it could not be enforced under article 32.
Learned counsel for the intervener further submitted that the decision in the 2nd case mentioned above could also be explained on that basis and on the further ground that proceeding under article 32 was not (1) ; , 918.
(3) ; (2) ; (4) intended to be used for obtaining relief against the voluntary action of a person and that appropriate remedy for recovery of money lay in a suit.
The decision in the 3rd case proceeded on the same basis and did not carry the matter any further.
It is impossible to treat any of those decisions as representing the considered opinion of this Court on the question of waiver of a breath of the fundamental right under article 14 of the Constitution.
Reference was also made by the learned Attorney General to the decision of a Single Judge of the Allahabad High Court in Subedar vs State (1) where it was held that article 20(3) conferred merely a privilege and that such privilege could always be waived It was overlooked that if a person volun tarily answered any question then there was no breach of his fundamental right at all, for the fundamental right is that a person shall not be compelled to incriminate himself.
That case, therefore, is not a case of waiver at all.
The case of Pakhar Singh vs The State (2) is also, for the same reason, not a case of waiver.
(2): The answer to this question depends upon facts which have not been properly investingated.
The appeal is against the order of the income tax authorities which order makes no reference to the plea of waiver.
Further the filing of the statements of case having been dispensed with, we have not had the benefit of the statement of facts on which this plea is said to be founded.
The view taken on question (1), however, relieves us of the necessity of going into this question.
On a consideration of the nature of the fundamental right flowing from article 14, we have no doubt in our mind that it is not for a citizen or any other person who benefits by reason of its provisons to waive any breach of the obligation on the part of the State.
We are, therefore, of the opinion that this appeal should be accepted, the order of the Income Tax Commissioner, Delhi, dated January 29, 1958, should be set aside and all proceedings now pending for implementation of the order of the Union Government dated July 5, 1954, (1) A. I. R. 1957 All.
(2) A. 1.
R. 1958 Punj.
556 should be quashed and that the assessee appellant, should get the costs of this appeal.
BHAGWATI, J.
I agree with the reasoning adopted and the conclusion reached in the judgments prepared by My Lord the Chief Justice and my brother, section K. Das, J., in regard to the ultra vires character of the proceedings adopted under section 8 A of the Taxation on Income (Investigation Commission) Act, 1947 (30 of 1947), and the void character of the settlement reached thereunder.
As regards the parts of the judgments which deal with the question whether a fundamental right guaranteed by the Constitution can be waived at all, I find myself in agreement with the judgment prepared by my brother, Subba Rao, J., and am of the opinion that it is not open to a citizen to waive the fundamental rights conferred by Part III of the Constitution.
The question of waiver came to be argued before us in this way.
If the proceedings and the settlement under section 8 A of the Act were void as aforesaid, the respondent contended that the appellant had waived the fundamental right enshrined in article 14 of the Constitution and was therefore not entitled to challenge the settlement.
This was only by way of reply to the contention of the appellant and was not set out in proper details in any affidavit filed on behalf of the respondent.
The learned Attorney General, however, relied upon the application made by the appellant before the Investigation Commission and the contents thereof as also the payments made by the appellant from time to time both before and after the pronouncement of our decision in M. Ct.
Muthiah vs The Commissioner of Income tax, Madras (1) in order to support this plea of waiver and the arguments before us proceeded on that basis.
No objection was taken by either of the parties before us to the issue of waiver being decided on such materials and the question was argued at considerable length before us.
The arguments moreover extended to the whole field of fundamental rights and were not confined to article 14 only.
(1) ; 557 We, therefore, see no reason why we should refrain from pronouncing our opinion on that question.
The preamble to our Constitution, article 13 and the language in which the fundamental rights have been enacted lead to one conclusion and one conclusion only that whatever be the position in America, no distinction can be drawn here, as has been attempted in the United States of America, between the fundamental rights which may be said to have been enacted for the benefit of the individual and those enacted in public interest or on grounds of public policy.
Ours is a nascent democracy.
and situated as we are, socially, economically, educationally and politically, it is the sacred duty of the Supreme Court to safeguard the fundamental rights which have been for the first time enacted in Part III of our Constitution.
The limitations on those rights have been enacted in the Constitution itself, e.g., in articles 19, 33 and 34.
But unless and until we find the limitations on such fundamental rights enacted in the very provisions of the Constitution, there is no justification whatever for importing any notions from the United States of America or the authority of cases decided by the Supreme Court there in order to whittle down the plenitude of the fundamental rights enshrined in Part III of our Constitution.
The genesis of the declaration of fundamental rights in our Constitution can be traced to the following passage from the Report of the Nehru Committee (1928): " Canada, Australia and South Africa have no declaration of rights in their Constitutions but there are various articles to be found in the Constitution of the Irish Free State which may properly be grouped under the general head " fundamental rights ".
The reason for this is not far to seek.
Ireland is the only country where the conditions obtaining before the treaty were the nearest approach to those we have in India.
The first concern of the people of Ireland was, as indeed it is of the people of India to day, to secure fundamental rights that have been denied to them.
The other dominions had their rise from earlier British 558 settlements which were supposed to have carried the law of England with them.
Ireland was taken and kept under the rule of England against her own will and the acquisition of dominion status by her became a matter of treaty between the two nations.
We conceive that the constitutional position in India is very much the same.
That India is a dependency of Great Britain cannot be denied.
That position can be altered in one of two ways force or mutual consent.
It is the latter in furtherance of which we are called upon to recommend the principles of a constitution for India.
In doing so it is obvious that our first care should be to have our fundamental rights guaranteed in a manner which will not permit their withdrawal under any circumstances.
" At the Round Table Conference that preceded the making of the Government of India Act, 1935, therefore, the, Indian leaders pressed for a Bill of Rights in the proposed Constitution Act, in order to bind the administration with certain declarations of individual rights.
This was, however, rejected by the Simon Commission with these observations: " We are aware that such provisions have been inserted in many Constitutions, notably in those of the European States formed after the War.
Experience, however, has not shown them to be of any great practical value.
Abstract declarations are useless unless there exist the will and means to make them effective.
" The framers of our Constitution however followed the American view represented by the famous words of Jefferson in preference to that expressed by the Simon Commission : " The inconveniences of the declaration are, that it may cramp government in its useful exertions.
But the evil of this is short lived, moderate and reparable.
The inconveniences of the want of a declaration are permanent, afflictive and irreparable.
They are in constant progression from bad to worse.
The executive in our governments is not the sole, it is scarcely the principal object of my jealousy.
The tyranny of the legislatures is the most formidable dread. . . . 559 (Vide Basu 's Commentary on the Constitution of India, Vol. 1, p. 74).
and incorporated the fundamental rights in Part III of our Constitution.
The object sought to be achieved was as the preamble to the Constitution states " to secure to all its citizens: JUSTICE, social, economic and political; ]LIBERTY of status and of opportunity; and to promote among them all FRATERNITY assuring the dignity of the individual and the unity of the Nation and article 13 provided: " 13.
(1) All laws in force in the territory of India immediately before the commencement of this Constitution, in so far as they are inconsistent with the provisions of this Part, shall, to the extent of such inconsistency, be void.
(2) The State shall not make any law which takes away or abridges the rights conferred by this Part and any law made in contravention of this clause shall, to the extent of the contravention, be void. . . " Laws in force " were defined in article 13(3) to include : " Laws passed or made by a Legislature or other competent authority in the territory of India before the commencement of this Constitution and not previously repealed, notwithstanding that any such law or any part thereof may not be then in operation either at all or in particular areas " and they were declared void, in so far as they were inconsistent with the provisions of this Part, to the extent of such inconsistency.
As regards laws to be enacted after the commencement of the Constitution, the State, in the wider significance of the term as including " the Government and Parliament of India and the Government and the legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India " (Vide article 12) was enjoined not to make any law which takes away or abridges the rights conferred by this Part and 'any law made in con travention of this clause was to the extent of the 560 contravention declared void.
It will be seen that the prohibition was thus effective both against past laws as well as future laws and both were equally void in so far as they were " inconsistent with " or " in derogation of " the fundamental rights enshrined in Part III of the Constitution.
no distinction was made between the past laws and future laws in this respect and they were declared void to the extent of the inconsistency or the extent of the contravention a,,; the case may be, leaving the unoffending parts thereof untouched.
It will be also seen that under article 13(2) an admonition was administered to the State not to enact any law which takes away or abridges the rights conferred by this Part and the obligation thus imposed on the State enured for the benefit of all citizens of Bharat alike in respect of all the fundamental rights enacted in Part III of the Constitution.
No distinction was made in terms between the fundamental rights said to have been enacted for the benefit of the individual and those enacted in the public interest or on grounds of public policy.
The question then arises whether a breach of the obligation thus imposed on the State can be waived by a citizen.
To borrow the words of My Lord the Chief Justice " In the face of such unequivocal admonition administered by the Constitution, which is the supreme law of the land, is it open to the State to disobey the Constitutional mandate merely because a citizen told the State that it may do so ? if the Constitution asks the State as to why the State did not carry out its behest, will it be any answer for the State to make that " True, you directed me not to take away or abridge the rights conferred by this Part, but this citizen said that I could do so, for he had no objection to my doing so.
" I do not think the State will be in any better position than the position in which Ad am found himself when God asked him as to why he had eaten the forbidden fruit and the State 's above answer will be as futile as that of Adam who pleaded that the woman had tempted him and Bo he ate the forbidden fruit.
" It is absolutely clear on a perusal of article 13(2) of the Constitution that it is a constitutional mandate 561, to the State 'and no citizen can by any act or conduct relieve the State of the solemn obligation imposed on it by article 13(2) and no distinction can be made at all between the fundamental rights enacted for the benefit of the individual and those enacted in the public interest or on grounds of public policy.
What then is the basis of this distinction which has be strenuously urged before us that there are certain fundamental rights which are enacted only for the private benefit of a citizen, e.g., rights of property, which can be waived by him and there are other fundamental rights enacted for the public good or as a matter of public policy which it would not be open to a citizen to waive even though he were affected by the breach thereof.
Reliance is placed in this behalf on certain decisions of the Supreme Court of the United States of America, passages from Willoughby, Willis and Rottschaeffer, quoted in the judgment of T. L. Venkatarama Aiyar, J., in Behram Khurshed Pesikaka vs The State of Bombay (1) and the observations of the said learned Judge in that case adopting the said distinction.
(Vide pp.
638 643 of the Report).
I am afraid this distinction cannot be accepted.
There is nothing in the terms of the various articles embodying the fundamental rights in Part III of our Constitution which warrants such a distinction.
The fundamental rights are enacted with all precision and wherever limitations on their exercise are thought of they are also similarly enacted.
Such constitutional limitations are to be found within the terms of the articles themselves and there is no justification for reading in the terms of the articles anything more than what is expressly stated therein.
There is further this distinction between the American Constitution and ours that whereas the American Constitution was merely enacted in order to form a more perfect union, establish justice, insure domestic tranquillity, provide for common defence, promote the general welfare and secure the blessings of liberty and was an outline of government and nothing more, our Constitution was (1) 71 562 enacted to secure to all citizens, justice, Liberty. ' Equality and Fraternity and laid emphasis on the welfare state and contained more detailed provisions,, defining the rights and also laying down restrictions thereupon in the interest of the general welfare, etc.
As observed by Wills in his Constitutional Law at p. 477: "The conflict between man and the state is as old as human history.
For this reason some compromise must be struck between private liberty and public authority.
There is some need of protecting personal liberty against governmental power and also some need of limiting personal liberty by governmental power.
The ideal situation is a matter of balancing one against the other, or adjusting conflicting interests." " In the United States Constitution an attempt has been made to strike a proper balance between personal liberty and social control through express limitations written into the Constitution and interpreted by the Supreme Court, by implied limitations created by the Supreme Court, and by the development of the governmental powers of regulation, taxa tion, and eminent domain by the Supreme Court." (Ibid pp. 477 478), whereas our Constitution has expressly sought to strike the balance between a written guarantee of individual rights and the collective interests of the community by making express provisions in that behalf in Part III of the Constitution.
(Vide Gopalan vs State of Madras) (1).
Moreover in the matter of considering the statements of law made by the text book writers in America and the dicta of the judges of the Supreme Court there in the various decisions cited before us, we must bear in mind the following admonition of Patanjali Sastri, C. J., in the State of Travancore Cochin vs The Bombay Co., Ltd. (2).
" These clauses are widely different in language, scope and purpose, and a varying body of doctrines (1) ; (2) [1952] S.C.R.1112, 1120 and tests have grown around them interpreting, extending or restricting, from time to time, their operation and application in the context of the expanding American commerce and industry, and we are of opinion that not much help can be derived from them in the solution of the problems arising under article 286 of the Indian Constitution" or for the matter of that, articles embodying the fundamental rights in Part III of our Constitution (see also The State of Bombay vs R. M. D. Chamarbaugwala(1) The rights conferred on citizens may be thus classified : (i) statutory rights; (ii) constitutional rights; and (iii) fundamental rights.
One need not consider the statutory rights in this context but the constitutional rights are those created and conferred by the Constitution.
They may or may not be waived by a. citizen, as stated in the text books and the decisions of the Supreme Court of the United States of America above referred to.
But when the rights conferred are put on a high pedestal and are given the status of fundamental rights, which though embodied in the Constitution itself are in express terms distinguished from the other constitutional rights (e.g., fundamental rights which are enshrined in Part III of the Constitution and are enacted as immune from any legislation inconsistent with or derogatory thereto and other constitutional rights which are enacted in other provisions, for instance in articles 265 and 286 and in Part XIII of the Constitution), they are absolutely inviolable save as expressly enacted in the Constitution and cannot be waived by a citizen.
The Constitution adopted by our founding fathers is sacrosanct and it is not permissible to tinker with those fundamental rights by any ratiocination or analogy of the decisions of the Supreme Court of the United States of America.
The only manner in which that can be done is by appropriate amendment of the Constitution and in no other manner whatever.
There is no difficulty whatever in working out this position and to my mind the difficulties pointed out (1) ; , 918.
564 are more imaginary than real.
If a citizen wanted to assert his fundamental right under the circumstances envisaged for instance in the judgment of my brother section K. Das, J., and made an application for a writ under article 32 or article 226 of the Constitution he would be promptly confronted with the argument that the Court should in the exercise of its discretion refuse him the relief prayed for.
The remedy is purely discretionary and no Court in those circumstances would exercise @ its discretion in his favour (Vide Dewan Bahadur Seth Gopal Das Mohta vs Union of India (1), Baburao Narayan Savas vs Union of India(2) and Laxmanappa Hoonmantappa Janakhandi vs Union of India (3).
Even then he might merely obtain a relief declaring the legislation ultra vires the Constitution and the Court would not grant him any consequential relief For that relief he would have to approach the regular courts of law, when all questions of law, apart from the mere constitutionality of the provision would be considered by the Court on a contest between the par.
ties, e.g., estoppel, acquiescence, limitation and the like (Compare our observations in Sales Tax Officer, Banaras vs Kanayalal Mukundlal Saraf (4) ).
The only thing which parties would be concluded by would be the adjudication as to the ultra vire 's character of the measure in question and the citizen would not be entitled to the relief claimed merely for the asking.
These considerations, therefore, do not militate against the position that a citizen cannot waive the fundamental rights conferred upon him by Part III of the Constitution.
I fully endorse the opinion expressed by Mahajan, C. J., in Behram Khursheed Pesikaka vs The State of Bombay (5) at page 653 : ,,We think that the rights described as fundamental rights are a necessary consequence of the declaration in the preamble that the people of India have solemnly resolved to constitute India into a (1) [1955] I S.C.R. 773.
(3) [19551 1 S.C.R. 769.
(2) (4) Civil Appeal No. 87 Of 1957 decided on September 23, 1958.
(5) 565 sovereign democratic republic and to secure to all its citizens justice, social, economic and political; liberty of thought, expression, belief, faith and worship; equality of status and of opportunity.
These fundamental rights have not been put in the Constitution merely for individual benefit, though ultimately they come into operation in considering individual rights.
They have been put there as a matter of public policy and the doctrine of waiver can have no application to provisions of law which have been enacted as a, matter of constitutional policy.
" This, in my opinion is the true position and it cannot therefore be urged that it is open to a citizen to, waive his fundamental rights conferred by Part III of the Constitution.
The Supreme Court is the bulwark of the fundamental rights which have been for the first time enacted in the Constitution and it would be a, sacrilege to whittle down those rights in the manner attempted to be done.
The result is however the same and agree with the order proposed by My Lord the Chief Justice.
section K. DAS J.
This is an appeal by special leave from an order dated January 29, 1958, passed by the Commissioner of Income tax, Delhi, respondent No. 1 before us, in circumstances which are somewhat unusual and out of the ordinary.
We shall presently relate those circumstances; but at the very outset it may be stated that two questions of far reaching importance fall for consideration in this appeal.
One is the validity of a settlement made under section 8A of the Taxation on Income (Investigation Commission) Act, 1947 (30 of 1947) hereinafter referred to as the Act, after the coming into force of the Constitution on January 26, 1950, and the second is if a fundamental right guaranteed by the Constitution can be said to have been waived by the appellant in the circumstanoes of this case. 'The appellant before us is Basheshar Nath, whom we shall hereafter call the assessee.
As we have already stated, the Commissioner of Income tax, Delhi, is the first respondent, The second respondent 566 is the Union of India.
We also allowed the Model Knitting Industries, a limited liability Company with its registered office in Calcutta, to intervene in the appeal, on the ground that the intervening Company has a case pending in the High Court of Calcutta where the same questions are in issue.
We have also heard the intervener in support of the appeal.
On behalf of the appellant it has been ' contended that the Commissioner of Income tax, Delhi, is a tribunal within the meaning of Art, 136 of the Constitution and exercised judicial functions when it passed the impugned order of January 29, 1958.
The respondents pointed out, however, that the so called order was nothing but a reply which respondent No. 1 gave to a communication received, from the assessee.
However, the respondents have waived any prelimi nary objection to the maintainability of the present appeal, and the learned Attorney General appearing for the respondents has frankly stated before us that he is raising no such preliminary objection, as the Union Government is equally anxious to have a decision on the question, very important from its point of view and with far reaching financial consequences, as to whether a settlement made under section 8A of the Act after January 26, 1950, and the orders passed thereon by the Union Government are valid.
We have, therefore, proceeded on the footing that the present appeal is competent, and have considered it unnecessary to decide in the abstract the more general question as to the circumstances in which an order made by a revenue authority like the Commissioner of Income tax partakes of the character of A judicial or quasi judicial order.
Now, for the facts and circumstances which have led up to this appeal.
The Act received the assent of the Governor General on April 18, 1947, and came into force on May 1, 1947.
On July 22, 1948, the case of the assessee was referred to the Investigation Commission, constitued under section 3 of the Act.
The reference was made under section 5(1) of the Act, and it ,stated that the Central Government had prima facie reasons for believing that the assessee either alone or 567 in combination with ' other persons evaded payment of taxation on income to a substantial extent, and therefore the case of the asseesee was sent to the Investigation Commission for investigation and report.
The period of investigation was from April 1, 1939 to March 31, 1947.
The report of the Investigation Commission which has been made available to us shows that the case against the assessee was that he carried on a business of supplying tents, executing contract works, and commission agency for some textile mills on a fairly extensive scale, both individually and in partnership With his brother.
It appears that the total wealth statement of the assessee was filed on November 10, 1948, and was forwarded to an authorised official appointed under section 6(3) of the Act.
From January 8, 1949 to October 14, 1949 the authorized official was engaged in the collection of assessment records of the assessee from the income tax authorities and of materials from the Civil Supplies Directorate.
On July 5, 1949, the total wealth statement was received back from the assessee and the order ,sheet shows that on May 26, 1950, (that is, after the coming into force of the Constitution) the authorised official is sued a notice to the assessee fixing the hearing for June 10, 1950.
The assessee then asked for time, and it appears that for a period of about three years till June, 1953, nothing was done.
Thereafter, the authorised official held a preliminary investigation and computed intially that the undisclosed income ,of the assessee for the period in question was Rs. 12,07,000; on further scrutiny and examination of accounts and after heating the assessee 's explanation, the authorised official reduced the amount in his final report, submitted sometime towards the end of 1953, to Rs. 9,56,345.
The Investigation Commission considered the report of the authorised official, heard the assessee, and came to the conclusion that the total amount to be assessed in the hands of the assessee was Rs ' 4,47,915.
In their report dated May 24, 1954 the Investigation Commission said: " During the course of the hearing before us,the assessee as well as his Auditors applied for a 568 settlement after admitting liability for the aforesaid sum.
In the circumstances, we consider it proper to allow the assessee the benefit of a settlement on the lower concessional basis of 75% of evaded income payable by way of tax and a moderate penalty of Rs, 14,064. .
The assessee accepting our findings both as regards the amount of income that escaped assessment and the amount of tax and penalty payable, offered a settlement.
In the circumstances, we re commend the acceptance by the Government of the assessee 's offer of a settlement.
" The Central Government accepted the settlement under section 8A of the Act and on July 5, 1954, passed an order under section 8A(2) directing the issue of a demand notice by the Income tax Officer concerned for a sum of Rs. 3,50,000 (including the penalty of Rs. 14,064) on the assessee and further directing that " all such other proceedings under the Indian Income tax Act or under any other law, as may be necessary, should be taken with a view to enforcing the payment of the demand and the terms and conditions of settlement." Though under the terms of settlement no instalments were given, it appears that the assessee was allowed to pay the amount at the rate of Rs. 5,000 per month.
It further appears that up to and including September 8, 1957, the assessee had paid in all a sum of Rs. 1,28,000 towards the demand.
In December, 1955 was given the decision of this Court in M. CT.
Muthiah vs The Commissioner of Income tax, Madras (1), in which the majority of Judges held that section 5(1) of the Act was ultra vires the Constitution, as it was discriminatory and violative of the fundamental right guaranteed by article 14 of the Constitution by reason of two amendments which were made in section 34 of the Indian Income tax Act 1922 one in 1948 by the enactment of the Income.
tax and Business Profits Tax (Amendment) Act, 1948 (48 of 1948) and the other in 1954 by the enactment of the Indian Income tax (Amendment) Act, 1954 (33 of 1954).
Sometime earlier than the aforesaid deci sion, the Income tax Officer concerned had sent a (1) ; , 569 recovery certificate to the Collector, New Delhi, and the assessee stated that in execution of the said certificate his properties situated in Dharamsala and Hissar were attached.
On December 27, 1957, the assessee filed a petition to the Income tax Commissioner, Delhi, in which after stating the relevant facts, the assessee claimed that, after the decision in Muthiah 's case (1), the settlement made under section 8A of the Act had no force and was not binding on him: the assessee then prayed that the attached properties should be released from attachment and the amounts recovered under the terms of settlement refunded to him.
On January 29, 1958, the Commissioner of Income tax sent the following reply " With reference to your petition dated 27th December 1957 regarding the settlement arrived at under section 8A(2) of the Taxation on Income (Investigation Commission) Act, 1947, 1 am to inform you that the settlement is valid and binding on you.
You are ' therefore, requested to make good the arrears of instalments which you have not paid recently by 5th February, 1958 and also to continue making the payments in accordance with the instalments ' scheme agreed to, failing which the recovery proceedings will be vigorously pursued through the usual recovery channels.
" The assessee asked for and obtained special leave from this Court on February 17, 1958, to appeal from the aforesaid order.
In the appeal as orginally filed in pursuance of the special leave granted to the assessee, the prayer portion was inadvertently left out.
Subsequently, the assessee prayed that (a) the report of the Investigation Commission dated May 24, 1954, be quashed, (b) the settlement made on the basis of the report and the directions given by the Central Government in pursuance thereof and the proceedings for recovery of arrears of tax be all quashed, and (c) the amounts already recovered may be ordered to be refunded.
With regard to the last prayer, we may state here that it was not pressed before us and we are relieved from the task, at least in this appeal, of (1) ; 72 570 deciding in what circumstances and on what considerations a refund of tax voluntarily paid can be claimed.
Therefore, the first and foremost question before us is the validity of the settlement made under section 8A of , the Act.
On behalf of the assessee the main argument is that section 5(1) of the Act having been held ultra vires the Constitution, the very foundation for the report of the Investigation Commission has disappeared and a settlement based thereon is neither valid, nor can it be enforced.
On behalf of the respondents, the learned Attorney General has contended that there is no decision of this Court which has held that section 5(1) of the Act is wholly void and on a proper construction of the various sections of the Act, it will be found that there are two separate and distinct procedures or jurisdictions which the Investigation Commission may follow or exercise: one is investigation and the other relates to settlement.
He has submitted that the jurisdiction conferred on the Investigation Commission under section 8A, which was inserted in the Act in 1949 by section 33 of Act 67 of 1949, is not affected by the decision in Muthiah 's case (1), and if the Investigation Commission had jurisdiction to entertain an application from the assessee for settlement, approve of the same, and refer it to the Central Government, the latter had also jurisdiction to accept it under sub s.(1) and make necessary orders under sub.s.
(2) of section 8A.In short, the argument of the learned Attorney General is that there is nothing in Muthiah 's decision (1), which renders section 8A constitutionally invalid.
It is necessary to read at this stage the relevant provisions of the Act in so far as they bear upon the problems before us.
We have said that the Act came into force on May 1, 1947.
This was before the coming into force of the Constitution of India, and no question of the violation of any fundamental rights guaranteed by the Constitution arose on that date.
Section 3 of the Act empowers the Central Government (now Union Government) to constitute a Commission to be called the Income tax Investigation (1) ; 571 Commission, whose duties shall be (to quote the words of the section) " (a) to investigate and report to the Central Government on all matters relating to taxation on income, with particular reference to the extent to which the existing law relating to, and procedure for, the ' assessment and collection of such taxation is adequate to prevent the evasion thereof ; (b)to investigate in accordance with the provisions of this Act any case or point in a case referred to it undersection 5 and make a report thereon (including such interim reports as the Commission may think fit) to the Central Government in respect of all or any of the assessments made in relation to the case before the date of its report or interim report, as the case may be.
" We are concerned in this appeal with the duty of the Commission referred to in section 3(b) above.
Section 4 deals with the composition of the Commission, details whereof are unnecessary for our purpose, Sub sections (1), (2) and (4) of section 5 are relevant to the problems before us and must be read : " 5(1).
The Central Government may at any time before the 1st 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 1st 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.
(2) The Commission may, after examining the material submitted by the Central Government with reference to any case or points in a case and making such investigation as it considers necessary, report to the Central Government that in its opinion further investigation is not likely to reveal any substantial 572 evasion of taxation on income and on such report being made the investigation shall be deemed to be closed.
(3). . . . . . . . . . (4) If in the course of investigation into any case or points in a case referred to it under sub section (1), the Commission has reason to believe (a)that some person other than the person whose case is being investigated has evaded payment of taxation on income, or (b) that some points other than those referred to it by the Central Government in respect of any case also require investigation, it may make a report to the Central Government stating its reasons for such belief and, on receipt of such report, the Central Government shall, notwithstanding anything contained in sub section (1), forthwith refer to the Commission for investigation the case of such other person or such additional points as may be indicated in that report.
" Section 5 as originally enacted mentioned the date, 30th of June, 1948, but by Act 49 of 1948 the date substituted was " 1st day of September, 1948 ".
Section 6 states the powers of the Commission, and they may be summarised thus: (a) the Commission has power to require any person or banking or other Company to give information on relevant points; (b) it has power to administer oaths and all the powers of a civil court to take evidence, enforce the attendance of witnesses etc; (c) it has power to impound and retain a document in its custody; (d)it has power to ask an authorised official to examine accounts and interrogate any person; (e) it has power to give directions to an authorised official; (f) it has power to close the investigation and make a best of judgment assessment in respect of a person who refuses or fails to attend in person to give evidence or produce documents etc; and 573 (g) it has power of seizure, search etc.
in certain specified circumstances.
Sections 6A and 6B deal with the power of the Commission to tender immunity from prosecution and to withdraw such tender.
Section 7 states the procedure to be followed by the Commission, sub sections
(2), (4) and (6) whereof need only be referred to here: " 7(2) In making an investigation under clause (b) of section 3, the Commission shall act in accordance with the principles of natural justice, shall follow as far as practicable the principles of the (1 of 1872), and shall give the person whose case is being investigated a reasonable opportunity of rebutting any evidence adduced against him; and the power of the Commission to compel production of documents shall not be subject to the limitation imposed by section 130 of the (1 of 1872), and the Commission shall be deemed to be a court and its proceedings legal proceedings for the purpose of sections 5 and 6 of the (XVIII of 1891).
(3). . . . . . . . . . (4) No person shall be entitled to inspect, call for, or obtain copies of, any documents, statements or papers or materials furnished to, obtained by or produced before the Commission or any authorised official in any proceedings under this Act; but the Commission, and after the Commission has ceased to exist such authority as the Central Government may in this behalf appoint, may, in its discretion, allow such inspection and furnish such copies to any person: Provided that, for the purpose of enabling the person whose case or points in whose case is or are being investigated to rebut any evidence brought on the record against him, he shall, on application made in this behalf and on payment of such fees as may be prescribed by Rules made under this Act, be furnished with certified copies of documents, statements, papers and materials brought on the record by the Commis Sion.
(5). . . . . . . . . . 574 (6) In any proceedings under this Act, the Commission may, in its discretion, admit in evidence and act upon any document notwithstanding that it is not duly stamped or registered.
" Section 8 states in effect what the Commission shall do on the conclusion of the investigation: it states that the materials brought on the record shall be considered by all the members, and the report shall be in accordance with the opinion of the majority.
Subsection (2) of section 8 gives the Central Government power to direct reopening of assessment proceedings on the report of the Commission.
Sub section (4) states that in the assessment or reassessment proceedings in pursuance of a direction given under sub section
(2), the findings recorded by the Commission shall be final, subject to the provisions of sub sections
(5) and (6).
Then comes section 8A which must be quoted in full: "section 8A(1) Where any person concerned in any case referred to or pending before the Commission for investigation applies to the Commission at any time during such investigation to have the case or any part thereof settled in so far as it relates to him, the Commission shall, if it is of opinion that the terms of the settlement contained in the application may be approved, refer the matter to the Central Government, and if the Central Government accepts the terms of such settlement, the Commission shall have the terms thereof recorded and thereupon the investigation, in so far as it relates to matters covered by such settlement, shall be deemed to be closed.
(2) For the purpose of enforcing the terms of any settlement arrived at in pursuance of subsection (1), the Central Government may direct that such proceedings as may be appropriate under the Indian Income tax Act, 1922 (XI of 1922), the Excess Profits Tax Act, 1940 (XV of 1940) or any other law may be taken against the person to whom the settlement relates, and, in particular, the provisions of the second proviso to clause.
(a) of sub section (5) of section 23, section 24B, the proviso to sub section (2) of section 25A, the proviso to sub section (2) of section 26 and sections 44 and 46 of the Indian Income tax Act, 1922 575 shall be applicable to the recovery of any sum specified in such settlement by the Income tax Officer having jurisdiction to assess the person by whom such sum is payable as if it were income tax or an arrear of income tax within the meaning of those provisions.
(3) Subject to the provisions of subsection (6) of section 8, any settlement arrived at under this section shall be conclusive as to the matters stated therein, and no person whose case has been so settled shall be entitled to reopen in any proceeding for the recovery of any sum under this section or in any subsequent assesssment or reassessment proceeding relating to taxation on income or in any other proceeding before any court or other authority any matter which forms part of such settlement.
(4) Where a settlement has been accepted by Government under sub section (1), no proceedings under section 34 of the Indian Income tax Act, 1922 (XI of 1922), or under section 15 of the Excess Profits Tax Act, 1940 (XV of 1940), shall be initiated in respect of the items of income covered by the settlement unless the initiation of such proceedings is expressly allowed by the terms of the settlement.
" Section 9 bars the jurisdiction of courts, but it is not disputed that if any of the provisions of the Act are ultra vires the Constitution, section 9 will neither cure the defect nor stand in the way of the assessee.
Section 10, the last section, gives the Central Government power to make rules.
The above recital gives a brief conspectus of the main provisions of the Act.
It is necessary now to refer to a few earlier decisions of this Court with regard to some of these provisions.
The earliest in point of time is the decision in Suraj Mall Mohta and Co. vs A. V. Viswanatha Sastri where sub section
(4) of section 5 of the Act and the procedure prescribed by the Act in so far as it affected the persons proceeded against under that sub section, were held to be discriminatory and therefore void and unenforceable.
No opinion was, however, expressed on the validity of section 5(1) of the Act.
(1) ; 576 In Shree Meenakshi Mills Ltd., Madurai vs Sri A. V. Viswanatha Sastri (1), it was held that after the coming into force on July 17, 1954, of the Indian Income tax (Amendment) Act, 1954, (33 of 1954) which operated on the same field as section 5(1) of the Act, the provisions of section 5 (1) became void and unenforceable as being discriminatory in character.
It was further held that when an Act was valid in its entirety before the date of the Constitution, that part of the proceedings regulated by the special procedure and taken during the pre Constitution period could not be questioned how.
ever discriminator it might have been, but the discriminatory procedure could not be continued after the coming into force of the Constitution.
In that case (Meenakshi Mills ' case(1)) the Investigation Commission had not even commenced the proceedings though a period of seven years had elapsed and the investigation was pending when the writ petitions were filed.
In those circumstances it was held that the proceedings before the Investigation Commission which had become discriminatory could no longer be continued.
Then came the decision in M. CT.
Muthiah vs The, Commissioner of Income tax, Madras(2).
The facts relevant to that decision were that the Investigation Commission held an enquiry into three cases and submitted a report on August 26, 1952, finding a particular sum to be the undisclosed income during the investigation period.
The Central Government accepted the report and passed an order under section 8(2) of the Act on September 16, 1952.
Notices under section 34 of the Indian Income tax Act were then issued and reassessments except for one year were made on the findings of the Commission, which were treated as final and conclusive.
The re assessment orders were served on the assessees in February and May 1954.
On December 6, 1954, the assessees filed their writ petitions challenging the constitutionality of section 5 (1) of the Act.
It was held by the majority that section 5 (1) was discriminatory and violative of the fundamental right guaranteed under article 14 of the Constitution, because section 34 of the Indian Income tax Act, 1922 as (1) (2) ; 577 amended in 1948 operated on the same field and from and after January 26, 1950, it included the strip of territory which was also occupied by section 5 (1) and two substantially different laws of procedure, one more , prejudicial to the assessee than the other, could not be allowed to operate on the same field in view of the , guarantee of article 14 of the Constitution.
In the result it was held that barring those cases which were already concluded by reports made by the Commission and directions given by Government before January 26, 1950, the cases which were pending before the commission for investigation as also assessment or reassessment proceedings which were pending on January 26, 1950, were hit by article 14.
The assessment orders were accordingly quashed as being unconstitutional.
Now, we come back to the problems before us: (1) what is the effect of Muthia 's decision(1) in the present ease, and (2) does the Act contemplate two separate and distinct, but severable, procedures or jurisdictions one relating to investigation and the other to settlement, so that the vice of discrimination (if any) attaches to the investigation procedure only and not to the other ? We do not see how the learned Attorney General can escape from the position that Muthia 's decision (1) holds in express terms that section 5 (1) of the Act was hit by article 14 of the Constitution on and after January 26, 1950.
The ratio of the decision was thus explained in the majority judgment at page 1260, 1261: " After the 8th September, 1948, there were two procedures simultaneously in operation, the one under Act XXX of 1947 and the other under the Indian Income tax Act with reference to persons who fell within the same class or category, viz., that of the substantial evaders of income tax.
After the 8th September, 1948, therefore, some persons who fell within the class of substantial evaders of income tax were dealt with under the drastic and summary procedure prescribed under Act XXX of 1947, while other (1) ; 73 578 persons who fell within the same class of substantial evaders of income tax could be dealt with under the procedure prescribed in the Indian Income tax Act after service of notice upon them under the amended section 34 (1) of the Act.
Different persons, though falling under the same class or category of substantial evaders of income tax, would, therefore, be subject to different procedures, one a summary and drastic procedure and the other a normal procedure which gave to the assessees various rights which were denied to those who were specially treated under the procedure prescribed in Act XXX of 1947.
The legislative competence being there, these provisions, though discriminatory, could not have been challenged before the advent of the Constitution.
When, however, the Constitution came into force on the 26th January, 1950, the citizens obtained the fundamental rights enshrined in Part III of the Constitution including the right to equality of laws and equal protection of laws enacted in article 14 thereof, and whatever may have been the position before January 26, 1950, it was open to the persons alleged to belong to the class of substantial evaders thereafter to ask as to why some of them were subjected to the summary and drastic procedure prescribed in Act XXX of 1947 and others were subjected to the normal procedure prescribed in section 34 and the cognate sections of the Indian Income tax Act, the procedure prescribed in Act XXX of 1947 being obviously discriminatory and, therefore, violative of the fundamental right guaranteed under article 14 of the Constitution.
" That ratio is equally applicable in the present case, and if section 5(1) of the Act is unenforceable after January 26, 1950, the reference made thereunder against the assessee must also fall after that date and with it must go overboard all that was done under the drastic and summary procedure prescribed under the Act after January 26,1950.
Two possible arguments that (1) substantial evaders whose s were referred by the Central Government for investigation by the Commission 579 before September 1, 1948, formed a class by themselves and (2) that proceedings having started before the Commission under a reference valid at the time when it was made cannot be affected by any subsequent amendment of the Income tax Art, 1922, were raised, but not accepted in Suraj Mall Mohta 's Meenakshi Mills ' or Muthia 's case (1) (2) (3).
There has been some argument before us as to how the two procedures one prescribed under the Income tax Act, 1922, and the other under the Act compare and contrast with each other; but this is a point which was canvassed at great length in each of the three cases mentioned above.
This Court found in unequivocal terms that the procedure prescribed under the Act was more summary and drastic, and in Suraj Mall Mohta 's case the substantial differences between the two procedures were summarised at pp.
463 466 of the report.
We do not propose to cover the same ground again, but cop tent ourselves with drawing attention to what was pointedly said in Suraj Mall Mohta 's case namely, that it was conceded on behalf of Government that the procedure prescribed by the impugned Act in sections 6 and 7, which we have read earlier, was more drastic than the procedure prescribed in sections 37 and 38 of the Indian Income tax Act.
It was stated therein that though in the first stages of investigation there was some similarity between the two procedures, the overall picture was not the same.
The learned Attorney General has not seriously contested the correctness of this position, but has argued that what we are concerned with in the present case is not the mere possibility of a differential treatment, but what actually was done by the Commission in the case of the present assessee after January 26, 1950.
He has submitted that the assessee was not subjected to any differential treatment in fact, and has invoked to his aid the ratio of our decision in Syed Qasim Razvi vs The State of Hyderabad (4), where the majority judgment laid down the following tests: in a case where part of the trial cannot be challenged as (1) [1955] 1S.C.R.448 (2) (3) [1955) 2 S.C.R. 1247.
(4) 580 bad, it is incumbent on the court to consider, first whether the discriminatory provisions of the law can be separated from the rest and even without them a fair measure of equality in the matter of procedure can be secured, and secondly, whether the procedure actually followed 'did or did not, proceed upon the discriminatory provisions and it was stated that a; mere threat or possibility of unequal treatment was not sufficient to invalidate the subsequent proceedings.
A reference was there made to the earlier decisions, of this Court in Keshavan Madhava Xenon vs The State of Bombay (1), and Lachmandas Kewalram Ahuja vs The State of Bombay (2 ), and the decision in Lachmandas case (supra), again a majority decision, was distinguished on two grounds: first, the question as to whether after eliminating the discriminatory provisions it was still possible to secure a fair measure of equality with the normal procedure was neither raised nor considered ; secondly, it was assumed that it was not possible to proceed with the trial without following the discriminatory procedure and as that procedure became void on the coming into force of the Constitution, the jurisdiction to proceed under that procedure came to an end.
Applying the tests laid down in the majority decision of Syed Qasim Razvi 's case (3), the learned Attorney General has contended that in the present case the discriminatory provisions can be separated from the rest of the Act, and the assessee was not in fact subjected to any discriminatory procedure.
He has sought to distinguish Muthia 's case on the same ground, viz., that the re assessments made in that case were actually based on a discriminatory procedure.
In our view the ratio of the majority decision in Syed Qasim Razvi 's case (3) has no application in the case under our consideration, and the principle which applies is what was laid down in Lachmandas 's case (2).
The majority decision is Syed Qasim Razvi 's case proceeded on the finding (to quote the words of Mukherjea, J., who delivered the majority judgment) that " although there were deviations in certain particulars, (1) ; (2) (.3) 581 the accused had substantially the benefit of a normal trial".
The minority judgments, however, very pertinently pointed out that the discriminatory provisions were an integral part of the Regulation under which the accused person in that case was tried and in fact the discriminatory provisions were applied.
Bose, J. (as he then was expressed the view (at p. 618) " that in testing the validity of a law, it is irrelevant to consider what has been done under it, for a law is either constitutional or not and the validity or otherwise cannot depend upon what has been accomplished under its provisions.
" It is, we think, unnecessary to go into the controversy which arises out of the two views expressed above.
For the present case, it is sufficient to say that (1) the discriminatory provisions are an integral part of the procedure prescribed under the Act which cannot be separated from the rest; and (2) we are satisfied that the report which led to the settlement was made by the Investigation Commission in pursuance of and as a direct result of the discriminatory procedure which it followed.
Indeed, the Investigation Commission followed the only procedure of investigation prescribed under the Act, which was a drastic and summary procedure, and if that procedure became void on the coming into force of the Constitution, the jurisdiction of the Investigation Commission practically came to an end (see Lachmandas 's case, supra).
It is necessary to explain here why we cannot accept the contention of the learned Attorney General that there are two procedures or two jurisdictions under the Act.
What in substance is the effect of the provisions of the Act, in so far as they relate to the Commission 's duty under section 3 (b)? The Commission receives a reference under section 5 (1) if it does not proceed under section 5 (2), it exercises such of its powers under section 6 as it considers necessary.
It then follows the procedure laid down in section 7 and submits its report under section 8.
On that report, the Central Government takes action under section 8 (2).
If, however, the assessee applies for settlement, even then the Commission has the, duty to report to Government if the terms of settlement are 582 approved by it.
To fulfil this duty, the Commission must get the materials by exercising its powers under section 6 and by following the procedure laid down in section 7.
That is exactly what was done in the present case.
An authorised official was asked to examine the accounts etc.
under section 6 (3).
He examined the accounts and submitted an interim report in 1953.
He followed the procedure laid down in the Act with regard to inspection of documents, examination of witnesses etc.
He then submitted a final report.
The Commission then heard the assesee on May 19, 1954, and reserved orders.
On May 20, 1954, after the assessee knew what the final finding of the Commission was going to be, he filed an application for settlement.
The Commission made its final report four days after.
It is difficult to understand how in the circumstances stated above, it can be said that the Commission followed a non discriminatory procedure or that it had two jurisdictions one relating to investigation and the other to settlement.
The jurisdiction was really one, and the procedure followed also the same.
It is not as though the Act provided a separate procedure for purposes of effecting a settlement; nor is this a case where a settlement has been made without applying any of the provisions relating to investigation.
A full investigation was made, and after the assessee had been subjected to the drastic and summary procedure under the Act, he was told what the result of the investigation was.
Then, he made an application for settlement, which was approved by the Commission under section 8A.
We are accordingly of the view that the learned Attorney General has failed to make out his case that (1) Muthia 's decision (1) does not apply and (2) the settlement under section 8A of the Act is a legally valid settlement by reason of the severability or non application of the discriminatory procedure under the Act in the case of the assessee.
This brings me to the second question, that of waiver of a fundamental right, which is as important as it is complex.
It is a question on which unfortunately we (1) [1955] 2 S.C.R.1247.
583 have not been able to achieve unanimity.
It is beset with this initial difficulty that the present appeal is not from a judgment or order rendered after the trial of properly framed issues; it is from an order which merely rejected the prayer of the assessee that his properties attached in execution of the recovery certificate should be released and the amounts paid under the terms of the settlement refunded.
The question of waiver was neither raised, nor tried; and the necessary facts were not ascertained or determined by the revenue authority concerned.
Unfortunately, the filing of a statement of their case by the parties was also dispensed with, the result whereof has been that the question of waiver has been urged for the first time in the course of arguments here.
We have, however, heard full arguments on it, and proceed to consider it on such materials as have been placed before us.
It is necessary to make one point clear.
The respondents have raised the plea of waiver, and the onus lies heavily on them to establish the essential requirements in support of the plea.
Two points arise in this connection: (1) have the respondents established, on the materials before us, the necessary facts on which a plea of waiver can be founded ; and (2) if so, can a fundamental right guaranteed by the Constitution be waived at all.
If the first point is answered in the negative, the second point need not be answered in the abstract.
On behalf of the respondents, it has been submitted that assuming (without conceding) that the discriminatory provisions of the Act were applied in the case of the assessee before he asked for a settlement, the materials on record show that he never objected to the procedure adopted, voluntarily asked for a settlement, got by the settlement the benefit.
of reducing his liability for both tax and penalty, and paid without demur the following instalments (some even after Muthia 's decision (1) ) (1) [1955] 2 S.C.P. 1247.
584 Payments made up to April 55 10,000 Payment made on 10 5 55 5,000 19 6 55 5,000 7 7 55 5,000 13 8 55 5,OOO 7 9 55 5,000 15 10 55 5,000 10 11 55 5,000 15 12 55 5,000 8 2 56 5,000 13 2 56 5,000 7 3 56 5,000 14 5 56 5,000 19 5 56 5,000 13 6 56 5,000 6 8 56 5,000 7 9 56 5,000 9 10 56 5,000 10 11 56 5,000 23 12 56 5,000 14 1 57 5,000 29 3 57 5,000 4 6 57 5,000 8 9 57 8,000 1,28,000 The learned Attorney General has in this connection referred us to the application for settlement which the assessee had made to the Commission, wherein the following statements were made: " in view of the fact that though no disclosure statement had been made before the submission of his reports by the authorised official,, still during the enquiry before the Commission,, the assessee and his auditors admitted their liability to tax in respect of the aforesaid sum of Rs. 4,47,915, the Commission was of the opinion that the assessee should be granted the benefit of a settlement on the lower concessional basis of payment of 75 per cent.
of the undisclosed income by way of tax.
The Commission was also of the opinion that the assessee should pay by way of penalty a sum of Rs. 14,064.
585 The assessee accepts the conclusions of the Commission as regards the amount of income that escaped assessment, the tax payable thereon and the penalty payable as aforesaid.
" On the basis of these statements, the learned Attorney General has argued that there is no foundation for the suggestion made on behalf of the assessee that the application for settlement was made " under the pressure of circumstances and in view of the coercive machinery of the Act." He has submitted that the necessary facts on which the plea of waiver is founded have been established, and he has relied on three cases decided by this Court, where according to him the effect of the decisions was to accept such a plea in circumstances very similar: Dewan Bahadur Seth Gopal Das Mohta vs The Union of India(1); Baburao Narayanrao Sanas vs The Union of India (2); and Laxnanappa Hanumantappa Jamkhandi vs The Union of India (3) On behalf of the assessee, it is contended on the contrary that the necessary facts to found a plea of waiver are totally absent in the present case, and none of the aforesaid three decisions which were all pronounced on the same day proceed on a plea of waiver.
Two of the three decisions referred to above relate to a settlement made under section 8A and the third to an order made under section 8(2) of the Act.
All the three decisions were pronounced on applications made under article 32 of the Constitution, and not on any appeal from an order of the revenue authority.
In Gopal Das Mohta 's case (1) the argument urged was, inter alia, that sections 5, 6, 7 and 8 of the Act were invalid and ultra vires as they contravened the provisions of articles 14, 19 (1) (f), and 31 of the Constitution and the prayer made was that the entire proceedings should be quashed as also all orders made by the Central Government in pursuance of the settlement under section 8A.
In rejecting the argument and prayer, Mahajan, C. J., who delivered the , judgment of the Court said at p. 776 (1) ; (2) (3) ; 74 586 " In our judgment this petition is wholly misconceived.
Whatever tax the petitioner has already paid, or whatever is still recoverable from him, is being recovered on the basis of the settlement proposed by him and accepted by the Central Government.
Because Of his request for a settlement no assessment was made against him by following the whole of the procedure of the Income tax Act.
In this situation unless and until the petitioner can establish that his consent was improperly procured and that he is not bound thereby he cannot complain that any of his fundamental rights has been contravened for which he can claim relief under article 32 of the Constitution.
Article 32 of ',,the Constitution is not intended for relief against the voluntary actions of a person.
His remedy, if any, lies in other appropriate proceedings.
" There has been a good deal of argument before us as to the true effect of the decision in Gopal Das Mohta 's case (1).
While I recognise that the reason stated for the decision, viz., that article 32 is not intended for relief against voluntary actions of a person, comes very near to saying that a person has waived his protection in a given case since whatever injury he may incur is due to his own act rather than to the enforcement of an unconstitutional measure against him, I am unable to hold that the decision proceeded strictly on the doctrine of waiver; it is perhaps true to say that some of the observations made therein are of a " Delphic nature to be translated into concreteness by the process of litigating elucidation" (to borrow the words of Frankfurter, J., in Machinists vs Gonzales (2).
It seems to me that the decision proceeded more upon the scope of article 32 than upon the doctrine of waiver.
I am fortified in this view by the circumstance that in a decision given only a month earlier (see Behram Khurshed Pesikaka vs The State of Bombay (3)) the same learned Chief Justice expressed himself strongly, though tentatively, against introducing in our Constitution the doctrine of waiver as enunciated by some American Judges in construing the American Constitution, without a full discussion of the matter.
The report of Gopal (1) [1955] 1 S.C.P. 773.
(2) ; ,619 (3) 653,654.
587 Das Mohta 's case (1) does not contain any reference to the doctrine of waiver, and it is obvious that no ,fuller discussion of the doctrine took place in that case.
It is not, therefore, reasonable to hold that the effect of Gopal Das Mohta 's case is to uphold the doctrine of waiver.
Babu Rao 's case (2) merely followed Gopal Das Mohta (1) and gave no separate reasons.
Laxmanappa Jamkhandi 's case (3) dealt with an order under section 8(2) of the Act and said at p. 772: " From the facts stated above it is plain that the proceedings taken under the impugned Act XXX of 1947 concluded so far as the Investigation Commission is concerned in September, 1952, more than two years before this petition was presented in this Court.
The assessment orders under the Income tax Act itself were made against the petitioner in November, 1953.
In these circumstances we are of the opinion that he is entitled to no relief under the provisions of Article 32 of the Constitution.
It was held by this Court in Ramjilal vs Income tax Officer, Mohindar garh; , , that as there is a special pro.
vision in Article 265 of the Constitution, that no tax shall be levied or collected except by authority of law, clause (1) of Article 31 must therefore be regarded as concerned with deprivation of property otherwise than by the imposition or collection of tax, and inasmuch as the right conferred by article 265 is not a right conferred by Part III of the Constitution, it could not be enforced under Article 32.
In view of this decision it has to be held that the petition under Article 32 is not maintainable in the situation that has arisen and that even otherwise in the peculiar circumstances that have arisen it would not be just and proper to direct the issue of any of the writs the issue of which is discretionary with this Court.
" Here, again, there is no reference to the doctrine of waiver, and the case was decided on the ambit and scope of article 32 of the Constitution.
I would hold, therefore, that the decisions of this Court relied on by the learned Attorney General do (1) ; (2) (3)[1955] 1 S.C.R.769.
588 not help him in establishing waiver.
Let me now examine the circumstances on which the learned Attorney General founds his plea of waiver.
Indeed, it is true that the assessee submitted to the discriminatory procedure applied to him by the Commission; he also asked for a settlement under which he agreed to pay 75% of his alleged tax liability and a small amount of penalty; he made some payment in instalments even after Muthia 's decision in December, 1955.
Do these circumstances amount to waiver ? It is to be remembered that in 1953 1954 when the discriminatory procedure of the Act was applied to him and the report against him was made by the Commission on which the settlement is based, the assessee did not know, nor had it been declared by a court of competent jurisdiction that section 5(1) of the Act was ultra vires.
In his application for a settlement, he said clearly in paragraph 3 that the Commission announced it as its view that the income, profits and gains that had escaped assessment in the hands of the assessee was Rs. 4,47,915.
The assessee also knew that under the Act this finding was final and binding on him.
If in these circumstances, the assessee made an application for settlement, can it be said that it is a voluntary or intentional relinquishment of a known right ? I venture to think not.
It has been said that ' waiver ' is a troublesome term in the law.
The generally accepted connotation is that to constitute ' waiver ', there must be an intentional relinquishment of a known right or the voluntary relinquishment or abandonment of a known existing legal right, or conduct such as warrants an inference of the relinquishment of a known right or privilege.
Waiver differs from estoppel in the sense that it is contractual and is an agreement to release or not to assert a right; estoppel is a rule of evidence.
(See Dawson Bank Limited vs Nippon Menkwa Kabushiki Kaisha) (1).
What is the known legal right which the assessee intentionally relinquished or agreed to release in 1953 1954 ? He did not know then that any part of the Act was invalid, and I doubt if in (1) (1935) L.R.62 I.A.100,108.
589 the circumstances of this case, a plea of 'waiver ' can be founded on the maxim of 'ignorance of law is no excuse '.
I do not think that the maxim 'ignorance of law is no excuse ' can be carried to the extent of saying that every person must be presumed to know that a piece of legislation enacted by a legislature of competent jurisdiction must be held to be invalid, in case it prescribes a differential treatment, and he must, therefore, refuse to submit to it or incur the peril of the bar of waiver being raised against him.
I do not think that such pre science is a necessary corollary of the maxim.
On the contrary, the presumption, if any, which operated at the relevant time was the presumption that a law passed by a competent legislature is valid, unless declared unconstitutional by a court of competent jurisdiction.
Furthermore, I do not think that any inference of waiver can be retrospectively drawn from the instalments paid in 1956 57, particularly when the question of refund of the amounts already paid is no longer a live issue before us.
It would, I think, be going too far to hold that every unsuspecting submission to a law, subsequently declared to be invalid, must give rise to a plea of waiver: this would make constitutional rights depend for their vitality on the accident of a timely challenge and render them illusory to a very large extent.
I hold, therefore, that the necessary foundation for sustaining the plea of waiver has not been laid in this case, and the onus being on the respondents, the plea must fail.
In view of my finding that the necessary foundation on facts for sustaining the plea of waiver has not been laid in this case, it becomes unnecessary to decide, in the abstract, the further question if a right guaranteed by any of the provisions in Part III of the Constitution can be waived at all.
I am of the view that this Court should indeed be rigorous in avoiding to pronounce on constitutional issues where a reason.
able alternative exists; for we have consistently followed the two principles (a) that " the Court will not anticipate a question of constitutional law in 590 advance of the necessity of deciding it " (Weaver on Constitutional Law, p. 69) and (b) " the Court will not formulate a rule of constitutional law broader than is required by the precise facts to which it is to be applied " (ibid, p. 69).
My Lord the Chief Justice and my learned brother Kapur, J., have however expressed the view that the fundamental right guaranteed under article 14 cannot be waived; my learned brethren, Bhagwati and Subba Rao, JJ., have expressed the view that none of the fundamental rights guaranteed by the Constitution can be waived.
I greatly regret to have to say that I have come to a conclusion different from theirs with regard to this question, and as they have thought fit to express their views on it proceed now to explain why I have come to a conclusion different from those of my learned brethren on this question.
This question was mooted, though not fully answered, in Behram Khurshed Pesikaka 's case (1).
Venkatarama Aiyar, J., expressed his views at pages 638 to 643 of the report.
Mahajan, C. J., with whom Mukherjea, Vivian Bose and Ghulam Hasan, JJ., concurred, expressed his views at pages 651 to 655 of the report, and my Lord the Chief Justice as Das, J., reserved his opinion on the question.
The view which Venkatarama Aiyar, J., expressed was this: if the constitutional provision which has been infringed affects the competence of the legislature which passed the law, the law is a nullity; as for example, when a State enacts a law which is within the exclusive competence of the Union; when, however, a law is within the competence of the legislature which passed it and the unconstitutionality arises by reason of its repugnancy to provisions enacted for the benefit of individuals, it is not a nullity, but is merely unenforceable; such unconstitutionality can be waived and in that case the law becomes enforceable.
He said that in America this principle was well settled and he referred to Cooley on Constitutional Limitations, Volume 1, pages 368 to 371 ; Willis on Constitutional Law at (1) , 653, 654. 591 pages 524, 531, 542 and 558; Rottschaefer on Constitutional Law at pages 28 and 29 30.
He then referred to certain American decisions in support of his views and then said: " The position must be the same under our Constitution when a law contravenes a prescription intended for the benefit of individuals. .
It is open to any person whose rights have been infringed to waive it and when there is waiver, there is no legal impediment to the enforcement of the law.
It will be otherwise if the statute was a nullity; in which case it can neither be waived nor enforced.
If then the law is merely unenforceable and can take effect when waived, it cannot be treated as non est and as effaced out of the statute book.
" The contrary view expressed by Mahajan, C. J., can be best explained in his own words: " We think that it is not a correct proposition that constitutional provisions in Part III of our Constitution merely operate as a check on the exercise of legislative power.
It is axiomatic that when the lawmaking power of a State is restricted by a written fundamental law, then any law enacted and opposed to fundamental law is in excess of the legislative authority and is thus a nullity.
Both these declarations of unconstitutionality go to the root of the power itself and there is no real distinction between them.
They represent but two aspects of want of legislative power.
The legislative power of the Parliament and the State legislatures as conferred by articles 245 and 246 of the Constitution stands curtailed by the fundamental rights chapter of the Constitution.
" His Lordship then referred to article 13 of the Constitution and said that it was a clear and unequivocal mandate of the fundamental law prohibiting the State from making any laws which came into conflict with Part III of the Constitution.
His Lordship added: " In our opinion the doctrine of, waiver enunciated by some American Judges in construing the American Constitution cannot be introduced in our Constitution without a fuller discussion of the matter. .
Without finally expressing an opinion on this question, we 592 are not for the moment convinced that this theory has any relevancy in construing the fundamental rights conferred by Part III of the Constitution.
We think that the rights described as fundamental rights are a necessary consequence of the declaration in the ,preamble that the people of India have solemnly resolved to constitute India into a sovereign democratic republic and to secure to all its citizens justice, social, economic and political; liberty of thought, expression, belief, faith and worship; equality of status and of opportunity.
These fundamental rights have not been put in the Constitution merely for individual benefit, though ultimately they come into operation in considering individual rights.
They have been put there as a matter of public policy and the doctrine of waiver can, have no application to provisions of law which have been enacted as a matter of constitutional policy.
" It would appear that the two main reasons which Mahajan, C. J., gave in support of the views expressed by him were these.
Firstly, he held that the effect of article 13 of the Constitution was to prohibit the State from making any laws which came into conflict with Part III of the Constitution and he recognised no such distinction as was drawn by Venkatarama Aiyar, J., between absence of legislative power (that is, incompetence of the legislature) and non observance of provisions which operate merely as a check on the exercise of legislative power.
He thought that absence of legislative power and check on the exercise of legis lative power were both aspects of want of legislative power.
Secondly, he referred to the preamble and the scheme of Part III of the Constitution in support of his view that the doctrine of waiver did not apply.
I shall take these reasons in the order in which I have stated them.
First, as to the effect of article 13 of the Constitution.
Article 13 is in two parts: the first part deals with " all laws in force in the territory of India immediately before the commencement of this Constitution " 'and says that so far as such laws are inconsistent with the provisions of Part III, they shall to the extent of such inconsistency be void; the second part deals with laws made after the commencement of the Constitution and says that " the State shall not make any law which takes.
away or abridges the rights conferred by Part III " of the Constitution and any law made in contravention of cl.
(2) of article 13 shall to the extent of the contravention be void.
It seems clear to me that the Article itself recognises the distinction between absence of legislative power which will make the law made by an incompetent legislature wholly void, and exercise of legislative power in contravention of a restriction or check on such power, which will make the law void to the extent of the inconsistency or contravention.
The use, of the words " to the extent of the inconsistency " and " to the extent of the contravention " indubitably points to such a distinction, and indeed this was pointed out in Bhikaji Narain Dhakras vs The State of Madhya Pradesh (1).
This was an unanimous decision of this Court and several earlier decisions including the decision in Kesavan Madhava Menon 's case (2), on which Mahajan, C. J., placed so much reliance, were considered therein.
The decision in Behram Khurshed Pesikaka (3)was also considered, and then the following observations were made with regard to article 13 of the Constitution at p. 598 " Article 13(1) by reason of its language cannot be read as having obliterated the entire operation of the inconsistent law or having wiped it out altogether from the statute book.
Such law existed for all past transactions and for enforcement of rights and liabilities accrued before the date of the Constitution, as was held in Keshavan Madhava Menon 's case.
The law continued in force even after the commencement of the Constitution, with respect to persons who were not citizens and could not claim the fundamental right.
In short, article 13(1) had the effect of nullifying or rendering the existing law which had become inconsistent with article 19(1)(g) read with el.
(6) as it then stood ineffectual, nugatory and devoid of any legal (1) [1055] 2 S.C.R. 589 (2) ; (3) ,653.
654. 75 594 force or binding effect only in respect of the exercise of the fundamental right on or after the date of the commencement of the Constitution. .
All laws,existing or future, which are inconsistent with the provisions of Part III of our Constitution are, by the express provision of article 13, rendered void I to the extent of such inconsistency '.
Such laws were not dead for all purposes.
" The aforesaid view expressed in Bhikaji Narain 's case (1) was accepted in many later decisions including the decision in Muthia 's case (2).
The same distinction was again referred to in another unanimous decision of this Court in The State of Bombay vs R.M.D. Chamarbaugwala (3) where at p. 885 it was observed: The Court of Appeal has rightly pointed out that when the validity of an Act is called in question, the first thing for the court to do is to examine whether the Act is a law with respect to a topic assigned to the particular Legislature which enacted it.
if it is, then the court is next to consider whether, in the case of an Act passed by the Legislature of a Province now a State), its operation extends beyond the boundaries of the Province or the State, for under the provisions conferring legislative powers on it such Legislature can only make a law for its territories or any part thereof and its laws cannot, in the absence of a territorial nexus, have any extra territorial operation.
If the impugned law satisfies both these tests, then finally the court has to ascertain if there is anything in any other part of the Constitution which places ~any fetter on the legislative powers of such Legislature.
The impugned law has to pass all these three test.
" Therefore, the mere use of the word ~(6 void " in article 13 does not necessarily militate against the application of the doctrine of waiver in respect of the provisions contained in Part III of our Constitution.
Under the American Constitution also, a law made in violation of a constitutional guarantee is struck down, because under article VI of that Constitution, " the Constitution and the laws of the United States which (1) ; (2) ; (3) ; 595 shall be made in pursuance thereof. . shall be the supreme law of the land.
" I am unable, therefore, to accept the view that article 13 shows that the doctrine of waiver can never be applied in respect of the provisions in Part III of the Constitution.
Let me now go to the second reason.
Is there any thing in the preamble and the scheme of our Constitution, with particular reference to Part III, which will make the doctrine of waiver inapplicable ? Let me first place the two preambles side by side: Premple to our Premple to the American Constitution.
Constitution,1787.
"We the people of India "We the people of the United having solemny resolved to States, in order to form a constitute India into a so more perfect Union,establish vereign democratic republic justice,insure domestic tra and to secure to all its ci nquillity,provide for the tizens:justice,social,ecc common defence,promote the nomic and political; liber general welfare,and secure ty of though,expression, the blessing of liberty to belief,faith and worship; ourselves and our posterity equality of status and of do ordain and establish opportunity;and to promote this Constitution for the among them all fraternity United State of America." assuring the dignity of the individual and the unity of the nation;in our Constitu ent Assemply this twenty sixth day of November,1949 do hereby adopt,enact and give to ourselves this Co nstitution.
" 596 American Constitution were : (a) to form a more perfect Union; (b) to establish justice; (c) to insure domestic tranquillity; (d) to promote general welfare; and (e) to secure the blessings of liberty.
In our Constitution, the emphasis is on the Welfare State on Justice, Liberty, Equality and Fraternity.
But the question before us is the limited question of the application of the doctrine of waiver.
I do not find any.
thing in the two preambles which will make the doctrine applicable in one case and not applicable in the other.
It is necessary to refer here to one important distinction between the two Constitutions.
Speaking broadly, the American Constitution of 1787, except for defining the enumerated powers of the Federal Government and limiting the powers of the States, was an outline of government and nothing more.
Its provisions were written in general language and did not provide minute specifications of Organisation or power.
It contemplated subsequent legislation and interpretation for carrying the provisions into effect.
In other words, it was early recognised that the Constitution was not self executing.
The Indian Constitution is more detailed, and in Part III of the Constitution are provisions which not merely define the rights but also state to what extent they are subject to restrictions in the interests of general welfare, etc.
In other words, there is an attempt at adjustment of individual rights with social good, and in that sense the limitations or restrictions are also defined.
But I do not think that this distinction has any particular bearing on the question at issue before us.
The rights as also the restrictions are justiciable, and an interpretation of the rights given and of the restrictions imposed, by courts of competent jurisdiction is contemplated.
Indeed, I recognise that there is a constitutional policy behind the provisions enacted in Part III of the Constitution.
In a, sense, there is a legislative policy in all statutory enactments.
In my opinion, the crucial question is not whether there is a constitutional or legislative policy behind a particular provision, but the question is is the provision meant 597 primarily for the benefit of individuals or is it for the benefit of the general public ? That distinction has, I think, been recognised in more than one decision.
Take, for example, an ordinary statutory enactment like section 80 of the Code of Civil Procedure which says that no suit shall be instituted against the Government or against a public officer in respect of any act purporting to be done by such public officer in his official capacity until the expiration of two months next after a notice in writing has been given, etc.
There is undoubtedly a reason of public policy behind this provision, but it is open to the party for whose benefit the vision has been made to waive notice and indeed the party may be estopped by his conduct from pleading the want of notice.
As the Privy Council pointed out in AL.
Villavar Chettiar vs Government of the Province of Madras (1), there is no inconsistency between the propositions that the provisions of a section are mandatory and must be enforced by the court and that they may be waived by the authority for whose benefit they are provided.
The question then is is there anything in the statute which militates against the application of the doctrine of waiver to such right, subject to the safeguards and precautions necessary for the application of the doctrine, provided the right is for the benefit of individuals ? I am conscious that rights which the Constitution itself characterises as fundamental must be treated as such and it will be wrong to whittle them down.
But are we whittling down fundamental rights when we say that the question of waiver of fundamental rights cannot be answered in the abstract by a general affirmative or a general negative; the question must always depend on (a) the nature of the right guaranteed and (b) the foundation on the basis of which the plea of waiver is raised.
It is to be remembered that the rights guaranteed by Part III of the Constitution are not confined to citizens alone.
Some of the rights are guaranteed to non citizens also.
Moreover, they are not all rights relating to justice, liberty, equality and fraternity; some of the provisions define the rights (A) (1947) L.R. 74 I.A. 223, 228.
698 while others indicate the restrictions or checks subject to which the rights are granted.
Article 33, for example, does not give any right to any person; on the contrary it gives power to Parliament to modify the rights conferred by Part III in their application to persons.
Article 34 lays down a conferred by Part III while in any area.
It is not, there fore, quite correct to say that all the provisions in Part III grant fun amental rights, though the heading is 'Fundamental Rights '.
There is, I think, a three fold classification: (1) a right granted by an ordinary statutory enactment; (2) a right granted by.
the Constitution; and (3) a right guaranteed by Part III of the Constitution.
With regard to an ordinary statutory right there is, I think, no difficulty.
It is well recognised that a statutory right which is for the benefit of an individual can in proper circumstances be waived by the party for whose benefit the provision has been made.
With regard to a constitutional right, it may be pointed out that there are several provisions in our Constitution which do not occur in Part III, but which yet relate to certain rights; take, for example, the rights relating to the Services under the Union and the States in Part XIV.
I do not think that it can be seriously contended that a right which is granted to a Government servant for his benefit cannot be waived by him, provided no question of jurisdiction is involved.
I may refer in this connection to the provisions in Part XIII which relate to trade, commerce and intercourse within the territory of India.
These provisions also impose certain restrictions on the legislative powers of the Union and of the States with regard to trade and commerce.
As these provisions are for the benefit of the general public and not for any particular individual, they can not be waived, even though they do not find place in Part III of the Constitution.
Therefore, the crucial question is not whether the rights or restrictions occur in one part or other of the Constitution.
The crucial question is the nature of the right given: is it for the benefit of individuals or is it for the general public? 599 That, in my opinion, is the true test.
I may here state that the source of the right contractual or statutory is not the determining factor.
The doctrine of waiver is grounded on the principle that a right, statutory or otherwise, which is for the benefit of an individual can be waived by him.
I am aware that a right which is for the benefit of the general public must in its actual operation relate to particular individuals, in the same way as a right for the benefit of individuals will in its actual operation arise in connection with individual A or individual B.
The test is not whether in its operation it relates to an individual.
The test is for whose benefit the right has been primarily granted for the benefit of the general public or for individuals ? Let me now apply this test to some of the provisions in Part III of the Constitution.
These provisions have been classified under different heads: (1) right to equality, (2) right to freedom, (3) right against exploitation, (4) right to freedom of religion, (5) cultural and educational rights, (6) right to property and (7) right to constitutional remedies.
There can be no doubt that some of these rights are for the benefit of the general public.
Take, for example, article 23 which prohibits traffic in human beings, etc ; so also article 24 'which says that no child below the age of 14 shall be employed to work in any factory or mine or engaged in any other hazardous employment.
I do not wish to multiply examples and it is sufficient to state that several of these rights are rights which are meant primarily for the benefit of the general public and not for an individual.
But can we say the same thing in respect of all the rights ? Let us take article 31, which says that no person shall be deprived of his property save by authority of law and that no property shall be compulsorily acquired or requisitioned save for a public purpose and save by authority of law which provides for compensation, etc.
Take a case where a man 's property is acquired under a law which does not fix the amount of compensation or specify the principles on which or the manner in which the compensation is to be determined and given.
The man whose 600 property is taken may raise no objection to the taking of his property under such law.
Indeed, he may expressly agree to Government taking his land for a public purpose under the law in question, though it does not comply with the requirements as to compensation.
Can such a man after two or three years change his mind and say that the law is invalid and his land on which a school or a hospital may have been built in the meantime should be restored to him, because he could not waive his fundamental right ? In my opinion, if we express the view in the abstract that no fundamental right can ever be waived, many startling and unforeseen results may follow.
Take another example.
Suppose a man obtains a permit or a licence for running a motor vehicle or an excise shop.
Having enjoyed the benefit of the permit for several years, is it open to him to say when action is proposed to be taken against him to terminate the licence, that the law under which the permit was granted to him was not constitutionally valid ? Having derived all the benefit from the permit granted to him, is it open to him to say that the very Act under which a permit was granted to him is not valid in law ? Such and other startling results will follow if we decide in the abstract, by a general negative, that a fundamental right can never be waived.
Take article 32, which is a right to a constitutional remedy, namely, the right to move the Supreme Court by appropriate proceedings for the enforcement of the rights conferred by Part III.
It is now well settled by several decisions of this court that the right under article 32 is itself a fundamental right.
Suppose a person exercises that right and initiates appropriate proceedings for enforcement of a fundamental right ' Later he thinks better of it and withdraws his application.
Still later he changes his mind.
Can he then say that he could not waive his right under article 32 and the order passed on his application for withdrawal had no legal validity ? We may take still another example.
Under article 30(1) of the Constitution, all minorities, whether based on religion or language, have the right to establish and administer educational institutions of 601 their choice.
Suppose, there is a minority educational institution and the minority has the right to administer that institution, but they want grant from Government.
The minority may have to surrender part of its right of administration in order to get Government aid.
Can the minority waive its right? Such a question arose for consideration in the advisory opinion which we gave in connection with the Kerala Education Bill and , so far as I have been able to understand, the effect of our opinion is that the minority can surrender part of its right of administration of a school of its own choice in order to get aid from Government.
If we now hold that the minority can never surrender its right, then the result will be that it will never be able to ask for Government aid.
I do not see any such vital distinction between the provisions of the American Constitution and those of our Constitution as would lead me to the conclusion that the doctrine of waiver applies in respect of constitutional rights guaranteed by the American Constitution but will not apply in respect of fundamental rights guaranteed by the Indian Constitution.
Speaking generally, the prohibition in Part III is against the State from taking any action in violation of a fundamental right.
The word 'State ' in that Part includes the Government and Parliament of India as also the Government and Legislature of each of the States and also all local or other authorities within the territory of India or under the control of the Government of India.
The American Constitution also says the same thing in effect.
By article VI it states that the Constitution and the laws of the United States which shall be made in pursuance thereof shall be the supreme law of the land.
It is well settled in America that the first ten amendments to the original Con stitution were substantially contemporaneous and should be construed in pari materia.
In many of the amendments the phraseology used is similar to the phraseology of the provisions of Part III of our Constitution.
The position under the American Constitution is 76 602 well settled and a succinct statement of that position will be found in Rottschaefer on Constitutional Law, pp. 28 29.
The learned author has summarised the position thus: " There are certain constitutional provisions that may be waived by the person for whose protection they were intended.
A person who has waived that protection in a given instance may not thereafter.
raise the issue that his, constitutional rights have been infringed in that instance, since whatever injury he may incur is due to his own act rather than to the enforcement of an unconstitutional measure against him.
A person who would otherwise be entitled to raise a constitutional issue is sometimes denied that right because he is estopped to do so.
The factor usually present in these cases is conduct inconsistent with file present assertion of that right, or conduct of such character that it would be unjust to others to permit him to avoid liability on constitutional grounds.
A person may not question the constitutionality of the very provision on which he bases the right claimed to be infringed thereby, nor of a provision that is an integral part in its establishment or definition.
The acceptance of a benefit under one provision of an Act does not ordinarily preclude a person from asserting ' the invalidity of another and severable provision thereof, but there are exceptions to this rule.
The. ' promoters of a public improvement have been denied ' the right to contest the validity of the rule apportioning its cost over the benefited lands, and a person who has received the benefits of a statute may not there ' after assert its invalidity to defeat the claims of those, against whom it has been enforced in his own favour.
A state is estopped to claim that its own statute deprives it.
of its property without due process of law but it is permitted to assert that its own statute invades rights that its constitution confers upon it.
Prior inconsistent conduct will not,however preclude a person from asserting the, invalidity of an act if under all the circumstances its assertion involves no 603 unfairness or injustice to those against whom it is raised.
" The learned Attorney General placed reliance on the following decisions: (1) Pierce vs Somerset Railway (1); (2) Wall vs Parrot Silver and Copper Company (2); (3) Pierce Oil Corporation vs Phoenix Refining Company (3) ; (4) Shepard vs Barron(4) ; (5) United States V. Murdock(5); (6) Patton vs United States (6) ; and (7) Adams vs United States (7).
The position in America is so well settled that I think it is unnecessary to examine the aforesaid decisions in detail.
I need only refer to the observations of Frankfurter, J., in William A. Adam 's case (supra).
The observations were made in connection with a case where a trial was held without a jury at the request of the accused person himself in spite of the guarantee of Amendment VI.
The observations were " What was contrived as protections for the accused should not be turned into fetters.
To assert as an absolute that a layman, no matter how wise or experienced he may be, is incompetent to choose between judge and jury as the tribunal for determining his guilt or innocence, simply because a lawyer has not advised him on the choice, is to dogmatize beyond the bounds of learning or experience.
" I have not been able to find any real reason on the basis of which the decisions given above with regard to the American Constitution can be held to be inapplicable to similar cases arising under the Indian Constitution.
Two subsidiary reasons have been given for holding that the position under the Indian Constitution is different.
One is that ours is a nascent democracy and, therefore, the doctrine of waiver should not apply.
With respect, I am unable to concur in this view.
I do not think that we shall be advancing the cause of democracy by converting a fundamental right into a fetter or using it as a means for getting out of an (1) ; (2) (1917) 244.U.S.407.
(3) (1922) 259.U.S.125.
(4) (1904) 194.U.S.553.
(5) (1931) 284.U.S.141.
(6) (1930) 281.U.S.276.
(7) (1942) 317.U.S.269.
604 agreement freely entered into by the parties.
I appreciate that waiver is not to be light heartedly applied, and I agree that it must be applied with the fullest rigour of all necessary safeguards and cautions.
What I seriously object to is a statement in the abstract and "in absolute terms that in no circumstances can a right given by any of the provisions in Part III of the Constitution be waived.
Another point taken is that the provisions in Part III embody what are called natural rights ' and such rights have been retained by the people and can never be interfered with.
I am unable to acquiesce in this.
The expression natural rights ' is in itself somewhat vague.
Sometimes, rights have been divided into natural rights ' and civil rights ', and natural rights ' have been stated to be those which are necessarily inherent or innate and which come from the very elementary laws of nature whereas civil rights are those which arise from the needs of civil as distinguished from barbaric communities.
I am unable, however, to agree that any such distinction is apparent from the provisions in Part III of our Constitution: all the rights referred to therein appear to be created by the Constitution.
I do not think that Locke 's doctrine of natural rights ', which was perhaps the authority for the American Declaration of Independence, played any part in the enactment of the provisions of Part III of our Constitution.
The doctrine which has long since ceased to receive general acceptance, has been thus explained by E. W. Paterson (see Natural Law and Natural Rights, Southern Methodist University Press, Dallas, 1955, p. 61): " The theory of natural rights, for which we are indebted to the seventeenth century English philosopher, John Locke, is essentially different from the theories of natural law just discussed in that it lacked the two important characteristics above mentioned: the concept of an immutable physical order and the concept of divine reason. .
He begins with the purpose of justifying the existence of a government with coercive powers.
What inconveniences would arise if there were no government? Men would live in a " stage of nature '; to avoid confusion with the 605 political state I shall call this a condition of nature '.
In such a condition man would be free to work, to enjoy the fruits of his labour, and to barter with others; he would also be free to enforce the law of nature (whose precepts Locke did not define) against every other man.
Since Locke was an optimist about human nature he thought men would get along pretty well in this lawless condition.
Yet the condition of nature is for Locke a fiction like the assumption of a frictionless machine in mechanics.
The chief disadvantages that men in this condition would suffer were, he thought, the absence of an established law,, the absence of a known and impartial magistrate to settle disputes, the absence of a. power sufficient to execute and enforce the judgment of the magistrate.
Moved by these inconveniences, men would enter into a social compact with each other whereby each would transfer to a third person, the government, such rights over his person and property as the government must have in order to remove these inconveniences.
All other rights, privileges, and immunities he reserved, as a grantor of land conveys the fee simple to his son and reserves a life estate to himself.
These reserved rights were natural ' rights because they had originated in the condition of nature and survived the social compact.
" There are, in my opinion, clear indications in Part III of the Constitution itself that the doctrine of ' natural rights ' had played no part in the formulation of the provisions therein.
Take articles 33, 34 and 35 which give Parliament power to modify the rights conferred by Part III.
If they were natural rights, the Constitution could not have given power to Parliament to modify them.
Therefore, I am of the view that the doctrine of 'natural rights ' affords nothing but a foundation of shifting sand for building up a thesis that the doctrine of waiver does not apply to the rights guaranteed in Part III of our Constitution.
The true position as I conceive it is this: where a right or privilege guaranteed by the Constitution rests in the individual and is primarily intended for his benefit and does not impinge on the right of others, it 606 can be waived provided such waiver is not forbidden by law and does not contravene public.
policy or public morals.
In the case before us, I have held that there is no foundation on facts to sustain the plea of waiver.
Therefore, I would allow the appeal with costs.
The order of the Commissioner of Income tax, Delhi, dated January 29, 1958, must be set aside and all proceedings now pending for implementation of the order of the Union Government dated July 5, 1954, must be quashed.
SUBBA RAO, J.
I have had the advantage of perusing the judgments of my Lord the Chief Justice and my learned brother, section K. Das, J.
I agree with their conclusion, but I would prefer to express my opinion separately in regard to the question of the applicability of the doctrine of waiver to the fundamental rights.
This case raises a most serious and important question, viz., whether the doctrine of waiver operates on the fundamental rights enshrined in the Constitution, a question not confined to the immediate purpose of this litigation, but to the public in general.
The question is bound to arise frequently, and the varying observations already expressed by the learned Judges of this Court would lend scope for conflicting decisions involving parties in unnecessary litigation and avoidable hardship.
The question was directly raised and fully argued before us.
In the circumstances, I cannot share the opinion of my learned brother, section K. Das, J., that this Court should avoid a decision on this question and leave it to be decided in a more appropriate case.
The facts have been fully stated by my Lord the Chief Justice in his judgment and I need not restate them.
The learned Attorney General contended that in the American Law the principle of waiver was applied to rights created by the Constitution except in cases where the protection of the rights was based upon public policy and that, by the same analogy, if no public policy was involved, even in India, the person 607 affected by the infringement of the fundamental rights could waive the constitutional protection guaranteed to him.
It was said that in the present case the appellant waived his fundamental right under article 14 of the Constitution as the right was only in respect of his liability to tax and he could legitimately waive it.
To, appreciate this argument it would be convenient at the outset to notice the American Law on the subject.
Certain rights, which are sometimes described as the Bill of Rights, have been introduced by the Amendment; to the Constitution of America.
They declare the rights of the people of America in respect of the freedom of religion speech, press, assemblage and from illegal seizurs.
They guarantee trial by jury in certain criminal and civil matters.
They give protection against self incrimination.
The Fifth Amendment of the Constitution of the United States prescribes that no person shall be deprived of life.
, liberty or property without due process of law; nor shall private property be taken for public use without just compensation.
The Fourteenth Amendment of the Constitution introduces the rule of due process as a protection against the State action.
The said amendments are intended as a protection to citizens against the action of the Union and the States.
Though the rights so declared are general and wide in their terms, the Supreme Court of America, by a long course of judicial, interpretation, having regard to the social conditions ' in that country, has given content to those rights and imposed limitations thereon in an attempt to reconcile individual rights with social good, by evolving counterbalancing doctrines of police power, eminent domain,,.
and such others.
During the course of the evolution.
of the law, attempts were made to apply the doctrine of waiver to the provisions of the Constitution of America.
American Courts applied the doctrine with great caution and in applying the same, laid down definite principles.
The said principles were culled out from the various decisions and clearly summarized in the authoritative, text books on the Constitution of America under different heads: 608 WILLIS ON 'CONSTITUTIONAL LAW ': 1.
Self incrimination: The privilege against self incrimination ' like any other privilege, is one which may be waived.
Double jeopardy: Double jeopardy is a privilege and may be waived expressly or impliedly.
Immunity against unreasonable searches and seizures: The immunity is one which may be waived and by consent one can make a search and seizure reasonable.
Jury Trial: The United States Supreme Court. . held that neither a jurisdictional question nor the interest of the State was involved, but only the privilege and right of the accused, and that these were subject to waiver in accordance with the usual rules.
Due Process of Law as a matter of jurisdiction: In order to delimit personal liberty by exercising social control, the branch of the government undertaking to do so must have jurisdiction.
If it does not have jurisdiction, it is taking personal liberty (life, liberty or property) without due process of law.
To this rule there are no exceptions.
It cannot be waived. 'COOLEY 'S CONSTITUTIONAL LIMITATIONS ': Where a constitutional provision is designed for, the protection solely of the property rights of the.
citizen, it is competent for him to waive the protection, and to consent to such action as would be invalid if taken against his will.
In criminal cases the doctrine that a constitutional privilege may be waived must be true to a very limited extent only.
A party may consent to waive rights of.
property, but the trial and punishment for.
public offences are not within the provinces of individual con.
sent or agreement.
CORPUS JURIS SECUNDUM: It has been stated supra (p. 1050, note 32) that the doctrine of waiver extends to rights and privileges 609 of any character, and since the word ' waiver ' covers every conceivable right, it is the general rule that a person may waive any matter which affects his property, and any alienable right or privilege of which he is the owner or which belongs to him or to which he is legally entitled, whether secured by contract, conferred by statute, or guaranteed by constitution, provided such rights and privileges rest in the individual, are intended 'for his sole benefit, do not infringe on the rights of others, and further provided the waiver Of the right or privilege is not forbidden by law, and does not contravene public policy, and the principle is recognized that everyone has a right to waive, and agree to waive, the advantage of a law or rule made solely for the benefit and protection of the individual in his private capacity, if it can be dispensed with and relinquished without infringing on any public right and without detriment to the community at large. .
As a general rule, rights relating to procedure and remedy are subject to waiver, but if a right is so fundamental in its nature as to be regarded by the state as vitally integrated in immemorially established processes of the administration of justice, it cannot be waived by anyone.
The cases cited at the Bar illustrate the aforesaid principles.
The doctrine was applied to the obligations under a contract in Pierce vs Somerset Railway (1); to deprivation of property without due process of law in Pierce Oil Corporation vs Phoenix Refining Company(2) and Shepard vs Barron (3) to trial by jury in Patton vs United States (4) and Adams vs United States(5); and to self incrimination in United States vs Murdock (6).
It is true, as the learned counsel for the appellant contended, that in some of the aforesaid decisions, observations are in the nature of obiter, but they clearly indicate the trend of judicial opinion in America.
(1) (1898) 43 L. Ed 316; ; (2) ; ; (3) ; ; (4) ; ; (5) ; (6) ; ; 77 610 The American Law on the subject may be summarized thus: The doctrine of waiver can be invoked when the Constitutional or Statutory guarantee of a right is not conceived in public interest or when it does not affect the jurisdiction of the authority infringing the said right.
But if the privilege conferred or the right created by the statute is solely for the benefit of the individual, he can waive it.
But even in those cases the Courts invariably administered a caution that having regard to the nature of the right some precau tionary and stringent conditions should be applied before the doctrine is invoked or applied.
This leads me to the question whether the fundamental rights enshrined in the Indian Constitution pertain to that category of rights which could be waived.
To put it differently, whether the Constitutional guarantee in regard to the fundamental rights restricts or ousts the jurisdiction of the relevant authorities under the Constitution to make laws in derogation of the said rights or whether the said rights are for the benefit of the general public.
At the outset I would like to sound a note of warning.
While it is true that the judgments of the Supreme Court of the United States are of a great assistance to this Court in elucidating and solving the difficult problems that arise from time to time, it is equally necessary to keep in mind the fact that the decisions are given in the context of a different social, economic and political set up, and therefore great care should be bestowed in applying those decisions to cases arising in India with different social, economic and political conditions.
While the principles evolved by the Supreme Court of the United States of America may in certain circum stances be accepted, their application to similar facts in India may not always lead to the same results.
It is therefore necessary to consider the nature of the fundamental rights incorporated in the Indian Constitution, the conditions of the people for whose benefit and the purpose for which they were created, and the effect of the laws made in violation of those rights.
The Constitution of India in its preamble promises to secure to all citizens justice, social, economic and 611 political; liberty of thought, expression, belief, faith and worship; equality of status and of opportunity; and to promote among them all fraternity assuring the dignity of the individual and the unity of the nation.
One of the things the Constitution did to achieve the object is to incorporate the fundamental rights in the Constitution.
They are divided into seven categories: (i) right to equality articles
14 to 18; (ii) right to freedom articles
19 to 22; (iii) right against exploitation articles
23 and 24; (iv) right to freedom of religion articles 25 to 28 ; (v) cultural and educational rightsArts.
29 and 30; (vi) right to property articles
31, 31 A and 31B; and (vii) right to Constitutional remediesArts.
32 to 35.
Patanjali Sastri, J., as he then was, pointed out, in Gopalan vs The, State of Madras(1), that fundamental rights contained in Part III of the Constitution are really rights that are still reserved to the people after the delegation of rights by the people to the institutions of Government both at the Centre and in the States created by the Constitution.
Article 13 reads : (1) All laws in force in the territory of India immediately before the commencement of this Constitution, in so far as they are inconsistent with the pro.
visions of this Part, shall, to the extent of such inconsistency, be void.
(2) The State shall not make any law which takes away or, abridges the rights conferred by this Part and any law made in contravention of this clause, shall, to the extent of the contravention, be void.
" This Article, in clear and unambiguous terms, not only declares that all laws in fore before the commencement of the Constitution and made thereafter taking away or abridging the said rights would be void to the extent of the contravention but also prohibits the State from making any law taking away or abridging the said rights.
Part III is therefore enacted for the benefit of all the citizens of India, in an attempt to preserve to them their fundamental rights against infringement by the institutions created by the Constitution; for, without that safeguard, the objects (1) ; 612 adumbrated in the Constitution could not be achieve, ].
For the same purpose, the said chapter imposes a limitation on the power of the State to make laws in violation of those rights.
The entire part, in my view, has been introduced in public interest, and it is not proper that the fundamental rights created under the various Articles should be dissected to ascertain whether any or which part of them is conceived in public interest and which part of them is conceived for individual benefit.
Part III reflects the attempt of the Constitution makers to reconcile individual freedom with State Control.
While in America this process of reconciliation was allowed to be evolved by the course of judicial decisions, in India, the fundamental rights and their limitations are crystallized and embodied in the Constitution itself; while in America a freehand was given to the judiciary not only to evolve the content of the right but also its limitations, in the Indian Constitution there is not much scope for such a process.
The Court cannot therefore import any further limitations on the fundamental rights other than those contained in Part III by any doctrine, such as " waiver " or otherwise.
I would, therefore, hold that the fundamental rights incorporated in Part III of the Constitution cannot be waived.
It is said.
that such an inflexible rule would, in certain cases, defeat the very object for which the fundamental rights are created.
I have carefully scrutinized the Articles in Part III of the Constitution of India, and they do not, in my view, disclose any such anomaly or create unnecessary hardship to ' the people for whose benefit the rights are created.
Article, 14 embodies the famous principle of equality before the law and equal protection of the laws, and articles 15 to 18 and article 29(2) relate to particular applications of the rule.
The principle underlying these Articles is the mainspring of our democratic form of government and it guarantees to its citizens equal protection in respect of both substantive and procedural laws.
If the doctrine of waiver is engrafted to the said fundamental principles, it will mean that a citizen can agree to be discriminated. ' When one realizes the unequal 613 positions occupied by the State and the private citizen, particularly in India where illiteracy is rampant, it is easy to visualize that in a conflict between the State and a citizen, the latter may, by fear of force or hope of preferment, give up his right.
It is said that in such a case coercion or influence can be established in a Court of law, but in practice it will be well nigh impossible to do so.
The same reasoning will apply to articles 15 and 16.
article 17 illustrates the evil repercussion of the doctrine of waiver in its impact on the fundamental rights.
That Article in express terms forbids untouchability; obviously, a person cannot ask the State to treat him as an untouchable.
Article 19 reads: "(1) All citizens shall have the right (a) to freedom of speech and expression; (b) to assemble peaceably and without arms; (c) to form associations or unions; (d) to move freely throughout the territory of India ; (e)to reside and settle in any part of the territory of India; (f) to acquire, hold and dispose of property ; and (g) to practice any profession, or to carry on any occupation, trade or business.
" The right to freedom is the essential attribute of a citizen under democratic form of government.
The freedoms mentioned in article 19 are subject to certain restrictions mentioned in cls.
(2) to (6) of that Article.
So far as the freedoms narrated in sub cls.
(a) to (g) of Cl.
(1) of article 19 are concerned, I cannot visualise any contingency where a citizen would be in a worse position than he was if he could not exercise the right of waiver.
In regard to freedom to acquire, hold and dispose of property, a plausible argument may be advanced, namely, that a citizen should have a right to waive his right to acquire, hold and dispose of property ; for, otherwise he might be compelled to acquire and hold his property, even if he intended to give it up There is an underlying fallacy in this argument.
The Article does not compel a citizen to acquire, hold and 614 dispose of property just as it does not compel a per.
son to do any of the acts covered by the other freedoms.
If he does not want to reside in any part of the territory of India or to make a speech or to practise any profession, he is at liberty not to do any of ,,these things.
So too, a person may not acquire the property at all or practise any profession but if he seeks to acquire property or practise any profession, he cannot be told that he has waived his right at an earlier stage to acquire property or practise the profession.
A freedom to do a particular act involves the freedom not to do that act.
There is an essential distinction between the non exercise of a right and the exercise of a right subject to the doctrine of waiver.
So understood, even in the case of the right covered by sub cl.
(f) of cl.
(1), there cannot be any occasion when a citizen would be worse off than when he had no fundamental rights under the Article.
The preservation of the rights under article 19 without any further engrafting of any limitations than those already imposed under the Constitution, is certainly in the interest of the public ; for, the rights are essential for the development of human personality in its diverse aspects.
Some comment is made in regard to the right covered by el.
(3) of article 20, and it is asked that if a person has no liberty to waive the protection under that clause, he could not give evidence even if he wanted to give it in his own interest.
This argument ignores the content of the right under cl.
(3) of article 20.
The fundamental right of a person is only that he should not be compelled to be a witness against himself.
It would not prevent him from giving evidence voluntarily.
Under article 21, no person shall be deprived of his life or personal liberty except according to procedure established by law and article 22 gives protection against arrest and detention in certain cases.
I do not think that any situation can be conceived when a person could waive this right to his advantage.
Article 23(1) prohibits traffic in human beings and forced labour.
It is not suggested that a person can waive this Constitutional protection.
So too, the right under article 24, which prohibits employment 615 of children in factories, cannot be waived.
That apart, so far as this Article is concerned, no question of waiver can arise as a child cannot obviously waive his right under this Article.
Article 25 gives guarantee for religious liberty subject to certain restrictions contained therein.
It declares that all persons are equally entitled to freedom of conscience and the right freely to profess, practise and propagate religion.
This right is certainly conceived in the public interest and cannot be waived.
So too, freedom to manage religious affairs, freedom as to payment Of taxes for promotion of any particular religion and freedom as to attendance at religious instruction or religious worship in certain educational institutions are all conceived to enforce the religious neutrality of the State and it cannot be suggested that they are not in public interest.
The cultural and educational rights of the minorities and their right to establish and administer educational institutions of their choice are given for the protection of the rights of the minorities and it cannot be said that they are not in public interest.
Article 31, which prohibits the State from depriving a person of his property save by authority of law or to acquire any property without paying compensation, is intended to protect the properties of persons from arbitrary actions of the State.
This Article is conceived in the interest of the public and a person cannot say that he can be deprived of his property without authority of law or that his land can be acquired without compensation.
It is suggested that if a person, after waiving his fundamental right to property and allowing the State to incur heavy expenditure in improving the same, turns round and claims to recover the said property, the State would be put to irreparable injury.
Firstly, no such occasion should arise, as the State is not expected to take its citizens ' property or deprive them of their property otherwise than by authority of law.
Secondly, if the owner of a property intends to give it to the State, the State can always insist upon conveying to it the said property in the manner known to law.
Thirdly, other remedies may be open to the 616 recover compensation or damages for the improvements bonafide made or the loss incurred, having regard to the circumstances of a particular case.
These considerations, in my view, are of no relevance in considering the question of waiver in the context of fundamental rights.
By express provisions of the Constitution, the State is prohibited from making any law which takes away or abridges the rights conferred by Part III of the Constitution.
The State is not, therefore, expected to enforce any right contrary to the Constitutional prohibition on the ground that the party waived his fundamental right.
If this prohibition is borne in mind, no occasion can arise when the ' State would be prejudiced.
The prejudice, if any, to the State would be caused not by the non application of the doctrine of waiver but by its own action contrary to the Constitutional prohibition imposed on it.
It is then said that if the doctrine of waiver is to be excluded, a person can apply to the Supreme Court under article 32 of the Constitution for the relief provided therein, withdraw the petition, get the order of the Supreme Court dismissing it and then apply over again for issue of a writ in respect of the same right.
The apprehension so expressed is more imaginary than real; for, it has no foundation either in fact or in law.
When an application is dismissed, for whatever reason it may be whether on merits or on admission , the order of the Court becomes final and it can be reopened only in the manner prescribed by law.
There is no scope for the application of the doctrine of waiver in such a cage.
Articles 33 and 34 contain some of the Constitutional limitations on the application and the enforcement of the fundamental rights.
The former.
Article confers power on Parliament to modify the rights conferred by Part III of the Constitution in their application to facts and the latter enables it to impose restrictions on the rights conferred by ' that Part, while martial law is in force in any area.
These two Articles, therefore, do not create fundamental rights, but impose limitations thereon and I 617 cannot appreciate the argument that their presence in Part III either derogates from the content of the fundamental rights declared therein or sustains the doctrine of waiver in its application to the said rights.
Article 35 confers on the Parliament, the power to legislate for giving effect to the provisions of Part III to the exclusion of the Legislatures of the, States.
This Article also does not create a fundamental right, but provides a machinery for enforcing that right.
A startling result, it is suggested, would flow from the rejection of the doctrine of waiver and the suggestion is sought to be illustrated by the following example : A person takes a permit for several years from the State for running a motor vehicle or an excise shop.
Having enjoyed the benefit for several years and when action is proposed to be taken against him to terminate the licence, he contends that the law under which the permit was granted to him offended his fundamental rights and therefore constitutionally not valid.
It is asked whether it would be open to him to say that the very Act under which the permit was granted to him was not valid in law.
To my mind, this illustration does not give rise to any anomaly.
Either a person can run a motor vehicle or an excise shop with licence or without licence.
On the basis the law is valid, a licence is taken and the motor vehicle is run under that licence and if that law offends his fundamental right and therefore void, he continues to ran the business without licence, as no licence is required under a valid law.
The aforesaid illustration does not, there.
fore, give rise to any anomaly and even if it does, it does not affect the legal position.
I have considered the various provisions relating to the fundamental rights with a view to discover if there is any justification for the comment that without the aid of the doctrine of waiver a citizen, in certain circumstances, would be in a worse position than that he would be if he exercised his right.
I have shown that there is none.
Nor is there any basis for the suggestion that the State would irreparably suffer under certain contingencies; for, any resulting hardship would be its 78 618 own making and could be avoided if it acted in accordance with law.
A large majority of our people are economically poor, educationally backward and politically not yet conscious of their rights.
Individually or even collectively, they cannot be pitted against the State organizations and institutions, nor can they meet them on equal terms.
In such circumstances, it is the duty of this Court to protect their rights against themselves.
I have, therefore, no hesitation in holding that the fundamental rights created by the Constitution are transcendental in nature, conceived and enacted in national and public interest, and therefore cannot be waived.
That apart, I would go further and hold that as section 5(1) of the Act XXX of 1947 was declared to be void by this Court in M. Ct.
Muthiah vs The Commissioner of Income tax, Madras (1), the appellant can.
not, by the application of the doctrine of waiver, validate the enquiry made under the said Act.
It is suggested that there is a distinction between a case where the enactment is beyond the legislative competence Of the Legislature which made it and the case where the law is unconstitutional on the ground of existence of a constitutional limitation, that while in the former case the law is null and void, in the latter case the law is unenforceable and may be revived by the removal of the limitation by an amendment of the Constitution.
On this distinction an argument is sought to be built to the effect that as in the present case section 5(1) of the Act XXX of 1947 was declared to be invalid only on the ground that it was hit by article 14 of the Constitution, the law must be deemed to be on the statute book and therefore the appellant was within his right to waive his constitutional guarantee.
I am unable to appreciate this, argument.
The scope of article 13(1) of the Constitution was considered by this Court in Keshavan Madhava Menon vs The state of Bombay (2).
This Court by a majority held that article 13(1) of the Constitution does not make (1) ; (2) ; 619 existing laws which are inconsistent with the fundamental rights, void ab initio, but only renders such laws unenforceable and void with respect to the exercise of the fundamental rights on and after the date of commencement of the Constitution.
Mahajan, C. J., who was a party to that decision, explained the word ,void ' in article 13(1) of the Constitution in Behram Khurshed Pesikaka vs State of Bombay (1).
He observed at page 652 thus: " It is axiomatic that when the law making power of a State is restricted by written fundamental law, then any law enacted and opposed to the fundamental law is in excess of the legislative authority and is thus a nullity.
Both these declarations of unconstitutionality go to the root of the power itself and there is no real distinction between them.
They represent but two aspects of want of legislative power.
The legislative power of Parliament and the State Legislatures as conferred by articles 245 and 246 of the Constitution stands curtailed by the fundamental rights Chapter of the Constitution.
" This decision in clear and unambiguous terms lays down that there cannot be any distinction on principle between Constitutional incompetency and Constitutional limitation.
In either case, the Act is void, though in the latter case, the pre constitutional rights and liabilities arising under the statute are saved.
This Court again dealt with the meaning of the word void ' in Bhikaji Narain Dhakras vs State of Madhya Pradesh (2).
There the question was whether an Act 'Which was declared void on the ground of inconsist ency with the Constitution, can be revived by any subsequent amendment to the Constitution removing the inconsistency.
This Court answered the question in the affirmative.
Das, acting C.; J., observed at page 598 thus: " As explained in Keshavan Madhava Menon 's case, the law became void not in toto or for all purposes or for all times or for all persons but only to the extent of such inconsistency that is to,say, to the extent, it became inconsistent with the provisions of Part (1) (2) ; 620 III which conferred the fundamental rights on the citizens.
It did not become void independently of the existence of the rights guaranteed by Part III.
In Short, Article 13(1) had the effect of nullifying or rendering the existing law which had become inconsistent with article 19(1)(g) read with clause (6) as it then stood ineffectual, nugatory and devoid of any legal force or binding effect only with the exercise of the fundamental right on and after the date of the commencement of the Constitution. . . .
It is only as against the citizens that they remained in a dormant or moribund condition.
In our judgment, after the amendment of clause (6) of article 19 on the 18th June, 1951, the impugned Act ceased to be unconstitutional and became revivified and enforceable against citizens as well as against non citizens.
" This judgment does not say anything different from that expressed in Keshavan Madhava Menon 's case (1) nor does it dissent from the view expressed by Mahajan, C. J., in Behram Khurshed 's case (2).
The problem that confronted the learned Judges was a different one and they resolved it by applying the doctrine of "eclipse '.
The legal position, vis a vis, the law declared to be void either on the ground of legislative incompetence or for the reason of constitu tional limitation, as stated in the earlier decisions, remains unshaken by this decision.
So long as the inconsistency remains the law continues to be void, at any rate vis a vis the fundamental rights of a person.
We are not concerned in this case with the doctrine of revival; for the inconsistency of section 5(1) of the Act with the fundamental right under article 14 of the Constitution has not been removed by any amendment of the Constitution.
So long as it is not done, the said section is void and cannot affect the fundamental rights of the citizens.
In M. Ct.
Muthiah vs The Commissioner of Income tax, Madras (3), it was declared that section 5(1) of Act XXX of 1947 was unconstitutional on the ground that it infringed the fundamental rights of the citizens under article 14 of the Constitution.
(1) ; (2) (3) ; 621 Under article 141 of the Constitution, the law declared by the Supreme Court is binding on all the Courts in India.
It follows that the Income tax Commissioner had no jurisdiction to continue the proceedings against the appellant under Act XXX of 1947.
If the Commissioner had no jurisdiction, the appellant could not by waiving his right confer jurisdiction on him.
The scope of the doctrine of waiver was considered by this Court in Behram Khurshed 's case(1).
There a person was prosecuted for an offence under section 66(b) of the Bombay Prohibition Act and he was sentenced to one month 's rigorous imprisonment.
One of the questions raised there was whether section 13(b) of the Bombay Prohibition Act, having been declared to be void under article 13(1) of the Constitution in so far as it affected the consumption or use of liquid medicinal or toilet preparation containing alcohol, the prosecution was maintainable for infringement of that section.
The Court held that in India once the law has been struck down as unconstitutional by the Supreme Court, no notice can be taken of it by any Court, because, after it is declared as unconstitutional, it is no longer law and is null and void.
Even so, it was contended that the accused had waived his fundamental right and therefore he could not sustain his defence.
Mahajan, C. J., delivering the judgment of the majority, repelled this contention with the following observations at page 653: " The learned Attorney General when questioned about the doctrine did not seem to be very enthusiastic about it.
Without finally expressing an opinion on this question we are not for the moment convinced that this theory has any relevancy in construing the fundamental rights conferred by Part III of our Constitution.
We think that the rights described as fundamental rights are a necessary consequence of the declaration in the preamble that the people of India have solemnly resolved to constitute India into a sovereign democratic republic and to secure to all its citizens justice, social, economic and political ; liberty ,of thought, expression, belief, faith and worship; (1) 622 equality of status and of opportunity.
These fundamental rights have not been put in the Constitution merely for the individual benefit though ultimately they come into operation in considering individual rights.
They have been put there as a matter of public policy and the doctrine of waiver can have no application to provisions of law which have been enacted as a matter of Constitutional policy.
Reference to some of the articles, inter alia, Articles 15(1) 20, 21, makes the proposition quite plain.
A citizen cannot get discrimination by telling the State 'You can discriminate ', or get convicted by waiving the protection given under Articles 20 and 21.
" On the question of waiver, Venkatarama Aiyar, J., in his judgment before review, considered the American decisions and was inclined to take the view that under our Constitution when a law contravenes the provisions intended for the benefit of the individual, it can be waived.
But the learned Judge made it clear in his judgment that the question of waiver had no bearing to any issue of fact arising for determination in that case but only for showing the nature of the right declared under article 19(1)(f) and the effect in law of a statute contravening it.
Das, J., as he then was, in his dissenting judgment, did not state his view on this question but expressly reserved it in the following words: " In coming to the conclusion that I have, I have in a large measure found myself in agreement with the views of Venkatarama Aiyar, J., on that part of the case.
I, however, desire to guard myself against being understood to agree with the rest of the observations to be found in his judgment, particularly those relating to waiver of 'unconstitutionality, the fundamental rights being a mere check on the legislative power or the effect of the declaration under article 13(1) being relatively void '.
On those topics prefer to express no opinion on this occasion.
" I respectfully agree with the observations of Mahajan, C. J.
For the aforesaid reasons, hold that the doctrine of waiver has no application in the case of fundamental rights under our Constitution.
623 ORDER The appeal is allowed.
The order of the Income Tax Commissioner, Delhi, dated January 29, 1958, is set aside and all proceedings now pending for implementation of the order of Union Government dated July 5, 1954, are quashed.
The appellant shall get costs of this appeal.
| IN-Abs | The two questions for determination in this appeal were, (1) whether a settlement under section 8A of the Taxation of Income (Investigation Commission) Act, 1947 (30 Of 1947) made after the commencement of the Constitution was constitutionally valid and (2) whether the waiver of a fundamental right was permissible under the Constitution.
The appellant 's case was on July 22, 1948, referred by the Central Government under section 5(1) of the Act to the Investigation Commission.
for investigation and report.
The Commission directed the authorised official under section 6 of the Act to examine the appellant 's accounts.
He submitted his final report by the end of 1953.
The Commission considered the report heard the assessee and came to the conclusion that Rs. 4,47,915 had escaped assessment.
Thereupon the appellant on May 20, 1954, applied to the Commission for a settlement of his case under section 8A of the Act, agreeing to pay Rs. 3,50,000 by way of tax and penalty at the concessional rate.
The Commission reported to the Central Government approving of the settlement, the Central Government accepted it and it was recorded by the Commission.
The Central Government directed the recovery of the said amount under section 8A(2) of the Act.
The appellant was permitted to make payments by monthly instalments of Rs. 5,000 and the total amount thus paid up to September 8, 1957, aggregated to Rs. 1,28,000.
In the meantime the Income Tax Officer issued a certificate and certain properties of the appellant were attached.
Relying on the decisions of this Court in Suraj Mall Mohta and Co. vs A. V. Visvanatha Sastri, ; and M. Ct.
Muthiah vs The Commissioner of Income tax, Madras, ; , the appellant applied to the Commissioner of Income tax challenging the validity of the settlement made under section 8A of the Act on the ground that section 5(1) Of the Act on which it was founded had been declared void by this Court, and claimed that his properties might be released from attachment and the amount paid under the settlement might be refunded to him.
, On January 29, 1958, the Commissioner of Income Tax sent a reply to the appellant maintaining that the settlement was valid and 529 that the appellant was bound thereunder to pay up the arrears of instalments and requesting him to continue to pay in future.
Against this decision of the Commissioner of Income Tax the.
appellant came up to the Supreme Court by special leave.
It was contended on behalf of the respondent that the Act laid down two distinct and separate procedures, one for investigation and the other for settlement and it was the former alone and not the D, latter that was affected by the decisions of this Court.
and that the appellant by voluntarily entering into the settlement had waived his fundamental right founded on article 14 of the Constitution.
Held (Per Curiam), that both the contentions must fail.
It was not correct to say that the Taxation of Income (In vestigation Commission) Act, 1947, laid down two different procedures, one for investigation and assessment under section 8(2) of the Act and another for settlement under section 8A of the Act and assessment in terms of such settlement and that while the decision of this Court in M. Ct.
Muthiah vs The Commissioner of Incometax, Madras, declaring section 5(1) of the Act to be discriminatory and therefore void, affected only the former procedure and not the latter.
The Act laid down but one procedure and in entertaining a proposal for settlement as in the investigation itself the Commission exercised the same jurisdiction, and powers and followed the one and the same procedure as laid down by sections 5, 6 and 7 Of the Act.
Since the settlement in the instant case was no exception to that rule, it was covered by the decision and must be held to be violative of article 14 Of the Constitution.
M. Ct.
Muthiah vs The Commissioner of Income tax, Madras, ; , applied.
The observations made in the majority judgment of this Court in Syed Qasim Razvi vs The State of Hyderabad, [1953] S.C.R. 589, must be kept strictly confined to the special facts of that case and had no application to the facts of the present case.
Syed Qasim Razvi vs The State of Hyderabad, [1953] S.C.R. 589, held inapplicable.
Per Das, C. J., and Kapur J.
There could be no waiver of the fundamental right founded on article 14 Of the Constitution and it was not correct to contend that the appellant had by entering into the settlement under section 8A of the Act, waived his fundamental right under that Article.
Article 14 was founded on a sound public policy recognised and valued all over the civilised world, its language was the language of command and it imposed an obligation on the State of which no person could, by his act or conduct, relieve it.
As it was not strictly necessary for the disposal of this case, the question whether any other fundamental right could be waived need not be considered in this connection.
Laxamanappa Hanumantappa jamkhandi vs The Union of India; , ; Dewan Bahadur Seth Gopal Das Moht 67 530 vs The Union of India, [1955] 1 S.C.R.773; Baburao Narayanrao Sanas vs The Union Of India, [1954] 26 I.T.R. 725; Subedar vs State, A.I.R. 1957 All.
396 and Pakhar Singh vs The State, A.I.R. 1958 Punj.
294, distinguished and held inapplicable.
Per Bhagwati and gubba Rao, jj.
There could be no waiver '.,not only of the fundamental right enshrined in article 14 but also of any other fundamental right guaranteed by Part III of the Constitution.
The Constitution made no distinction between fundamental rights enacted for the benefit of the individual and those enacted in the public interest or on grounds of the public policy.
There could, therefore, be no justification for importing American notions or authority of decided cases to whittle down the transcendental character of those rights, conceived in public interest and subject only to such limitations as the Constitution had itself thought fit to impose.
Article 13(2) was in terms a constitutional mandate to the State in respect of all the fundamental rights enacted in Part III of the Constitution and no citizen could by waiver of any one of them relieve the State of the solemn obligation that lay on it.
The view expressed by Mahajan, C. J., in Behram Khurshed Pesikaka vs The State of Bombay, , correctly laid down the law on the point.
Since the arguments in the instant case had covered the entire field of fundamental rights, there was no reason why the answer should be confined to article 14 alone.
Behram Khurshed Pesikaka vs The State of Bombay, ; State of Travancore Cochin vs The Bombay Co., Ltd., and The State of Bombay vs R. M. D. Chamarbaugwala; , , referred to.
Per section K. Das, J. It seems clear that article 13 itself re cognises the distinction between absence of legislative power which will make the law made by an incompetent legislature wholly void, and exercise of legislative power in contravention of a restriction or check on such power, which will make the law void to the extent of the inconsistency or contravention; therefore the mere use of the word " void " in article 13 does not necessarily militate against the application of the doctrine of waiver in respect of the provisions contained in Part III of the Constitution.
Behram Khurshed Pesikaka vs The State of Bombay, , considered.
Bhikaji Narain Dhakyas vs The State of Madhya Pradesh, ; ; M. Ct.
Muthiah vs The Commissioner of Income tax, Madras, ; and The State of Bombay vs R.M.D. Chamarbaugwala, ; , referred to.
There was nothing in the two preambles to the Indian and the American Constitutions that could make the doctrine of waiver applicable to the one and not to the other; since the doctrine 531 applied to the constitutional rights under the American Constitution, there is no reason why it should not apply to the fundamental rights under the Indian Constitution.
Case law considered.
But it must be made clear that there is no absolute rule, or one formulated in the abstract, as to the applicability of that doctrine to fundamental rights and such applicability must depend on (1) the nature of fundamental right to which it is sought to be applied and (2) the foundation on the basis of which the plea is raised.
The true test must be whether the fundamental right is one primarily meant for the benefit of individuals or for the benefit of the general public.
Where, therefore, the Constitution vested the right in the individual, primarily intending to benefit him and such right did not impinge on the rights of others, there could be a waiver of such right provided it was not forbidden by law or did not contravene public policy or public morals.
As in the instant case the respondents who had raised the plea, had failed to prove the necessary facts on which it could be sustained, the plea of waiver must fail.
Per Subba Rao, J. Apart from the question as to whether there could be a waiver in respect of a fundamental right, section 5(1) of the Taxation of Income (Investigation Commission) Act, 1947, having been declared void by this Court in M. Ct.
Muthiah vs The Commissioner of Income tax, Madras, as being violative of the fundamental right founded on Art ' 14 Of the Constitution and such decision being binding on all courts in India, the Commissioner of Income tax had no jurisdiction to continue the proceedings against the appellant under that Act and the appellant could not by a waiver of his right confer jurisdiction on him.
No distinction could be made under article 13(1) of the Con stitution between the constitutional incompetency of a legislature and constitutional limitation placed on its power of legislation, for a statute declared void on either ground would continue to be so, so long as the inconsistency continued.
As the inconsistency of section 5(1) of the Act with article 14 continued, it must continue to be void.
Keshavan Madhava Menon vs The State of Bombay, [1951] S.C.R. 228; Behram Khurshed Pesihaka vs State of Bombay, and Bhikaji Narain Dhakras vs State of Madhya Pradesh, ; , referred to.
|
ivil Appeals Nos.
945 47 of 1991.
From the Judgment and Order dated 8.8.1990 of the Punjab & Haryana High Court in L.P.A. Nos.
266, 267 and 268 of 1986.
P.P. Rao, J. Lal, Ms. Yasmin Tarapore, S.K. Bagga and C.M. Nayar for the Appellants.
G.L. Singhi, J.K. Sibal and Ms. Kamini Jaiswal for the Respondents.
The Judgment of the Court was deliverd by FATHIMA BEEVI, J.
Special leave granted.
These Civil Appeals arise from the common judgment dated 8.8.1990 of the High Court of Punjab and Haryana dismissing Letters Patent Apeals against the judgment dated 12.2.1986 of the single Judge allowing writ petitions filed under Articles 226 and 227 of the Constitution of India.
Civil Appeals arising out of S.L.P. (C) Nos.
14471 73 of 1990 are filed by the State of Punjab and Civil Appeals arising out of S.L.P. (C) Nos.
14236 38 of 1990 are filed by Ram Saran and O.P. Singhla, the respondents in the writ petitions.
We shall hereinafter refer the contesting respondents Ram Saran and O.P. Singhla as 'the appellants ' and writ petitioners as 'the petitioners ' for the sake of convenience.
In the Punjab Excise & Taxation Department, there were two separate and distinct cadres known as Assistant Excise and Taxation 733 Officers governed under the Punjab Excise and Taxation Department (State Service Class III A) Rules, 1956 (hereinafter referred to as Class III/A Rules ') and the Excise and Taxation Officers governed by the Punjab Excise and Taxation Department (State Service Class II) Rules.
Under the Class II Rules, appointment to the cadre of Excise and Taxation Officers was made (a) by direct recruitment to the extent of 50% and (b) by promotion from amongst Assistant Excise and Taxation Officers to the extent of 50%.
Under Class III A Rules, subordinate staff was eligible for promotion to the extent of 50% of the vacancies of Assistant Excise and Taxation Officers and their shares were as under: (i) Taxation Inspector 25% (ii) Excise Inspector 12 1/2% (iii) Ministerial Staff Head Office 6 1/4% (iv) Ministerial Staff Sub Office 6 1/4% The appellants as well as the writ petitioners joined the ministerial cadre of the Excise and Taxation Department as Clerks and were confirmed as such.
The writ petitioners were promoted to the higher post and later appointed as Excise/Taxation Inspectors in 1971 72 by transfers under Rule 7(a)(ii) of the Punjab Excise Subordinate Service Rules, 1943.
On such transfer as Excise/Taxation Inspectors, the lien of the writ petitioners was suspended in accordance with the provisions of Rule 3.14(b) of the Punjab Civil Services Rules (Volume I Part I).
The appellants continued in the ministerial cadre, Ram Saran as Assistant and O.P. Singhla as Superintendent.
The Excise and Taxation Department was reorganised on 18th May, 1977.
The cadre of Assistant Excise and Taxation Officers was abolished on 18th May, 1977 and the Assistant Excise and Taxation Officers were redesignated as Excise and Taxation Officers.
Thereafter Class III A Rules became redundant and inoperative and under Class II Rules became redundant and inoperative and under Class II Rules, there was no provision for promotion from subordinate staff direct as Excise and Taxation Officers.
The Government in order to provide avenues of promotion to the subordinate staff decided to make suitable amendment to the Class II Rules on the following terms: "Rule 5.
The members of the service shall be recruited in 734 the following manner, namely: a. xxx xxx xxx b.
In the case of an Excise and Taxation Officer; (i) by promotion from amongst the Taxation Inspectors and Excise Inspectors who have an experience of working as such for a minimum period of five years; or (ii) by promotion from amongst the Superintendents, Assistant, Accountants and Senior Scale Stenographers working in the Excise and Taxation Commissioners Head Office and in the Divisional and District Offices of the Department of Excise and Taxation, Punjab," It was further provided that there will be certain quota for each of the above categories for promotion to the rank of Excise and Taxation Officers.
The State Government decided to adopt and apply the draft provision of Rule 5 in the matter of filling up of the vacancies in the carde of Excise/Taxation Officers before rules could be formally promulgated.
Thus on 22.8.1983, Ram Saran and O.P. Singhla were promoted as Excise/Taxation Officers.
The writ petitioners having been transferred to the other cadres of Excise/Taxation Inspectors have continued there for 14/15 years beyond and period of probation and also qualified the departmental test for Inspectors and they were not considered for the promotion as Excise and Taxtion Officers.
The writ petitions were, therefore, filed challenging the promotion of the appellant mainly on the ground that on the basis of their seniority and lien on the post in the ministerial cadre, the writ petitioners had a right to be considered for promotion to the post of Excise and Taxation Officers prior to the appellants.
The contention of the appellants as well as the State was that though the lien of the writ petitioners in the ministerial cadre was suspended in terms of Rule 3.14(b) of the Punjab Civil Service Rules, if the petitioners wanted that they should be considered for the post of Excise and Taxation Officers on the basis of their lien in the ministerial cadre, they may seek reversion and thereafter their case would be considered on merits and under rules.
It was clarified by the Financial Commissioner in the order dated 7.8.1985 that the case of the writ petitioners would be considered in the light of the eligibility under the 735 relevant rule, that is to say, the amended Rule 5.
The eligibility prescribed under the said rule for promotion from amongst Superintendents etc.
in the ministerial service includes experience of working as such for a period of five years.
The writ petitioners felt that if the service rendered by them as Excise and Taxation Inspectors was not being considered as service rendered in the ministerial cadre, they would be ineligible for consideration to the post of Excise and Taxation Officers.
The learned single Judge accepted the contention of the writ petitioners that there was no conscious decision to apply the draft rules and consequently for the post of Excise and Taxation Officer, the writ petitioners are entitled to be considered without any bar of eligibility as their juniors had already been considered for the post.
On appeal, the Division Bench proceeded on the assumption that the draft rules though not promulgated were rightly implemented.
The Division Bench dealt with the question whether the service rendered on transfer to the ex cadre would be available to the writ petitioners in the matter of their promotion to the higher posts thus: "In view of this, question that calls for determination is as to whether on the return of the writ petitioners from the post of Excise and Taxation Inspectors to the Ministerial cadre, the service rendered by them on the post of Excise and Taxation Inspector could by deeming fiction be considered as having been rendered in the Ministerial cadre? The answer to this question is that such a service is to be counted as if the petitioners were always in the Ministerial cadre.
Once it is held that the petitioner lien was only suspended under Rule 3.14(b) of the Punjab Civil Service Rules, the petitioners had a right to come back to their posts in the Ministerial cadre and once that is so, the rest would follow as if for all times deemingly they were in the Ministerial cadre.
" The Division Bench relied on the decision of this Court in State of Mysore & Anr.
vs P.N. Nanjundiah & Anr., , and opined that the entire service rendered by the petitioners as Excise and Taxation Inspectors will be considered in the Ministerial cadre and if that is counted the petitioners would be eligible for promotion under the relevant rules.
It rejected the contention that the petitioners could not be said to be retaining a lien in the Ministerial cadre as they had successfully completed the period of probation as Excise and Taxation 736 Inspectors and they will be deemed to be confirmed there.
The Division Bench endorsed the view that the revival of the lien essentially means that it stands revived with effect from the date it had been suspended, and dismissed the appeals observing: ". we may observe that the petitioners shall now be considered forthwith for the posts of ETOs from the date their juniors were promoted and if found suitable they will be promoted to that rank from the dates their juniors were promoted and they would be entitled to all the consequential benefits arising out of their promotion from the said date.
" Shri P.P. Rao, the Senior Counsel for the appellants, and Shri G.L. Sanghi, the Senior Counsel for the respondents (writ petitioners), conceded that both parties claim promotion to the post of Excise and Taxation Officers only by virtue of the provision in the amended Rule 5 of Class II Rules and, therefore, the question whether there had been conscious application of the said rule before promulgation is only academic.
We agree with the view of the High Court that for the purpose of present controversy we have to assume that the amended Rules were rightly implemented before they were formally promulgated in effecting the promotions now challenged.
The appellants maintain that the Division Bench as clearly wrong, and that the petitioners in order to claim the benefit of promotion from the ministerial cadre under the amended Rules have necessarily to satisfy the eligibility test.
To be more specific, they should have actual experience of five years in the ministerial cadre even when they are reverted back to that cadre.
We have said that the petitioners were appointed as Inspectors by transfer under Rule 7 of the Punjab Excise Subordinate Service Rules, 1943 and thereafter they belonged to a different cadre.
Their lien had also been suspended after three years.
The Punjab Civil Services Rules, Volume, I, Part I, Rule 3.14 reads: "3.14.
(a) A competent authority shall suspend the lien of a Government employee on a permanent post which he holds substantively; if he is appointed in a substantive capacity 737 (1) to a tenure post, or (2) to a permanent post outside the cadre on which he is borne, or (3) provisionally, to a post on which another Government employee would hold a lien, had his lien not been suspended under this rule.
(b) A competent authority may, at its option, suspend the lien of a Government employee on a permanent post which he holds substantively if he is deputed out of India or transferred to foreign service, or in circumstances not covered by clause (a) of this rule, is transferred, whether in a substantive or officiating capacity, to a post in another cadre, and if in any of these cases there is reason to believe that he will remain absent from the post on which he holds a lien, for a period of not less that three years.
(c) xxx xxx xxx (d) If a Government employee 's lien on a post is suspended under clause (a) or (b) of this rule, the post may be filled substantively, and the Government employees appointed to hold it substantively shall acquire a lien on it: Provided that the arrangements shall be reversed as soon as the suspended lien revives.
Note 1.
xxx xxx xxx Note.
When a post is filled substantively under this clause, the appointment will be termed "a provisional appointment"; the Government employee appointed will hold a provisional lien on the post; and that lien will be liable to suspension under clause (a) but not under clause (b) of this rule.
(e) xxx xxx xxx (f) A Government employee 's lien which has been suspended under clause (b) of this rule shall revive as soon as he ceased to be on deputation out of India or on foreign service or to hold a post in another cadre . " 738 According to the appellants, the respondents having been transferred to the cadre of Excise and Taxation Inspectors and having continued there for 14/15 years beyond the period of probation, their lien over ministerial post was suspended.
The consideration of their names for the purpose of promotion as Excise and Taxation Officers from the ministerial post did not arise.
The amended Rule introduced eligibility that would exclude the service rendered by the petitioners in other posts and if such service is excluded, the petitioners would be ineligible.
The lien of the petitioners had been suspended by the competent authority under the mandatory provisions of Rule 3.14(b) referred to.
They could seek reversion to their parent ministerial cadre and claim consideration for promotion to the post of Excise and Taxation Officers according to their eligibility and suitability.
The next below rule does not apply to the case of promotion to the higher posts in other cadres under specific rules governing promotions to those cadres.
The recruitment to the post of Excise and Taxation Officer is governed by Punjab Excise and Taxation Department (State Service Class II) Rules, 1956.
The eligibility of Taxation Inspectors and Excise Inspectors and members of ministerial establishment for the post is governed by the amended Rule 5.
According to the proposed Rule 5(b)(ii), promotion to the post of Excise and Taxation Officer is to be made from amongst the Superintendents, Assistants, Accountants and Senior Scale Stenographers working in the Excise and Taxation Commissioners Head Office and in the District and Divisional Offices.
In view of this provision, the Taxation Inspectors and Excise Inspectors whose lien against their posts in the ministerial cadres has been suspended and who are not working on the eligible ministerial establishment posts and who have been working as Taxation Inspectors and Excise Inspectors for a long number of year cannot claim that they are to be considered automatically for recruitment to the post of Excise and Taxation Officer.
The normal line of promotion within the cadre for the members of the ministerial establishment was from the lowest post of a Clerk to the highest post of a Superintendent.
So also the further channel of promotion was open to the Inspectors to the post of Excise and Taxation Officer.
If the Inspectors are to be considered for the post of Excise and Taxation Officer from the quota of the ministerial establishment, that will result in the Inspectors getting two avenues for promotion while the ministerial staff losing even the one which had been provided.
The appointment to the ex cadre posts of Excise and Taxation Inspector is made by transfer in accordance with the provisions of Rule 739 7 of Subordinate Service Rules, 1943 which provide that appointment to the cadre post shall be made by transfer or deputation of an official already in Government service.
It implies that any Government employee irrespective of his office can be appointed as Excise or Taxation Inspector.
The Excise and Taxation Inspectors ' cadre is distinctly different from the ministerial cadre having duties or functions altogether different in nature and content.
Instead of waiting for their turn to be promoted from the Inspectors quota, the petitioners have laid the claim to the quota in the ministerial service.
The appellants are also persons who have been confirmed in the ministerial cadre and have worked for more than 20 years as such.
The result would be that there would be no promotions to the post of Excise and Taxation Officer from the ministerial staff as such, and those who got transferred as Inspectors would be getting double benefit by claiming promotion to the post of Excise and Taxation Officer as members of the ministerial staff while retaining their right to claim promotion from within the quota specifically provided for the Inspectors.
The petitioners with suspended lien on the post of Clerk and continuously holding the Inspector 's post for over 13 years cannot be considered to be at par with officials continuously working on the ministerial post for over 21 year.
From the scheme of the Rules and the method of recruitment, it is clear that the petitioners while working as Inspectors on appointment by transfer to that cadre had the advantage of being considered for promotion as Officers under the amended Rule 5 out of the quota for Inspectors, while the ministerial staff to the exclusion of the Inspectors were entitled to certain percentage.
The petitioners without being on the ministerial cadre even by reversion could not claim promotion as a member of the ministerial cadre without revival of the lien.
Such revival could be effected only on reversion and not while the lien remained suspended.
When the rule requires members of the ministerial staff to have experience as such for five years to satisfy the elibility requirement, the Inspectors cannot claim that service in the different cadre with their lien suspended be equated to service in the ministerial cadre and treated as experience in the ministerial cadre even if the functions and duties of the Inspectors may be of identical nature.
The purpose of the rule is to provide promotional avenues to different categories within specified limits.
The benefit intended for one category cannot be extended to another category by stretching the rules, particularly when no injustice would result.
The argument that the petitioners if found ineligible would remain in the lower cadre while their juniors are being promoted to the higher cadre 740 cannot be coutenanced.
Even when the juniors continued in the lower ministerial cadre for long years, the petitioners were in a different cadre which had a larger promotional avenue and they are satisfied in that post.
If the petitioners did not exercise their option to revert back to the ministerial cadre at the right time to qualify themselves for further promotion, the appellants cannot be deprived of the benefit they derived by continuing in the lower cadre on account of that situation.
The High Court was clearly wrong in holding that the petitioners have acquired eligibility by rendering service in the cadre of Inspectors since their lien had been suspended.
The decision in State of Mysore 's case (supra) is distinguishable on facts.
Rule 53(b)(i) of the Mysore Service Rules considered in that case provided that service in another post whether in a substantive or officiating capacity shall count for increments in the time scale applicable to the post on which the Government servant holds a lien or as well as in the time scale applicable to the post, if any, on which he would hold a lien had his lien not been suspended.
The Court noticed that the service of an officer on deputation to another department is treated as equivalent to the service in the parent department under the rule.
On account of that equation between the service in the two departments, it was held that the service on deputation should be deemed to be rendered in the parent department.
The ratio of the decision is, therefore, not applicable in the present case.
In C. Narasinga Rao & Ors.
vs State of Andhra Pradesh by its Secretary, Vol.
2 1968 S.L.R.644, Rule 9 of the Andhra Pradesh State and Subordinate Service Rules provided that service rendered in the transferred department should be deemed to have been rendered in the parent department for promotion and seniority.
And when the rule is thus specific, it was held that the petitioners ' service in the police department should be deemed to have been rendered in the parent department entitling them to promotion.
If the Government employee was on deputation or holding a post in another cadre, the lien shall revive as soon as he ceased to hold the post in another cadre.
There is no revival of the lien during the period the employee continues to hold a post in another cadre.
Therefore, during the period the suspension is operative, the employee cannot claim that he had been continuing in the post in the parent cadre and gaining experience.
When the rule is clear and specific that for the purpose of promotion from the cadre of Superintendents, Assistants, Accountants, Senior Scale Stenographers to the post of Excise and 741 Taxation Officers, the eligibility qualification is 'experience of working 'as such ' for five years ' the employee is not entitled to claim the experience in the ex cadre as experience of working in the ministerial cadre.
In the light of what has been stated above, we are unable to uphold the decision of the High Court.
The writ petitions are liable to be dismissed.
Accordingly, we allow the appeals.
R.N.J. Appeals allowed.
| IN-Abs | In the Punjab Excise and Taxation Department there were two separate cadres known as "Assistant Excise & Taxation Officers" governed under the State Service Class III A Rules, 1956 and "Excise & Taxation Officers" governed by the State Service Class II Rules.
Under the class II Rules, appointments were made in the ratio of(a) 50% by direct recruitment and (b) 50% by promotion from amongst Assistant Excise and Taxation Officers.
Likewise under the Class III A Rules 50% of the vacancies were filled by direct recruitment and 50% by promotion from the subordinate staff comprising the Taxation Inspectors, Excise Inspectors, Ministerial Staff Head Office and Ministerial Staff Sub office who within themselves had shares as laid down.
The Writ Petitioners and the contesting respondents Ram Saran and O.P. Singhla had initially joined the Punjab Excise and Taxation Department as clerks and were confirmed as such.
The Petitioners were promoted and appointed as Excise/Taxation Inspectors by transfer under Rule 7(a)(ii) of the Punjab Excise Subordinate Service Rules, 1943 and their lien in the taxation department suspended under Rule 3.14(b) of the Punjab Civil Service Rules.
Whereas Ram Saran and O.P. Singhla continued in the ministerial cadre and were Assistant and Superintendent respectively at the relevant time.
730 Following reorganisation of the department, the carde of Assistant Excise & Taxation Officers was abolished and all the Assistant Excise & Taxation Officers were redesignated as Excise and Taxation Officers.
Consequently Class III A Rules became redundant.
As under Class II Rules there was no provision for promotion of subordinate staff direct as Excise & Taxation Officers the Government in order to provide avenues of promotion to the ministerial carde including Taxation Inspectors and Excise Inspectors brought in suitable amendments to these Rules on the following terms. "Rule 5.
The members of the service shall be recruited in the following manner namely: (a) xxx xxx xxx (b).
In the case of an Excise and Taxation Officer; (i) by promotion from amongst the Taxation Inspectors and Excise Inspectors who have an experience of working as such for a minimum period of five years; or (ii) by promotion from amongst the Superintendents, Assistant, Accountants and Senior Scale Stenographers working in the Excise and Taxation Commissioners Head Office and in the Divisional and District Offices of the Department of Excise and Taxation, Punjab." Applying the draft amended Rules before they were formally promulgated the contesting respondents Ram Saran and O.P. Singhla were promoted as Excise & Taxation Officers on 22.8.1983.
The Writ Petitioners who had been transferred earlier to other cardes of Excise/Taxation Inspectors and worked there for 14/15 years beyond the probation period were not considered.
They therefore, filed writ petitions in the High Court challenging the promotion of the appellants mainly on the ground that on the basis of their seniority and lien in the ministerial cadre, they had a right to be considered for promotion prior to the appellants.
The appellants and the State contended that if the Petitioners wanted to be considered for this post on the basis of their lien in the ministerial carde, they may seek reversion to this cadre and thereafter their case would be considered on merits in accordance with the eligilbility as prescribed under the amended Rule 5 which includes experience of working as such for a period of five years in the ministerial 731 cadre.
To this reply of the Writ Petitioners was that if the service rendered by them in the other cadre as Excise and Taxation Inspectors was not considered as service rendered in the ministerial cadre, they would be ineligible for consideration to this post.
The learned single judge accepted the petitioners ' contention and in allowing the Writ Petitions held that there was no conscious decision to apply the draft rules and consequently the Petitioners were entitled to be considered for the post of Excise & Taxation Officers without any bar of eligibility as their juniors had already been considered.
On appeal, the Division Bench took the view that the draft rules, though not promulgated were rightly implemented.
However on the question whether service rendered by the Petitioners on transfer to the other cadres could be considered as having been rendered in the Ministerial cadre, the Division Bench relying on the decision of this court in State of Mysore & Anr.
vs P.N. Nanjundiah & Anr., , held that it did and that if that is counted the petitioners would be eligible for promotion under the relevant rules with their suspended lien reviving with effect from the date it had suspended and they shall be considered forthwith.
Against this order Ram Saran and O.P. Singhla have preferred appeals by special leave and so has the State separately.
Reversing the decision of the High Court and allowing the appeals dismissing the writ petitions, this Court, HELD: From the scheme of the Rules and the method of recruitment it is clear that the petitioners while working as Inspectors on appointment by transfer to that cadre had the advantage of being considered for promotion as Officers under the amended Rule 5 out of the quota for Inspectors, while the ministerial staff to the exclusion of the Inspectors were entitled to certain percentage.
[739E] The petitioners without being on the ministerial cadre even by reversion could not claim promotion as a member of the ministerial cadre without revival of the lien.
Such revival could be effected only on reversion and not while the lien remained suspended.
[739F] If the Government employee was on deputation or holding a post in another cadre, the lien shall revive as soon as he ceased to hold the post in another cadre.
There is no revival of the lien during the period the employee continues to hold a post in another cadre.
Therefore, during the period the suspension is operative, the employee cannot claim that he had been continuing in the post in the parent cadre and gaining experience.
[740G] 732 When the rule is clear and specific that for the purpose of promotion from the cadre of Superintendents, Assistants, Accountants, Senior Scale Stenographers to the post of Excise and Taxation Officers, the eligibility qualification is 'experience of working ' as such ' for five years, the employee is not entitled to claim the experience in the ex cadre as experience of working in the ministerial cadre.
[740H 741A] State of Mysore & Anr.
vs P.N. Nanjundian & Anr., , distinguished.
C. Narasinga Rao & Ors.
vs State of Andhra Pradesh by its Secretary, Vol. 2 relied upon.
|
Civil Appeal Nos.
(NCE) 1044 & 1045 of 1991.
From the Judgement and Order dated 29.10.1990 of the Bombay High Court in Election Petition No.5 of 1990.
K.K. Venugopal, Harish Salve, P.H. Parekh, Sunil Dogra, V.D. Joshi and A.M. Khanwilkar for the Appellants.
A.S. Bobde, V.A. Bobde, S.D. Mudliar, C.K. Ratnaparkhi, B.P. Pandye, and Mrs. Nirmal Chhagan for the Respondent.
The Judgement of the Court was delivered by SAWANT, J. These two petitions arise out of a common order dated 29th October, 1990 passed by the Bombay High Court in Election Petition No. 5 of 1990 and raise a common question of law.
Hence they are disposed of by this judgement.
Leave is granted in both the petitions.
The election petition in which the impugned order is passed was filed by a defeated candidate (Respondent No.1) against the elected candidate (Respondent No.2) and other contesting candidates challenging the validity of the election of respondent No.2 to the Lok Sabha from the Bombay South Central Constituency in the election held on November 24, 1989.
The election of respondent No.2 is challenged in the petition, among other things, on the ground of corrupt practices under sub sections (2), (3) and (3A) of Section 123 of the Representation of the People Act, 1951 (hereinafter referred to as the "Act").
It appears from the impugned order that the High Court has reached a stage in the trial of the election petition where examination in chief and cross examination of about 14 witnesses has been completed and various documents have been brought on record.
It is at this stage that the impugned order has been made, the operative part of which reads as follows: 762 "In this Election Petition, the Petitioner seeks to set aside the election of Respondent No.1 on the ground of corrupt practice under Sections 123(3) and 123(3A) of the said Act.
The Petitioner has led documentary and oral evidence.
Respondent No.1 has tendered documents but has led no oral evidence.
The other Respondents have remained absent even though served.
Petitioner and Respondent No.1 have argued their respective cases.
The learned Advocate General has also drawn my attention to Section 99 of the said Act which requires this Court, whilst giving a finding that corrupt practice has been proved, to name all persons who have been proved at the trial to have been guilty of any corrupt practice and the nature of that practice.
This however must be after having given to such persons notice to appear and show cause why he/they should not be so named.
At this stage, I am of the prima facie opinion that the charges alleged in the Petition of corrupt practice under Section 123(3) and 123(3A) of the said Act have been proved to have been committed and that Mr. Bal Thackeray, Mr. Chhagan Bhujbal and Mr. Manohar Joshi Are (to use the words of Supreme Court) collaborators in such corrupt practice.
Accordingly, I direct that notices under Section 99 of the Representation of the People Act, 1951, shall be given to Mr. Bal Thackeray, Mr. Chhagan Bhujbal and Mr. Manohar Joshi to appear before me on 3rd December, 1990, to show cause why they should be not be so named in the order on the Election Petition.
Each notice shall state that the person named in the notice shall have an opportunity of cross examining all witnesses who have given evidence against him and that he shall have a right of calling evidence and of being heard.
I direct that to all the notices shall be annexed photo copies of: (a) the Petition, the written statement of Respondent No.1 and the Issues.
763 (b) the oral depositions of the petitioners witnesses.
(c) all exhibits, except Exhibits RR, SS to YY, AAA, AAA1, AAAA, BBBB, BBBB1 and Exhibits 1 to 8.
(d) this order.
I also direct that along with all the notices shall be sent audio cassettes containing copies of Exhibits SS to YY.
" Aggrieved by this order, two of the persons named therein, viz., Manohar Joshi and Chhagan Bhujbal have approached his Court by way of these two separate appeals by special leave.
The order is assailed on the ground that although it directs the issuance of notice to the appellants to answer allegations of corrupt practices allegedly committed by them, it is vague and does not indicate which of the corrupt practices they are alleged to have committed and which evidence on record supports them.
In the absence of the specific charge/s and the evidence in support of it/them indicated in the order and the notices issued pursuant to it, the appellants are at a loss to comprehend the case that they are called upon to meet.
They are thus put to a disadvantage and are gravely prejudiced.
It is pointed out that the consequences of naming a person on his being found guilty pursuant to such notice are grave inasmuch as, among other things, he incurs a disqualification for contesting election under Article 103 of the Constitution read with Section 8A of the Act.
It is also urged that even otherwise the notice to appear and the opportunity to show cause contemplated under the proviso to sub section (1) of Section 99 of the Act enjoins upon the Court to state precisely the charge and the evidence which the person summoned is called upon to meet.
It does not contemplate a vague notice such as the one which is issued and is directed to be issued by the impugned order.
For reasons more than one, we find great force in these submissions.
Shri Bobde, the learned Advocate General of Maharashtra who appeared for respondent No.1 could not seriously dispute these contentions.
However, he pointed out to us an earlier order dated December 1, 1988 of this Court passed in Special Leave Petition No. 13163 of 1988 which was filed against a similar order passed by the Bombay High Court in Election Petition No.1 of 1988.
This Court by its said order had held as follows: 764 "We do not think that in a notice under Section 99 of the Representation of the People Act, 1951 the portions of the speeches of the petitioner are required to be specific for the purpose of sub sections (3) and (3A) of Section 123 of the said act.
The petitioner, however, will be at liberty to make an application before the Court for specifying those portions which, Prima facie, according to the Court, come within the purview of sub sections (3) or (3A) of Section 123 of the said Act.
If any such application is made, the Court will dispose of it in accordance with law.
The special leave petition is disposed of accordingly.
" The provisions of the Act which have a cumulative bearing on the present question are contained in sections 82, 83, 97, 98, 99, 107, 123(3) and 123(3A) of the Act.
Section 82 enjoins upon the election petitioner to join as respondent to the petition, in addition to other necessary parties, any candidate against whom allegations of any corrupt practice are made in the petition.
Section 83 which deals with the contents of the election petition states, among other things, as follows: "83.
Contents of petition. (1) An election petition (a) . . . . . . . . (b) shall set forth full particulars of any corrupt practice that the petitioner alleges, including as full a statement as possible of the names of the parties alleged to have committed such corrupt practice and the date and place of the commission of each such practice; and (c). . . . . . . .
Provided that where the petitioner alleges any corrupt practice, the petition shall also be accompanied by an affidavit in the prescribed form in support of the allegation of such corrupt practice and the particulars thereof.
(2) Any schedule or annexure to the petition shall also be signed by the petitioner and verified in the same manner as the petition.
" 765 It is clear from the reading of these two sections that even in the election petition where allegations of corrupt practices are made, full particulars of the alleged corrupt practice including as fuller a statement as possible and the names of the parties who are alleged to have committed such practice and the date and place of the commission of each such practice have to be furnished.
What is further, the allegations of the corrupt practice have to be accompanied by an affidavit in support both of the allegations as well as the particulars thereof, and if there are any schedules or annexure to the petition in support of the corrupt practice, they have also to be signed by the petitioner and verified by him in the same manner as the petition.
This is a mandatory requirement.
The object of the said provisions is obvious.
The party and it includes not only the returned candidate but all other candidates against whom the corrupt practice is alleged, must have an adequate notice of the precise allegations made against him so that he has a proper opportunity to meet them.
Section 97 states that when in an election petition a declaration that any candidate other than the returned candidate has been duly elected is claimed, the returned candidate or any other party may give evidence to prove that the election of such candidate would have been void if he had been the returned candidate and the petition had been presented calling in question his election.
The section requires that before the returned candidate or such other party, as aforesaid, gives such evidence, he should have, within 14 days from the date of the commencement of the trial, given notice to the High Court of his intention to do so and that notice has to be accompanied by the statement and particulars required by Section 83 in the case of an election petition and has to be signed and verified in the like manner.
We have already referred to the relevant requirements of Section 83 with regard to the furnishing of the particulars of the corrupt practice.
Section 98 states that on the conclusion of the trial of an election petition, the High Court shall make an order (a) dismissing the election petition; or (b) declaring the election of all or any of the returned candidates to be void; or (c) declaring the election of all or any of the returned candidates to be void and the petitioner or any other candidate to have been duly elected.
Then follows Section 99 of which what is relevant for our purpose in sub section (1) which reads as follows: "99.
Other orders to be made by the High Court. (1) At 766 the time to making an order under section 98 the High Court shall also make an order (a) where any charge is made in the petition of any corrupt practice having been committed at the election, recording (i) a finding whether any corrupt practice has or has not been proved to have been committed at the election, and the nature of that corrupt practice; and (ii) the names of the persons, if any, who have been proved at the trial to have been guilty of any corrupt practice and the nature of that practice; and (b) fixing the total amount of costs payable and specifying the persons by and to whom costs shall be paid.
Provided that a person who is not a party to the petition shall not be named in the order under sub clause (ii) of clause (a) unless (a) he has been given notice to appear before the high Court and to show cause why he should not be so named; and (b) if he appears in pursuance of the notice, he has been given an opportunity of cross examining any witness who has already been examined by the High Court and has given evidence against him, of calling evidence in his defence and of being heard.
" It is clear from the provisions of sub clause (i) and (ii) of clause (a) of sub section (1), that at the time of deciding the petition, the Court has to record a finding that a corrupt practice is proved to have been committed and that it is committed by a particular person.
The Court has not only to name the person but also the nature of the corrupt practice committed by him.
If the person is a party to the petition, it is not necessary to hear him separately before recording such finding.
However, when he is not a party to the petition, before such serious finding is recorded against him, he must have the same opportunity as the party to the petition, to meet the allegations against him.
In that respect, he stands on the same footing as the party to the petition against whom such a finding is to be recorded.
He cannot be 767 discriminated against and made to suffer any disadvantage because he is not a party to the petition.
This is the precise object which is sought to be secured by the proviso to the Section.
Section 107 of the Act states that the order of the High Court under Section 98 or Section 99 shall take effect as soon as it is pronounced by the High Court subject, of course, to the stay, if any, granted by the High Court itself or in appeal by the Supreme Court.
Section 123 enumerates and defines the corrupt practices for the purposes of the Act.
We are concerned in the present case with the corrupt practices mentioned in sub sections (3) and (3A) of the said section.
Those sub sections read as follows: "(3) The appeal by a candidate or his agent or by any other person with the consent of a candidate or his election agent to vote or refrain from voting for any person on the ground of his religion, race, caste, community or language or the use of, or appeal to religious symbols or the use of, or appeal to, national symbols, such as the national flag or the national emblem, for the furtherance of the prospects of the election of that candidate or for prejudicially affecting the election of any candidate: Provided that no symbol allotted under this Act to a candidate shall be deemed to be a religious symbol or a national symbol for the purposes of this clause.
(3A) The promotion of, or attempt to promote, feelings of enmity or hatred between different classes of the citizens of India on grounds of religion, race, caste, community, or language, by a candidate or his agent or any other person with the consent of a candidate or his election agent for the furtherance of the prospects of the election of that candidate or for prejudicially affecting the election of any candidate.
" It is clear from the aforesaid sub sections that each of them enumerates not a single corrupt practice but various distinct corrupt practices.
They are as follows.
Sub section (3) speaks of the corrupt practices of (A) the appeal (i) to vote, or (ii) to refrain from voting for any 768 person on the ground of (a) his religion.
(b) his race, (c) his caste, (d) his community, or (e) his language; (B)(i) of the use of, or (ii) of appeal to (a) religious symbols (b) national symbols such as the national flag or (bb) the national emblem either for the furtherance of the prospects of the election of that candidate, or for prejudicially affecting the election of any candidate.
Likewise Sub section(3A) consists of different corrupt practices as follows: (i) the promotion of, or (ii) attempt to promote feeling of enmity or hatred between different classes of the citizens of India on ground of (a)religion, (b) race, (c) caste, (d) community, or (e) language either for the furtherence of the prospects of the election of that candidate or for prejudically affecting the election of any candidate.
Hence merely by enumerating in the notice the numbers of sections, viz., 122(3) and 122(3A) as is directed to be done by the impugned order, the person summoned does not understand which of the various corrupt practices mentioned in the sections is alleged against him and what precise charge he has to meet.
Section 8A of the Act states that the case of every person who is found guilty of a corrupt practice by an order under section 99 shall be submitted, as soon as may be, after such order takes effect, by such authority as the Central Government may specify in this behalf, to the President for determination of the question as to whether such person shall be disqualified and if so, for what period.
The period of disqualification is not to exceed 6 years from the date on which the order made in relation to him under Section 99 takes effect.
Subsection (3) thereof requires the President to obtain the opinion of the Election Commission on such question and to act according to such opinion.
The President exercises this power under Article 103 of the Constitution and the powers of Election Commission when such a reference is made by the President are governed by Section 146 of the act.
769 12.
A reading of all the aforesaid provisions together would show that the proceedings pursuant to the notice issued by the High Court under Section 99 of the Act are of a quasi criminal nature.
It has also been held so by this Court in so many words, in some of the decisions: See D.P.Mishra vs Kamal Narain Sharma & Ors . , and Rashim Khan vs Khurshid Ahmed & Ors. ,[1975] 1 SCR 643.
Where, therefore, a corrupt practice is alleged, the trail of an election petition on such charge is of a quasi criminal nature, and a heavy burden rests on the person alleging the corrupt practice to prove strictly all the ingredients of the charge.
This is as it should be since the naming of a person as having committed a corrupt practice has a serious consequence of disqualifying him from being chosen as or from being member of any House of the Parliament or of the Legislative Assembly or Council of a State for a period upto 6 years.
What is further, as pointed out above, when the legislature requires that the election petition shall contain full particulars of each and every alleged corrupt practice including as fuller a statement as possible of the names of the parties and the date and place of the commission of such practice, it would be contrary to the object of the said provisions to hold that when a notice is issued under Section 99 against a person who is not a party to the election petition for holding him guilty of any corrupt practice, the notice should not apprise him of the precise charge against him and give him the full particulars thereof.
Judged in the light of these requirements of law there is no doubt that the impugned order directing the issuance of notice as stated theren, is extremely vague and defective to the point of being contrary to the provision of law.
We have reproduced above the relevant portion of the order.
The order (i) directs issuance of an omnibus notice against the appellants and one other person;(ii) states again in an omnibus manner that the Court is satisfied that the charges alleged in the petition of corrupt practices under Section 123(3) and 123(3A) of the Act have been proved to have been committed by all of them (iii) further directs that each notice shall state that the person named in the notice shall have an opportunity of cross examining all witness who have given evidence against him and that he shall have a right calling evidence and of being heard.
It then directs that to all the notices to be issued, copies of (a) the petition and the written statement, (b) oral deposition, (c) all exhibits (d) the impugned order itself and (e) audio cassettes containing copies of Exhibits SS to YY should be annexed 770 15.
The notices directed to be issued and which have accordingly been issued are defective in many respects.
In the first instance, they do not spell out the precise corrupt practice which each of the appellants is called upon to meet.
As has been pointed out above, Section 123(3) does not refer to one corrupt practice but a variety of them.
Yet the notice does not specify which particulars corrupt practice is sought to be brought home to each of the appellants.
Secondly, although the copies of the petition, written statement etc. are directed to be sent along with the notices, the order does not direct the notices to state and therefore, they do not state which of the portions of the petition, written statement, oral evidence, documentary evidence and audio cassettes is being relied upon to sustain which of the charges and against which of the appellants.
As pointed out earlier, it is a pre condition for the trial of the charges of the corrupt practices that the person called upon to face the charge should be apprised, in advance, of the precise charge or charges against him and also the precise evidence oral or documentary, which is sought to be relied upon in support of the said charge or each of the said charges.
It is obvious that the kind of notice which is directed to be issued by the impugned order is defective in all these respects and conveys nothing to the appellants.
The impugned order and the notices issued pursuant to it falling short of the requirement of law are, therefore, liable to be struck down.
It is true that this Court in its order dated December 1, 1988 had refused to interfere with a similar order and had held that such a notice is not against the provisions of the law.
It has, however, to be remembered in this connection that even while doing so, the Court had given an opportunity to the petitioner therein to make an application before the High Court for specifying those portions of the speeches of the petitioner which prima facie according to the High Court came within the purview of sub sections (3) or (3A) of Section 123.
The Court had further directed that if any such application is made, the High Court should dispose it of in accordance with law.
It appears that consequent upon the direction, an application was made by the petitioner for specifying the portions of the speeches which were sought to be relied upon to sustain the charges under sub sections (3) and (3A).
The High Court held that the provisions of Section 99 did not require it to analyse the evidence and specify either in the notice under the said section or at any time prior to hearing the person to whom it is issued, what portion or portions thereof seemed in its view prima facie to make out the case which he was called upon to answer.
771 This the High Court did in spite of the fact that it recorded correctly that the person to whom a notice under Section 99 is issued is entitled to be put in the same position as the elected candidate and that his position can be no better.
We have pointed out earlier that in fact the vague notice which is directed to be issued by the impugned order does in fact place the person against whom the notice is issued in a worse position than not only the elected candidate but other persons who are parties to the election petition.
It is with a view to see that he is not placed in a disadvantaged position as against the parties to the petition that it is necessary to apprise him also of the details of the specific charges against him in advance.
We have also pointed out that the trial being of a quasi criminal nature and the consequence of the named person being serious, he is entitled to this minimum safeguard.
The view taken by the High Court was, therefore, obviously wrong.
Unfortunately, the special leave petition filed even against that order of the High Court came to be dismissed in limine and without a speaking order.
We are of the view that for the reasons which we have stated above, neither the order of December, 1 1988 nor the later non speaking order of January 23, 1989 lays down the correct position of law and should be deemed to have been overruled by this decision.
However, we make it clear that these observations will not in any way affect the validity of the decision rendered by the High Court in that election petition being Election Petition No. 1 of 1988.
We further make it clear that the law laid down here will operate only prospectively, i.e., to final orders of indictment passed under Section 99 of the Act, hereafter.
In the view we have taken above, we should set aside the impugned order and the notices issued in each case in pursuance of the said order.
However, we are of the view that it is not necessary to do so.
Instead, we direct that the appellants will appear before the High Court on 25th March, 1991 and the High Court will on that day or on such other day as it may deem convenient, issue proper notices to the appellants in the light of the law laid down and then proceed to hear and dispose of the notices in accordance with law.
The appeals are allowed accordingly.
In the circumstances of the case, there will be no order as to costs.
R.S.S. Appeals allowed.
| IN-Abs | In the 1989 elections to the Lok Sabha, respondent No. 2 was declared elected from the Bombay South Central Constituency.
One of the defeated candidates (respondent No. 1) filed an election petition challenging the validity of the election of respondent No. 2 inter alia on the ground of corrupt practices under sub section (2),(3) and (3A) of section 123 of the Representation of the People Act, 1951.
The High Court having reached the stage in the trial when it was prima facie of the opinion that the charges alleged in the petition, of corrupt practices falling under sections 123(3) and 123(A) had been proved to have been committed, it proceeded under section 99 to name the collaborators in such corrupt practices.
The High Court accordingly directed issuance of notices to three persons.
Aggrieved by this order, two of the person named therein approached his Court by way of two separate appeals.
Before this Court, it was contended on behalf of the appellants that (i) the consequences of naming a person on his being found guilty pursuant to such notices were grave; (ii) the proviso to sub section(1) of section 99 of the Act enjoined upon the Court to state precisely the charges and the evidence which the person summoned was called upon to meet; and (iii) the notices to the appellants to answer allegations of corrupt practices allegedly committed by them were vague.
Allowing the appeals and directing the High Court to issue proper notices to the appellants in the light of law, this Court, HELD: (1) It is clear from the provisions of sub clauses (i) and (ii) of clause (a) of sub section (1) of section 99, that at the time of deciding 760 the election petition the Court has to record a finding that a corrup practices is proved to have been committed and that it has been committed by a particular person.
The Court has not only to name the person but also the nature of the corrupt practice committed by him.[766F G)] (2) If the person is a party to the petition, it is not necessary to hear him separately before recording such finding.
However, when he is not a party to the petition, before such serious finding is recorded against him, he must have the same opportunity as the party to the petition, to meet the allegations against him.
In that respect, he stands on the same footing as the party to the petition against whom such a finding is to be recorded.
He cannot be discriminated against and made to suffer any disadvantage because he is not a party to the petition.
[766H 767] (3) Where a corrupt practice is alleged, the trial of an election petition on such charges is of a quasi criminal nature, and a heavy burden rests on the person alleging the corrupt practice to prove strictly all the ingredients of the charge.
This is as it should be since the naming of a person as having committed a corrupt practice has a serious consequence of disqualifying him from being chosen as or from being member of any House of Parliament or of the Legislative Assembly or Council of a State for a period upto 6 years.
[769B C) D.P. Mishra vs Kamal Narain Sharma & Ors., [1971] 3 S.C.R. 257 and Rashim Khan vs Khurshid Ahmed & Ors., [1975] I.S.C.R. 643, referred to.
(4) When the legislature requires that the election petition shall contain full particulars of each and every alleged corrupt practice including as fuller a statement as possible of the names of the parties and the date and place of commission of such practice, it would be contrary to the object of the said provisions to hold that when a notice is issued under Section 99 against a person who is not a party to the election petition for holding him guilty of any corrupt practice, the notice should not appraise him of the precise charge against him and give him the full particulars thereof.[769D E] (5) The impugned order directing the issuance of notice is extremely vague and defective to the point of being contrary to the provisions of law.
The notice is of an omnibus character.
Section 123(3) does not refer to one corrupt practice but a variety of them.
Yet the notice does not specify which particular corrupt practice is sought to be 761 brought home to each of the appellants, and does not state which of the portions of the petition, etc.
is being relied upon to sustain which of the charges and against which of the appellants.
[769F G, 770B] [Order dated December 1, 1988 in Special Leave petition No. 13163 of 1988 and the later non speaking order of January 23, 1989 in the matter overruled.] [771D]
|
N: Criminal appeal No. 512 of 1979.
From the Judgement and Order Dated 18.7.1979 of the Allahabad High Court Crl.
A No. 564 of 1974.
U.R. Lalit, Sobhag Mal Jain, Sudhanshu Atreya, Ms. P. Jain and S.K. Jain for the Appellants.
Vijay Bahuguna, Prashant Chaudhary and D. Bhandari (NP) for the Respondent.
The Judgement of the Court was delivered by V.RAMASWAMI, J.
The four appellants along with 15 others were charged for offences punishable under Section 302 read with section 149 and also section 201 read with section 149 and section 147 and 148 of the Indian Penal Code.
The charges were that they were members of an unlawful assembly, in prosecution of the common object of namely to deter Ram Sewak (PW2), from filing the nomination paper for the post of Pradhan Gaon Sabha Tikhra and to commit the murder of his associates including one Gajendra Singh Yadav (deceased), a resident of village Bibiapur and in furtherance of that common object did commit the murder of the said Gajendra Singh Yadav and live cartrides belonging to the deceased.
They were also charged that in furtherance of the said common objects and knowing that the murder of the said Gajendra Singh was punishable with death or imprisonment for life and caused the evidence of the said offence to disappear by scraping the blood stained earth at the scene of occurrence and burning it and taking away the dead body of Gajendra Singh and thereafter burning it with the intention of screening of evidence.
The first Additional District and Sessions Judge, Kheri in Sessions Trial No. 264 of 1973 acquitted all the accused persons of all the charges on the ground that there are many infirmities rendering the prosecution evidence unworthy of belief.
The State of Uttar Pradesh preferred Criminal Appeal No. 654 of 1974 before the Lucknow 859 Bench of the Allahabad High Court.
The High Court set aside the acquittal of the first appellant Bhupendra Singh (1) and convicted him for offence under section 302 of the Indian Penal Code and sentenced him to a term of life imprisonment.
The High Court also set aside the acquittal of the second, third and fourth appellants (A4, 7 and 8) in part, convicted them under section 201, IPC and sentenced them to a term of seven years rigorous imprisonment under that section.
The acquittal of the appellants under the remaining charges were confirmed.
The High court also acquitted the other 15 appellants of all the charges.
The prosecution case was that the deceased and Ram Sewak (PW2) who are residents of village Bibiapur alongwith Tarun Kumar (PW1) son of the deceased, Ram Avtar Yadav (PW3) and their party people came to the village Padarial Tula in a bullock cart on 25.4.1972 for the purpose of filing the nomination papers of Ram Sewak (PW2) for the election of Pradhan of Gaon Sabha.
they reached around 10.30 A.M. the Mela Maidan near the compound of school cum temple in village Padaria Tula.
They left the bullock cart and the bullocks in a nearby place to the west of the eastern pathway about 50 paces away from the school where the nomination papers had to be filed.
Bhupendra Singh, the first accused was also a candidate for the office of Pradhan of Gaon Sabha.
He had also come for filing the nomination along with the other accused who were his supporters.
On seeing the party of the deceased arrive Bhupendra Singh enquired Ram Sewak (PW2), whether he had come to file nomination paper against him.
At that time Gajenddra Singh, deceased intervened and challengingly told the first accused that he should ask him.
This resulted in verbal altercation between the first accused and the deceased.
The first accused then fired a shot with his rifle at the deceased and on receiving the bullet injury the deceased fell on the ground.
The prosecution case further was the six other accused had also guns and they also fired at the deceased.
The other accused who were armed with lathis and ballams, physically assaulted the deceased.
Thereafter the accused dragged the deceased to a small mound on the west of the scene of occurence and then loaded the dead body on the trolley of a tractor belonging to the first accused, which had been used by the accused to reach at the scene and which driven by the first accused and the deceased was taken away.
All the accused got into the trolley and shouting loudly that they are going to burn the body and throw its remains in the water drove the tractor towards the north.
PWs 1 to 6 are stated to be eye witnesses to this part of the occurrence.
PWs 7,8,9 and 10 are stated to have seen the first accused driving the tractor to 860 which the trolley was attached and the three other appellants and 15 or 16 more people sitting on the tractor and going towards a revolt shouting that they are taking the body of Gajendra Singh and that the will be burnt and thrown into the river.
PW 10 Lalji also claimed that he saw the burning of the dead body near the river and the ashes thrown in river suita.
Tarun Kumar PW1 son of the deceased went to his village Bibiapur, wrote the report exhibit Ka. 1 and gave the first information report before the Station House Officer Thana Mira which is about 12 miles from the scene of occurrence at 3.30 PM on that day.
Rama Nand Tewari (PW17) took up the investigation reached the scene of occurrence at 5.30 P.M. and seized some blood stained earth at a point market `A ' in the plan and also some ashes, besides 55 pellets wads, teeth and some buttons on the spot under Mahazars which were attested by Rajendra Prasad (PW4) and Durga Prasad (PW5) and another.
On the 27th of the April, 1972 he interrogated Asharfi (PW7), Chhotanney (PW8), Reoti Prasad (PW9) and Lalji (PW10) and accompanied by them he reached the jungle at the outskirts of village Daulatpur where he found burnt leaves near a Shisham tree.
He seized burnt earth, ashes and burnt pieces of bones under recovery memo in the presence of Rajendra Prasad (PW4) and Durga Prasad (PW5).
On the 14th of May, 1972 in Village Mudia he interrogated Ram Autar (PW3), Ram Sewak (PW2), Gaua Din (PW6) and others submitted the charge sheet on 4th December, 1972.
As already stated the charge against the first appellant was one under section 302 read with section 149, IPC and the Trial Court had acquitted him of that offence.
The High Court on appeal by the State while setting aside the acquittal of the first appellant convicted him for the substantive offence under section 302, IPC on the ground that the he was the principal offender; that his shot resulted in death of Gajendra Singh and the other accused persons to whom no specific part has been brought home were entitled to benefit of doubt.
The High Court also believed the prosecution case relating to the disposal of body by taking it away from the scene of occurrence and burning it and throwing the ashes in the river but held that PWs 7,8,9 and 10 speak of the appellants alone by name as among the persons in the tractor and trolley and the names of others were not mentioned by them and therefore set aside the acquittal in respect of the offence under section 201 of IPC in so far as the appellants are concerned and convicted them and sentenced them a term of seven years of rigorous imprisonment.
The four appellants have filed the above criminal appeal against this conviction and sentence of the High Court.
861 There could be no doubt that an occurrence of type spoken to by the prosecution witnesses had taken place at the Mela Maidan, Padaria Tula, 25.4.1972 was the date fixed for filing nomination papers for the election of Pradhan of the Gaon Sabha comprising Padaria Tula.
The place where the nomination papers had to be filed is the school premises at the place.
Ramesh Chander Mishra (PW15) the Sub Deputy Inspector of Schools had been authorised to receive the nomination papers.
He was assisted by the Gram Sewak Verma (CW1) and Rajendra Prakash (PW14) among others.
They had stated in their evidence that they were inside the school premises and that around 10.30 A. M. they heard gun shots near the school.
PW2 Ram Sewak as also the first appellant Bhupendra Singh had come there to file their nomination papers along with other party people.
The investigating officer had made certain recoveries from the scene of occurrence along with bullock cart and the two bullocks in which the deceased and his party had come to the sense.
The evidence of PWs 1 to 6 are also uniform that the occurrence had taken place at that place.
We can therefore, safely assume that the incident took place at the Mela Maidan near the compound of School cum temple in Village Padaria Tula as stated by the prosecution.
It is true that the pieces of burnt bones recovered from the place where the body was stated to have been burnt were set to the Serologist but he was unable to tender any opinion regarding origin, sex and age.
Though, it was contended by the learned counsel for the appellants that the prosecution had not established that any such occurrence had taken place that morning and that Gajendra Singh had fallen the victim in such occurence we are unable to agree with the learned counsel that the occurrence had not taken place at all that Gajendra Singh had not been proved to have been killed.
There could be no doubt that corpus delieti could be established by the prosecution through direct evidence and that is what the prosecution had done in this case in the circumstances we are of the view that the prosecution had established that there was an occurence at 10.30 A.M. on 25.4.1972 at the place mentioned by the prosecution in which Gajendra Singh had fallen a victim and died.
Mr. Lalit, learned counsel for the appellants took us through the entire evidence and contended that the prosecution had not established the complicity of the first appellant for murder and the appellants for the offence of screening the evidence punishable under section 201, IPC.
In the FIR, Tarun Kumar (PW1) had mentioned the names of the four appellants and the presence of PWs 2 to 6 at the scene of 862 occurence.
All these eye witnesses had uniformly stated that they saw only Bhupendra Singh firing at the deceased which brought him down to the ground and stated further that immediately on hearing the first shot they ran and hid themselves behind the dilapidated wall of the temple and they had heard only 6 and 7 shots thereafter.
They have not attributed over acts to any of the accused other than Bhupendra Singh, the first appellant.
It is in those circumstances, the High Court confirmed the acquittal of all the accused other then Bhupendra Singh of the offence under section 302 read with section 149, IPC.
PWs 3 to 6 have stated in their evidence that during the course of verbal altercation between the first accused and the deceased, the first accused shot Gajendra Singh with rifle on the fore head.
On the basis of that shooting with the rifle on the fore head the first appellant was convicted for the substantial offence of murder under section 392 IPC and sentenced to life imprisonment.
In the FIR though Tarun Kumar, PW1 has stated that the first appellant fired at his father first, he had not stated that the bullet hit fore head bringing down its father to the ground.
It is stated in the FIR: "Bhupender then, first of all, fired on my father; along with, all other started firing.
My father then fell down as a result of attack by fire arms; then others with lathis and ballams started assaulting.
From there, I noticed that Bhupender Singh and his companions carried the dead body of my father, along with his gun, in his tractor trolley towards Karmapura." Thus though an overt act had been assigned to the first appellant in the FIR it had not been stated where the bullet shot hit the deceased.
It is true that in their oral evidence PWs 3 to 6 have assigned the first shooting to the first appellant but their evidence relating to the shot hitting at the fore head could not be accepted for more than one reason.
As already stated, PW1, first went to his village Bibiapur from the scene of occurrence at Padaria Tula, prepared the FIR in his house and then delivered the same at 3.30 P.M. at the Police Station.
In spite of time gap and his being with deceased at the time of the occurrence he had not specifically stated that the first aim of the first appellant hit the fore head of the deceased.
the names of PWs 2 to 6 are given in the FIR itself.
However, PWs 3 and 6 were examined by the Investigating Officer only on 14th of May and no explanation was forthcoming 863 as to why they were not examined earlier.
PWs1 and 2 did not say in their oral evidence that the shot aimed by the first appellant hit the fore head of the deceased.
PWs 3,4,5 and 6 gave the evidence to the effect that the first rifle shot of the appellant hit the deceased on his fore head.
But this part of the statement we are unable to believe because PW1, Tarun Kumar had not confirmed this either in the FIR or in his evidence as PW1.
This was also not stated by PW2 in his evidence or during investigation as seen from the evidence of PW17 the investigation officer.
PWs 3 and 6 were examined by PW17 only after 20 days i.e. on the 14th of May, 1972 though their names were mentioned in the FIR.
In the circumstances the contention of the learned counsel for the appellants that the possibility of an improvement in the case to implicate A 1 for a substantive offence cannot be ruled out.
While we could accept the case of the prosecution trying to establish corpus delicti through the evidence of PWs 1 to 6 we could not accept the evidence in so far as it not known where the bullet hit and whether that injury caused by the same and that injury is sufficient to cause death, the offence under section 302 IPC could not be said to have been made out.
In the circumstances, therefore, we are unable to agree with the High Court that the first appellant is guilty of offence under section 302 IPC of causing the death of Gajendra Singh.
However, we are of the view that while the first appellant shot at the deceased there could be no doubt that either he had the intention to kill him or at least he had the knowledge that the act could cause the death.
All the witnesses also say that the shot by A 1 brought down the deceased to the ground.
There could, therefore, be no doubt that the shot had caused some hurt or injury could have caused the death.
In the circumstances we consider that the offence would come under the second limb or second part of section 307, IPC.
Though imprisonment for life also could be awarded as sentence for such an offence on the facts and circumstances we impose a sentence of 10 years rigorous imprisonment.
Accordingly we alter the conviction under section 302, IPC as one under section 307 IPC and sentence him to term of 10 years rigorous imprisonment.
So far as the offence under section 201 IPC is concerned the 864 prosecution relied upon the evidence of PWs 7,8,9 and 10.
The evidence of PWs 7,8 and 9 only go to show that they had seen 15 to 20 people sitting in the trolley of the tractor driven by the first accused.
They have referred to the names of the appellants among the 20 people who were in the trolley.
However, none of them had stated that they had seen the body of Gajendra Singh alive or dead in the trolley.
The prosecution tried to establish that the accused were carrying body of Gajendra Singh in the trolley from the statement of PW7 who said the Chet Ram one of the persons who was travelling in the trolley along with other and who is now dead was saying or shouting that: "Gajender Singh had been killed and he would roasted and eaten and thrown in the river." And the statement of PW3 that: "The people sitting the trolley were talking amongst themselves and uttering the words `today we have killed and brought a lion '" But PWs 7 and 8 had not given any such version to PW17 in their statements during investigation.
PW 9 turned hostile and his evidence is also worth nothing.
PW 10 had stated that Chet Ram said: "We have killed Gajendra Singh and brought him on his tractor why you have come here".
and then he ran about 250 steps towards the east and stood there but the version given in the statement before PW 17 was different.
This evidence can be relied on only for the purpose of showing that about 15 or 20 people were travelling in the trolley of a tractor driven by the first accursed which was going towards the river.
This evidence does not bring home the offence of screening the evidence.
Of course PW 10 said that the body was burnt with wooden pieces and grass after it was all burnt Chet Ram, who is now dead, collected the whole residual ashes and threw them in the Sutia rivulet.
he mentioned the name of Chet Ram and no other name.
Further though he sated to be neighbour of Ram Sewak PW 2 and Ram Sewak and himself used to meet everyday he did not tell PW 2 about the burning of the body of the appellants.
This witness also belongs to the Ahir community which is the community of the deceased Gajendra Singh also.
It appears that only the bones stated to have been recovered were sent for chemical analysis and the report of the serologist was that it was not possible to 865 give any opinion regarding the origin, sex and age.
The report had not even stated that they were human bones.
Though PW 10 had stated that there were with him two others at the time and PW 17 had taken PW 10 and the said two others also to the place where the body was stated to have been burnt, they had not been examined.
We have read the evidence carefully and the evidence also does not impress us that he is telling the truth.
In the result we set aside the conviction of the appellants under section 201, IPC.
The conviction of the first appellant is modified into one under section 307, IPC and we sentence him to 10 years rigorous imprisonment.
The bail bonds of appellants 2,3 and 4 are cancelled.
The first appellant is directed to surrender.
R.N.J. Appeal partly allowed.
| IN-Abs | Nineteen persons were tried by the Additional District and Session Judge, Khetri in S.T. No. 264 of 1973 for offences under section 302/149, 201/149, 379/149, 147 and 148 for the incident that took place on 25.4.1972 in village Padaria Tula (UP) on the day of filing of the nomination papers for election for the post of Pradhan Gaon Sabha, Tikhra in which fire arms were used by the party led by Bhupendra Singh accused no.l, who was also a candidate for the office of Pradhan of Gaon Sabha resulting in the death on the spot of Gajendra Singh, one of the supporters of the rival candidate Ram Sewak, P.W. 2.
The prosecution case is that both the rival candidates with their supporters had come to village Padaria Tula on the morning of 25.4.1972 where nomination papers had to be filed.
On seeing the party of the deceased arriving, Bhupendra Singh enquired from Ram Sewak (P.W.2) if he had come to file his nomination papers against him.
Gajendra Singh (deceased) intervened and challengingly told the accused No. 1 that he should ask him.
Following the altercation that ensued, it is alleged that Bhupendra Singh fired the first shot on the deceased followed by shooting by his other associates and the deceased fell dead.
The party of Ram Sewak fled from the scene to escape the 857 attack.
It is further alleged that the body of the deceased was dragged by Gajendra Singh and his companions and carried by them on a tractor trolly belonging to A1 on which they had come, burnt it and ashes thrown in the river causing disappearance of the entire evidence.
The first Additional Judge acquitted all the charges on the ground that there are many infirmities in the prosecution case rendering its evidence unworthy of belief.
The state of Uttar Pradesh preferred appeal before the Lucknow Bench of the Allahabad High Court.
The High Court set aside the acquittal of Bhupendra Singh (A1) and convicted him for offence under section 302 I.P.C and awarded sentence of Rigorous Imprisonment for life , set aside the acquittal of A 4, 7, 8 in part, convicted them under section 201 of I.P.C. and sentenced each of them to seven years Rigorous Imprisonment thereunder.
Their acquittal under other charges was confirmed.
Appeal as against rest of the accused was dismissed altogether.
A1, 4, 7 and 8 have thus come in appeal against the judgement of the High Court.
In party allowing the appeal setting aside the conviction of appellants 2 to 4 (A1, 7, 8) under section 201 I.P. C. , and altering the conviction of appellant No. 1 (A1) from one under section 302 I.P. C. to one under section 307 I.P.C. and sentencing him to a term of 10 years rigorous imprisonment thereunder, this Court.
HELD: The evidence only established that the first appellant shot at the deceased but it is not known where the bullet hit and whether that injury caused by the said bullet shot caused the death.
Even in the case of shooting by a rifle unless the evidence shows the particular injury caused by the same and that injury is sufficient to cause death, the offence under section 302 I.P.C. could not be said to have been made out.
In the circumstances, therefore, we are unable to agree with the High Court that the first appellant is guilty of offence under section 302 IPC of causing the death of Gajendra Singh.
However we are of the view that while the first appellant shot at the deceased there could be no doubt that either he had the intention to kill him or at least he had the knowledge that the act could cause the death.
[863D E] We consider that the offence would come under the second limb or second part of section 307, IPC.
Though imprisonment for life also could be awarded as sentence for such an offence, on the facts and circumstances we impose a sentence of 10 years rigorous imprisonment.
We alter the conviction under section 302, IPC to one under section 307 IPC and sentence him to a term of 10 years rigorous imprisonment.
[863G].
858 So far as the offence under section 201 IPC is concerned we have read the entire evidence carefully and the same does not impress as to bring home the offence of screening the evidence.
[863H,865H]
|
ivil Appeal No. 2992 of 1986.
From the Judgement and Order dated 22.7.1986 of the Madras High Court in W.P No 815 of 1985.
T.S. Krishnamurthy Iyer, Miss Purnima Bhat, Atul Sharma, A.V. Pillai and E.C. Agrawala for the Appellant.
P. Chidambaram, R. Ayyam Perumal, K.C. Dua, V. Krishnamurthy and R. Mohan for the Respondents.
The Judgement of the Court was delivered by S.C. AGRAWAL, J.
This appeal and the connected petitions for special leave to appeal are directed against the common judgment of the Division Bench of the Madras High Court dated July 22; 1986 whereby the judgement of the learned Single Judge has been set aside and the writ petitions filed by the appellant as well as the petitioners in the special leave petitions (referred to as 'the petitioners ' for the sake of convenience) have been dismissed.
The petitioners joined the Indian Army as Emergency Commissioned Officers (ECOs) in 1963 after the Chinese aggression.
They were discharged from the Army during the years 1967 to 1970.
After their discharge from the Army, they joined the Commercial Tax Service of the State of Tamil Nadu on being selected by the Tamil Nadu Public Service Commission through a competitive examination.
For rehabilitation of ECOs/Short Service Regular Commissioned Officers (SSRCOs) on their release from the Armed Forces, the Government of Tamil Nadu had by G.O. ms. No. 84 dated January 1, 1967, reserved 25% of the vacancies to be filled by direct recruitment during the four years 1967 1970 in respect of certain categories of posts in the State services.
By Order, G.O. Ms. No. 686 dated March 24, 1970, the Government of Tamil Nadu, in modification of the said order reserved 25% of the vacancies in non technical posts under various groups (both Gazetted and non Gazetted) to be filled by direct recruitment during five years commencing from 1969 for rehabilitation of ECOs/SSRCOs on their release from the Armed Forces.
The said order made provision for relaxation of age in case of such officers for 849 the purpose of recruitment to be reserved vacancies.
As regards seniority provision was made in paragraph 8 of the said order which prescribed as under: Inter se seniority among the candidates selected for the reserved vacancies will be determined by the Commission.
So far as the seniority in the department is concerned, the officers will take their seniority with reference to the order of preference indicated by the Commission and not with reference to the service with the "Armed Forces".
It appears that in respect of doctors who had joined the defence forces in connection with the emergency declared in 1962 and who were subsequently appointed in the cadre of Assistant Surgeons in the State of Tamil Nadu, the Government had issued an Order G.O. Ms. No. 2020 dated September 23, 1965, whereby seniority of such an incumbent was to be fixed by allotting them the year in which he would have been appointed to the post at his first possible attempt after the date of joining military service/training.
The Tamil Nadu Public Service Commission, in their letter dated February 6, 1973 addressed to the Chief Secretary to the Government of Tamil Nadu, made a reference to G.O. Ms No. 2020 Health dated September 23, 1965 with regard to fixation of seniority of candidates appointed to the post of Assistant Surgeon against vacancies reserved for ECOs/SSRCOs and expressed the view that allowing one of released persons like Doctors to enjoy the concession of their seniority being reckoned with reference to their date of appointment in the Army and at the same time denying such a concession to ECOs/SSRCOs selected to a non technical post will not be fair and such differential treatment will not also be in the interests of rehabilitating released Army personnel.
The Public Service Commission, therefore, commended that the principle followed in the matter of determining seniority in respect of released Army Doctor with reference to the date of their joining duty in the Armed Forces be extended to all services as recruitment to all the sevices are made on the basis of the competitive examinations comprising either of a written test or an oral test or a combination of both.
In the said letter, it was requested that orders in paragraph 8 of G.O.Ms. 686 may be suitably modified.
Keeping in view the aforesaid view expressed by the State Public Service Commission, the Government of Tamil Nadu passed an order G.O.Ms No. 25 dated November 16, 1976 whereby, in supersession of the earlier procedure prescribed for determining the seniority of the ECOs/SRRCOs recruited for non technical posts (both Gazetted and non Gazetted) against reserved 850 vacancies in G.O.Ms No. 686 dated March 24, 1970, the following procedure was prescribed: "(i) the seniority of the Emergency Commissioned/Short Service Regular Commissioned Officers recruited to the State Civil Services (both Ghazetted and Non Gazetted) between 24.3.1970 to 4.10.73 against reserved vacancies shall be fixed treating them as belonging to the year in which they would have been appointed to the posts in their first possible attempt after the date of joining military service/training." After the issuance of the aforesaid order dated November 16, 1976, it was represented to the State Government that the concession granted to the ECOs/SSRCOs recruited to the Civil Services of the State instead of confirming it only to those recruited between 1970 and 1973.
The State Government decided to accede to that request and issued a fresh G.O.ms No. 734 dated June 15, 1977 whereby the orders in para 1(i) of the Order dated November 16, 1976 were thus modified: "1.
(i) The seniority of Emergency Commissioned Officers/Short Service Regular Commissioned Officers recruited to the non technical posts against reserved vacancies shall be fixed treating them as belonging to the year in which they would have been appointed to the posts in their first possible attempt after the date of joining military duty.
In the case of candidates who joined Military service on or before 30th June of a year, the year of allotment would be the same; while in the case of those who joined the Military services on or after Ist July of a year, the year of allotment would be the next year.
" By the said order, it was also directed that the appointing authority should take steps to refix the seniority of the ECOs/SSRCOs recruited to the Civil Services with reference to instructions after issuing notices to all affected parties.
In accordance with the aforesaid directions, notices were issued to the other officers whose seniority was likely to be disturbed in view of the concession extended to ECOs/SRRCOs under Order dated June 15, 1977.
After taking into consideration the representations received in pursuance of the said notice 851 the State Government issued an Order G.O.Ms.
No. 233 dated March 3, 1980 whereby the orders dated November 16, 1976 and June 15, 1977 were cancelled.
In the said order, it was stated that: "The Government have carefully examined the above representations with reference to the legal position.
They consider that the vested seniority rights already accused to individuals by virtue of the rules in force cannot be divested by issuing fresh rules and giving retrospective effect to them.
The Government have therefore decided not to implement those orders by amending the special Rules governing these non technical posts.
" The petitioners as well as some other ECOs/SSRCOs filed writ petitions in the Madras High Court challenging the validity of the said order dated March 3, 1980.
The writ petitions were heard by a learned Single Judge of the High Court who allowed the same by his judgement dated December 4, 1984.
The learned Single Judge was of the view that under orders dated November 16, 1976 and June 15, 1977, which were passed on the recommendations of the Tamil Nadu public Service Commission, the petitioners had acquired certain rights in the matter of seniority and promotion and since the impugned Government order takes away the said rights of the petitioners, the petitioners should have been afforded an opportunity of a hearing before passing the impugned order which had not been done in this case.
Appeals were filed by the State Government as well as by private respondents against the said decision of the learned Single Judge.
The said appeals were decided by a Division Bench of the High Court by its judgment dated July 22, 1976, whereby it was held that the provision with regard to fixation of seniority in the cadre of Commercial Tax Officer (CTOs) in which the petitioners were appointed in governed by Rule 35 of the General Rules which are contained in Part II of the Tamil Nadu State and Subordinate Service Rules made under proviso to Article 309 of the Constitution and under the said rule, seniority is to be fixed on the basis of date of appointment to the service.
the learned Judges found that the said Rules had not been amended and in the absence of an amendment in rule 35, the orders with regard to fixation of seniority of ECOs/SSRCOs contained in Orders dated November 16, 1976 and June 15, 1977 were invalid and no rights could accure to the petitioners on the basis of the said orders which may require affording an opportunity to them.
With regard to Doctors and Engineers, the learned Judges have pointed out that suitable amendments had been made in the relevant statutory rules relating to both 852 the services.
The learned Judges, therefore, while setting aside the order of the learned Single Judge, dismissed the Writ Petitions of the petitioners but observed that the judgment would not prevent the State Government from amending the Rules made under Article 309 of the Constitution and if and when rules are made and if any persons are affected, they are entitled to challenge the said Rules.
Feeling aggrieved by the said decision of the division Bench of the High Court, the petitioners have approached this Court.
The first contention that has been urged by the learned counsel for the petitioners is that the concessions contained in the orders dated November 16, 1976 and June 15, 1977 were not invalid inasmuch as it was permissible for the State Government to issue administrative instructions with regard to determination of the seniority of the ECOs/SSRCOs and by the said orders which were issued on the recommendations of the State Public Service Commission the lacuna which was found in the existing rules was sought to be removed and that it w as permissible for the State Government to issue administrative instructions to remove such a lacuna.
In support of the said submission, reliance has been placed on the decisions of this Court in Sant Ram Sharma vs State of Rajasthan & Anr., ; ; Union of India vs H.R. Patankar 7 Ors., [[1985] 1 SCR 400 and State of Gujarat vs Akhilesh C. Bhargav & Ors. ; In the above mentioned decisions, it has been laid down that although the Government cannot amend the statutory rules by administrative instructions, but if the rules are silent on any particular point, the Government can fill up the gaps and supplement the rules and issue instructions not inconsistent with the rules already framed.
in the instant case, it cannot be said that on the date of issue of orders dated November 16, 1976 and June 15, 1977, the rules were silent on the matter of fixation of seniority of persons recruited to the Tamil Nadu Commercial Tax Service.
Appointment to the said service was governed by General Rules contained in Part Ii of the Tamil Nadu State and Subordinate Rules.
Clauses (a) and (aa) of rule 35 of the said General Rules provide as under "(a) The seniority of a person in a service, class or category or grade shall unless he has been reduced to lower rank as a punishment, be determined by the rank obtained by him in the list of approved candidates drawn up by the Tamil Nadu Public Service Commission or other appointing authority, as the case may be, subject to the rule of reservation 853 where it applies.
The date of commencement of his probation shall be the date on which he joins duty irrespective of his seniority.
(aa) The seniority of a person in a service, class or category or grade shall, where the normal method or recruitment to that service, class, category or grade is by more than one method of recruitment, unless the individual has been reduced to a lower rank as a punishment, be determined with reference to the date on which he is appointed to the service, class, category or grade".
This shows that thee was an express provision in the statutory rules providing that seniority shall be fixed on the basis of the date of appointment.
By orders dated November 16, 1976 and June 15, 1977, the said principle for fixation of seniority contained in rule 35 was sought to be altered in respect of ECOs/SSRCOs and the seniority was sought to be fixed on the basis of a different criterion, namely, by treating them as belonging to the year in which they would have been appointed to the posts in their first possible attempt after the date of joining military duty.
This was inconsistent with the principle for fixing the seniority contained in rule 35 of the General Rules and this could onlybe done by suitably amending the said rules and it could not be done by issuing administrative instructions.
The High Court has, in our opinion, rightly held that the directions contained in orders dated November 16, 1976 and June 15,1977 were invalid being contrary to the provisions contained in rule 35 of the General Rules.
Since the said orders were invalid, the petioners could not claim any right on the basis of the said orders and there was, therefore, no question of affording them an opportunity of a hearing before passing the order dated March 3, 1980.
In so far as appointments to medical and engineering services are concerned, the High Court has pointed out that suitable amendments were made in the relevant Services Rules relating to those services whereby the benefit of the Army Service was given in the matter of fixation of seniority of ECOs/SSRCOs.
who had joined the medical and engineering services.
No similar amendment has been made in the rules governing the non technical services, e.g., Commercial Tax Service to which the petitioners were appointed.
The learned counsel for the petitioners have next contended that the petitioners have been subjected to arbitrary discrimination i n the matter of fixation of their seniority inasmuch as ECOs/SSRCOs who have joined the medical and engineering service of the Government of 854 Tamil Nadu have been given the benefit of their service in the Army in the matter of fixation of seniority whereas similar benefit has been denied to the petitioners even though the petitioners as well as other ECOs/SSRCOs who have joined medical and engineering service were all similarly situate.
In this connection, reliance has been placed on the decision of this Court in Union of India & Ors.
vs Dr. section Krishna Murthy & Ors. etc., [1989] Supp.
(1) SR 275.
This contention, in our view, is misconceived.
ECOs/SSRCOs who have joined medical and engineering services of the State of Tamil Nadu were technically qualified in their fields and they had worked in the Army in the same field in which they are now employed in the State service.
The benefit of the experience gained by them during the period of their service in the Army on the posts viz. medical/engineering held by them was available to the State they joined the medical/engineering services of the State of Tamil Nadu.
The same cannot be said for the petitioners because the nature of the duties discharged by them in the Army were different from the duties they are now required to perform at CTOs in the State service.
It cannot, therefore, be said that the ECOs/SSRCOs who have joined the medical and engineering services of the State of Tamil Nadu and the petitioners who have joined the Commercial Tax Department of the State are persons similarly situate in the matter of determination of seniority and for counting the earlier Army service for that purpose.
In Union of India vs Dr. section Krishna Murthy, case (supra), the ECOs/SSRCOs on discharge from the Army had joined the Indian Forest Service and the Indian Police Service and provision was made in the Regulation of Seniority Rules governing these Services whereby it w as provided that year of allotment of an officer appointed to the said Service shall be deemed to be the year in which he would have been so appointed at his first or second attempt after the date of joining pre commission training or the date of their commission where there was only post commission training.
The validity of the said rules was challenged by other direct recruits to those Services on the ground that the ECOs/SSRCOs could not be classified into a separate category.
The said contention was rejected by this Court and it was held that ECOs/SSRCOs formed a definite class, distinct from other officers of the Indian Forest Service and Indian Police Service, and that the said classification was founded on an intelligible differentia which distinguishes them from other officers and that the classification has rational relation to the objects sought to be achieved by the Rules inasmuch as it has been made for the purpose of compensating the ECOs/SSRCOs for the lost opportunity because of their joining the Army service.
855 The said decision may have a bearing in the event of rules being framed making provision for giving the benefit of Army service in the matter of fixation of seniority of the petitioners and other persons who have joined the Commercial Tax Service of the State of Tamil Nadu.
Since there is no such rule, the petitioners cannot derive any assistance from this decision.
In the circumstances, we find no ground to interfere with the decision of the High Court.
The appeal as well as the special leave petitions are, therefore, dismissed but with no orders as to costs.
| IN-Abs | The appellant/petitioners joined the Army as Emergency Commissioned Officers in 1963 and were discharged during the year 1967 to 1970.
After their discharge they joined the Commercial Tax Service under the Respondent State on selection by the State Public Service Commission.
It was provided under R.35 of the Tamil Nadu State and Subordinate Service Rules that their seniority in the department would be fixed in the order of preference indicated by the Service Commission and not with reference to the service in the Armed Forces.
However, in respect of similar candidates who were appointed as Assistant Surgeons, the government order provided that their seniority would be fixed by allotting them the year in which they would have been appointed to the post at the first possible attempt after the date of joining military service/training.
Thus, the concession of seniority reckoned with reference to date of appointment in the Army, which has been extended to Asstt.
Surgeons was denied to similar candidates selected to other services categorised as non technical.
On a suggestion made by the Public Service Commission, the 846 Respondent State passed orders extending the benefit to the other services also.
The Respondent State further extended the benefit of fixation of seniority to all such candidates irrespective of their year of recruitment.
The appointing authorities were directed to take steps to refix the seniority of such officials after issuing notice to all the affected parties.
Accordingly notices were issued, and in response thereof representations were received by the Respondent State, which, after due to consideration decided not to implement the orders extending the benefits to other candidates in the non technical category.
Aggrieved by the said order issued on 3.8.1980 the affected persons filed Writ Petitions before the High Court.
A Single Judge allowed the Writ Petitions holding that under orders dated November 16, 1976 and June 15, 1977, which were passed on the recommendations of the Public Service Commission,, the petitioners had acquired certain rights in the matter of seniority and promotion and since the Government order dated 3.31980 took away the said right of the petitioners, they should have been afforded an opportunity of hearing before passing the said order.
On appeal, the Division Bench set aside the judgement of the Single Judge.
In the appeal and special leave petitions preferred against the said judgment it was contended that it was permissible for the State Government to issue administrative instructions with regard to determination of the seniority and to remove the lacuna which was found in the existing rules, viz. discrimination between the Medical/Engineering service and other services.
Dismissing the matters, this Court, HELD: 1.
Although the Government cannot amend the statutory rules by Administrative instructions, if the rules are silent on any particular point, the Government can fill up the gaps and supplement the rules and issue instructions not inconsistent with the rules already framed.
In the instant case, it cannot be said that on the date of issue of orders dated November 16, 1976 and June 15, 1977, the rules were silent on the matter of fixation of seniority of persons recruited to the Tamil Nadu Commercial Tax Service.
[852E F] (Sant Ram Sharma) vs (State of Rajasthan & Anr.,) ; of India) vs (H.R. Patankar & Ors.,) [1985] 1 SCR 400 and (State of Gujarat) vs (Akhilesh C. Bhargav & Ors.) ; referred to.
847 2.
There was an express provision in the statutory rules viz. Rule 35 of the Tamil Nadu state and Subordinate Service Rules providing that seniority shall be fixed on the basis of the date of appointment.
By orders dated November 16, 1976 and June 15, 1977, the said principle for fixation of seniority contained in rule 35 was sought to be altered in respect of Emergency Commissioned Officers/Short Service Regular Commissioned Officers and the seniority was sought to be fixed on the basis of a different criterion, namely, by treating them as belonging to the year in which they would have been appointed to the posts in their first possible attempt after the date of joining military duty.
This was inconsistent with the principle for fixing the seniority contained in rule 35 and this could only be done by suitably amending the said rules not by issuing administrative instructions.
The directions contained in orders dated November 16, 1976 and June 15, 1977 were invalid being contrary to the provisions contained in Rule 35.
Since the said orders were invalid the appellant petitioners could not claim any right on the basis of the said orders and there was, therefore, no question of affording them an opportunity of a hearing before passing the order dated March 3, 1980.
In so far as appointments to Medical and Engineering Services are concerned suitable amendments were made in the relevant Service Rules relating to those services whereby the benefit of the Army service was given in the matter of fixation of seniority.
No similar amendment has been made in the rules governing the non technical services e.g., Commercial Tax Service to which the appellant petitioners were appointed.
[853C G] 3.
Emergency Commissioned Officers/Short Service Regular Commissioned Officers who have joined Medical and Engineering Services of the Respondent State were technically qualified in their fields and they had worked in the Army in the same field in which they are now employed in the State service.
The benefit of the experience gained by them during the period of their service in the Army on the post viz. Medical/Engineering held by them was a vailable to the State when they joined the Medical/Engineering Services of the Respondent State.
The nature of the duties discharged by the appellant/petitioners in the Army were different from the duties they are now required to perform as Commercial Tax Officers in the State service.
It cannot, therefore, be said that the Emergency Commissioned officers/Short Service Regular Commissioned Officers who have joined the medical and Engineering Service of the State and the appellant/petitioners who have joined the Commercial Tax Department of the State are persons similarly situated in the matter of determination of seniority and for counting their earlier Army Service for that purpose.
[854B D] 848 Union of India & Ors. etc.
vs Dr. section Krishna Murthy & Ors. etc., [1989] Supp. 1 SCR 275, distinguished.
|
ON:Criminal Appeal No. 680 of 1987.
From the Judgement and Order dated 16.8.1984 of the Andhra Pradesh High Court in Crl.
A. No. 604 of 1982.
N. Santosh Hegde, A.D.N. Rao and A, Subha Rao for the Appellants.
G. Prabhakar for the Respondent.
The Judgement of the Court was delivered by 877 V.RAMASWAMI, J.
The appellants along 11 others were tried for causing the murder of on Appikatla Tataiah, and for causing injuries on Jarugu Rama Koteshwararao (PW2) on 24th June, 1981 near `Manchineeti Cheruyu '(fresh water tank) at or about 8.00 P.M. in Machavaram Village.
The learned Sessions Judge, Krishna Division Machilipatnam by his Judgment dated 16.7.1982 acquitted A 3, A 4, A 6 to A 10, A 12 and A 15 of all the charges.
He convicted Kurakula Nagamelleswarao (A 1), Jarugu Kotaiah (A 2), Appikatla Krishnamurthy (A 5) and Appikatla Nagulu (A 11) under section 148, Indian Penal Code and sentenced each of them to undergo two years rigorous imprisonment.
A 1 was further convicted under section 302, IPC and sentenced to imprisonment for life.
A 2 was convicted under section 302 read with section 34, IPC and sentenced to imprisonment for life.
A 5 and A 11 were convicted under section 302 read with section 149, IPC and each of them were sentenced to undergo imprisonment of life.
Regarding the attack on PW 2 jarugu Rama Koteshwararao the learned Sessions Judge convicted A 1 and A 2 under section 326, IPC read with section 149 and sentenced each of them to undergo rigorous imprisonment for four years.
The learned Judge further convicted A 5 and A 11 under section 324, IPC for causing simple hurt to PW 2 and sentenced each one of them to undergo rigorous imprisonment for two years.
A 1 and A 2 were also convicted under section 324 read with section 149, IPC and each of them were sentenced to two years rigorous imprisonment.
The sentences awarded against each accused under various ground were ordered to run concurrently.
The convicted accused preferred Criminal Appeal No. 604 of 1982 and the State appealed against the acquittal of the rest of the accused in Criminal Appeal No. 630 of 1983.
At the time of admission of appeal, however, the State appeal was dismissed as against A 9, A 10, A 12, A 13, A 14, and A 15 and it was admitted only as against acquittal of A 3, A 4 and A 6 to A 8.
The High Court confirmed the conviction and sentence of A 1, A 2, A 5 and A 11 under section 148, IPC.
However, it alterted the conviction of A 1 and A 2 under section 302, IPC and Section 302 read with section 34 respectively into one under section 148 and section 302 read with section 149 and the sentence awarded thereunder were also confirmed.
The High Court also confirmed the conviction and sentences on the accused under sections 326 and 324 read with section 149 and sections 324 read with 878 section 149, IPC.
The sentences were directed to run concurrently.
the lerned Judges of the High Court dismissed the appeal preferred by the State in respect of acquittal of the other accused.
In this appeal Sh.
Santosh Hedge, Senior Advocate appearing for the accused appellants did not canvass the conviction of the four appellants, namely, A 1, A 2, A 5 and A 11 under section 324 and 326, IPC and section 324 read with section 149, IPC and section 326 read with section 149, IPC in relation to the attack on PW 2 but without prejudice to his contention that on the facts section 149, IPC could not have been invoked in relation to the offence under section 302,IPC.
This stand was taken on the basis that the appellants had already served or had almost finished serving the four year terms which was awarded for those offences.
The conviction and sentence under section 148 was also not canvassed for the same reason without prejudice the above said contention.
He confined his arguments against the convictions and sentences of A 1, A 2, A 5 and A 11 under section 302 read with section 149, IPC.
The argument of the learned counsel for the appellant was that in the absence of specific finding to the effect and apart from the four appellants the prosecution has proved the involvement of other persons, section 149 IPC cannot be used for convicting for four appellants under section 302.
In this connection, he also relied on the decisions of this Court in Amar Singh V. State of Punjab, [1987] 1SCC 679 and Maina Singh V. State of Punjab, [1976]3SCR651.
So far this part of the case is concerned in the present case the High Court observed: "The lower court has convicted A 1 under section 302 of the Indian Panal Code for attacking the deceased.
A 2, was convicted under sections 149, 302 r.w. section 34, 324 r.w. section 149 and 326 I.P.C. for attacking the deceased.
A 5 and A 11 were convicted under sections 148, 302 r.w. section 149, 324 and 326 r.w. section 149 IPC.
As already observed the facts and circumstances undoubtedly show that there was an unlawful assembly consisting of more than five persons and the common object of the unlawful assembly was to attack and kill the deceased and attack PW 2.
As already observed only such of accused whose presence and participation is established can safely be held to be the members of the unlawful assembly.
To arrive at such a conclusion we have indicated that the evidence of PW 2 to extent consisting with the earlier versions of exhibit P 2 can 879 safely be accepted to be the basis and if corroboration is necessary the same can be found in the evidence of PWs 1, 3 and 4P. Ws. 2 's evidence is subjected to scrutiny in the light of the contents in exhibit P 2.
The consistent version regarding the presence and participation by A 1,A 2, A 5 and A 11 can safely be accepted and they can be held to be the members of the unlawful assembly along with some others unidentified persons.
The common object of the unlawful assembly along with some others unidentified persons.
The common object of the unlawful assembly was to commit murder of the deceased.
All of them can be conviction under section 302 read with section 149 IPC in as much as there can be no doubt whatsoever that the object of such an unlawful assembly of which A 1, A 2, A 5 and A 11 are members is to attack the deceased and PW 2.
In this context it must also be remembered that PW 2 who received the serious injuries, would be the last person to leave out the real assailants and implicate the innocent persons.".
(Emphasis supplied) We are of the view that there is some confusion in the statement of the High Court.
The charges under section 324 and section 326 read with section 149 and section 326 and section 324 read with section 149 are in relation to the injuries inflicted on PW 2.
So far as injuries inflicted on PW 2 is concerned as already stated the conviction and sentence in regard to the same are not canvassed in this appeal.
So far as the attack on the deceased is concerned P 1 the statement of PW 1 given to the village Munsif on 24.6.1981 immediately after the occurence stated that: ". surrounded my husband and my elder brother armed with axes, curved knives, and spears.
Then Kurakula Nagamalleswararao hacked my elder brother with curved knife (Yerukala Kathi) on the left shoulder.
Jargugu Kotiah hacked my elder brother with an axe on the left shoulder.
Appikatla Nagulu beat my elder brother on the head with stick portion of the spear.
I raised hue and cry loudly that they are killing my husband and my elder brother.
On hearing my cries Ummadisetti Pooraniah and my sister in law Srikrishna came there.
the above fifteen persons caused injuries to my husband by beating and hacking with axes, spears and curved knives (Yerukala Kathi)which were in their hand.
My husband succumbed to the knife injuries.
" 880 It may be seen from this report that there is a bald statement that fifteen persons caused injuries to her husband (deceased) by beating and hacking with axes, spears and curved knives (Yerukala Kathi) which were in their hands and her husband succumbed to the knife injuries.
It did not attribute any overt act to A 1, A 2, A 5 and A 11, who are the appellants in this case.
The PW2 gave the statement exhibit P 2 dated 25.6.1981 recorded by the Munsiff Magistrate, Avamigadda as a dying declaration which was later taken as a statement under section 157 Code of Criminal Procedure.
In this so far as the injuries inflicted on the deceased are concerned he had merely stated: "The aforesaid four persons and the other eleven persons, beat and hacked my younger sisters ' husband Appikatla Tataiah and felled him down." The charges framed against the accused appellants also stated: "That you, accused Np.
1 to 15, on the night of 24th day of June, 1981, at about 8.P.M. near the Manchineeti Cheruvu ' in Machavaram Village, Divi taluk, were members of an unlawful assembly and did, in prosecution of the common object of which viz. in killing Appikatla Tataiah, S/o Chittonna alias Chinna Ammanna an d Jarugu Rama Koteswara Rao, S/o Mangaiah of Machavaram village. " Thus the specific prosecution case was that accused 1 to 15 attacked the deceased and no specific overt act was attributed to any of the accused.
It is true that PW 1 in her evidence stated that A 1 hacked the deceased on the left side of neck with Yerukala Kathi and the evidence of doctor PW 8 showed that this is injury No. 2 which proves fatal by itself.
But in the light of the first information report P 1 and the dying declaration exhibit P 2 dated 25.6.1981 of P.W. 2 recorded by the Munsiff Magistrate which was later on treated as statement under section 57 of the Criminal Procedure Code which did not attribute any specific overt act to any of the appellant accused in this case, this case was not accepted by the High Court.
It is because of this reason the High Court did not accept the conviction of the appellants 1 and 2, namely, accused 1 and 2 under section 302 and section 302 and section 302 read with section 34, accused 1 and 2 under section 302 and section 302 read with section 34, IPC and altered the conviction into one under section 302 read with the section 149, IPC.
The learned counsel for the appellant also contended that the evidence of PW 1 apart from the fact it was not accepted by the High 881 Court in so far as it related to the specific overt acts of A 1, 2, 5 and 11 are concerned are also not acceptable as they are full of infirmities and improbabilities and also by reason of the possibility of improving the case.
He had pointed out that though PW 2 and deceased were said to have gone to the Manchineeti Cheruyu (fresh water tank) to verify whether the paddy bags kept by them for soaking were in tact, paddy bags were not found the investigating officer or anybody and they were not recovered.
the learned counsel also pointed out, the story that PWs 1 and 3 and had gone that side for calls of nature are also not believable as the place were ladies ease was on the opposite direction and not in the direction of the fresh water.
The houses of the deceased and PW 2 and that of Pw 4 were about 150 yards away from the scene of occurence and the occurrence is stated to have taken place at 8.00 P.M.
These ladies ran to the scene of occurrence on hearing the cries of the deceased and PW 2.
It was also pointed out that though they stated that when they (ladies) went to answer the calls of nature they had taken along with them chambus or lotas with water, and those chambus or lotas were not recovered.
In her evidence PW 1 stated that when she found her husband lying dead with number of injuries and blood everywhere she fell over her husband and wept but none of her blood stained clothes were recovered.
Though they had stated that when she found her husband PW 2 injured she carried him but her blood stained clothes were also not recovered.
Though they had stated before going to the village Munsiff for giving the complaint and after taking PW2 to the house they have changed the clothing their evidence clearly throw a doubt as to the presence at the time of occurrence.
It should be kept in mind that PW1 is the wife of the deceased PW3.
And thus they are all closely related and the possibility of an exaggeration or of improving in their evidence cannot be ruled out.
It may also be pointed out that these witnesses stated that there was electric lamp post and there was no question of any electric light being on.
There is ample evidence of rivalry between the parties also.
In these circumstances their presence at the time of occurrence is doubtful and it is also not possible to believe the evidence of PWs 1,2,3 and 4 in respect overt acts attributed to the four appellants herein.
In fact, as already stated the High Court was not willing to accept their evidence in this regard and that is why the conviction was made under section 302 read with section 149, IPC.
882 However, the learned Judges over looked that since the accused who are are convicted were only four in number and the prosecution has not proved the involvement of other persons and the courts below have acquitted all the other accused of all the offences, section 149 cannot be invoked for convicting the four appellants herein.
The learned Judges were not correct in stating that A1, A2, A5 and A11 "can be held to be the members of the unlawful assembly along with some others unidentified persons ' on the facts and circumstances of this case.
The charge was not that accused 1, 2, 5 and 11 "and others ' or "and other unidentified persons" formed into an unlawful assembly but it is that "you accused 1 to 15" who formed into an unlawful assembly.
It is not the prosecution case that apart from the said 15 persons there were other persons who were involved in the crime.
When the 11 other accused were acquitted it means that their involvement in the offence had not been proved.
It would not also be permisible to assume or conclude that others named or unnamed acted conjointly with the charged accused in the case unless the charge itself specifically said so and there was evidence to conclude that some others also were involved in the commission of the offence conjointly with the charged accused in furtherance of a common object.
In Maina Singh 's case (supra) the appellant in that case and four others were charged with offences under sections 302/149, IPC, the appellant with having shot at the deceased and the other accused with giving blows to the deceased with a sharp edged weapon.
The Trail Court acquitted the four accused and convicted the appellant under section 302 read with section 34.
The High Court dismissed the appeal for the State against the acquittal as also the appellants appeal against the conviction.
In the appeal before the Supreme Court it was contended for the appellant that it was not permissible to take the view that a criminal act was done by the appellant in furtherance of the common intention of other co accused when those accused who had been named had all been acquitted and that all that was permissible for the High Court was to convict the appellant of an offence which he might have committed in his individual capacity.
The head note in the report brings the ratio of the judgement correctly and that may be quoted: "In a given case even if the charge disclosed only the named persons as co accused and the prosecution witness confined their testimony to them, it would be permissible to conclude that others, named or unnamed, acted cojointly with one of the charged accused if there was other 883 evidence to lead to that conclusion, but not otherwise.
The charge in the present case related to the commission of the offence of unlawful assembly by the appellant along with four named co accused, and with no other person.
The trial in fact went on the basis throughout.
There was also no direct or circumstantial evidence to show that the offence was committed by the appellant along with any other unnamed person.
So when the other four co accused had been given the benefit of doubt and acquitted, it would not be permissible to take the view that there must have been some other person alongwith with the appellant in causing injuries to the deceased.
the appellant would accordingly be responsible for the offence, if any, which could be shown to have been committed by him without regard to the participation of others.".
The facts in the Amar Singh 's case (supra) in short were that seven accused were charged for murder under section 302 read with section 149 IPC.
Two out of the seven accused were acquitted by the Trial Court and on appeal the High Court acquitted one more accused.
However, the High Court convicted four of the accused under section 302 read with section 149 IPC and sentenced them for life imprisonment.
The four convicted accused appealed to this Court and it was contended on their behalf that after the acquittal for three accused persons out of seven, the appellants who were remaining four cannot be held to have formed an unlawful assembly within the meaning of Section 141, IPC and accordingly the charge under section 149 was not maintainable.
Accepting this contention this Court observed: "As the appellants were only four in number, there was no question of their forming an unlawful assembly within the meaning of section 141 IPC.
It is not the prosecution case that apart from the said seven accused persons, there were other persons who were involved in the crime.
Therefore, on the acquittal of three accused persons, the remaining four accused, that is, the appellants, cannot be convicted under section 148 or section 149 IPC for any offence, for, the first condition to be fulfilled in designating an assembly an `unlawful assembly ' is that such assembly must be of five or more persons, as required under section 141 IPC.
In our opinion, the convictions of the appellants under sections 148 and 149 IPC cannot be sustained.
" 884 The ratio of these judgements are also applicable to the facts and circumstnces of this case.
In the result the appeal of the appellants against the conviction and sentence under section 302 read with section 149, IPC is allowed and the same is set aside.
We, however, confirm the conviction and sentence of the appellants under the other charges.
R.N.J. Appeal allowed.
885 GURMUKH SINGH V AMAR SINGH MARCH 15, 1991 [N.M.KASLIWAL AND K. RAMASWAMY, JJ.] : Section 23 Contract opposed to public policy What is Agreement to purchase property in public auction and thereafter convey half the property Specific performance of Whether enforceable.
The respondent field a suit for specific performance of an agreement of sale of land or refund of the money paid to him contending that he and the appellant had contracted that the appellant would participate, on their behalf in public aution to purchase the evacuee property and the appellant would convey half the property purchased thereat and in furtherance of that he had contributed his share, but the appellant who became the highest bidder and got a sale certificate issued by the custodian of the evacuee property had not performed his part of the contract.
The appellant resisted the suit, and denied the execution of the agreement.
He also pleaded that the contract was illegal and void, being opposed to public policy, and that the relief of specific performance being discretionary could not be granted in favour of the respondent.
The trial court decreed the suit.
On appeal by the appellant, both the first appellate court and the High Court confirmed the decree.
Hence the appeal, by special leave.
On behalf of the appellant it was contended that the agreement was opposed to public policy since it was to knock out the public property on a minimum price and, therefore, void under section 23 of the contract Act, 1872.
Dismissing the appeal, this Court.
, HELD: 1.1 Section 23 of the Contract Act adumbrates that the consideration or object of an agreement is lawful unless it is forbidden by law, or is of such a nature that, if permitted, it would defeat the provision of any law; or is fraudulent; or involved or implied injury to 886 the persons or property of another; or the court regards it as immoral or opposed to public policy.
In each of these cases, the consideration or object of an agreement is unlawful.
Thus, every agreement of the consideration or object of which is unlawful is void.
[888F G] 1.2 The word "object" would mean the purpose and design which is the object of the contracts; it is opposed to public policy if it tends to defeat any provision of law or purpose of law, and it becomes unlawful and void under section 23 of the Contract Act.
Section 23 is concerned with only the object or consideration of the transaction and not the reasons or motive which prompted it.
Public policy imposes certain limitation upon freedom of contract.
Certain objects of contract are forbidden or discouraged by law; though all other requisites for the formation of a contract are complied with, yet if these objects are in contemplation of the parties when they entered into the agreement, the law will not permit them to enforce any rights under it.
Most cases of illegality are of this sort; the illegality lie in the purpose which one or both parties have in mind.
But in some instances the law strikes at the agreement itself, and the contract is then by its very nature illegal.
[888G H,889A B] 1.3 The public policy is not static.
It is variable with the changing times and the needs for the society.
The march of law must match with the fact situation.
A contract tending to injure public interest or public welfare or fraudulent to defeat the right of the third parties is void under section 23 of the Contract Act.
[892F] 1.4 The object of conducting public sale is to secure as much price or revenue as possible to redeem the debt of the debtor or to secure maximum price to the exchequer for use of public purpose.
If such a contract to form a ring among the bidders was to peg down the price and to have the property knocked out a low price it would defeat the above economic interest of the debtor or public welfare.
Thereby the agreement becomes fraudulent and opposed to public policy and is void under section 23.
[ 890E F] In the instant case, the facts demonstrate that the agreement between the appellant and the respondent was only a combination to participate at an auction of the evacuee property.
There is no intention either to peg down the price or to defraud the Government to knock out the sale at a lower price.
Thus, the object of the agreement is not opposed to public policy, and therefore, it is not void under section 23 of the Contract Act.
Therefore the agreement between the appellant and the 887 respondent is lawful contract.
The courts below committed no error of law warranting interference.[892H,893A B] Rattan Chand Hira Chand vs Askar Nawaj Jung, J.T. 1991 1SC 433 and Cheerulal Prakash vs Mabadeodas Maiyua & Ors., [1959] (Suppl.) 2 SCR 406, referred to.
Scott vs Brown.
Deorning Mc Nab & Co., [1892] 2 K.B. 724 and Mohamed Meerta vs S.V. Raghunadha Gopalar, 27 Indian Appeals 17, referred to.
Kayjay Industries (P) Ltd. vs Asnew Drums (P) Ltd. & Ors.,[1974] 3 SRC 678; Central Inland Water Transport Corpn.
Ltd. & Anr vs Brojo Nath Ganguli & Anr., {1986] 2 SCR 278 and Delhi Transport Corporation vs D.T.C. Mazdoor Congress & Ors., A.I.R. 1991 SC 190, inapplicable.
Chandra Sreenivasa Rao vs Korrapati Raja Rama Mohana Rao and Anr., ; Ram Lal Misra vs Rajendra Nath Sanyal, A.I.R. (1933) Oudh P. 124 at 127; Nand Singh @ Ghuddha vs Emperor, A.I.R. (30) 1943 Lahore 101; Hutchegowda vs H.M. Basaviah, A.I.R. ; Ratanchand Hirachand vs Askar Nawaz Jung & Ors., A.I.R. 1976 A.P. 112; Mo. Issac V. Sreeramula, A.I.R. Mad.
289= [1946] 1 Madras Law journal, 187; Ramalingiah vs Subbarami Reddi A.I.R. 1951 Mad.
390; Mohafazul Rahim vs Babulal, A.I.R. 1949 Nagpur 113 and Lachhman Das & Ors v Hakim Sita Ram & Ors.
A.I.R. 1975 Delhi 159, referred to.
Chitty 's contract, 26th Edn., Vol.
I Paragraph 1134, P. 686 and Halsbury 's Laws of England.
Fourth Edition, Vol.
9 Paragraph 392 at p. 266 and paragraph 746 at 383, referred to.
& CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1335 of 1977.
From the Judgement and Order dated 7.3.1977 of the Punjab & Haryana High Court in R.S.A. No. 1162 of 1966.
J.M. Khanna and Mr. I.B. Gaur for the Appellant.
Dhruv Mehta, Aman Vachhar, S.K. Mehta, Arvind Verma and Romesh Chand for the Respondent.
888 The Judgement of the Court was delivered by K. RAMASWAMY, J.
The unsuccessful defendant/appellant resisted the suit of the respondent for specific performance of the agreement of sale of 27 Bhigas and 2 Biswas of the land situated in Chakkar Karman Village.
According to the respondent he and the appellant contracted that the appellant would participate on their behalf in a public auction to purchase the evacuee property.
he contributed his share.
The appellant agreed to convey half the property purchased at the auction.
The appellant became the highest bidder for a sum of Rs. 5,000 and he contributed his share and the sale was confirmed on March 11, 1964 and a sale certificate was issued by the custodian of he evacuee property but the appellant had not performed his part of the contract.
Accordingly he laid the suit for specific performance or refund the amount advanced by him.
The suit was resisted by the appellant denying the execution of the agreement and also pleaded that the contract is illegal and void being opposed to public policy.
The relief of specific performance being discretionary cannot be granted in favour of the respondent.
The Trial Court decreed the suit; on appeal and on further second appeal the District Court and the High Court confirmed the same.
Thus this appeal on social leave under article 136 of the Constitution.
The contention neatly argued by Shri Khanna, the learned counsel for the appellant, is that the agreement is opposed to public policy and, therefore, it is void under section 23 of the Contract Act, 1872.
According to him the agreement was to knock out the public property on a minimum price and that, therefore, the object of the agreement is opposed to public policy and is hit by section 23.
We found no force in the contention .
Section 23 of the Contract Act adumbrates that the consideration or object of an agreement is lawful unless it is forbidden by law; or is of such of nature that, if permitted, it would defeat the provision of any law; or is fraudulent; or involved or implied injury to the persons or property of another; or the court regard it as immoral or opposed to public policy.
In each of these cases, the consideration or object of an agreement is a said to be unlawful.
Every agreement of which the object or consideration is unlawful is void.
The word object would mean the purpose and design which is the object of the contract, if is opposed to public policy which tends to defeat any provision of law or purpose of law, it becomes unlawful and thereby it is void under section 23 of the Contract Act.
Section 23 is concerned with only the object or consideration of the transaction and not the reasons or motive which prompted it.
Public policy imposes certain limitations upon free 889 dom of contract.
Certain objects of contract are forbidden or discouraged by law; though all other requisites for the formation of a contract are complied with, year if these objects are in contemplation of the parties when they entered into the agreement, the law will not permit them to enforce any rights under it.
Most cases of illegality are of this sort: the illegality lies in the purpose which one or both parties have in mind.
But in some instances the law strikes at the agreement itself, and the contract is then by its very nature illegal.
Whenever a plea of illegality or against public policy is raised as a defence to a contractual claim, the test to be applied is: Does public policy require that this claimant, in the circumstances which have occurred, should be refused relief of which he would otherwise have been entitled with respect to all or part of his claim .
In addition, once the court finds that the contract is illegal and unenfocreable, a second question should be posed which would also lead to greater clarity: do the facts justify the granting of some consequential relief (other than enforcement of the contract) to either of the parties to the contract.
In Chandra Sreenivasa Rao vs Korrapati Raja Rama Mohan Rao and Anr., , Subba Rao J., as he then was, while considering the word "object" in section 23 of the Contract Act in the context of enforceability of the debt secured to celebrate the marriage of the minor which was prohibited by the Child Marriage Restraint Act, held that the word "object" in section 23 meant "purpose" or "design" of the contract.
The purpose of borrowing was unlawful as it was opposed to the public policy of celebrating the marriage of a minor in violation of the statutory provisions, and therefore, the promissory note was held to be unenforcable.
An agreement between A & B to purchase property at an auction sale jointly and not to bid against each other at the auction is perfectly lawful, though the object may be to avoid competition between the two.
But if there is an agreement between all the competing bidders at the auction sale, be it of the court sale or revenue sale, or sale by the government of its property or privilege and formed a ring to peg down the price and to purchase the property at knock out price, the purpose or design of the agreement is to defraud the third party, namely , the debtor or Govt.
whose property is sold out at the court auction or revenue sale, or public welfare.
The object or consideration of the contract, oral or written, to share such property is unlawful.
There is also implied "injury to the debtor" within the meaning of section 23.
Thereby the contract was fraudulent.
The contract thus is also opposed to public policy and is void.
Take for instance four persons participated at an aution sale; pursuant to their previous agreement, they made pretext of partici 890 pation in the auction; bid upto an agreed price though the real value of the property is much more than what they had offered for.
Here the design or object of their forming a ring is to knock out the property for a song to defraud the debtor or public.
What is the object of the public policy in this regard ? The scope of public policy was classified into five groups in paragraph 1134 at p. 686 of Chitty 's on Contract , 26th Edn., Vol.
I, thus: "Objects which on ground of public policy invalidate contracts may, for convenience, be generally classified into five groups; first, objects which are illegal by common law or by legislation; secondly, objects injurious to good government either in the field of domestic or foreign affairs; thirdly objects which interfere with the proper working of the machinery of justice; fourthly, objects injurious to marriage and morality and fifthly, objects economically against the public interest.
" In Halsbury 's Laws of England , Fourth Edition, Vol. 9, in paragraph 392 at p. 266 it is stated that an agreement which tends to be injurious to the public or against the public good is invalidated on the ground of public policy.
"The question whether a particular agreement is contrary to public policy is a question of law, to be determined like any other by the proper application of prior decisions" The object of conducting public sale is to secure as much price or revenue as possible to redeem the debt of the debtor or to secure maximum price to the exchequer for use of public purpose.
If such a contract to form a ring among the bidders was to peg down the price and to have the property knocked out at a low price would defeat the above economic interest of the debtor or public welfare.
Thereby the agreement becomes fraudulent and opposed to public policy and is void under section 23 .
In Ram Lal Misra vs Rajendra Nath Sanyal, A.I.R. (1933) Oudh p. 124 at 127 the finding was that the agreement was not merely of an honest combination between two bidders to purchase the property at an advantageous price but goes further by resorting to secret artifice for the purpose of defrauding a third person, namely, the rival decreeholder.
Accordingly, it was held that the agreement was fraudulent and that, therefore, void under section 23 of the contract Act; Same is the view expressed by the Lahore High Court in Nand Singh @ Ghudda vs Emperor, A.I.R. 30 1943 Lahore 101 and in Hutchegowda vs H.M. Basaviah, A.I.R. (1954)Mysore 29.
In Rattan Chand Hira Chand vs Askar Nawaj Jung,J.T. this Court held that an agreement to influence authorities to obtain favourable verdict was held to 891 be opposed to public policy and void under section 23 and approved the decision of the A.P. High Court in Ratanchand Hirachand vs Askar Nawaz Jung & Ors.
A.I.R. 1976 A.P. 112.
An agreement to rig the market for share has been held to be fraudulent and unenforceable in Scott vs Drown, Deorning McNab & Co. [1872]2K.B. 724.
In Halsbury 's Laws of England Fourth Edition, Vol. 2, paragraph 746 at p. 383, it was stated that where good were purchased at an auction by a person who had entered into an agreement with another or others that the other or the others, or some of them, shall abstain from bidding for the goods, and he or the other party, or one of the other parties, to the agreement is a dealer, the seller may avoid the contract under which the goods are purchased.
Where a contract is avoided by virtue of this provision, then if the purchaser has obtained possession of the goods and restitution thereof is not made, the persons who were parties to the agreement are jointly or severally liable to make good to the vendor any loss he sustained by reason of the operation of the agreement.
In Md. Issac vs Sreeramulu, A.I.R.1946 Mad.
289=(1946) 1 Madras Lw Journal, 187 the Madras High court held that an agreement between two bidders not to bid against each other at an auction is not illegal and is not opposed to public policy.
The same was followed in Ramalingiah vs Subbartami Reddi, A.I.R. 1951 Mad 390.
In Mohafazul Robim vs Babulal, A.I.R. 1949 Nagpur 113 the Nagpur High Court also held that persons agreeing not to bid against each other is not opposed to public policy.
The Division Bench of Delhi High Court in Lachman Das & Ors.
vs Hakim Sita Ram & Ors.
A.I.R. 1975 Delhi 159 had to consider that an agreement entered into by the parties not to bid at the auction against each other is not opposed to public policy, and therefore, it is not avoid.
While upholding the agreement it was also held that where agreements are likely to prevent the property put up for sale in not realising its fair value and to dump the sale would certainly be against public good and, therefore, is void being opposed to public policy.
In Cheerulal Prakash v Madadeodas maiyua & Ors., [1959] (suppl.) 2 SCR 406 this court held that though a wagering contract was void and unenforceable under section 30 of the ContractAct, it was not forbidden by law and agreement collateral to such a contract was not unlawful within the meaning of section 23 of the Contract Act.
A partnership with the object of carrying on wagering transaction was not therefore, hit by section 23.
In Mohomed Meerta vs S.V. Raghunadha Gopalar, 27 Indian Appeals, 17 the sale was impugned, on one of the grounds that the agreement was made for the benefit of the Papanand Zamidar and 892 the appellant, intended to sell the property back to the former when he should be in a position to repurchase it and both of them had combined to dissuade persons from bidding, and did in fact dissuade them.
Thereby they purchased the property for lesser price than the real value.
The execution was set aside.
On appeal, the High Court did not agree with the finding that the appellant and the Jainilabdin and the Papanand Zamindar did combine to dissuade the persons from bidding but fount that the appellant played fraud on the court by suppressing the contract as being a decree holder obtained leave of the count and bid in the auction.
Therefore, the sale was void on that ground.
On further appeal the judicial committee found that the ground on which the High Court set aside the sale was not pleaded, nor an opportunity given to the appellant.
Therefore, for the first time that ground cannot be taken before the High Court and having disagree with the executing court that there was an agreement to dissuade third party to participate in the bid, the sale cannot be set aside on the new ground.
The Privy Council confirmed the sale.
On those facts the ratio is of no assistance to the appellant since there is no agreement between the appellant and the respondent to dissuade third party to participate in the bid.
The ratio in Kayjay Industries (P) Ltd. vs Asnew Drums (P) Ltd. & Ors. ; is of no assistance to the appellant.
Therein the executing court, on the previous occasion, with a view to secure better price did not confirm the sale, the conduct of the second sale, therefore, was held not to be vitiated by any material irregularity.
The general principles of public policy discussed by this Court in Central Inland Water Transport Corpn.
Ltd. & Anr.
vs Brojo Nath Ganguli & Anr., [1986] 2SCR 278 and one of us (K.R.S., J.) in Delhi Transport Corporation vs D.T.C. Mazdoor Congerss & Ors.
A.I.R. 1991 SC 190 are of no assistance on the facts in this case.
The public policy is not static.
It is variable with the changing times and the needs of the society.
The March of law must match with the fact situation.
A contract tending to injure public interest or public welfare or fraudulent to defeat the rights of the third parties are void under section 23 of the Contract Act.
From the record it is clear that there were as many as six bidders who participated in the auction, the upset price was fixed at Rs. 1,000.
The auction was started with the bid at Rs. 1,000 and ultimately at 20th knock the highest bid of the respondent was at Rs. 5,000.
Thus, the facts demonstrate that the agreement between the appellant and the respondent was only a combination to participate at an auction of the 893 evacuee property.
There is no intention either to peg down the price or to defraud the Government to knock out the sale at a lower price.
Thus, the object of the agreement is not opposed to public policy, and therefore, it is not void under section 23 of the Contract Act.
Thus, on the facts of this case we have no hesitation to conclude that the impugned agreement between the appellant and the respondent is lawful Contract.
The Courts below committed no error of law warranting interference.
The appeal is accordingly dismissed, but in the circumstances without costs as we did not call upon the respondent to argue the case.
N.P.V. Appeal dismissed.
| IN-Abs | The 4 appellants along with 11 others were tried for murder and for causing injuries.
The learned sessions judge while acquitting all others of all the charges, convicted A 1, A 2, A 5 and A 1 on different counts.
The sentences awarded to them under various charges including the sentence of life imprisonment under section 302 IPC were ordered to run concurrently.
The convicted accused preferred appeal to the High Court against their conviction and sentences and the State appealed against the acquittal of the rest of the accused.
The High Court altered the convection of A 1 and A 2 under section 302 I.P.C. and 302 read with section 34 respectively into one under section 302 read with section 149 I.P.C. and confirmed the sentence for imprisonment for life.
Except for this modification the convictions and sentences in respect of all the four accused were confirmed.
The state appeal against acquittal of all other accused was dismissed.
In this appeal preferred by the four convicted accused namely, A 1, A 2, A 5 and A 11 their counsel confined his arguments against their convictions and sentences under section 302 read with section 149 I.P.C. only as the appellants had either already served or had almost finished serving to their sentences awarded to them under other charges.
876 The argument was that in the absence of a specific finding to the effect that apart from the 4 appellants the prosecution has proved the involvement of other persons, section 149 I.P.C. cannot be invoked for convicting them under section 302 I.P.C. Confirming the convictions and sentences of the appellants under other charges but allowing their appeal against their conviction and sentence under section 302 I.P.C. read with section 149 I.P.C. this Court, HELD: Since the accused who are convicted were only four in number and the prosecution has not proved the involvement of other persons and the court below have acquitted the other accused of all the offences, section 149 cannot be invoked for convicting the four appellants herein.
The learned judges were not correct in stating that A1, A2, A5 and A11 can be held to be the members of an unlawful assembly along with some other unidentified persons on the facts and circumstances of this case.
The charge was not that accused 1,2,5 and 11 "and others" or "and other unidentified persons" formed into an unlawful assembly but it is that "you accused 1 to 15" formed into an unlawful assembly.
It is not the prosecution case that apart from the said 15 persons there were other persons who were involved in the crime.
When the 11 other accused were acquitted it means that their involvement in the offence had not been proved.
It would not also be permissible to assume or conclude that others named or unnamed acted conjointly with the charged accused in the case unless the charge itself specifically said so and there was evidence to conclude that some others also were involved in the commission of the offence conjointly with the charged accused in furtherance of a common object.
[882A D] Amar Singh vs State of Punjab, [1987] 1SCC 679 and Maina Singh vs State of Punjab, [1976]3SCR 651, followed.
|
ite Petition No. 974 of 1989.
(Under Article 32 of the Constitution of India).
Gobinda Mukhoty, S.K. Bhattacharya and D.K. Garg for the Petitioner.
K. Swamy, R.C. Kaushik (NP) for the Respondents.
The Judgement of the Court was delivered by K. JAYACHANDRA REDDY, J.
In this write petition the petitioner has challenged the order passed by the Commandant, 11th Battalion C.R.P.F., the 4th respondent, dismissing the petitioner from service.
The petitioner was working as a Head Constable in the Central Reserve Police Force ("CRPF" for short) on the relevant date.
He joined as a Constable in the year 1963.
He was awarded three medals for performing his duty diligently and in the year 1967 he was given an award of Rs. 500 and a special promotion while fighting in the 897 Nagaland.
He also claims to have been awarded some other such cash awards later.
He was promoted as Head Constable later on.
In total he has put in 20 years of service.
While working as Post Commander of Vijaynagar Post Tirap District, two undertrial prisoners who were Burmese nationals, were handed over on 29.3.83 till further order by the Circle Officer to the custody of the CRPF Vijaynagar Post of which the petitioner was the Post Commander.
On the intervening night of 4th and 5th April, 1983 the two Burmese nationals escaped from the custody.
It was alleged that the petioner was negligent in his duty and that he did not take immediate action to report the matter to the Circle Officer and that he also connived the escape of the two undertrial prisoners and deliberately dug a tunnel to make it appear that the undertrial prisoners had dug the tunnel and and escaped through the same.
On the basis of this incident, a chargesheet was served on 18th August, 1983 on the petitioner and an enquiry was conducted.
The Deputy Superintendent of Police was the Enquiry Officer and he recorded the statements of some witnesses who were then posted under the petitioner.
That Enquiry was cancelled and a fresh enquiry was commenced.
Three charges were framed which are referred to as Articles in the report of the Enquiry Officer.
These are as under: "Article I No. 630110316 HC.
L.S. Pandey of E. Coy 11 Bn.
CRPF while functioning as post Commander of Vijay Nagar post in distt.
Tirap (ACP) from 11/3/83 to 18/6/83 and while functioning a Guard Commander of the Guard post Vijay Nagar post in Distt.
Tirap (ACP) on 5/4/83 committed an offence of remissness in his capacity as a member of the force U/S 11 )1) of CRPF Act, 1949 in that he allowed No. 800210049 Ct.
Md Shamsher Alam to leave the santry post at 0430 hrs without arranging proper relief which resulted in the escape of 2 UTPs from the prisoner cell.
Article II That during the aforesaid period while functioning as post Commander and guard Commander at Vijay Nagar post, the said No. 630110316 H.C.L.S. Pandey of E Coy 11 Bn, CRPF committed an offence of neglect of duty in his capacity as a member of the force U/S 11 (1) of CRPF Act, 1949 in that he did not take immediate action to report the matter to the Circle Officer of Vijay Nagar and sent Crash 898 Message to Bn Hqrs.
When the UTPs were found missing from the UTPs cell at about 0500 hours on 5/4/83.
Article III That during the aforesaid period while functioning as post/guard Commander of Vijay Nagar post of Distt.
Tirap (ACP) the said No. 630110316 HCLS.
Pandey of E Coy 11 Bn, CRPF committed an offence of grave misconduct in his capacity as a member of the force U/S 11 (1) of CRPF Act, 1949 in that he connived the escape of two UTPs and deliberately dug the tunnel to make it appear that the UTPs and deliberately dug the tunnel to make it appear that the UTPs had dug the tunnel and escaped through the tunnel.
He did not handover the guard duty roster to next post Commander No. 630040452 HCB Lakara thereby destroying the documents to prevent its production as evidence.
" The statements of some of the witnesses were recorded.
Thereafter the deliquent 's statement also was recorded.
The deliquent was again given an opportunity to put forward his plea.
He pleaded not guilty and the deliquent was asked to enter his defence by filing a written statement and also produce a list of defence witnesses.
He accordingly gave a list of defence witnesses and only one def witness was examined.
The Enquiry Officer submitted the report holding that the delinquent connived the escape of the two undertrial prisoners and then deliberately dug the tunnel to make it appear that the undertrail prisoners dug the same and escaped and he accordingly recommended that the disciplinary proceedings should be initiated against the petitoner as well as against another Constable Mohd. Shamsher Alam.
On the basis of this report a dismissal order was passed against the petitioner on 30th June, 1984.
The petitioner preferred an appeal under Section 28 of the CRPF Rules to the Deputy Inspector General of Police, CRPF, the appellate authority, but the same was dismissed on 23rd October, 1984.
A further revision filed by him to the Inspector General of Police, CRPF was also dismissed on 2.5.86.
During all these enquiries the plea of the petitioner had been that on 29.3.83, the two undertrail prisoners were entrusted late in the evening and he was not given full strength of 40 Constables and that there were only 11 Constables and it was dark and raining heavily and that neither torches nor candle sticks nor kerosene oil were available.
There were also no locks and stationery and there were no proper arrangements of the building where the two undertrial prisoners could be kept in custody and he also sent a message that more persons should be deputed but no 899 steps were taken.
With regard to the enquiry, his grievance has been that suddenly area of enquiry was shifted from Khonsa to Logding 50 kms.
away and that all the defence witnesses cited by him were not examined.
He has also stated that the first enquiry was dropped and he was exonerated and on the whole the enquiry was not fair and not according to the Rules and that the entire proceedings were mala fide in as much as the first enquiry officer dropped the enquiry and exonerated the petitioner from all charges.
In this writ petition also the same submissions are put forward.
In the counter affidavit filed on behalf of the respondents, it is stated that full opportunity was given to the petitioner during the departmental enquiry and that venue of enquiry was shifted from Khonsa to Longding only to avoid unnecessary delay in the enquiry and that the petitoner never objected to the shifting of the place of enquiry.
It is also submitted that the petioner was given full opportunity to produce the defence witnesses and notices were also served on them but they did not appear.
Regarding the first enquiry it is stated that the same was not completed by the Enquiry Officer.
Therefore a fresh enquiry was ordered and that it cannot be said that by cancellation of the first enquiry the petitoner was exonerated.
It is further submitted that the petitioner was given full opportunity and that he duly participated in the enquiry and no prejudice whatsoever was caused.
On a careful examination of the affidavit, and the counter affidavit and the allegations as well as the denials, we are of the opinion that there are a number of disputed questionss of fact.
The learned counsel for the petitoner, however, submitted that under Article 32 even disputed questions of fact can be gone into by this Court.
He relied on a judgement of this Court in Kavalappara Kottarathil Kochunni Moopil Nayar vs The State of Madras and Others, [1959]Suppl.
2SCR 316 where it is observed that: "Clause (2) of article 32 confers power on this Court to issue directions or orders or writs of various kinds referred to therein.
This Court may say that many particular writ asked for is or is not appropriate or it may say that the petitioner has not established any fundamental right or any breach thereof and accordingly dismiss the petition.
In both cases this Court decides the petition on merits.
But we do not countenance the proposition that, on an application under article 32, this Court may decline to entertain the same on the 900 simple ground that it involves the determination of disputed questions of fact or on any other ground.
If we were to accede to the aforesaid contention of learned counsel, we would be failing in our duty as the custodian and protector of the fundamental rights.
We are not unmindful of the fact that the view that this Court is bound to entertain a petition under article 32 and to decide the same on merits may encourage litigants to file many petitions under article 32 instead of proceeding by way of a suit.
But that consideration cannot, by itself, be a cogent reason for denying the fundamental right of a person to approach this Court for the enforcement of his fundamental right which may, prima facie, appear to have been infringed.
Further, questions of fact can and very often are dealt with on affidavits." In support of the same proportion, the learned counsel for the petitioner also relied on the decision of this Court in Smt.
Ujjam Bai vs State of Uttar Pradesh, [1963] 1SCR 778.
Having carefully examined the entire records and the submissions made, we do not think that it is necessary to examine the scope of Article 32 in this case.
Since the petitioner who has been in service for 20 years has been dismissed, we thought fit even to examine and their statements clearly establish the charges framed against the petitioner.
That apart undisputedly the two Burmese national were entrusted to the custody of the petitioner and they escaped and the responsibility entirely lies with the petitioner who was the Post Commander of Vijaynagar Post.
No doubt, he pleaded that the arrangements were inadequate and the two undertrial prisoners took advantage, dug a tunnel through which they managed to escape.
The Dy.
Superintendent of Police who visited the premises inspected the same and made a report and in he said report he clearly observed that there was certainly some negligence on the part of CRPF men for not noticing the activities of the undertrial prisoners and therefore an enquiry was necessary.
In the enquiry report the statements of the witnesses namely the Constables who were on duty are referred to in detail and it is held that the petitioner was the Guard Commander till 5.4.83.
The Enquiry Officer has also referred to the records in this regard and on the basis of the oral an documentary evidence, he concluded that the petitioner committed an offence of neglect of duty and that he did not take immediate action to report the matter to the Circle Officer.
What is more the statements of 901 PWs 1, 3, 4, 5, 6, 8 and 9 go to show that there was no tunnel at all when they reached the spot of hearing the alarm.
It is in the statement of PW 2 that he saw the petitioner digging the tunnel.
In view of these clear statements made by the Constables who were on duty alongwith the petitioner when the two Burmese nationals escaped, the Enquiry Office was justified in recommending disciplinary action.
Under these circumstances, we see no force in the submission that the enquiry was not properly conducted and that prejudice was caused to the petitioner.
After having perused all the records carefully, we are unable to find any clinching circumstances on the basis of which it can be said that the petitioner was not negligent in discharge of his duties and that he did not commit any act of misconduct.
On the other hand we find that the statements of PWs 1, 3, 4, 5, 6, 8 and 9 coupled with that the PW 2 falsify the plea of the petitioner that the undertrial prisoners themselves dug the tunnel and managed to escape.
As already mentioned the learned counsel also submitted that the enquiry is vitiated inasmuch as proper opportunity was not given to the petitioner as all the defence witnesses were not examined and that place of hearing was shifted because of which the witnesses could not be produced and that the cancellation of the first enquiry amounted to exoneration.
therefore, according to the learned counsel for the petitioner, the impugned order of dismissal should be quashed as there is clear violation of his fundamental rights guaranteed under Articles 14 and 16 of the Constitution of India.
In this context he relied on decisions of this Court in Tata Oil Mills Co. Ltd. vs Its Workmen, ; State of Uttar Pradesh vs Om Prakash Gupta, ; State Bank of India vs R.K. Jain 7 Ors., [1972] 1 SCR 755 and State of Andhra Pradesh & Ors.
vs Chitra Venkat Rao, ; In all these cases it is laid down that such enquiries must be conducted in accordance with the principles of natural justice and that a reasonable opportunity to deny the guilt and to cross examine the witnesses produced and examined, should be given and that the enquiry should be consistent with the rules of natural justice and in conformity with the statutory rules prescribing the mode of enquiry.
We have already referred to the details of enquiry conducted in the instant case and we are unable to say that there was any violation of principles of natural justice.
It is, however, urged that in these matters merely following the rules in the procedure established is not enough, but the principles of natural justice must also necessarily be followed.
What this Court in a number of cases has been observed is that what particular rule of natural justice should apply to a given case depends to a 902 great extent on the facts and circumstances of the case.
Reliance has also been placed on some of the decisions of this Court.
In A.K. Kraipak and Others vs Union of India and Others, it is pointed out that: "Para 20.
The aim of the rules of natural justice is to secure justice or to put it negatively to prevent miscarriage of justice.
These rules can operate only in areas not covered by any law validly made.
In other words they do not supplant the law of the land but supplement it.
xx xx xx What particular rule of natural justice should apply to a given case must depend to a great extent on the facts and circumstances of that case, the framework of the law under which the enquiry is held and the constitution of the Tribunal or body of persons appointed for that purpose.
Whenever a complaint is made before a court that some principle of natural justice had been contravened the court has to decide whether the observance of that rule was necessary for a just decision on the facts of that case.
" In Capt.
Harsh Appall vs Union of India and Others, ; the contention was that before confirming the sentence by the court material under the Army Act, an opportunity should have been given to the delinquent officer.
In respect of this contention is observed that: "to insist that the confirming authority should give a hearing to the petitioner before it confirmed the sentence passed by the Court Martial is a contention which cannot be accepted.
To accept this contention would mean that all the procedure laid down by the Code of Criminal Procedure should be adopted in respect of the Court Martial, is a contention which cannot be accepted in the face of the very clear indications in the Constitution that the provisions which are applicable to all the civil cases are not applicable to cases of Armed Personnel." (emphasis supplied) As observed in Khemchand vs Union of India, to which there is a reference in some of the decisions cited above all that the courts have to see is whether there was non observance of any of 903 those principles in a given case and whether the same has resulted in defecting the course ofjustice and that what principles of natural justice should be applied in a given case depends on the facts and circumstances of that case (vide State of Uttar Pradesh vs Om Prakash Gupta, In our view even applying all these principles the petitioner has failed to prove that the enquiry is vitiated in any manner.
The last submission of the learned counsel is that the punishment of dismissal is wholly disproportionate to the alleged act of misconduct.
We are unable to go to the extent of holding that the punishment by way of dismissal is arbitrarily awarded.
But there are certain mitigating circumstances.
The petitioner joined as a Constable in the year 1963 and he was awarded medals for the performing his duties diligently.
He has put in 20 yard of service and no act of negligence or misconduct is attributed to him at any time before during this long service.
Under these circumstances if the petitioner makes any representation the concerned authority may consider the question of awarding a lesser sentence.
With the above observations the writ petition is dismissed.
G.N. Petition dismissed.
| IN-Abs | The petitioner, a Head Constable in the Central Reserve Police Force was charge sheeted for negligence in his duty, resulting in the escape of two undertrial prisoners, who were handed over to him for custody.
An enquiry was conducted against the petitioner, but later it was cancelled and a fresh enquiry was commenced on the charges that he allowed a Santry to leave the santry post without arranging proper relief resulting in the escape of 2 undertrial prisoners; that he did not take immediate action to report the matter to the Head Quarters; that he connived the escape of the two undertrial prisoners; that he dug up a tunnel to make it appear that the two undertrial prisoners escaped through the tunnel and that he did not hand over the guard duty roster thus preventing its production as evidence.
Statement of some witnesses and that of the Petitioner were recorded.
Only one defence witness was examined.
The Enquiry Officer submitted his report recommending disciplinary proceedings against the petitioner.
On the basis of the Report , a dismissal order was passed against the petitioner.
The petitioner 's appeal against the dismissal order was dismissed by the appellate authority.
Revision Petition preferred by him also met the same fate.
In the present Writ Petition, challenging the dismissal order, the 895 petitioner contended that during the relevant time, there was absolute shortage of personnel, non supply of torch or candle or kerosene and absence of proper arrangements to keep custody of the undertrial prisoners.
It was also contended that all the defence witness cited by him were not examined and that the enquiry was mala fide since the earlier enquiry was dropped and he was exonerated.
The Respondents contended that no prejudice was caused to the petitioner since full opportunity was afforded to him, that the venue of the enquiry was shifted only to avoid unnecessary delay and the petitioner never objected to it during the enquiry.
As regards the first enquiry, it was contended that since the same was not completed and later cancelled, fresh enquiry was ordered and it did not mean that the petitioner was exonerated.
Dismissing the Writ Petition, this Court, HELD: 1.
It is necessary to examine the scope of Article 32 of the Constitution in this case.
Since the two undertrials were entrusted to the custody of the petitioner and they escaped, the responsibility was entirely on the petitioner.
No doubt, he pleaded that the arrangements were inadequate and the two undertrial prisoners took advantage, dug a tunnel through which they managed to escape.
The Deputy Superintendent of Police who visited the premises inspected the same and made a report in which he clearly observed that there was certainly some negligence in not noticing the activities of the undertrial prisoners and therefore an enquiry was necessary.
The Enquiry Officer, on the basis of the oral and documentary evidence, concluded that the petitioner committed an offence of neglect of duty and that he did not take immediate action to report the matter to the Circle Officer.
The statements of PWs 1, 3, 4, 5, 6, 8 and 9 to show that there was no tunnel at all when they reached the spot on hearing the alarm.
It is in the statement of PW 2 that he saw the petitioner digging the tunnel.
In view of these clear statements made by the PWs viz. the Constables who were on duty alongwith the petitioner when the two undertrial escaped, the Enquiry Officer was justified in recommending disciplinary action, and no prejudice was caused to the petitioner.[900D H, 901A B] Kavalappara Kottarathil Kochunni Moopil Nayar vs The State of Madras and Ors., [1959] (supp.) 2 SCR 316 and Smt.
Ujjam Bai vs State of Uttar Pradesh, [1963]1 SCR 778, referred to. 2.
Whether there was non observance of any of the principles of 896 natural justice in a given case and whether the same has resulted in defecting the course of justice, and what principles of natural justice should be applied in a given case depends on the facts and circumstances of that case.
In the instance case, the petitioner has failed to prove that the enquiry is vitiated in any manner whatsoever.
[902H;903A B] Tata Oil Mills Co. Ltd. vs Its Workmen, [1964] 7Scr 555 ; State of Uttar Pradesh vs Om Prakash Gupta, ; State Bank of India vs R.K. Jain & Ors., [1972] 1 SCR 755; State of Andhara Pradesh & Ors.v.
Chitra Venkata Rao, [1976]1SCR 521; A.K. Kraipak and Ors.
vs Union of India and Ors.
, [1969] 2SCC 262; Capt.
Harish Uppal vs Union of India and Ors., ; and Khemchand vs Union of India, , referred to.
[Though the Petitioner 's challenge to the dismissal order was negatived by the Court, appreciating the mitigating circumstances such as the petitioner 's long service of 20 years in which he was performing his duties diligently and bagging medals therefore, and that no act of negligence or misconduct was attributed to him earlier, the Court observed that if the petitioner marks any representation, the authority concerned may consider the question of awarding a lesser sentence.]
|
Civil Appeal Nos.
2012 2013 of 1974.
From the Judgement and Order dated 2.2.1973 of the Calcutta High Court in Appeal No. 211 of 1966.
B. Sen, Mrs. Geetanjali Mohan and Bishan Lal for the Appellant.
Dr. Shanker Ghosh, Darshan Singh, Praveen Kumar, I.B. Gaur and Ms. Shaifali Khanna (NP) for the Respondents.
The Judgement of the Court was delivered by KASLIWAL, J.
These appeals by special leave are directed against the order of the Calcutta High Court dated February 2, 1973.
Brief facts necessary for the determination of these appeals are that Shri Gouri Sankar Sarda (hereinafter referred to as Respondent No. 1) filed a Suit No. 1783 of 1965 in the Calcutta High Court against R. McDill and Company Pvt.
Ltd. (in short Appellant No. 1), Mirilal Dharamchand (Pvt.
) Ltd. (in short Appellant No.2 ) and Shri Misrilal Jain for the recovery of some amounts as well as for some other reliefs.
On or about 15th December, 1965 both the appellant Nos. 1 and 2 who were also defendants in the suit submitted a joint application in the High Court for staying proceedings of the aforesaid suit, under Section 34 of the (hereinafter referred to as 'the Act ').
In view of some formal defect in the application the High Court by order dated 25th February 1966 gave permission to withdraw the said application with liberty to file a fresh application.
As the entire case hinges on the above order dated 25th Feb. 1966, relevant portion of the said order is reproduced as under: 812 :Application withdrawn with liberty to make a fresh application.
Cost to be paid by the applicant.
" Though the above order does not make a mention of the formal defect, but according to the appellants the permission to withdraw was sought as no copy of the plaint was annexed with such application.
Thereafter, on March 21, 1966 the appellant Nos. 1 and 2 instead of making a joint application submitted two separate applications for staying the suit against the respective appellants and in the alternative for stay of the suit as a whole.
These applications were resisted by the plaintiff respondent No. 1 on the ground that separate applications were not in terms of the order dated 25.2.1966 and hence no stay should be granted.
Learned Single judge upheld the objection raised by the plaintiff and refused to stay the suit.
On appeal the Division bench of the Calcutta High Court by order dated 2nd February, 1973 dismissed the appeal.
The Division Bench took the view that liberty was granted to make a fresh application and as such under the provision of Order XXIII of the Code of Civil Procedure, the appellants had no right to move two separate applications for staying the suit.
Aggrieved against the aforesaid Order of the High Court dated 2nd February, 1973 the appellants have filed these appeals by the grant of special leave.
order XXIII C.P.C. as it existed at the relevant time is reproduced as under: ORDER XIII: WITHDRAWAL AND ADJUSTMENT OF SUITS 1.
Withdrawal of suit or abandonment of part of claim: (1) At any time after the institution of a suit, the plaintiff may as against all or any of the defendants abandon his suit or abandon a part of his claim.
(2) Where the Court is satisfied (a) That a suit must fail by reason for some formal defect or (b) That there are other sufficient grounds for allowing the plaintiff to institute a fresh suit for the subject matter of a suit or part of claim.
813 It may, on such terms as it thinks fit, grant the plaintiff permission to withdraw from such suit or abandon such part of a claim with liberty to institute a fresh suit in respect of the subject matter of such suit or such part of claim.
(3) Where the plaintiff withdraws from a suit, or abandon part of a claim, without the permission referred to in sub rule he shall be liable for such costs as the Court may award and shall be precluded from instituting any fresh suit in respect of such subject matter or such part of the claim.
(4) Nothing in this rule shall be deemed to authorise the Court to permit one of several plaintiffs to withdraw the consent of the others".
It was contended on behalf of the appellants that the provisions or Order XXIII were not applicable in the matter of applications filed under Section 34 of the .
It was contended that the provisions of Order XXIII could only apply to the proceedings of a suit and not in respect of any applications filed under the Act.
It was submitted that the High Court committed an error in taking a highly technical view of the matter that initially a joint application was submitted for stating the suit and liberty was given to withdraw the same and to make a fresh application and as such the appellants were not entitled to submit two separate applications though for the same purpose.
It was contended in this regard that there were two separate agreements between the plaintiffs and appellants Nos. 1 or 2 containing an arbitration clause and as such the appellants were given a legal advice to submit two separate applications for staying the suit and the High Court should not have dismissed the applications on the ground that liberty to file fresh application was given in respect of one application only.
Learned counsel for the appellants in support of this contention placed reliance on Nawab Usmanli Khan vs Sagarmal, On the other hand it was argued on behalf of the respondent No. 1 that provisions or Order XXIII C.P.C. were applicable in respect of an application under the Act.
It was contended that basically the proceeding had arisen on account of a suit filed by the plaintiff respondent and in that suit an application was submitted for staying the suit and referring the matter to Arbitrator under Section 34 of the Act.
The Order as such passed by the High Court on 25th February, 1966 would be governed by the provisions of order XXIII of the Code of Civil 814 Procedure and fresh application could only lie in accordance with the terms and conditions imposed at the time of permitting the withdrawal of the first application.
It was contended that it was an admitted position that a joint application was filed for staying the suit and the permission was granted to withdraw the same with liberty to make a fresh application and the defendants appellants had no right to submit two separate applications in violation of the order of the Court dated 25th February, 1966.
Reliance in support of the above contention was placed on Munshi Ram vs Banwari Lal, [1962] Supp.
(2) SCR 477 and Hakam Singh vs M/s Gammon (India) Ltd.; , We would first deal with the question whether the provisions of Order XXIII C.P.C. apply or not to an application for stay of suit filed under Section 34 of the Act.
Section 41 of the Act reads as under: 41 Procedure and powers of Court.
"Subject to the provisions of this Act and of rules made thereunder (a) The provisions of the Code of Civil Procedure, 1908, shall apply to all proceedings before the Court, and to all appeals, under this Act, and (b) The Court shall have, for the purpose of, and in relation to, arbitration proceeding before the Court.
Provided that nothing in clause (b) shall be taken to prejudice any power which may be vested in an arbitrator or umpire for making orders with respect to any of such matters".
According to the above provision the provisions of the Code of Civil Procedure, 1908 shall apply to all proceedings before the Court subject course to the provisions of The and of any rules made thereunder.
it has been laid down in various decisions from time to time that the following provisions of the Code of Civil Procedure shall apply to proceedings under the Act.
In the 'Law of Arbitration ' by R.S. Bachawat (2nd 1987 Ed., 585) under the Heading 'Applicability of Code of Civil Procedure to court proceeding ' it has been mentioned as under: 815 Subject to the provisions of the Act and the Rules made thereunder the provisions of the code of civil procedure aplply to all proceddings before the Court and to all appeals under the Act, Section 41(a).
The following provisions of the Code of Civil Procedure have been held to apply to certain proceedings under the Act: (1) Section 20 Hakam Singh vs Gammon (India) ltd.; , (2) Section 96(3) Union of India vs Mohinder Singh & Co., AIR 1971 JK 10.
(3) Section 24 Union of India vs Rup Kishore, AIR 1957 All 504.
(4) Section 114 read with Order 47 Executive Engineer vs Thingom Iboyaima Singh, AIR 1970 Manipur 76.
(5) Order 1 Rule 8 Abdul Gani vs Reception Committee, AIR 1936 Bom.
250: ILR (6) Order 3 Rule 5 Ram Bharosey vs Peary Lal, AIR 1957 All 265.
(7) Order 5 Shrinath Bros. vs Century Spinning & Wvg.
Co., AIr (8) Order 6 Rule 17 Indian Minerals Co. vs Northern India Uime Marketing Association, (9) Order 9 Rule 13 Ganeshmal vs Keshoram Cotton Mills, AIR 1952 Cal 10: ILR (10) Order 23 Rule, 3 Munshi Ram vs Banwari Lal, ; (11) Order 30 Rule 3 Governor General in Council vs Associated Live Stock Farm (India) Ltd., AIR 1948 Cal.
230: 52 CWN 288.
(12) Order 30 Rule 4 Soorajmull Nagarmull vs Sagar Mal, AIR 1978 Cal.
A proceeding under Section 14 Section 17 under the Act is not a suit and the provisions of Section 86(1) C.P.C. read with Section 87 C.P.C. does not apply to such a proceeding (Usman Ali Khan) vs (Sagar Mal,) ; Nor does the provision of Section 80 C.P.C. apply to a proceeding under Section 20 (Ramchand) vs (Governor General in Council,) AIR 1947 sind 147.
The following provisions of the Code Civil Procedure apply to appeals under the Act: 816 (1) Section 96(3) (Union of India) vs (Mohinder Singh & Co.,) AIR 1971 JK 10; (2) Order 41 Rule 5 (Scottish Union of National Insurance Co.) vs (Saraswati Sajnani,) AIR 1960 Cal.
22:63 CWN 800.
Apart from the above cases Section 41 of the Act itself provides that the provisions of the Code of Civil Procedure shall apply to all proceedings before the Court.
We do not find any provision in the Act so as to take away the provisions or Order XXIII C.P.C. from being applied to applications filed under Section 34 of the Act, in a suit.
That apart the case before us has started on a plaint filed by the plaintiff and in such a suit if any application is filed under the Act, the same ought to be governed by the provisions of the Code of Civil Procedure.
In (Munshi Ram) vs (Banwari Lal,) (supra) the facts were that the Arbitrator gave an award.
The award was filed in the court by the Arbitrator.
The appellants made application for setting aside the award and the respondents filed their replies to the application.
Thereafter, the parties came to terms and asked for a decree to be passed in accordance therewith.
The court passed a decree on the award modified by the compromise.
In execution, the appellant contended that the decree was nullity as the Court had no jurisdiction to modify the award by compromise.
It was argued that after a dispute is referred to arbitration and an award has been obtained and filed in Court, it is not open to the Court to record the compromise under Order XXIII Rule 3 of the Code of Civil Procedure, because an award can be set aside or modified as laid down in the , there is no provision in the for recording the compromise, the above contention was not accepted and it was held as under: "When an award is given, the parties cannot, under the Act challenge it except as laid down there.
The powers of the Court are indicated by the Act.
They are limited to accepting the award, if there be no objection and passing a decree in accordance therewith, or superseding the reference or revoking or modifying the award or remitting it for further consideration, as laid down in the Act.
But, the Act does not disable the parties from terminating their dispute in a different way, and if they do it could not be intended by law that a dispute, which had been successfully terminated, should again become the subject of litigation.
If the parties are dissatisfied with the award and want to substitute it by a compromise involving matters alien to the original dispute 817 which are inseparable, the Court may supersede the submission, and leave the parties to work out their agreement in accordance with the law outside the ".
In (Nawab Usmanali Khan) vs (Sagarmal,) (supra) on which reliance has been placed by learned counsel for the appellant it was held that a proceeding under Section 14 read with Section 17 of the Act for the passing of a Judgement and decree on an award does not commence with a plaint or a petition in the nature of a plaint, and cannot be regarded as a suit and the parties to whom the notice of the filing of the award is given under Section 14(2) cannot be regarded as "suit in any Court otherwise competent to try the suit" within the meaning of Section 86(1) read with section 87B, Civil Procedure Code.
In the above case the appellant was the Ruler, or the former Indian State of Jaora.
The had money dealing with the respondent.
The respondent after obtaining a decree in terms of the award started execution proceedings against the appellant.
The Central Government gave a certificate under Section 86(3) read with Section 87B of the Code Civil Procedure, 1908 consenting to the execution of the decree against the properties of the appellant.
The Executing Court passed the prohibitory order under Order XXI Rule 46 of the Code of Civil Procedure in respect of sums payable to the appellant on account of the privy purse.
On an objection raised by the appellant by order dated March 15, 1958, the Court recalled the decree and cancelled the certificate as prayed for, on the ground that the amount receivable by the appellant on account of his privy purse was not attachable.
The respondent preferred appeal before the High Court.
The High Court allowed the Appeal No. 33 of 1958.
Usmanali Khan (appellant) filed an appeal before this Court.
This Court held as under: "Section 86(1) read with section 87B confers upon the Rulers of former Indian State substantive rights of immunity from suits.
Section 141 makes applicable to other proceedings only those provisions of the Code which deal with procedure and not those which deal with substantive rights.
Nor does section 41(a) of the Indian carry the matter any further.
By that section, the provisions of the Code of Civil Procedure, 1908 are made applicable to all proceedings before the Court under the Act.
Now, by its own language section 86(1) applies to suits only, and section 141, Code of Civil procedure does not attract the provisions of section 86(1) to proceedings other than suits.
Accordingly, by the conjoint application of section 41(a) of the Indian Arbitration 818 Act and sections 86(1) and 141 of the Code of Civil Procedure, the provisions of section 8691) are not attracted to a proceeding under s.14 of the Indian .
It follows that the Court was competent to entertain the proceedings under section 14 of the Indian and to pass a decree against the appellant in those proceedings, though no consent to the institution of those proceedings had been given by the Central Government".
The following observations in (Hansraj Gupta) vs (Official Liquidator, Dehra Dun Mussorrie Electric Tramway Co.) [1932] L.R. 60 I.A. 13, 19 made by Lord Russell of Killowen were quoted.
"The word 'suit ' ordinarily means, and apart from some context must be taken to mean a civil proceeding instituted by the presentation of a plaint".
The following observations made by Shah, J. in (Bhagwat Singh) vs (State of Rajasthan,) ; were also quoted with approval: "The appellant is recognised under article 366(22) of the Constitution as a Rule of an Indian State, but section 86 in terms protects a Ruler from being 'sued ' and not against the institution of any other proceeding which is not in the nature of a suit.
A proceeding which does not commence with a plaint or petition in the nature of plaint, or where the claim is not in respect of dispute ordinarily triable in a Civil Court, would prima facie not be regarded as falling within section 86 Code of Civil Procedure".
The above observation made by Lord Russell of Killowen and Shah, J. go to show that for a suit the civil proceedings is instituted by the presentation of a plaint.
In the aforesaid background it was held that a proceeding which does not commence with a plaint or petition in the nature of plaint, or where the claim is not in respect of dispute ordinarily triable in a civil court, would prima facie not be regarded as falling with Section 86, Code of Civil procedure.
In the case before us as already mentioned above a suit by presenting a plaint was instituted by the respondent No. 1 and thereafter it was sought to be stayed by submitting application under section 34 of the Act.
Thus we are clearly of the view that the above case of (Usmanali Khan) vs (Sagarmal,) (supra) is clearly distinguishable and does not help the appellants in the case before us.
It may be noted that Bachawat, J. who delivered the Judgment in (Usmanali Khan) vs (Sagarmal,) (supra) has himself in his 819 book on the 'law of Arbitration ' under the heading 'Applicability of Code of Civil Procedure to Court Proceeding ' has mentioned a number of decisions wherein the provisions of Code of Civil Procedure have been held to apply to proceedings under the Act.
We have already extracted the above passage from the book of Bachawat, j.
In (Hakam Singh) v (M/s Gammon (India) Ltd.,) (supra) it was held that the Code of Civil Procedure in its entirety applies to proceedings under the by Virtue of Section 41 of the later Act.
The jurisdiction of the Courts under the to entertain a proceeding for filing an award is accordingly governed by the provisions of the Code of Civil Procedure read with Explanation (II) thereto, the respondent company which had its principal place of business at Bombay, was liable to be sued at Bombay.
Thus in the above case dispute arose between the parties and the appellant submitted a petition to the Court of the Subordinate Judge at Varanasi for an order under Section 20 of the Indian , 10 of 1940 that the agreement be filed and an order of reference be made to an Arbitrator or Arbitrators appointed by the Court to settle the dispute between the parties in respect of the construction works done by him.
In order to determine the place of suing, it was held that Section 20 of the Code of Civil Procedure would govern the case.
Thus we do not find any force in the submission made by learned counsel for the appellants before us that the provisions or Order XXIII of the Code of Civil Procedure will not apply to the Order passed by the High Court on 25th February, 1966.
We would, now, consider the scope and effect of the order dated 25th February, 1966 considering that the said order would be governed by the provisions of Order XXIII of the Code of Civil Procedure.
Admittedly, appellant Nos. 1 and 2 were defendants in the suit filed by respondent No. 1.
A joint application was submitted on their behalf for staying the proceedings of the suit, under Section 34 of the Act, Though the order dated 25th February, 1966 does not make a mention of the formal defect on account of which the said application was withdrawn, but the appellants have categorically stated that the same was withdrawn on account of the fact that copy of the plaint was not annexed with such application and in the absence of any counter made by the respondent, we take that the reason for withdrawing the application was that copy of the plaint was not annexed with such application.
The said application was allowed to be withdrawn with liberty to 820 make a fresh application.
To our mind, the term 'a fresh application ' used in singular had no more significance than the fact that as both the appellants had submitted one joint application as such the liberty was given to make a fresh application.
The main purpose of moving the application by the appellant was to stay the proceedings of the suit under Section 34 of the Act the intention and the purpose of moving two separate applications is also to stay the proceedings of the suit under Section 34 of the Act.
The explanation given by the appellants for moving two separate applications is that they were given a legal advice to move two seperate applications as there were two different agreements between the appellant Nos. 1 and 2 and the respondent No. 1.
There was no element of mala fide in doing so and the two applications were also submitted on March 21, 1966 i.e. within 30 days of the order dated 25.2.66.
Learned counsel for the respondent No. 1 submitted that there was no merit in the applications submitted by the appellants under Section 34 of the Act and the proceedings of the suit have already remained stayed for nearly 15 years in this Court and now there is no justification for further staying the suit.
So far as the pendency of this appeal in this Court is concerned, no party is at fault and it would have been proper if the respondent had been advised not to take such objection of non maintainability of two applications before the High Court and would have contested the applications on merits.
We are not deciding the question of maintainability of the applications under Section 34 of the Act on merits and we make it clear that respondent No. 1 would be free to take all objections as he likes against the grant of such application and the same would be decided by the High Court on merits in accordance with law.
We are, however, clearly of the view that the High Court was not correct in dismissing the applications on the ground that two applications were not maintainable as the same were not covered within the order passed by the High Court dated 25th February, 1966.
In view of the fact that it is an old matter, we request the High Court to dispose of the applications filed by the appellants Nos. 1 and 2 under Section 34 of the Act.
At the earliest.
In the result, these appeals are allowed, the order of the High Court dated 2nd February, 1973 is set aside and the case would now be decided by the High court in the manner indicated above.
The parties are left to bear their own costs.
R.P. Appeals Allowed.
| IN-Abs | In a suit filed by plaintiff respondent no.1 before the High Court defendant appellants filed a joint application under section 34 of the for staying proceedings of the suit and referring the matter to arbitration.
In view of some formal defects in the said application, the High Court on 25.2.1966 without mentioning the defects ordered.
"Application withdrawn with liberty to make a fresh application".
on 21.3.1966 the appellants submitted two separate applications for staying the suit in so far as it related to them or in the alternative for stay of the entire suit.
The plaintiff respondent resisted the applications as not being in terms of the order dated 25.2.1966.
Upholding the objection, Learned Single Judge refused to stay the suit.
On appeal, the Division bench of the High Court held that the liberty was granted to 'make a fresh application ' and as such, under the provisions or Order XXIII, C.P.C., the appellants had no right to move two separate applications to stay the suit.
In appeal by special leave to this Court it was contended that provisions or Order XXIII, C.P.C. were not applicable to applications filed under section 34 of the ; and that the High Court committed an error in taking a technical view that as liberty was given to withdraw the application in order to make a fresh application, the appellants were not entitled to make separate stay applications.
Respondent No. 1 supported the impugned judgment.
Allowing the appeals, this Court, 810 HELD: 1.
In view of section 41 of the , subject to provisions of the Act, Code of Civil Procedure, 1908 apply to all proceedings before the Court No. provision in the takes away the provisions of Order XIII, C.P.C. from being applied to applications filed under section 34 of the in a suit.
[814F, 816B] Hakam Singh vs M/S Gammon (India) Ltd, ; relied on.
Nawab Usman Ali Khan vs Sagarmal, ; , held inapplicable.
Munshi Ram vs Banwari Lal [1962] Supp; (2) SCR 477; Hansraj Gupta vs Officlal Liquidator Dehradun Musoorie Electric Tramway Co, [1932] L.R. 60 I.A. 13; Union of India vs Mohinder Singh & Co., AIR 1971 JK 10; Union of India vs Rup Kishore, [1957] All. 504; Executive Engineer vs Thingom Iboyaima Singh, AIR 1970 Bom. 250; Ram bharosey vs Peary Lal, AIR 1957 All. 265; Shrinath Bros. vs Century Spinning & Wvg.
Co. AIR 1968 Bom 443; India Minerals Co. vs Northern India Lime Making Association, ; Ganeshmal vs Keshoram Cotton Mills, AIR 1952 Cal.
10; Governor General in Council vs Associated Live Stock Farm (India) Ltd., AIr ; Soorajmull Nagarmull vs Sagar Mal, AIR 1978 Cal. 239; Ramchand vs Governor General in Council, AIR 9147 Sind.
147 and Scotish Union of National Insurance Co. vs Saraswati Sajnani, Air 1960 Cal. 22, referred to. 2.
In the instant case, apart from section 41 of the providing for application of Code of Civil Procedure and there being no provision taking away provisions of order XXIII, C.P.C. from being applied to the applications for stay filed under section 34 of the , the proceeding started on a plaint filed by the plaintiff and in such a suit if any application was filed under the , the same ought to be governed by the provisions of the Code of Civil Procedure.
[816A c] 3.1 The High Court was not right in dismissing the applications on the ground that two applications were not maintainable as the same were not covered within its order dated 25.2.1966.
[820E F] 3.2 The term 'a fresh application ' in the order dated 25.2.1966 used in singular had no more significance than the fact that as both the 811 appellants had submitted one joint application, liberty was given to make a fresh application, The main purpose of moving the applications under section 34 of the was to stay the suit proceeding.
The intention and purpose of moving two such separate applications was also the same.
The explanation given by the appellants was that they were given a legal advice to move two separate applications as there were two different agreements between appellants No. 1 and 2 and the respondent No. 1 There being no element of mala fide in the two applications having been submitted within 30 days of the order dated 25.2.1966, the same were maintainable .
[820A c]
|
ition No. 13029 of 1985.
(Under Articles 32 of the Constitution of India).
Petitioner in person.
Altaf Ahmed, Additional Solicitor General , Sri Narain Mathur, R. Mohan, Ms. Anil Katiyar, Ms. Sushma Suri, K. Swamy, R.K. Maheshwari and S.M. Ashri for the Respondents.
The Judgement of the Court was delivered by.
RANGANATH MISRA, CJ.
This is an application under Article 32 of the Constitution in the public interest litigation sector.
A practising advocate who is the Chairman of the Environment Protection Cell operating at Delhi is the petioner.
This Court has been asked to issue directions for closing down of hazardous industries located in the densely populated areas of Delhi and for regulation of air pollution caused by automobiles operating in the area as also the thermal units generating power for the Delhi Electric Supply Undertaking, (here after referred to as `DESU ').
The Union Territory of Delhi has a total population of about 96 868 lakhs, out of which the urban area consisting of old Delhi, New Delhi and the Cantonment has a population of around 90 lakhs.
By 1947 when the country became independent, Delhi had a population of a little over 5 lakhs.
In these little more than two scores of years the population has, thus, multiplied by 18 times.
Though it is a spread out city, in some pockets, the density of population is very high and these have become congested.
The problem of environmental pollution is global in a increasingly small world and concerns all countries irrespective of their size, level of development or ideology.
Notwithstanding political division of the world into national units, the oceanic world in an inter connected whole; the winds that blow over the countries are also one.
Pollution is capable of moving from continent to continent.
If USSR carries out a nuclear test, the fall out may be carried by the winds to any part of the world and such fall out or irresponsible disposal of radio active waste from a remote energy plant in one country may turn out to have greater adverse effect on the neighbouring countries that the danger of full fledged war.
Informed public mind is already agitated over the polluting effect of the Gulf War and the common concern of the entire homosapien race is obsessed by the apprehension of acid rain, toxic effect on the seas and even on the atmosphere.
The awareness of interaction of man with his environment is of recent origin.
The Declaration of the United Nations Conference on the Human Environment held in Stockholm in June, 1972 stated: "Man is both creature and moulder of his environment which gives him physical sustenance and affords him the opportunity for intellectual, moral, social and spiritual growth.
In the long and tortuous evolution of the human race on this planet a stage has been reached when, through rapid acceleration of science and technology, man has acquired the power to transform his environment in countless ways and on an unprecedented scale.
Both aspects of man 's environment, the natural and the man made, are essential to his well being and to the enjoyment of basic human rights even of life itself." Principle No. 1 of the same Declaration went on to say: "Man has the fundamental right to freedom, equality and adequate conditions of life, in an environment of a quality 869 that permits a life of dignity and well being, and he bears solemn responsibility to protect and improve the environment for present and future generations. ".
The closeness of the undeveloped and under developed communities to nature is not found in the developed ones.
Our ancestors had realised the importance of the tie between man and his environment.
The Samaveda note that Flute of Divine love by saying: "Listen to the melodious music of the divine poet.
He plays upon the flute of love, the notes soar to high heaven and reach the distant stars and dance on the raging waves of the sea." The earth, the seas, the sky, the stars are all woven together by the soft strains of the divine music.
Its vibrants echo through the corridors of time in the endless canopy of the sky." Norman Myers quoted in Sir Edmond Hillary 's Ecology 2,000 ' has rightly observed: " The fate of African environments is thus determined not only by local circumstances.
It is influenced, in part at least, by the lifestyles of the developed world.
These economic ecological linkages between different members of the international community are little recognized to date, but they represent a significant factor for land use patterns in Africa 's Savannahs".
Our Constitution by the Forty Second Amendment introduced Article 48A as also Article 51A into the Constitution.
these Articles provide: "48A. The State shall endeavour to protect and improve the environment and to safeguard the forests and wild life of the country."" 51A. It shall be the duty of every citizen of India: (g) to protect and improve the natural environment including forests, rivers and wild life, and to have compassion for living creatures.
" 870 The incorporation of protection of environment as an obligation of the State in the Directive Principles and the mandate in Article 51 A to the citizens of India as part of fundamental duty are indications of the Constitutional recognition of importance of environment on life both the flora and the fauna.
Ours is a great country territorywise, from the stand point of population as also legacy wise.
Though politically divided into many States throughout the ages it has been bound by a common culture short lived empires have grown up and Delhi became the capital of such empires of the north.
Delhi was the capital of the Mughals too but the Britishers had in the initial period Calcutta as their capital and it was only 1911 that the Indian capital of the British empire was shifted from Calcutta to Delhi.
With the growth of importance of Delhi, on the outskirts of the then city gradually industries developed.
Lack of vision and inadequate statesmanship allowed many of these industries to grow perilously close to human habitation and in the process of expansion of the city with the growth of population and activity, the industrial belt became a part of the city.
Hindustan Insecticides Limited, which is respondent No. 6 before us, is one of such industries, DESU has three generating units One known as the indraprastha Power Station, the other as the GT Power Stations and the third as the RPR Power Station.
These too are located within the densely populated area.
The Delhi Transport Corporation (hereafter DTC) which provides the public transport facility to the residents of Delhi operates thousands of buses has been impleaded as respondent No. 5 on the allegation that it is one of the notorious polluting agencies.
A monitoring Committee on ambient and automotive emission levels was set up for examining the impact of surface transport on air environment of Delhi at the instance of the Director of Transport, Delhi Administration.
The facts and figures available from the report may briefly be indicated.
As on March 31, 1982.
Delhi had a total number of 5,92,584 vehicles of which 65% were two wheelers, 3.5% were three wheelers, 25% cars, jeeps and other medium size vehicles and 1.5% were buses and the remaining 7% were goods carriers.
The affidavit of the Deputy Director of Transport of the Delhi Administration indicates that the vehicular population of 1990 is 13.5 lakhs.
This means that within about 8 years there has been an increase of about 8 lakhs of vehicles in Delhi which would work out to an addition of 871 about 1 lakh every year.
The proportion of the two wheelers has perhaps not been seriously disturbed.
Though the Deputy director of Transport has indicated that the automobiles contribute about 50% of the polluting factor there is material to suggest that the proportion is still higher.
Two wheelers and three wheelers contribute over sixty percent of the total emission of carbon monoxide and about eighty percent of the total hydrocarbons.
To meet the challenging task of controlling pollution, Air (Prevention and Control of Pollution) Act, 1981 has been enacted.
Respondent 3 is the Central Board set up under the Act.
The statute authorise Government in consultation with the Board to instruct the Transport Authorities for developing expertise by taking vehicular pollution survey covering all ramifications.
The Union Territory of Delhi was chosen on selective basis because it maintains the highest traffic volume.
Under the Motor Vehicles Act of 1989 certain provision have been made for regulating emission resulting in pollution.
Transport Authorities of the Delhi Administration had placed facts and figures relating to steps taken under the Act for regulating pollution.
Emission checking.
prosecution as also steps for canceling of registration are said to be the normal steps taken by the Administration in this behalf.
We were , however, not satisfied that the action taken in this behalf was adequate and the challenging task of pollution control could not be successfully dealt with that way.
Law alone also cannot help in restoring a balance in the biospheric disturbance.
Nor can funds help effectively.
The situation requires a clear perception and imaginative planning.
It also requires sustained effort and result oriented strategic action.
Campaign for general awakening of the people using automobiles of different classifications and among the people inhabiting the capital is indispensable preliminary.
All persons using automobiles should have a fair knowledge of the baneful effect on the community including those who use such vehicles on account of the emission from such vehicles.
Until that is done in an effective way the appropriate attitude would not develop and cooperation for reducing pollution would not emerge.
A brief extract from the journal entitled `Environmetal Policy & law ' vol.
13 nos.
1 2 Spring 1983) published from North Holland describes the problem thus: 872 "It became clear that all these measures are not themselves sufficient to come to grips with the problem of air pollution caused by road traffic.
In every one of the towns and cities, the problem of air pollution from motor vehicle traffic is a considerable one, and it was more or less generally apparent that present norms for motor vehicle exhausts are not adequate so as to achieve the necessary reductions in a rapid space of time.
In fact, the problem is, in part, on the increase.
This is not only true of private cars, especially diesel powered vehicles, but also of commercial vehicles . " "Despite the legal and other restrictions mentioned above, which hamper the towns and cities involved in pursuing effective policies aimed at limiting motor vehicle exhausts, some interesting strategies have been thought up which have either led to improvements in themselves or at least stimulated attitudes towards environmental policies.
For example, in formulating their regulations in the event of smog, both Munich and Berlin offered positive stimulus for the purchase of vehicles fitted with catalytic converters.
As far as city owned motor vehicles are concerned, some authorities have pursued a deliberate policy of purchasing those automobiles with improved exhaust systems.
" In course of the hearing of this matter we had called upon counsel to look at the problem not as an adversial litigation but to come forward with useful deliberations so that something concreate could finally emerge for easing the situation.
We were shown some literature and even gadgets which might help reduction of pollution.
The question of eliminating use of motor spirit and replacement of battery operated two wheelers was also mooted.
The Association of Indian Automobile Manufacturers had made an application for intervention and was present in Court.
Some of the aspects which came up for discussion were indeed sufficiently technical.
Some other aspects require laboratory testing and probe into efficacy.
Therefore, the question of setting up of a high powered committee was also mooted.
We are happy to find that the deliberations in course of the hearing have taken a concreate shape and the Ministry of Environment & Forests has ultimately instructed the learned Attorney General in writing (copy placed on the record) that a Committee could be set up by the Court to look into the problem of vehicular pollution in Delhi 873 and for devising methods of solution of the problem.
The Ministry has agreed that a retired Judge of this Court could act as Chairman and has suggested that Shri M.C. Mehta, the petitioner herein and Shri.
N.S. Tiwana, Chairman of he Central Pollution Control Board may be made the Members of the Committee.
We find this suggestion of the Ministry acceptable subject to certain modification.
We are inclined to take the view that Shri Sudhakar Girdharlal Shah representing the Association of Indian Automobile Manufacturers could be taken as a member of the Committee and the Committee would also have the power to co opt experts not exceeding three for its efficient working from time to time.
Shri Justice K.N. Saikia who has recently retired as a Judge of this Court is appointed as the Chairman of the Committee with Shri N.S. Tiwana, Shri M.C. Mehta and Shri.
S.G. Shah as Members.
The Joint Secretary in the Ministry of Environment and Forests shall be the convenor Secretary of the Committee.
Shri Justice Saikia shall be entitled to all the benefits to which a retired Judge of this Court while called back to duty is entitled.
The Committee may be constituted with effect from 18th March, 1991, under an appropriate Notification of the Union Government in the relevant Ministry.
The terms of reference for the time being as recommended by the Ministry are the following: "(i) To make an assessment of the technologies available for vehicular pollution control in the world; (ii) To make an assessment of the current status of technology available in India for controlling vehicular pollution; (iii) To look at the low cost alternatives for operating vehicles at reduced pollution levels in the metropolitan cities of India.
(iv) To examine the feasibility of measures to reduce/eliminate pollution from motor vehicles both on short term and long term basis and make appropriate recommendations in this regard; (v) To make specific recommendations on the administrative/legal regulations required for implementing the recommendations in (iii) above.
" For the time being the Committee may proceed to consider these.
874 other relevant aspects may be taken into consideration by the Committee.
This writ petition shall be deemed to be pending for the purpose of monitoring.
The Committee shall furnish a report to this Court once in two months as to the steps taken in the matter.
The Union Government and the Delhi Administration are directed to effectively cooperate with the Committee for its successful operation.
V.P.R. Petition pending for monitoring.
| IN-Abs | The petitioner, an Advocate and Chairman of the Environmental Protection Cell filed the petition under Article 32 asking the Court to issue directions for closing down of hazardous industries located in the densely populated areas of Delhi, and for regulation of air pollution caused by automobiles operating in the area as also the thermal units generating power for the Delhi Electric Supply Undertaking.
Making an interim order, and keeping the writ petition pending for the purpose of monitoring, the Court.
HELD: 1.
The incorporation of protection of environment as an obligation of the State in the Directive Principles and the mandate in Article 51 A to the citizens of India as part of fundamental duty are indications of the Constitutional recognition of importance of environment of life both the flora and the fauna.
[870 A B] 2.
Law alone also cannot help in restoring a balance in the biospheric disturbance.
Nor can funds help effectively.
The situation requires a perception and imaginative planning.
It also requires sustained effort and result oriented strategic action.
Campaign for general awakening of the people using automobiles of different classification and among the people inhabiting the Capital is an indispensable preliminary.
[871E G] 3.
All persons using automobiles should have a fair knowledge of the baneful effect on the community including those who use such vehicles on account of the emission from such vehicles.
Until that is done in an effective way the appropriate attitude would not develop and cooperation for reducing pollution would not emerge.
[871 F H] 867 4.
A Committee is set up by this court to look into the problem of vehicular pollution in Delhi and for devising methods of solution of the problem.
[ 872 H 873 A].
A retired Judge of this court to act as Chairman, the petitioner and the Chairman of the Central Pollution Control Board and the person representing the Association of Indian Automobiles Manufacturers could be the members of the Committee.
The Committee would also have the power to co opt experts not exceeding three for its efficient working from time to time.
The Joint Secretary in the Ministry of Environment and Forests shall be the Convenor Secretary of the Committee.
[873A D] 6.
The Committee may be constituted with effect from 18th March, 1991, under an appropriate Notification of the Union Government.
[873D] 7.
The Committee shall furnish a report to this Court once in two months as to the steps taken in the matter.
The Union Government and the Delhi Administration are directed to effectively cooperate with the Committee for its successful operation.
[874B]
|
ivil Appeal Nos.
1249/75 & 2075/79.
From the Judgment and Order dated ' 26.9.1974 and 16.10.1978 of Gujarat High Court in I.T.R. Nos. 19 of 1973 and 318 of 1977.
Harish N. Salve, P.H. Parekh and Sunil Degra for the Appellant.
915 V. Gauri Shanker, Sr.
and section Rajappa for the Respondent.
The Judgment of the Court was delivered by RANGANATHAN, J.
These appeals raise a question of some complexity on the interpretation of the provisions of the Income Tax Act, 1961, (The 1961 Act '), in regard to which there is a difference of opinion among various High Courts.
In the judgment under appeal, reported in , the Gujarat High Court has answered the question raised in favour of the Revenue and against the assessees.
Hence these appeals by the assessee, M/s. Garden Silk Weaving Factory, Surat.
The two appeals relate to the assessment years 1967 68 and 1968 69 for which the relevant previous years were the Saka years 2022 and 2023 respectively.
The question arises in similar circumstances for both the years.
We shall set out the facts relevant for the assessment year 1968 69 as the appeals and reference in respect of that year were disposed of earlier than those pertaining to the assessment year 1967 68.
The assessee, M/s. Garden Silk Weaving Factory, is a registered firm.
For the assessment year in question, it returned a total income of Rs.3,96,483 and a provisional assessment, under section 141 of the Act, was made accepting the income returned.
Subsequently, the Income Tax Officer found that, for the assessment year in question, the assessee had made an income of Rs. 11,82,056 but deducted there three figures aggregating to Rs.7,87,573 to arrive at the net income of Rs.3,94,483 which had been returned and accepted.
These three figures were figures carried over from the previous year for the assessment year 1967 68.
They comprised of: (i) Unabsorbed Rs. 1,59,181 Depreciation (ii) Unabsorbed Rs. 2,79,150 Development Rebate (iii) Unabsorbed Rs. 3,49,242 Business loss Total : Rs. 7,87,573 The Income Tax Officer (I.T.O.) agreed that, out of the above three months, the unabsorbed development rebate pertaining to the assessment year 1967 68 had been rightly carried forward and set off in computing the total income for the assessment year 1968 69.
However, 916 for reasons which will become clear later, the Income Tax Officer was of the opinion that the sum of Rs. 1,59,181 (which represented the amount of unabsorbed depreciation relating to the assessment year 1967 68) and the amount of Rs.3,49,242 (which represented the unabsorbed loss pertaining to the assessment year 1967 68) could not be carried forward, as done by the assessee, to the assessment year 1968 69.
He, therefore, added back the sum of Rs.5,08,423 (the aggregate of the above two amounts) to the returned income for determining the total income for assessment year 1968 69.
This action of the Income Tax Officer was confirmed by the Appellate Assistant Commissioner (A.A.C.).
However, on further appeal, the Income tax Appellate Tribunal (A.T.) took a different view.
It upheld the Income tax Officer 's stand that the firm could not be allowed to carry forward and set off the business loss carried from the earlier year.
But, so far as the unabsorbed depreciation was concerned, it upheld the assesses contention.
A reference to the High, Court followed.
The following two questions were referred to the High Court of Gujarat for its decision: 1.
Whether on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the assessee registered firm is entitled to carry forward unabsorbed depreciation from earlier years and that it will be deemed to be an allowance in the nature of depreciation in the previous year, relevant to assessment year 1968 69? 2.
Whether the claim of the assessee to carry forward and set off loss of Rs.3,49,242 against its total income for the assessment year 1968 69 has been rightly rejected?" The High Court, in a very detailed judgment, discussed the issues threadbare and answered both the questions against the assessee and in favour of the Revenue.
Hence the assesse 's appeal for the assessment year 1968 69 under a certificate of fitness granted by the High Court.
For the assessment year 1967 68, a full paper book containing all the orders and statement of facts has not been placed before us.
However, the petition of appeal gives a few facts which may be sufficient to dispose of the appeal.
The relevant facts are these.
For this assessment year, the assessee filed a return on 30/6/67 showing a loss of Rs.7,87,515 but filed a revised return on 22/3/72 showing a loss of Rs.5,46,351.
On 14 3 73 the I.T.O. completed the assessment determining a loss of Rs.4,85,250.
(It will be noticed that the assessment order for 1968 69 gives a different figure and also shows its composition as partly loss, partly unabsorbed depreciation and partly unab 917 sorbed development rebate but this is not very material for deciding the principle in issue before us).
The assessee 's request that this loss should be carried forward to the subsequent assessment year was rejected by the I.T.O. This was confirmed by the A.A.C. on further appeal, the A.T. confirmed the order of the A.A.C., following the High Court 's decision for assessment year 1968 69 which had by then been announced.
Thereupon the following question of law was referred to the High Court for its opinion: "Whether, on the facts and circumstances of the case, the Tribunal was justified in rejecting the claim for carry forward of business loss in the hands of the firm in view of the decision reported in " The High Court answered the question in the affirmative following its earlier decision but granted a certificate of fitness for appeal to this Court.
This is how the second appeal is before us.
It will be seen from the above that, though there are two appeals before us, the question involved in both the appeals is the same.
Before discussing the question at issue, it may be useful to briefly summarise the procedure under the statute for determining the total income of an assessee in respect of a previous year.
All income accruing or arising to the assessee and includible in his total income, is, to begin with, classified (see section 14) under six different heads: A. Salaries.
B. Interest on Securities: (recently omitted) C. Income from Property.
D. Profits and gains of business, profession or vocation.
(briefly, "business income") E. Capital gains F. Income from other sources.
In computing the income of the assessee according to this classification, two aspects have to be borne in mind.
One is that, even under the same head, an assessee may have different sources.
If so, the 918 income has first to be arrived at in respect of each such source.
Thus, if an assessee carries on several businesses, the income of each and every such, business has to be separately computed by allowing against the gross profits and gains of that business only the deductions relevant and appropriate to that business.
The second is that, for arriving at the figure of income assessable under a particular head, the individual figures in respect of all the sources have to be aggregated.
Thus, to take up the head, "profits and gains of business, profession or vocation", the statute contemplates the computation of the profits and gains of each business, profession or vocation carried on by the assessee separately.
The result of such computation may be either a profit or a loss.
If all the businesses end in profits, the profits are aggregated to arrive at a resultant figure of profits from "business".
On the other hand, if some of the businesses make profit and some of them result in a loss, the profits and the losses have to be added together in order to arrive at the consolidated income under the head "profits and gains of business.
" If the total amount of profits exceeds the total amount of losses, there will be a positive income under this head, assessable for that particular assessment year.
If on the other hand the losses exceed the profits, they will be "adjusted" against the profits, so as to reduce the assessable income under the head to nil; in addition, the losses of one or more businesses will remain "unabsorbed".
There will thus be one resultant figure of profit or loss under each head.
This is one aspect of the matter.
This is the first stage of computation which we may call "intra head adjustments".
This was not specifically provided for in the Indian Income tax Act, 1922 (the 1922 Act) but now finds specific mention in section 70 of the 1961 Act.
section 24(1) of the 1922 Act and section 71 of the 1961 Act next contemplate a mutual set off of the losses under one head against the income under some other head subject to some exceptions (like speculation loss, capital loss etc.
which, to avoid unnecessary complications and confusion, we shall leave out of account).
Thus if, in any particular assessment year, an assessee has incurred a loss under the head "business", this loss can be set off against the income earned by the assessee during that previous year under other heads.
Thus, for example, if an assessee has got income by way of salary of Rs.20,000 and income from house property of Rs.25,000 but has sustained a loss of Rs.40,000 in business, the Act envisages the set off of the loss of Rs.40,000 against the income of Rs.45,000 resulting in a total income of Rs.5,000 only.
This is the second stage in the process of assessment which we may describe as "inter head adjustment" or "set off".
919 The Acts [section 24(2) of 1922 Act and section 72 of the 1961 Act] next envisage a third stage in the process of assessment which can ' be described as the process of "carry forward and set off".
By this process, the assessee is permitted to carry forward a loss he had not been able to adjust or set off in the first and second stages of assessment.
This benefit is not available to all kinds of losses but, subject to certain conditions and restrictions on which we need not dilate, it is available to business losses.
A business loss of one assessment year which remains "unabsorbed" by the processes of intra and inter head ;adjustments can be carried forward to the succeeding assessment years ,and can be set off against any other business income in those years.
A modification to the above scheme had to be enacted in respect of partnership.
Partnership firms are treated as separate assesses for the purposes of the Income Tax Acts.
Under the Acts, firms are classified into two registered firms and unregistered firms.
Unregistered firms are distinct assesses which are liable to pay tax on their total income.
The Acts provided that any unabsorbed loss in the case of such a firm could be carried forward only by the firm and not by it 's partners.
However, under the 1922 Act, as it stood between 1939 and 1956, registered firms were treated as assesses only to this extent that the total income (or loss) of the firm in any previous year was computed.
However, the firm itself was not liable to any income tax.
The income of the firm was apportioned among its partners and each partner was assessed on his share of income from the firm.
In this scheme, it was obvious that, as soon as the income or loss of a firm was computed, there was nothing further to be done in the case of the firm; the income or loss became that of the partner for all practical purposes.
A partner 's share of a business loss of the firm which remained unabsorbed became business loss in the hands of the partner liable to intera head adjustments, inter head adjustments and carry forward as if the loss had been incurred by the partner himself.
The Act, therefore, provided that in the case of registered firms the loss which could not be absorbed in the same assessment year by the other income of the firm could be carried forward to the subsequent year not by the firm itself but only by the partners.
In other words, each partner carried forward to subsequent years his share of the business loss of the firm and set it off against his business income, whether from the firm or otherwise.
There is a third category of unregistered firms assessed as registered the provisions regarding which are not relevant for our present purposes.
Leaving them out of account, the Acts outlined a very simple scheme stemmed from the basic fact that a registered firm was not liable to pay tax whereas an unregistered firm had to pay 920 tax.
Under this scheme the full advantage of carry forward of the loss incurred by the firm was enjoyed by the partners in the case of a registered firm and in the case of an unregistered firm by the firm itself.
The simplicity of the above scheme of assessment of registered and unregistered firms, however, was not allowed to last.
In 1956, the legislature decided that registered firms should also be made to pay a tax.
This tax, called "firm 's tax" was at rates lower than those applicable to unregistered firms and other assesses.
Under the new scheme, which became effective from 1.4.1956, the total income of a registered firm is determined and it is liable to income tax thereon.
The income of the firm (less the firm 's tax) is then apportioned among the partners (subject to certain adjustment as before).
The share income of each partner is aggregated with the rest of his income to arrive at his total income on which he also pays tax.
In this new scheme the question arises: "when the net result of a business carried on by a registered firm in a particular year is a loss, who is to carry forward such loss? Is it the firm (as in the case of unregistered firms) or is it is the partners (as, earlier, in the case of registered firms) or both?" The answer to this question is furnished by the statute which, while broadly continuing the scheme of assessment of registered firms with the modification indicated above, makes a specific provision in regard to carry forward of losses.
The provisions of Ss. 75 and 77 in their present form can be usefully extracted here (though they contain references to certain amended provisions which we need not touch upon): 75.
Losses of registered firms: (1) Where the assessee is a registered firm, any loss which cannot be set off against any other income of the firm shall be apportioned between the partners of the firm, and they alone shall be entitled to have the amount of the loss set off and carried forward for set off under sections 70, 71, 72, 73, 74 and 74A. (2) Nothing contained in sub section (1) of section 72, sub section (2) of section 73, sub section (1) or sub section (3) of section 74 or sub section (3) of section 74A shall entitle any assessee, being a registered firm, to have its loss carried forward and set off under the provisions of the aforesaid section.
921 76.
Losses of unregistered firms assessed as registered firms: In the case of an unregistered firm assessed under the provisions of clause (b) of section 183 in respect of any assessment year, its losses for that assessment year shall be dealt with as if it were a registered firm.
Losses of unregistered firms or their partners: 1) Where the assessee is an unregistered firm which has not been assessed as a registered firm under the provisions of clause (b) of section 183, any loss of the firm shall be set off or carried forward and set off only against the income of the firm.
(2) Where the assessee is a partner of an unregistered firm which has not been assessed as a registered firm under the provisions of clause (b) of section 183 and his share in the income of the firm is a loss, then, whether the firm has already been assessed or not (a) such loss shall not be set off under the provisions of section 70, section 71, sub section (1) of section 73 or section 74A; (b) nothing contained in sub section (1) of section 72 or sub section (2) of section 73 or sub section (1) or sub section (3) of section 74 or sub section (3) of section 74A shall entitle the assessee to have such loss carried forward and set off against his own income.
In view of this specific provision the High Court, following an earlier decision of the same High Court in C. I. T. vs Dhanji Shamji Mana vdar,[ 1974 ] I.T.R. 173 (Guj.) answered the second question referred to it in the reference relating to assessment year 1968 69 and the only referred in regard to the assessment year 1967 68 in favour of the Revenue and against the assessee.
The correctness of this answer has not been challenged before us.
The first question referred to the High Court in respect of assessment year 1968 69, however, arises in a slightly different way.
It arises the context of "depreciation" which is one of the notional 922 allowances by which expression we mean a deduction in respect of an outgoing which is not an item of actual expenditure or is one, which cannot be treated as an outgoing of a revenue nature permitted by the statute to be deducted in the computation of the profits and gains, of a business.
In a sense, where the depreciation allowance exceeds the profits, otherwise arrived at, in respect of the business, there will be a resultant "loss" in the business; and, indeed, the Department 's contention is that there is no difference between an unabsorbed loss and unabsorbed depreciation.
It would, however, be useful to refer to the treatment meted out by the statute in respect of three items of deductions allowed in the computation of the profits of a business, which may be larger than the profits of the business otherwise computed.
One is the development rebate regarding which the statute provides that it has to be set off against the total income of the assessee so as to reduce it to nil and that the balance is, to be carried forward to succeeding assessment years to be accorded a similar treatment.
[See Ss.
10(2)(vib) of the 1922 Act and 33(2) of the 1961 Act].
This is an allowance which cannot be a constituent element of a figure of loss to be carried forward to later years and stands on a totally different footing.
The second is the allowance for depreciation under S10(2)(vi) of the 1922 Act.
In respect of this allowance, section 10(12)(vi) provided that if full effect to the allowance could not be given in the assessment of an assessee for any assessment year, the unabsorbed allowance could be carried forward and set off against business profits in succeeding assessment years indefinitely.
This provision, namely clause (b) of the proviso to section 10(2)(vi) of the 1922 Act after an addition in 1953 of the words underlined in the extract below reads thus,: " 10(2)(vi) . .
Provided that . . (a) . . . (b) where, in the assessment of the assessee or, if the assessee is a registered firm, in the assessment of its partners, full effect cannot be given to any such allowance in any year not being a year which ended prior to the I April, 1939, owing to there being no profits or gains chargeable for that year, or owing to the profits, or gains chargeable, being less than the allowance, then, subject to the provisions of clause (b) of the proviso to sub section (2) of section 24, the allowance or part of the allowance to which effect has not been given, as the case may be, shall be added to the. amount of the allowance for depreciation for the following year and 923 deemed to be the allowance for that year, and so on for succeeding years.
" This provision has, in substance, there are certain verbal differences which are not material for our purposes been re enacted as section 32(2) of the 1961 Act, which now reads thus: B "32(2) Where, in the assessment of the assessee (or, if the assessee is a registered firm or an unregistered firm assessed as a registered firm, in the assessment of its partners) full effect cannot be given to any allowance under clause (ii) of sub section ( 1) in any previous year, owing to there being no profits or gains chargeable for that previous year, or owing to the profits or gains chargeable being less than the allowance, then, subject to the provisions of sub section (2) of section 72 and sub section (3) of section 73, the allowance or part of the allowance to which effect has not been given, as the case may be, shall be added to the amount of the allowance for depreciation for the following previous .year and deemed to be part of that allowance, or if there is no such allowance for that previous year, be deemed to be the allowance for that previous year, and so on for the succeeding previous years.
" The third type of allowance of this nature, a carry forward of which is contemplated, is an allowance in respect of expenditure on capital assets related to a business.
This, by virtue of clause (f) of the proviso to section 10(2)(xiv) of the 1922 Act, re enacted in section 35(4) of the 1961 Act, is treated on the same lines as the depreciation allowance dealt with in section 10(2)(vi) and section 32(2).
We shall, however, leave this out of account in our future discussion as it is not material for the purposes of the present case and as, in any event, whatever is decided in regard to unabsorbed depreciation would apply equally in respect of such allowance as well.
From the above discussion, it will be seen that unabsorbed losses and unabsorbed depreciation are to be carried forward to future years to be set off against future income.
There is, however, one important difference.
Unabsorbed losses can be carried forward only for a period of eight years whereas unabsorbed depreciation can be carried forward indefinitely.
A rule of priority of set off as between these two therefore becomes necessary and this is provided by section 72(2) of the 1961 Act which deals with carry forward of losses the counterpart of 924 the proviso to section 24(2) of the 1922 Act which reads thus: "Where any allowance or part thereof is, under sub section (2) of section 32 or sub section (4) of section 35, to be carried forward, effect shall first be given to the provisions of this section.
" This is the historical context and statutory language on the basis of which the issue before us has to be resolved.
The issue is: when there is an unabsorbed depreciation computed in the assessment of a registered firm for any year, how is it to be treated for purposes of carry forward? Three alternatives are possible: (i) It should be retained (without apportionment) and carried forward by the firm only.
(ii) It should be apportioned among the partners.
Thereafter, it can be dealt with even for carry forward purposes only in the assessments of each of the partners in respect of his aliquot share thereof.
(iii) It should be apportioned among the partners each of whom may set off his share thereof against his other income.
If, after this, any amount remains unabsorbed, it will revert to the firm.
The firm will carry it forward.
set it off against its other income in the succeeding year.
This operation will be repeated every year indefinitely until the unabsorbed depreciation gets absorbed.
The three alternatives will yield widely different results and hence the present controversy.
On the above issue there has been a strong cleavage of opinion between the various High Courts.
The view that unabsorbed depreciation once allocated to the partners cannot be taken back to the firm 's assessment for being carried forward by the firm and that the partners alone are entitled to carry forward the unabsorbed depreciation for being set off against their income, has been taken in the following cases: (a) K. T. Wire Products vs Union of India, (b) Garden Silk Weaving Factory, and Garden Silk Weaving Factory, (c) CIT vs Ram Swarup Gupta, and Raj Narayan Aggarwala vs CIT, ; (d) Shankaranarayana Construction Co. vs CIT, The view that the unabsorbed depreciation, after being carried forward by the partners and set off against their income, reverts back to the registered firm for being carried forward and set off against its income and that any depreciation still remaining unabsorbed will again go to the partners and that if it still remained unabsorbed would revert back to the firm and so on, has been accepted in: (a) Ballarpur Collieries Co. vs CIT, 219 and CIT vs Nagpur Gas & Domestic Appliances, ; (b) CIT vs Nagapattinam Import and Export Corp., ; CIT vs Madras Wire Products, and CIT vs Madras Wire Products, ; (c) CIT vs Singh Transport Co., ; (d) CIT vs J. Patel & Co., ; (e) CIT vs Shrinivasa Sugar (Co., (f) Pearl Woollen Mills vs CIT, and CIT vs Mahavir Steel Rolling Mills,5, & H); and (g) CIT vs R. J. Trivedi & Sons, Shri Harish Salve, learned counsel for the assessee, canvassed the latter of the above views but with a slight modification.
He submitted that, in the present case, the firm as well as the partners had been returning losses all along with the result that no part of the unabsorbed depreciation of the firm had been set off in the partners ' hands.
He, therefore, submitted that it was sufficient for him to urge the first of the three alternatives set out earlier and that he need not, for the purposes of this case, seek to support the third alternative, upheld in some of the decisions, which may create an impression in the mind that the assessee was deriving a double benefit by having the unabsorbed depreciation set off in the hands of both the firm and the partners.
On the other hand, Dr. Gaurishankar, for the Revenue, strongly advocated the second alternative.
According to him, once the assessment is completed, and the total income or loss of the firm ascertained, it has to be apportioned amongst the partners.
Thereafter, there remained nothing in the assessment of the firm to be carried forward.
Only each of the partners can carry forward his share of the unabsorbed loss (and this, according to him, will include also the unabsorbed depreciation) for set off in his future assessments.
The answer to the problem before us has to be discovered in the language of section 32(2) supplemented by that of other sections which deal with the mode of assessment of a firm and its partners.
Before turning to these provisions, it will be necessary to clear up one aspect of section 32(2) to which Sri Salve drew attention in the course of his reply.
He pointed out that section 32(2) permits the carry forward of the depreciation allowance "where full effect cannot be given to it" owing to there being no profits or gains chargeable for that previous year, or owing to the profits or gains chargeable being less than the allowance.
Laying emphasis on the words "profits or gains", he contended that the carry forward of depreciation allowance is at a stage much anterior to that of the determination of the total income of the assessee.
On this construction, if an assessee A carries on two businesses, in one of which there is 926 an unabsorbed depreciation of Rs. 15,000 and the profits and gains of the other business is only Rs. 10,000, the net unabsorbed depreciation of Rs.5,000 has to be carried forward irrespective of the other income of the assessee in that year, to the succeeding year.
This contention, however, cannot be accepted.
Though the section, somewhat infelicitiously, uses the expression "profits and gains" as it occurs in the statute in the fasciculus of sections dealing with the computation of business income, the question of the carry forward of unabsorbed depreciation has always been understood and interpreted as arising only after the intra head and intra head adjustments, referred to earlier, have been carried out.
Thus, in the illustration given above, if A has a property income of Rs.6,000 the unabsorbed depreciation of Rs.5,000 will be set off against the property income and there will be no unabsorbed depreciation left for being carried forward to the subsequent assessment year.
This is because, where the depreciation allowance attributable to a particular business exceeds the profits otherwise computed for that business, the deduction of the depreciation allowance from such profits can only result in a "loss" from that business this, however, is subject to a limitation that will be discussed later and a business loss has to be set off against income from any other business, by way of intera head adjustment, under section 70 and the income under any other head, by way of inter head adjustment, under section 71.
This principle indeed emerges even from the language of section 32(2) in so far as it implicitly recognises that the excessive depreciation of one business can be "given effect to" against the profits and gains of another business in the same year.
This, indeed, is a well settled proposition, and it should be sufficient to cite two decisions of this Court which make this clear, In C.I.T. vs Jaipuria China Clay Mines (P) Ltd., [1966]591,T.R.555 this Court observed: "Mr. Shastri, learned counsel for the revenue, urges that depreciation, although a permissible allowance under section 10(2) of the Act, serves to compensate an assessee for the capital loss suffered by him by way of depreciation of his assets.
He says that if it had not been expressly allowed as allowance, it would have been treated as capital expenditure and would have been excluded.
He further says that depreciation is a charge on the profits of a business.
Bearing these two factors in mind, he urges that the expression "loss of profits and gains" in section 24(1 does not include any deficiency resulting from depreciation and, therefore, an assessee is not entitled to ask the department to include the depreciation in the amount which can be set 927 off against income, profits and gains under Other heads such as income from property or dividends.
Mr. Rajagopala Shastri for the assessee relies on the history of the legislation and a number of authorities to support the judgment of the High Court.
Apart from authority, looking at the Act as it stood on April 1, 1952, it is clear that the underlying idea of the Act is to assess the total income of an assessee.
Prima facie, it would be unfair to compute the total income of an assessee carrying on business without pooling the income from business with the income or loss under other heads.
The second consideration which is relevant is that the Act draws no express distinction between the various allowances mentioned in section 10(2).
They all have to be deducted from the gross profits and gains of a business.
According to commercial principles, depreciation would be shown in the accounts and the Profit and Loss account would reflect the depreciation accounted for in the accounts.
If the profits are not large enough to wipe off depreciation, the profits and loss account would show a loss.
Therefore, apart from proviso (b) to section 10(2)(vi), neither the Act nor commercial principles draw any distinction between the various allowances mentioned in section 10(2); the only distinction is that while the other allowances may be outgoings, depreciation is not an actual outgoing." and expressly disproved the observations of the Madras High Court in C.I.T. vs Nagi Reddy, [19641 that the deduction for depreciation should be limited to the amount of the profits and cannot result in working out a loss.
The following observations in the more recent decision in Rajapalayam Mills Ltd. vs C.I.T., , S.C. place the position beyond doubt: It is clear on a plain reading of the language of provision (b) to cl.
(vi) that it comes into operation only where full effect cannot be given to the depreciation allowance for the assessment year in question owing to there being no profits or gains chargeable for that year or profits or gains chargeable being less than the depreciation allowance.
Now, it is well settled, as a result of the decision of this court in CIT vs Jaipuria China Clay Mines (P) Ltd., , that the words "no profits or gains chargeable for that year" are not confined to profits and gains derived 928 from the business whose income is being computed under section 10, but they refer to the totality of the profits or gains computed under the various heads and chargeable to tax.
It is, therefore, clear that effect must be given to depreciation allowance first against the profits or gains of the particular business whose income is being computed under section 10 and if the profits of that business are not sufficient to absorb the depreciation allowance, the allowance to the extent to which it is not absorbed would be set off against the profits of any other business and if a part of the depreciation allowance still remains unabsorbed, it would be liable to be set off against the profits or gains chargeable under any other head and it is only if some part of the depreciation allowance still remains unabsorbed that it can be carried forward to the next assessment year.
Obviously, therefore, there would be no scope for the applicability of provision (b) to cl.
(vi), if the total income of the assessee chargeable to tax is sufficient to absorb the depreciation allowance, for then there would not be any unabsorbed depreciation allowance to be carried forward to the following assessment year.
But where any part of the depreciation allowance remains unabsorbed after being set off against the total income chargeable to tax, it can be carried forward under provision (b) to cl.
(vi) to the following year and set off against that year 's income and so on for succeeding years.
" The resultant position, therefore, is that initially, the depreciation allowance has to be deducted from the profits and gains of the business to which the assets earning the depreciation relate but, if it remains unabsorbed by such profits, the allowance has to be set off against the other business income of the assessee and, where that is also insufficient, against the other taxable income of the assessee.
The carry forward of any depreciation as unabsorbed cannot arise until the stage of final assessment is reached and the total income of the assessee otherwise computed is insufficient to absorb the year 's depreciation allowance.
Sri Salve 's argument that the stage of carry forward of depreciation arises at a stage anterior to the completion of the assessment and determination of the total income cannot, therefore, be accepted.
Shri Salve, then, contended that there is no statutory provision which enables the apportionment of the firm 's unabsorbed depreciation among the partners and that, therefore, the unabsorbed deprecia 929 tion has to be carried forward by the firm itself and none else.
In our opinion, this contention also is not well founded.
section 182, to the extent relevant for our present purposes, reads "section 182.
(]) Assessment of registered firms Not withstanding anything contained in section 143 and 144 and subject to the provisions of sub section (3), in the case of a registered firm, after assessing the total income of the firm, (i) the income tax payable by the firm shall be determined, and (ii) the share of each partner in the income of the firm shall be included in his total income and assessed to tax accordingly.
(2) If such share of any partner is a loss it shall be set off against his other income or carried forward and set off in accordance with the provisions of sections 70 to 75.
(3) When any of the partners of a registered firm is a non resident, the tax on his share in the income of the firm shall be assessed on the firm at the rate or rates which would be applicable if it were assessed on him personally, and the tax so assessed shall be paid by the firm.
(4) A registered firm may retain out of share of each partner in the income of the firm a sum not exceeding thirty percent thereof until such time as the tax which may be levied on the partner in respect of that share is paid by him; and where the tax so levied cannot be recovered from the partner, whether wholly or in part, the firm shall be liable to pay the tax, to the extent of the amount retained or could have been so retained.
" How this share is to be computed is set out in section 67 which may be set out here: section 67(1) Method of computing a partner 's share in the income of the firm In computing the total income of an assessee who is a partner of a firm, whether the net result of the computation of total income of the firm is a profit or a 930 loss, his share (whether a net profit or a net loss) shall be computed as follows: (a) any interest, salary, commission or other remuneration paid to any partner in respect of the previous year, and, where the firm is a registered firm or an unregistered firm assessed as a registered firm under clause (b) of section [183], the income tax, if any, payable by it in respect of the total income of the previous year, shall be deducted from the total income of the firm and the balance ascertained and apportioned among the partners; (b) where the amount apportioned to the partner under, clause (a) is a profit, any salary, interest, commission or other remuneration paid to the partner by the firm in respect of the previous year shall be added to that amount, and the result shall be treated as the partner 's share in the income of the firm; (c) where the amount apportioned to the partner under clause (a) is a loss, any salary, interest, commission or other remuneration paid to the partner by the firm in respect of the previous year shall be adjusted against that amount, and the result shall be treated as the partner 's share in the income of the firm.
(2) The share of a partner in the income or loss of the firm, as computed under sub section (1) shall, for the purposes of assessment, be apportioned under the various heads of income in the same manner in which the income or loss of the firm has been determined under each head of income.
(3) Any interest paid by a partner on capital borrowed by him for the purposes of investment in the firm shall, in computing his income chargeable under the head "Profits and gains of business or profession" in respect of his share in the income of the firm, be deducted from the share.
(4) If the share of a partner in the income of a registered firm or [an unregistered firm assessed as a registered firm under clause (b) of section 183, as computed under this section, is a loss, such loss may be set off, or carried forward and set off, in accordance with the provisions of this Chapter.
931 Explanation: In this section, "paid" has the same meaning as is assigned to it in clause (2) of section 23. 1.
"Sri Salve contends that these provisions talk only of "loss" and that to take this expression as including "unabsorbed depreciation" as well will obliterate the distinction in the treatment meted out to these as separate items by section 32(2) and section 72(2) and (3).
We think this argument is misconceived.
An unabsorbed depreciation is indeed a part of the "loss".
This is so because, in the first place, "depreciation" is a normal outgoing though in a sense notional, which has to be debited in the computation of the profits of a business on commercial principles (quite apart from statute) and it is difficult to see why, when such deduction yields a negative figure of profits, it cannot be a "loss" as generally understood.
Jaipuria definitely says so as pointed out earlier.
Again, as pointed out earlier, if it is treated as a genus totally different from a "loss", there is"no statutory provision that will permit its adjustment against other business income implicit in section 32( '2) itself and against all other income of the assessee as held by the above decisions.
We therefore do not see why "loss" and "unabsorbed depreciation should be treated as antithetical to, or mutually exclusive of, each other.
Nor are we persuaded that any mix up or anomaly will result as, suggested by counsel if we treat the expressions as synonymous except to the extent specifically treated differently by the statute.
In our view, there is nothing anomalous or absurd in the statute providing for a dissection of the amount of loss for purposes of carry forward and providing for a special or different treatment to unabsorbed depreciation in this regard although it is a component element of the genus described as "loss".
To illustrate, suppose an assessee,has a "profit" of Rs.5,000 in one business before deduction of depreciation of, say, Rs. 10,000 and a loss of Rs. 15,000 in another business, it will be quite correct to say that he has a business loss of Rs.20,000 in that assessment year.
But for purposes of carry forward this has to be considered under to headings: (a) an unabsorbed depreciation of Rs.5,000 and (b) a business loss of Rs. 15,000.
The amount of Rs.20,000 will be carried forward to the subsequent year but the carry forward of Rs.5,000 will be according to the provisions of section 32(2) and the carry forward under section 72 will have, perforce, to be restricted to the other amount of Rs, 15,000.
The language of section 72(2) itself contains an indication that, where unabsorbed depreciation is a component of the figure of loss carried forward, the amount of loss proper should be set off first and the unabsorbed depreciation later.
But for the special treatment ac 932 corded by section 32(2) and section 72 for purposes of carry forward, there is no difference between an item of "unabsorbed depreciation" and an item of "loss".
We are, therefore, of opinion that the unabsorbed depreciation will be allocated among the partners and, like any other loss, will be available to the partner for set off against his business income or other income in the same assessment year.
In fact section 32(2), in so far as it talks of depreciation being given effect to in the partners ' assessments recognises that such unabsorbed depreciation should be allocated among the partners.
So the first of the three alternatives referred to by us earlier is, in our opinion, out.
We now come to the crucial question as to what is to be done when the amount of unabsorbed depreciation does not get absorbed by the other income of the firm and, further, the aliquot shares of the partners therein do not also get absorbed in the partners ' assessments against their other income.
There can be two answers to this: (1) that the partners in whose hands the unabsorbed depreciation has been allocated should carry forward the depreciation to succeeding years; or (2) that the amount of depreciation so remaining unabsorbed should be carried forward by the firm for set off in future assessments.
We have given our most careful consideration to this matter, particularly in view of the controversy of judicial decisions prevailing thereon, and we have come to the conclusion that the second of these alternatives is what is truly envisaged by the statute.
The most formidable obstacle put forward to this course is that, once the unabsorbed depreciation gets divided and allocated to the partners, there is no statutory provision for recalling, to the firm 's "file", the amount remaining unabsorbed.
We think this, criticism really proceeds on an unduly narrow construction placed on the provisions of section 32(2).
In our opinion, section 32(2) itself contains an inbuilt mechanism for doing this.
It is plain, on the language of this sub section, that the benefit of the carry forward is to be given to the assessee.
Where the assessee is other than a registered firm or an unregistered firm assessed as a registered firm, this is indeed very plain.
In the case of this category of assessee, the difficulty arises because of the words in parenthesis.
But a moment 's thought will make it clear that the word "or" in the sub section is really used as a conjunctive.
It cannot be an alternative, for there can be no doubt that even in the case of such an assessee the 933 unabsorbed depreciation, for reasons already set out, has to be adjusted against its other income.
The assessment of the firm cannot be complete without such a set off.
Thus, where a firm assessed as a registered firm, has only unabsorbed depreciation of say, Rs.8,000, in the business carried on by it but a property income of Rs.12,000 its total income for the year has to be Rs.4,000; it cannot be assessed on an income of Rs. 12,000 with the depreciation of Rs.8,000 apportioned to its partners.
We have already pointed out that the partner 's share in the unabsorbed depreciation is part of his share in the loss of the firm and, by virtue of section 67(3), will be treated as business loss which is capable of adjustment against his business and other income.
This is the position envisaged by section 32(2) when it talks of effect being given to the unabsorbed depreciation in the assessment of the partners.
This can refer only to cases where the depreciation cannot be given effect to in the firm 's assessment.
It is, therefore, clear that section 32(2) contemplates the situation where the unabsorbed depreciation in the hands of the firm is too large to get absorbed, first, in the hands of the firm and then, after apportionment, in the hands of the partners.
What remains thereafter has obviously to be carried forward by the firm which is the assessee referred to in the sub section.
Perhaps the meaning of the provision will become clearer if its relevant words are rearranged as follows: "Where full effect cannot be given to any (depreciation) in any previous year in the assessment of the assessee (whatever category it belongs to) and, if the assessee is a registered firm or an unregistered firm assessed as a registered firm, in the assessment of its partners .
. . the allowance shall be added . . ".
As in the case of all other assesses, the carry forward will be available to the registered firm which is the assessee that is referred to in the sub section.
This construction is also strengthened by the last part of the sub section.
When it talks of the depreciation allowance carried forward being added to the allowance for depreciation for the following previous year it obviously refers to the depreciation allowance due to the assessee (that is, the firm) in the subsequent previous year.
In the normal run of cases, it will thus either get added to the subsequent year 's depreciation in respect of the same assets and get set off against the income from the same business or some other business of the same assessee or, failing that, against other income of such assessee.
What 934 the sub section clearly provides for is that the aggregate of the depreciation available to an assessee over the years will be taken into consideration for set off against its income over a period of years.
No doubt, the latter portion of section 32(2) does not envisage that the business carried on by the assessee in the subsequent years should be the same or that the assets to the depreciation in respect of which the unabsorbed depreciation is to be added should be the same or, indeed, that any depreciation at all should be allowable to the assessee in the subsequent year.
It is no doubt true that the words of the sub section are so widely couched that they can, with a certain amount of difficulty, be rendered capable of application to the situation of each partner carrying forward his share of the unabsorbed depreciation for set off, even where he has no business or business income, against his other income.
But we think that it is too strained a construction of the sub section.
When, as pointed out by Sri Salve, there is nothing in the sub section or the Act specifically providing even for an apportionment of the depreciation among the partners, it is too contrived a construction to read into the sub section several words intended to provide for a number of partners, each carrying forward his share of the unabsorbed depreciation to successive assessment years.
It seems natural and reasonable to construe the section as envisaging the following steps where the assessee is a registered firm: (i) Excessive depreciation should be adjusted in the assessment of the assessee against other business income and against other heads of income; (ii) Depreciation, which remains unabsorbed under (i), will be apportioned to the partners and the share of each will be adjusted against the business and other income of each of the partners pro tanto; (iii) If full effect cannot be given to the depreciation allowance of the assessee by the above processes and some depreciation remains unadjusted, the assessee firm will carry it forward to the succeeding assessment year.
The objection to this course is based on a mental imagery of the firm and its partners as altogether different assesses and of the impermissibility of "bringing back" to the firm 's "file" what has gone away to the files of the partners.
We think this approach of viewing the two assessments in water tight compartments is not correct.
The Act itself contains several provisions [e.g. Ss. 67(2) & (3)] which indicate 935 that this is not so.
The observations of this Court in Sankappa vs I. T. O., at pp.
766 7 also bring out the regions of inter dependence of these two assessments.
In any event, any such theoretical dichotomy cannot prevail over the provisions of section 32(2).
There is also one further reason why this view should find acceptance.
As we have pointed out earlier, unabsorbed depreciation is only a species of business loss.
But for purposes of carry forward the statute has drawn a distinction between them.
In doing so, it specifically out lines the procedure for carry forward and set off of losses in the case of a registered firm but is silent in regard to unabsorbed depreciation.
There is no statutory prohibition against the carry forward of unabsorbed depreciation by the registered firm as there is against carry forward of loss.
The need felt to enact a specific prohibition in respect of losses and the absence of a like provision in respect of depreciation are significant pointers in support of the above construction.
An argument has been put forward by Dr. Gaurishankar on the basis of the amendment to the proviso to section 10(2)(vib) in 1953 to submit that it was intended to negative the claim of carry forward by the firm which was earlier being accepted on the strength of the earlier language resulting in a double advantage.
Attention has been drawn to the objects and reasons of the amendment, set out thus at p. 57 in (1952) 21 I.T.R. (Statutes): "The (amendment) is intended to make it clear that where unabsorbed depreciation has been effectively allowed in the assessment of a partner of a registered firm, it would not be carried forward in the case of the firm." (emphasis added) It is true that the clause, before its amendment, permitted all assesses and this included registered firms as well to carry forward their unabsorbed depreciation and that though the registered firm paid no tax, it could, on the language claim a carry forward of the depreciation which had been apportioned among the partners.
This resulted in such carry forward being claimed even where the whole or a part of the unabsorbed depreciation of the firm had been set off in the assessment of individual partners.
The amendment, vide the words emphasised in the extract above, only seeks to make it clear that such carry forward will not be permitted to the extent it has been given effect to in the partners ' assessments; by necessary implication the carry forward, to the extent it has not been effectively allowed to the partner, continues 936 to be available.
The amendment of 1953, therefore, not only does not help the case of the Revenue, it actually lands support to the construction we are inclined to place on the proviso.
It is possible that our conclusion may give scope for two grounds of criticism: (i) that the partners derive a double advantage of setting off the unabsorbed depreciation to reduce the taxable income of the firm as well as the partners; and (ii) that this will distort the relief available to various partners depending upon the variations in income as between the several partners as well as over a period of years.
We do not think that the first criticism is a valid one.
For it is now settled law, that though a firm and its partners are distinct assesses for purposes of income tax, the Act still recognises the principle that a firm is only a compendious name for its partners and that the business carried on by the firm is also a business carried on by each of the partners too vide section 67(2) and (4) and the loss of a registered firm is treated as the losses of its partners too.
The procedure envisaged by it will only enable a firm and the partners to set off the aggregate of the unabsorbed depreciation of the firm against the aggregate income of the firm and partners.
To the extent effect is given to such unabsorbed depreciation to one or more of the partners the firm cannot again get the benefit and vice versa.
There is, therefore, really no double advantage.
There is some point in the second criticism.
But, then, a certain amount of imbalance among the partners is inherent in the application of any one of the three possible alternatives.
If, as suggested by Sri Salve, only the firm and not the partners can carry forward the unabsorbed depreciation, there will be an injustice to the partners who may have other income against which it could be set off.
On the other hand, if the unabsorbed depreciation is allocated to the partners and they alone can carry forward and set it off, it will have this consequence that the partners who have other high income will derive the benefit of set off qua their shares but no benefit can be got by partners whose total income is not enough to offset their share of the depreciation and the unabsorbed depreciation will not get absorbed even though the firm may have sufficiently large income in subsequent years.
In other words, whichever procedure is adopted, the relief available to the partners will not be uniform.
This is a consequence flowing from the variations in the income sources of various partners and cannot be avoided under any scheme of carry forward and set off.
We, therefore, do not think that this consideration should weigh against our reaching the conclusion which naturally flows from the language of the sub section.
937 For the reasons discussed above, we are of the opinion that the assessee appellant firm is entitled to a carry forward of the unabsorbed depreciation computed for the assessment year 1967 68 and have it set off in its assessment for the assessment year 1968 69.
The unabsorbed loss computed for the assessment year 1967 68, however, cannot be carried forward by the firm to be set off in its assessment for the assessment year 1968 69.
So far as the assessment year 1967 68 is concerned, the High Court was right in holding that unabsorbed business loss of one year cannot be carried forward and set off by the firm in a subsequent year; but, if there was any unabsorbed depreciation computed for the assessment year 1966 67, it could have been allowed to be brought forward and set off in the assessment for the assessment year 1967 68 in the manner discussed in the judgment.
In the result, appeals for both the assessment years are allowed to the extent indicated and the assessments directed to be modified appropriately.
We, however, make no order regarding costs.
V. P. R. Appeals allowed.
| IN-Abs | For the assessment year of 1968 69, the assessee appellant, a registered firm, returned a total income of Rs.3,94,483 and a provisional assessment was made.
Subsequently, the Income Tax Officer found that for the said assessment year, the assessee had made an income of Rs. 11,82,056 and deducting therefrom three figures viz., (i) unabsorbed depreciation: Rs.1,59,181; (ii) unabsorbed development rebate: Rs.2,79,150; and (iii) unabsorbed business loss: Rs.3,49,242, aggregating to Rs.7,87,573 and arrived at the net income of Rs.3,94,483, which had been returned and accepted.
The three figures were the figures carried over from the previous year for the assessment year 1967 68.
The Income Tax Officer allowed the unabsorbed development 910 rebate pertaining to the assessment year of 1967 68 to be carried for ward and set off in computing the total income for the assessment year of 1968 69, but he did not allow the amounts of unabsorbed depreciation and unabsorbed business loss.
He, therefore, added back the sum of Rs.5,08,423 (the aggregate of the amounts of unabsorbed depreciation and unabsorbed business loss) to the returned income for determining the total income for the assessment year of 1968 69.
The action of the Income Tax Officer was confirmed by the Appellate Assistant Commissioners (A.A.C.).
However, on further appeal, the Income tax Appellate Tribunal (A.T.) upheld the income tax Officer 's stand that the firm could not be allowed to carry forward and set off the business loss carried from the earlier year but, so far as the unabsorbed depreciation was concerned, it upheld the assessee 's contention.
On these two issues a reference to the High Court was made and the High Court answered them against the assessee.
For the assessment year 1967 68, the assessee filed a return on 30.6.67 showing a loss of Rs.7,87,515 but filed a revised return on 22.3.1972 showing a loss of Rs.5,46,351.
On 14.3.73 the I.T.O. completed the assessment determining a loss of Rs.4,85,250.
The assessee 's request that this loss should be carried forward to the subsequent assessment year was rejected by the I.T.O. This was confirmed by the A.A.C. On further appeal, the A.T. confirmed the order of the A.A.C., following the High Court 's decision for the assessment year 1968 69 which had by then been announced.
The High Court answered the (question "Whether, on the facts and circumstances of the case, the Tribunal was justified in rejecting the claim for carry forward of business loss in the hands of the firm in view of the decision reported in 101I.T.R. 658? in the affirmative.
Hence the assessee 's the appeals one appeal for the assessment year of 1968 69 and the other for the assessment year of 1967 68 under certificates of fitness granted by the High Court.
On behalf of the assessee it was contended that the firm as well as the partners had been returning losses all along with the result that no part of the unabsorbed depreciation of the firm had been set off in the partner 's hands; that when there was an unabsorbed depreciation computed in the assessment of a registered firm for any year, for the 911 purpose of carry forward, it should be retained and carried forward by the firm only.
On the other hand, it was submitted for the Revenue that once the assessment was completed and the total income or loss of the firm ascertained, it had to be apportioned amongst the partners.
Thereafter there remained nothing in the assessment of the firm to be carried forward.
Only each of the partners can carry forward his share of the unabsorbed loss, which also included the unabsorbed depreciation, as there was no difference between unabsorbed loss and unabsorbed depreciation; and that the amendment to the proviso to section 10(2)(vib) in 1953 of depreciation was intended to negative the claim of carry forward, by the firm which was earlier being accepted on the strength of the earlier language resulting in a double advantage.
Allowing the appeals, this Court, HELD: 1.
"Depreciation" is one of the notional allowances which expression means a deduction in respect an outgoing which is not an item of actual expenditure or is one which cannot be treated as an outgoing of a revenue nature permitted by the statute to be deducted in the computation of the profits and gains of a business.
[921H 922B] 2.
Initially, the depreciation allowances has to be deducted from the profits and gains of the business to which the assets earning the depreciation relate but, if it remains unabsorbed by such profits, the allowance has to be set off against the other business income of the assessee and, where that is also insufficient, against the other taxable income of the assessee.
The carry forward of any depreciation as unabsorbed cannot arise until the stage of final assessment is reached and the total income of the assessee otherwise computed is insufficient to absorb the year 's depreciation allowance.
[928E G] 3.
An unabsorbed depreciation is a part of the "loss".
This is so because, in the first place, "depreciation" is a normal outgoing, though in a sense notional, which has to be debited in the computation of the profits of a business on commercial principles (quite apart from statute) and it is difficult to see why, when such deduction yields a negative figure of profits, it cannot be a "loss" as generally understood.
Where the depreciation allowance attributable to a particular business exceeds the profits otherwise computed for that business, the deduction of the depreciation allowance from such profits can only result in a "loss" from that business and a business loss has to be set off against income 912 from any other business, by way of intra head adjustment, under section 70 and the income under any other head, by way of intra head adjustment, under section 71.
This is implicit in the provision that the excessive depreciation of one business can be "given effect toll against the profits and gains of another business in the same year and has been recognised by decisions holding that it can be set off against income from other heads.
If unabsorbed depreciation is treated as a genus totally different from a "loss", there is no statutory provision that will permit its adjustment against other business income implicit in section 32(2) itself and against all other income of the assessee.
"Loss" and "unabsorbed depreciation" should not be treated as antithetical to, or mutually exclusive of, each other.
However, there is nothing anomalous or absurd in the statute providing for a dissection of the amount of loss for purposes of carry forward and providing for a special or different treatment to unabsorbed depreciation in this regard although it is a component element of the genus described as "loss" [931B C, 926C E, 93IC F] 4.
Unabsorbed losses and unabsorbed depreciation are to be carried forward to future years to be set off against future income.
There is, however, one important difference.
Unabsorbed losses can be carried forward only for a period of eight years whereas unabsorbed depreciation can be carried forward indefinitely.
[923G H] 5.
There is also difference between the two in the matter of their carry forward in the case of assessment of a registered firm.
In this case, the unabsorbed loss cannot be carried forward by the firm at all.
The statute clearly so provides.
So far as unabsorbed depreciation is concerned, three alternatives are possible to be urged: (i) It should be retained (without apportionment) and carried forward by the firm only.
(ii) It should be apportioned among the partners.
Thereafter, it can be dealt with even for carry forward purpose only in the assessment of each of the partners in respect of his aliquot share thereof.
(iii) It should be apportioned among the partners each of whom may set off his share thereof against his other income.
If, after this, any amount remains unabsorbed, it will revert to the firm.
The firm will carry it forward, set it off against its other income in the succeeding year.
This operation will be repeated every year indefinitely until the unabsorbed depreciation gets absorbed.
[924B E] 6.
The third alternative is the correct one: (a) The unabsorbed depreciation should be allocated among the partners and, like any other loss, will be available to the partners to the extent of his share therein for set off against his business income or other income in the same 913 assessment year.
In fact section 32(2), in so far as it talks of depreciation being given effect to in the partners ' assessments recognises that such unabsorbed depreciation should be allocated among the partners.
The question is what is to be done thereafter.
[932A B] (b) When there is nothing in the sub section or the Act specifically providing even for an apportionment of the depreciation among the partners, it is too contrived a construction to read into the sub section several words intended to provide for a number of partners, each carrying forward his share of the unabsorbed depreciation to successive assessment years.
It seems natural and reasonable to construe the section as envisaging the following steps where the assessee is a registered firm: (i) Excessive depreciation should be adjusted in the assessment of the assessee against other business income and against other heads of income; (ii) Depreciation, which remains unabsorbed under (i), will be apportioned to the partners and the share of each will be adjusted against the business and other income of each of the partners pro tanto; (iii) If full effect cannot be given to the depreciation allowance of the assessee by the above processes and some depreciation remains unadjusted, the assessee firm will carry it forward to the succeeding assessment year.
[934C G] (c) The sub section, before its 1953 amendment, permitted all assesses and this included registered firms as well to carry forward their unabsorbed depreciation so that though the registered firm paid no tax, it could, on the language claim a carry forward of the depreciation which had been apportioned among the partners.
This resulted in such carry forward being claimed even where the whole or a part of the unabsorbed depreciation of the firm had been set off in the assessment of individual partners.
The amendment only seeks to make it clear that such carry forward will not be permitted to the extent it has been given effect to in the partners ' assessments; by necessary implication, the carry forward, to the extent it has not been effectively allowed to the partner, continues to be available.
The amendment of 1953, therefore, does not help the case of the Revenue.
[935F 936A] (d) The objection to the above course is also based on a mental imagery of the firm and its partners as altogether different assesses 914 and of the impermissibility of "bringing back" to the firm 's "file" what has gone away to the* files of the partners.
This approach of viewing the two assessments in water tight compartments for all purposes is not correct.
In any event, any such theoretical dichotomy cannot prevail over the provisions of section 32(2).
[934G 935A] (e) The construction suggested does not result in any double advantage to the partners.
[936D] (f) It is true that the construction may result in a certain amount of imbalance in the quantum of relief available as among different partners.
But similar imbalance is inherent in the application of any of the three possible alternatives.
[936E F] 7.
The assessee appellant firm is entitled to carry forward the unabsorbed depreciation computed for the assessment year 1967 68 and have it set off in its assessment for the assessment year 1968 69.
The unabsorbed loss for the assessment year, 1967 68, however, cannot be carried forward by the firm to be set off in its assessment for the assessment year 1968 69.
[937A B] K. T. Wire Products vs Union of India, ; Garden Silk Weaving Factory, ; Garden Silk Weaving Factory, C. I. T. vs Ram Swarup Gupta, ; Raj Narayan Aggarwala vs C.I.T., [1979] 75 ITR I (Del.); Shankaranarayana Construction Co. vs C. I. T., ; Ballarpur Collieries Co. vs C.I.T., ; C. 1.
T. vs Nagpur Gas & Domestic Appliances, ; CIT vs Nagapattinam Import and Export Corp., ; CIT vs Madras Wire Products, ; CIT vs Madras Wire Products, ; CIT vs J. Patel & Co., ; CIT vs Shrinivas Sugar Co., ; CIT vs Singh Transport Co., ; Pearl Wollen Mills vs CIT, ; CIT vs Mahavir Steel Rolling Mills, & H) and CIT vs R. J. Trivedi & Sons, , referred to.
IT vs Jaipuria China Clay Mines (P.) Ltd., and Rajapalayam Mills Ltd. vs C. I. T., , followed.
|
Civil Appeal No.1396 of 1991.
From the Judgement and Order dated 8.3.1990 of the Orissa High Court in Case No. 2867 of 1987.
Mrs. Uma Metha Jain and M.A. Firoz for the Appellant.
Ashok Kumar Panda for the Respondents.
The Judgement of the Court was delivered by KULDIP SINGH, J. Special leave granted.
Rabinarayan Mohapatra the appellant was appointed as Hindi Teacher in Bani gochha, M.E. School (Orrisa) for a period of 89 days or till a candidate selected by the State Selection Board was made available.
He joined the school on July 12, 1982.
The appointment was made by the District Inspector (Schools) on the recommendation of the managing committee of the school.
He continued to serve the school with repeated spells of 89 day appointments and one day break in between the spells, till May 25, 1986.
He was not paid the salary for the period of summer vacations during all these years.
Although the period of summer vacation during all these years.
Although the appellant continues to serve the school to date under orders of the managing committee yet his appointment after 1986 has not been approved by the educational authorities.
The managing committee even passed a resolution on July 6,1987, requesting the educational authorities of the State of Orissa to approve the continuous appointment of the appellant as Hindi Teacher but no action was taken by the said authorities.
The appellant filed a writ petition under Article 226 of the Constitution of India before the Orissa High Court claiming regularisation as Hindi Teacher with effect from July 12,1982.
The only argument raised before the High Court was that the appellant was entitled to be regularised in terms of the provisions of Section 3 of the Orissa Aided Educational Institutions (Appointment of Teachers Validation) Act, 1989 (hereinafter called 'the Validation Act ').
The relevant part of Section 3 of the Act is reproduced hereinafter : 3.
Validation of certain appointments Not withstanding 993 anything contained in the Education Act or in the Rules or Regulations framed thereunder. (a) graduate teacher, intermediate and matriculate teachers, physical education teachers and classical teachers and Hindi teachers of aided schools appointed by the managing authorities of such schools on ad hoc basic on or after the 1st December , 1976 but not later than the 31st December, 1984; (b) . . . (c) . . . who have continuous service as such teachers or lecturers for a period of at least one year without any break or with a break or breaks in one or more aided schools or Colleges and who are continuing as such teachers or whose services have been terminated after the 31st December ,1984 save for misconduct or. . . shall for all intents and purposes, be deemed to have been validly and regularly appointed, and no such appointment shall be challenged in any court of law merely on the ground that the appointment was made otherwise than in accordance with procedure laid down in the Education Act and the Rules and Regulations framed thereunder;. . . . .
The High Court rejected the prayer for regularisation, and held that the appellant was not entitled to the benefit of the Validation Act, on the following reasoning; "Admittedly, the petitioner was appointed on 12.7.1982 and continued till 18.7.1986 with breaks in between and the petitioner 's appointment was conditioned by the stipulation that he would continue until replaced by a candidate from the Select List.
His case, therefore, will not come within the preview of the Validation Act and, therefore, the question of issuing any direction to regularise his service in a substantive vacancy because of the Validation Act does not arise.
" We have heard Mrs. Uma Mehta Jain, learned counsel for the applellant.
This Court in Rattan Lal vs State of Haryana.
A.I.R. 1987 S.C. 478 speaking through Venkataramaiah, J. (as the learned Judge then was ) observed as under: 994 "The State Government of Haryana has failed to discharge that duty in these cases.
It has been appointing teachers for quite some time on an ad hoc basis for short periods as stated above without any justifiable reason.
In some cases the appointments are made for a period of six months only and they are renewed after break of a few days.
The number of teachers in the State of Haryana who are thus appointed on such ad hoc basis is very large indeed.
If the teachers had been appointed regularly, they would have been entitled to the benefits of summer vacation along with the salary and allowances payable in respect of that period and to all other privileges such as casual leave, medical leave, maternity leave etc.
available to all the Government servants.
These benefits are denied to these ad hoc teachers unreasonably on account of this pernicious system of appointment adopted by the State Government.
These ad hoc teachers are unnecessarily subjected to an arbitrary `hiring and firing ' policy.
These teachers who constitute the bulk of the educated unemployed are compelled to accept these jobs on an ad hoc basis with miserable conditions of service.
The Government appears to be exploiting this situation.
This is not a sound personnel policy.
It is bound to have serious repurcussions on the education institutions and the children studying there.
The policy of `ad hocism ' followed by the State Government for a long period has led to the breach of Article 14 of the Constitution.
Such a situation cannot be permitted to last any longer.
It is needless to say that the State Government is expected to function as a model employer".
"We strongly deprecate the policy of the State Government under which `ad hoc ' teachers are denied the salary and allowances or the period of the summer vacation by resorting to the fictional breaks of the type referred to above.
These `ad hoc ' teachers shall be paid salary and allowances for the period of summer vacation as long as they hold the office under this order.
Those who are entitled to maternity or medical leave shall also be granted such leave in accordance with the rules.
" The Validation Act has been enacted by the Orissa legislature with the obvious object of granting relief to those members of teaching community who are being exploited for years together by keeping 995 them in short spell appointments like 89 day appointments as here with one day break and in the process denying them their rightful dues and other service benefits.
Inspite of repeated depreciation by this Court the practice continues to be followed by various State Governments in the country.
Under the Constitution the State is committed to secure right to education for all citizens.
Bulk of our population is yet illiterate.
Till the time illiteracy is effaced from the country the resolution enshrined in the Preamble cannot be fulfilled.
Education is the dire need of the country.
There are neither enough schools nor teachers to teach.
Insecurity is writ large on the face of the teaching community because of nebulous and unsatisfactory conditions of service.
In order to make the existing educational set up effective and efficient it is necessary to do away with ad hocism in teaching appointments.
An appointment on 89 day basis with one day break which deprives a teacher of his salary for the period of summer vacation and other service benefits, is wholly arbitrary and suffers from the vice of discrimination.
The Validation Act covers the field upto December 31, 1984.
The State of Orissa will do well to consider the cases of all those who have completed one year or more as ad hoc teachers after December, 31, 1984 and come out with a scheme or any other appropriate measure to regularise their services.
Mrs. Jain contended that on the plain reading of Section 3 of the Validation Act the appellant is entitled to be regularised as Hindi Teacher with effect from July 12,1982.
To come within the purview of the Validation Act the following conditions are to be satisfied: 1.
The appointment by the managing authority of the school on ad hoc basis must be on or after the 1st December, 1976 but not later than 31st December, 1984; 2.
The service as such teacher is continuous for a period of atleast one year without any break or with a break or breaks in one or more aided schools; 3.
Is continuing as such teacher or his services were terminated after the 31st December, 1984 save for misconduct.
The apellant was appointed on July 12,1982 and has been working with the approval of the authorities for almost 4 years with short breaks.
The managing committee is still utilising his services though there is no approval by the educational authorities for the period subsequent to 1986.
It is no body 's case that his services were 996 ever terminated on grounds of inefficiency or misconduct.
The case of the appellant is, thus, fully covered by Section 3 of the Validation Act.
We are of the view that the High Court erred in denying the benefit of the Validation Act to the appellant on the ground that his initial appointment for 89 days was conditioned by the stipulation that he would continue until replaced by a candidate from the select list.
The High Court read into the Act what was not there.
In response to the notice issued in the Special Leave Petition the managing committee through its Secretary cum Head Master has stated that the appellant is still continuing to serve as Hindi teacher in the school under the orders of the managing committee.
We therefore, set aside the judgment of the High Court and direct the respondents to treat the appellant as the regularly appointed Hindi teacher in the school with effect from July 12, 1982.
The appeallant shall be entitled to his salary, including the salary for summer vacations and other breaks which must be taken as non est, from the date of his regular appointment i.e. July 12, 1982.
The respondents are directed to pay the arrears of salary and other emoluments due to the appellant as a result of his regularisation within a period of 3 months from today.
| IN-Abs | The appellant was appointed as Hindi Teacher in the M.E. School for a period of 89 days from July 12,1982 by the District Inspector (Schools) on the recommendation of the Managing Committee of the School.
He continued to serve the school with repeated spells of 89 day appointments and one day break in between the spells, till may 25, 1986.
He was not paid the salary for the period of summer vacations during all these years.
Although the appellant continues to serve the school to date under orders of the managing committee, but his appointment after 1986 was not approved by the educational authorities, in spite of the resolution of the managing committee dated July 6,1987.
The appellant filed a writ petition before the High Court claiming regularisation with effect from July 12,1982, contending that he was entitled to be regularsed in terms of the provisions of Section 3 of the Orissa Aided Educational Institutions (Appointment of Teachers Validation) Act, 1989.
The High Court dismissed the petition holding that the appellant was not entitled to the benefit of the Validation ACt, against which present appeal was filed by the appellant contending that his services were to be regularised with effect from July 12, 1982 under the provisions contained in Section 3 of the Validation Act.
Allowing the appeal, this Court, 991 HELD:1.1.
The Validation Act has been enacted by the Orissa Legislature with the obvious object of granting relief to those members of the teaching community who are being exploited for years together by keeping them in short spell appointments like 89 day appointments with one day break and in the process denying them their rightful dues and other service benefits.[994G 995A] 1.2 An appointment on 89 day basis with one day break which deprives a teacher of his salary for the period of summer vacation and other service benefits, is wholly arbitrary and suffers from the vice of discrimination.
The Validation Act covers the field upto December 31, 1984.
The State of Orissa will do well to consider the cases of all those who have completed one year or more as ad hoc teachers after December 31,1984 and come out with a scheme or any other appropriate measure to regularise their services.[995C D] 2.
To come with in the preview of the Validation Act the following conditions are to be satisfied: 1.
The appointment by the managing authority of the school on ad hoc basis must be on or after the 1st December 1976 but not later than 31st December 1984.
The services as such teacher is continuous for a period of at least one year without any break or with a break or breaks in one or more aided schools; 3.
Is continuing as such teacher or his services were terminated after the 31st December ,1984 save for misconduct.[995E G] 2.2.
The appellant was appointed on July 12,1982 and has been working with the approval of the authorities for almost 4 years with short breaks.
The managing committee is still utilising his services though there is no approval by the educational authorities for the period subsequent to 1986.
The case of the appellant is, thus, fully covered by Section 3 of the Validation Act.[995G 996A] 3.
The High Court erred in denying the benefit of the Validation Act to the appellant on the ground that his initial appointment for 89 days was conditioned by the stipulation that he would continue until replaced by a candidate from the select list.
The High Court read into the Act what was not there,[996A B] 992 Rattan Lal vs State of Haryana, A.I.R. 1987 S.C. 478, followed.
|
eference No. 1 of 1951.
The circumstances which led to this Special Reference by the President and the questions referred appear from the full text of the reference dated 7th January, 1951, which is reproduced below : "WHEREAS in the year 1912 the Governor General of India in Council acting in his legislative capacity enacted the , section 7 of which conferred power on the Central Government by notification to extend to the Province of Delhi (that is to say, the present State of Delhi) or any part thereof, with such restrictions and modifications as it thought fit, any enactment which wag in force in any part of British India at the date of such notification; "AND WHEREAS in 1947 the Dominion Legislature enacted the Ajmer Merwara (Extension of Laws) Act, 1947, section 2 of which conferred power on the Central Government by notifica tion to extend to the Province of Ajmer Merwara (that is to say, the present State of Ajmer), with such restrictions and modifications as it thought fit, any enactment which was in force in any other Province at the date of such notifica tion; 753 "AND WHEREAS, by virtue of the powers conferred by the said sections of the said Acts, notifications were issued by the Central Government from time to time extending a number of Acts in force in the Governors ' Provinces to the Province of Delhi and the Province of Ajmer Merwara, sometimes with, and sometimes without, restrictions and modifications, and the Acts so extended and the orders,rules, by laws and other instruments issued under such Acts were and are re garded as valid law in force in the Province (now State) of Delhi and in the Province of Ajmer Merwara (now State of Ajmer), as the case may be, and rights and privileges have been created, obligations and liabilities have been in curred and penalties, forfeitures and punishments have been incurred or imposed under such Acts and instruments; "AND WHEREAS Parliament with the object inter alia of making a uniform provision for extension of laws with regard to all Part C States except Coorg and the Andaman and Nico bar Islands enacted the Part C States (Laws) Act, 1950, section 2, of which confers power on the Central Government by notification to extend to any Part C State (other than Coorg and the Andaman and Nicobar Islands) or to any part of such State, with such restrictions and modifications as it thinks fit, any enactment which is in force in a Part A State at the date of the notification and also confers the power on the Central Government to make provision in any enactment so extended for the repeal or amendment of any corresponding law (other than a Central Act) which is for the time being applicable to that Part C State; "AND WHEREAS section 4 of the Part C States (Laws) Act, 1950 has repealed section 7 of the , and the Ajmer Merwara (Extension of Laws)Act, 1947, but the effect of the provisos to the said section is, notwithstand ing the said repeals, to continue, inter alia in force the Acts extended to the Provinces of Delhi and Ajmer Merwara or the States of Delhi and Ajmer under the provisions repealed by the said section; "AND WHEREAS notifications have been issued by the Central (Government from time to time under section 9, of the States (Laws) Act, 1950, extending Acts in force in Part A States to various Part C States sometimes with, and sometimes without, restrictions and modifications; "AND WHEREAS the Federal Court of India in Jatindra Nath Gupta vs Province of Bihar(1) held by a majority that (1)[1949] F.C.R. 595.
754 the proviso to sub section (3) of section 1 of the Bihar Maintenance of Public Order Act, 1947, was ultra vires of the Bihar Legislature inter alia on the ground that the said proviso conferred power on the Provincial Government to modify an Act of the Provincial Legislature and thus amounted to a delegation of legislative power; "AND WHEREAS, as a result of the said decision of the Federal Court, doubts have arisen regarding the validity of Section 7 of the , Section 2 of the Ajmer Merwara (Extension of Laws) Act, 1947, and Section 2 of the Part C States (Laws) Act, 1950, and of the Acts extended to the Provinces of Delhi and Ajmer Merwara and various Part C States under the said sections respectively, and of the orders and other instruments issued under the Acts so extended: "AND WHEREAS the validity of Section 7 of the , and section 2 of the Ajmer Merwara (Extension of Laws) Act, 1947, and of the Acts extended by virtue of the powers conferred by the said sections has been challenged in some cases pending at present before the Punjab High Court, the Court of the Judicial Commissioner of Ajmer, and the District Court and the Subordinate Courts in Delhi; "AND WHEREAS, in view of what is hereinbefore stated, it appears to me that the following questions of law have.
arisen and are of such nature and of such public importance that it is expedient that the opinion of the Supreme Court of India should be obtained thereon; Now, THEREFORE, in exercise of the powers conferred upon me by clause (1) of article 143 of the Constitution, I, Rajendra Prasad, President of India, hereby refer the said questions to the Supreme Court of India for consideration and report thereon, namely : "(1) Was section 7 of the , or any of the provisions thereof and in what particular or particu lars or to what extent ultra vires the Legislature which passed the said Act ? "(2) Was the Ajmer Merwara (Extension of Laws) Act, 1947, or any of the provisions thereof and in what particular or particulars or to what extent ultra vires the Legislature which passed the said Act ? "(3) Is section 2 of the Part C States (Laws) Act, 1950, or any of the provisions thereof and in what particular or particulars or to what extent ultra vires the Parliament?" 755 Arguments were heard on the 9th, 10th, 11th, 12th, 16th, 17th, 18th, 19th, 20th, 23rd, 24th, 25th, 26th, 27th and 30th days of April, 1951.
M.C. Setalvad, Attorney General for India, (G. N. Joshi, with him) for the President of India.
C.K. Daphtary, Advocate General of Bombay (G. N. Joshi, with him) for the State of Bombay.
(R. Ganapathy lyer, for the State of Madras.
M.L. Saxena,for the State of Uttar Pradesh.
A.R. Somanatha lyer, Advocate General of Mysore (R. Ganapathy lyer, with him) for the State of Mysore.
P.S. Safeer, for Captain Deep Chand.
N.S. Bindra, for Pt.
Amarnath Bharadwaj.
M.M. Gharakhan, for the Ajmer Electric Supply Co. Ltd. N.C. Chatterjee, (G. C. Mathur, Basant Chandra Ghose, and Tilak Raj Bhasin, with him) for the Maidens Hotel.
Jessaram Banasingh, for Runglal Nasirabad.
Jyoti Sarup Gupta and K.B. Asthana, for the Municipal Committee, Ajmer.
Din Dayal Kapur, for Shri Munshilal and two others.
May 23.
The following judgments were delivered.
KANIA C.J. This is a reference made by the President of India under article 143 of the Constitution asking the Court 's opinion on the three questions submitted for its consideration and report.
The three questions are as fol lows: "(1) Was section 7 of the , or any of the provisions thereof and in what particular or particu lars or to what exent ultra vires the Legislature which passed the said Act ?" Section 7 of the , mentioned in question, runs as follows : 756 "The Provincial Government may, by notification in the official gazette, extend with such restrictions and modifi cations as it thinks fit to the Province of Delhi or any part thereof, any enactment which is in force in any part of British India at the date of such notification.
" "(2) Was the Ajmer Merwara (Extension of Laws) Act, 1947, or any of the provisions thereof and in what particu lar or particulars or to what extent ultra vires the Legis lature which passed the said Act ?" Section 2 of the Ajmer Merwara (Extension of Laws) Act, 1947, runs as follows: ' 'Extension of Enactments to Ajmer Merwara.
The Cen tral Government may, by notification in the official ga zette, extend to the Province of Ajmer Merwara with such restrictions and modifications as it thinks fit any enact ment which is in force in any other Province at the date of such notification.
" "(3) Is section 2 of the Part C States (Laws) Act, 1950, or any of the provisions thereof and in what particu lar or particulars or to what extent ultra vires the Parlia ment ?" Section 2 of the Part C States (Laws) Act, 1950, runs as follows : "Power to extend enactments to certain Part C States.
The Central Government may, by notification in the Official Gazette, extend to any Part C State (other than Coorg and the Andaman and Nicobar Islands) or to any part of such State, with such restrictions and modifications as it thinks fit, any enactment which is in force in a Part A State at the date of the notification and provision may be made in any enactment so extended for the repeal or amend ment.
of any corresponding law (other than a Central Act) which is for the time being applicable to that Part C State.
" The three sections referred to in the three questions are all in respect of what is described as the delegation of.
legislative power and the three particular Acts are selected to raise the question in respect of the three main stages in the constitutional development of India.
757 The first covers the legislative powers of the Indian Legis lature during the period prior to the Government of India Act, 1915.
The second is in respect of its legislative power after the Government of India Act, 1935, as amended by the Indian Independence Act of 1947. 'The last is in respect of the power of the Indian Parliament under the present Consti tution of 1950.
It is therefore necessary to have an idea of the legislative powers of the Indian Legislature during those three periods.
Without going into unnecessary details, it will not be out of place to know the historical back ground.
The East India Company first started its operations as a trading company in India and gradually acquired politi cal influence.
The Crown in England became the legislative authority in respect of areas which had come under the control of the East India Company.
The Indian Councils Act of 1861, section 22, gave power to the Governor General in Council, with additional nominated members, to make laws.
The constitutional position therefore was that the British Parliament was the sovereign body which passed the Indian Councils Act.
It gave the Governor General in Council in his legislative capacity powers to make laws over the territo ries in India under the governance of the Crown.
Under the English Constitution the British Parliament with its legis lative authority in the King and the two Houses of Parlia ment is supreme and its sovereignty cannot be challenged anywhere.
It has no written Charter to define or limit its power and authority.
Its powers are a result of convention but are now recognised as completely absolute, uncontrolled and unfettered.
Sir Cecil Cart in his book on English Admin istrative Law at page 15 observes: "A more basic difference between the Constitutions of the United States and Britain is the notorious fact that Britain has no written Constitu tion, no fundamental statute which serves as a touchstone for all other legislation and which cannot be altered save by.
some specially solemn and dilatory process.
In Britain the King in Parliament is all powerful.
There is no Act which cannot be passed and will not be valid within 758 the ordinary limits of judicial interpretation . .
Even Magna Carts is not inviolate . .
The efficient secret of the English Constitution was the close union and nearly complete fusion of the executive and legislative powers.
In other words by the system of Cabinet Government the executive authority is entrusted to a committee consisting of members of the dominant party in the legisla ture and in the country." In Halsbury 's Laws of England, Vol.
VI, Article 429, it is further stated that it is for this reason that there is no law which the King in Parliament cannot make or unmake whether relating to the Constitution itself or otherwise; there is no necessity as in States whose Constitutions are drawn up in a fixed and rigid form and contained in written documents for the existence of a judicial body to determine whether any particular legislative Act is within the consti tutional powers of Parliament or not; and laws affecting the Constitution itself may be enacted with the same ease and subject to the same procedure as ordinary laws.
In England, when occasions of conferment of powers on subordinate bodies became frequent and assumed larger scope, questions about the advisability of that procedure were raised and a Commit tee on the Minister 's Powers, what is generally described as the Donoughmore Committee was appointed.
The Committee recommended that certain cautions should be observed by the Parliament in the matter of confermen of such powers on subordinate bodies.
This is natural because of the well recognised doctrine of the English Constitution that Parlia ment is supreme and absolute and no legislation can control its powers.
Such a legislative body which is supreme has thus cer tain principal characteristics.
It is improper to use the word "constitutional" in respect of laws passed by such a sovereign body.
The question of constitutionality can arise only if there is some touchstone by which the question could be decided.
In respect of a sovereign body like the British Parliament there is no 759 touchstone.
They are all laws and there is no distinction in the laws passed by the Parliament as constitutional or other laws.
Such laws are changed by the same body with the same ease as any other law.
What law follows from this is that no court or authority has any right to pronounce that any Act of Parliament is unconstitutional.
In Dicey 's Law of the Constitution, 9th Edition, in considering the Constitution of France,it was observed that the supreme legislative power under the Republic was not vested in the ordinary Parliament of two Chambers, but in a National Assembly or Congress composed of the Chamber of Deputies and the Senate sitting together.
The Constitutions of France which in this respect were similar to those of Continental polities exhibited as compared with the expansiveness or flexibility of English institutions that characteristic which was described by the author as rigid.
A flexible constitution was one under which every law of every description can legally be changed with the same ease and in the same manner by one and the same body.
The flexibility of the British Constitution consists in the right of the Crown and the two Houses to modify or repeal any law whatever.
They can modify or.repeal in the same manner in which they can pass an Act enabling a company to make a new railway from Oxford to London.
Therefore, in England laws are called constitutional because they refer to subjects proposed to affect the fundamental institutions of the State and not because they are legally more sacred or difficult to change than other laws.
Under the circumstances the term "constitutional law or enactment" is rarely applied to any English statute to give a definite description to its character.
Under a rigid constitution, the term "consti tutional" means that a particular enactment belongs to the articles of the constitution and cannot be legally changed with the same ease and in the same manner as ordinary laws, and it is because of this characteristic that courts are invested with powers to determine whether a particular legislation is permitted or not by the constitution.
Such a question can 760 never arise in respect of an enactment of the British Parliament.
As against this, the Governor General in Council with legislative powers established under the Indian Councils Act stood in a different position.
Its charter was the Indian Councils Act.
Its powers were there necessarily defined and limited.
That power, again, at any time could be withdrawn, altered and expanded or further curtailed.
Moreover, as the powers were conferred by an Act of the British parliament, the question whether the action of the Governor General in Council in his legislative capacity was within or without its legislative power was always capable of being raised and decided by a court of law.
In Dicey 's Law of the Constitution, 9th Edition the author has distin guished the position of a sovereign legislature and a subordinate law making body.
The distinction is drawn from the fact that the subordinate legislatures have a limited power of making laws.
At page 99, he has specifically considered the position of the legislative Council of British India prior to 1915 and stated as follows: "Laws are made for British India by a Legislative Council having very wide powers of Legislation.
This Council, or, as it is technically expressed, the Governor General in Council, can pass laws as important as any Acts passed by the Brit ish Parliament.
But the authority of the Council in the way of law making is as completely subordinate to, and as much dependent upon, Acts of Parliament as is the power of the London and North Western Railway Company to make bye laws .
Now observe, that under these Acts the Indian Council is in the strictest sense a non sovereign legisla tive body, and this independently of the fact that the laws or regulations made by the Governor General in Council can be annulled or disallowed by the Crown; and note that the position of the Council exhibits all the marks or notes of legislative subordination.
(1) The Council is bound by a large number of rules which cannot be changed by the Indian legislative body itself and which can be changed by the superior power of the Imperial parliament.
761 (2) The Acts themselves, from which the Council derives its authority, cannot be changed by the Council and. they stand in marked contrast with the laws or regulations which the Council is empowered to make.
These fundamental rules contain, it must be added, a number of specific restrictions on the subjects with regard to which the Council may legis late . (3) The courts in India . may, when the occasion arises, pronounce upon the validity or constitu tionality of laws made by the Indian Council.
" It is there fore clear that the Indian Legislature in 1861 and upto 1915 was a subordinate legislature and not a sovereign legisla ture.
At this stage it may again be noticed that the Govern ment was unitary and not federal.
There was no distribution of legislative powers as between the Centre and the differ ent Provinces.
Another important factor to be borne in mind is that while the British Parliament was supreme, its execu tive Government came into power and remained in power so long only as the Parliament allowed it to remain and the Parliament itself was not dissolved.
The result is that the executive government was a part of the legislature and the legislature controlled the actions of the executive.
Indeed, the legislature was thus supreme and was in a position effectively to direct the actions of the executive govern ment.
In India the position was quite different if not the reverse.
The Governor General was appointed by the Crown and even after the expansion of the legislative body before the Government of India Act of 1915 in numbers, it had no con trol over the executive.
In respect of the Indian Legisla ture functioning prior to the Government of India Act of 1915 the control from the Secretary of State was justified on the ground that the Provincial Legislatures were but an enlargement of the executive government for the purpose of making laws and were no more than mere advisory bodies without any semblance of power.
The executive Government of India was not responsible to the Indian Legislature and the composition of the Indian Legislature was such that the executive officers 762 together with the nominated members constituted the majority in the Legislature.
The result was that the Legislative Council was practically a creature of the executive Govern ment of India and its functions were practically limited to registering the decrees of the executive government.
It would not be wrong, according to Mr. Cowell in his lecture on "Courts and Legislative Authorities in India," to de scribe the laws made in the Legislative Councils as in reality the orders of Government.
Every Bill passed by the Governor General 's Council required his assent to become an Act.
The Indian Councils Act of 1892 empowered the Governor General in Council, with the approval of the Secre tary of State in Council, to make regulations as to the conditions under which nomination of the additional members should be made.
The word `election ' was carefully avoided.
The existence of a strong official block in the Councils was the important feature of the Act.
As noticed by a writer on Indian Constitution, the Government maintained a tight and close control over the conduct of official members in the Legislature and they were not allowed to vote as they pleased.
They were not expected to ask questions or move resolutions or (in some Councils) to intervene in debate without Government 's approval.
Their main function was to vote to vote with the Government.
However eloquent the non official speakers might talk and however reasonable and weighty their arguments might be, when the time for voting came the silent official flanks stepped in and decided the matter against them.
All these factors contributed to the unreality of the proceedings in the Council because the number of elected members was small and the issue was often known beforehand.
Speaking in the.
House of Lords in Decem ber 1908 on the Bill which resulted in the Government of India Act of 1909, Lord Morley, the then Secretary of State for India, declared: "If I were attempting to set up a Parliamentary system in India, or if it could be said that this chapter of rules led directly or necessarily up to the establishment of a Parliamentary system in India.
I for one would have 763 nothing at all to do with it . .
A Parliamentary system is not at all the goal to which I would for one moment aspire.
" The constitution of the Central Legislative Council under the Regulation of November, 1909, as revised in 1912, was this: Ordinary members of the Governor Gene ral 's Council, The Commander in Chief and the Lt. Governor . 8 Nominated members of whom not more than 28 must be officials . 33 Elected members, . 27 and The Governor General . 1 69 The executive government was thus supreme and was not bound to obey or carry out the mandates of the legislature.
Instances where Finance Bills were rejected and other Bills were backed by the popular feeling and which decisions the Governor General overruled, are well known.
The Indian Legislature was powerless to do anything in the matter.
Without the consent of the executive government no Bill could be made into an Act nor an Act could be amended or repealed without its consent.
The possibility of the Legis lature recalling the power given tinder an Act to the execu tive against the latter 's consent was therefore nil.
Once an Act giving such power (like the ) was passed, practically the power was irrevocable.
In my opinion, it is quite improper to compare the power and position of the Indian Legislature so established and functioning with the supreme and sovereign character of the British Parliament.
The legislative power of the Indian Legislature came to be changed as a result of the Act of 1915 by the creation of Provincial legislatures.
I do not propose to go into the details of the changes, except to the extent they are di rectly material for the discussion of the questions submit ted for the Court 's opinion, Diarchy 764 was thus created but there was no federation under the Act of 1915.
Under the Government of India Act, 1935, the legis lative powers were distributed between the Central legisla ture and the Provincial legislature, each being given exclu sive powers in respect of certain items mentioned in Lists I and II of the Seventh Schedule.
List III contained subjects on which it was open to the Centre or the Province to legis late and the residuary power of legislation was controlled by section 104.
This Act however was still passed by the British Parliament and therefore the powers of the Indian Central legislature as well as the Provincial legislatures were capable of being altered, expanded or limited according to the desire of the British Parliament without the Indian legislature or the people of India having any voice in the matter.
Even under this Act, the executive government was not responsible to the Central Legislature or the Provincial Legislature, as the case may be.
I emphasize this aspect because it shows that there was no fusion of legislative and executive powers as was the case with the Constitution in England.
The result of the Indian Independence Act, 1947, was to remove the authority of the British Parliament to make any laws for India.
The Indian Central Legislature was given power to convert itself into a Constituent Assembly to frame a Constitution for India, including the power to amend or repeal the Government of India Act, 1935, which till the new Constitution was adopted, was to be the Constitution of the country.
Even with that change it may be noticed that the executive government was not responsible to the Central Legislature.
In fact with the removal of the control of the Parliament it ceased to be responsible to anyone.
Under the Constitution of India as adopted on the 26th of January, 1950, the executive government of the Union is vested in the President acting on the advice of the Minis ters.
A Parliament is established to make laws and a Su preme Court is established with the powers defined in dif ferent articles of the Constitution.
The executive, legislative and judicial 765 functions of the Government, which have to be discharged, were thus distributed but the articles giving power to these bodies do not vest the legislative or judicial powers in these bodies expressly.
Under the Constitution of India, the Ministers are responsible to the legislatures and to that extent the scheme of the British Parliament is adopted in the Constitution.
While however that characteristic of the British Parliament is given to the Indian Legislature, the principal point of distinction between the British Parlia ment and the Indian Parliament remains and that is that the Indian Parliament is the creature of the Constitution of India and its powers, rights, privileges and obligations have to be found in the relevant articles of the Constitu tion of India.
It is not a sovereign body, uncontrolled with unlimited powers.
The Constitution of India has con ferred on the Indian Parliament powers to make laws in respect of matters specified in the appropriate places and Schedules, and curtailed its rights and powers under certain other articles and in particular by the articles found in Chapter 111 dealing with Fundamental Rights.
In case of emergency where the safety of the Union of India is in danger, the President is given express power to suspend the Constitution and assume all legislative powers.
Similarly.
in the event of the breaking.down of the administrative machinery of a State, the President is given powers under article 257 to assume both legislative and executive powers in the manner and to the extent found in the article.
There can be no doubt that subject to all these limitations and controls, within the scope of its powers and on the subjects on which it is empowered to make law% the Legislature is supreme and its powers are plenary.
The important question underlying the three questions submitted for the Court 's consideration is what is described as the delegation of legislative powers.
A legislative body which is sovereign like an autocratic ruler has power to do anything.
It may, like a Ruler, by an individual decision, direct that a certain person may be put to death or a cer tain property may be 766 taken over by the State.
A body of such character may have power to nominate someone who can exercise all its powers and make all its decisions.
This is possible to be done because there is no authority or tribunal which can question the right or power of the authority to do so.
The contentions urged on behalf of the President of India are that legislative power carries with it a power of delegation to any person the legislature may choose to appoint.
Whether sovereign or subordinate, the legislative authority can so delegate its function if the delegation can stand three tests.
(1) It must be a delegation in respect of a subject or matter which is within the scope of the legis lative power of the body making the delegation.
(2) Such power of delegation is not negatived by the instrument by which the legislative body is created or established.
And (3) it does not create another legislative body having the same powers and to discharge the same functions which it itself has, if the creation of such a body is prohibited by the instrument which establishes the legislative body it self.
It was urged that in the ease of an unwritten consti tution, like the British Parliament there can De no affirm ative limitation or negative prohibition against delegation and therefore the power of delegation is included to the fullest extent within the power of legislation.
The British Parliament can efface itself or even abdicate because it has a power to pass the next day a law repealing or annulling the previous day 's legislation.
When the British Parliament established legislative bodies in India, Canada and Austra lia by Acts of the British Parliament, the legislatures so established, although in a sense subordinate, because their existence depended on the Acts of the British Parliament and which existence could be terminated or further let tered by an Act of the British Parliament, neverthe less are supreme with plenary powers of the same nature as the British Parliament, on the subjects and matters within their respective legislative authority.
As the power of delegation is 767 included in the power of legislation, these legislative bodies have also, subject to the three limitations mentioned above, full power of delegation in their turn.
These legis lative bodies were not agents of the British Parliament.
Not being agents or delegates of the British Parliament, the doctrine delegata potestas non potest delegare cannot apply to their actions and if these legislatures delegate powers to some other authority to make rules or regulations, or authorise the executive government to enforce laws made by them or other legislatures wholly or in part and with or without restrictions or modifications, the legislatures are perfectly competent to do so.
The history of legislation in England and India and the other Dominions supports this contention.
It is recognised as a legislative practice and is seen in several Acts passed by the legislatures of the Dominions and in India.
Such delegation of the legislative functions has been recognised over a series of years by the Judicial Committee of the Privy Council and it is too late to contest the validity of such delegation.
It was lastly contended that the observations of the Federal Court in Jatindra Nath Gupta vs Province of Bihar(1), tending to show that delegation was not permissible, required to be recon sidered.
Before considering these arguments in detail, I think it is essential to appreciate clearly what is conveyed by the word "delegation ' '.
That word is not used, either in discus sions or even in some decisions of the courts, with the same meaning.
When a legislative body passes an Act it has exercised its legislative function.
The essentials of such function are the determination of the legislative policy and its formulation as a rule of conduct.
These essentials are the characteristics of a legislature by itself.
It has nothing to do with the principle of division of powers found in the Constitution of the United States of America.
Those essentials are preserved, when the legislature specifies the basic conclusions of fact, upon ascertainment of which, from relevant data, by a designated administrative agency, (1) 768 it ordains that its statutory command is to be effective.
The legislature having thus made its laws, it is clear that every detail for working it out and for carrying the enact ments into operation and effect may be done by the legisla ture or may be left to another subordinate agency or to some executive officer.
While this also is sometimes described as a delegation of legislative powers, in essence it is different from delegation of legislative power which means a determination of the legislative policy and formulation of the same as a rule of conduct.
I find that the word "delega tion" is quite often used without bearing this fundamental distinction in mind.
While the so called delegation, which empowers the making of rules and regulations, has been recognised as ancillary to the power to define legislative policy and formulate the rule of conduct, the important question raised by the Attorney General is in respect of the right of the legislature to delegate the legislative func tions strictly so called.
In support of his contention that the legislative power of the Indian Legislature carried with it the power of delegation, the Attorney General relied on several decisions of the Judicial Committee of the Privy Council and decisions of the Supreme Court of Canada and Australia.
The first is The Queen vs Burah(1).
Act XXII of 1869 of the Council of the Governor General of India for making laws and regula tions was an Act to remove the Garo Hills from the jurisdic tion of the tribunals established under the General Regula tions and Acts passed by any legislature in British India and provided that "no Act hereafter passed by the Council of the Governor General for making laws and regulations shall be deemed to extend to any part of the said territory unless the same was specifically named therein.
" The administration of civil and criminal justice within the said territory was vested in such officers as the Lieutenant Governor may from time to time appoint.
Sections 8 and 9 of the said Act provided as follows : (1) 51.
A. 178, 769 "Section 8.
The said Lieutenant Governor may from time to time, by notification in the Calcutta Gazette, extend to the said territory any law, or any portion of any law, now in force in the other territories subject to his Government, or which may hereafter be enacted by the Council of the Governor General ,or of the said Lieutenant Governor.
for making laws and regulations, and may on making such exten sion direct by whom any powers of duties incident to the provisions so extended shall be exercised or performed, and make any order which he shall deem requisite for carrying such provisions into operation." "Section 9.
The said Lieutenant Governor may from time to time, by notification in the Calcutta Gazette, extend mutatis mutandis all or any of the provisions contained in the other sections of this Act to the Jaintia Hills, the Nags Hills, and to such portion of the Khasi Hills as for the time being forms part of British India.
Every such notification shall specify the boundaries of the territories to which it applies.
" The Lieutenant Governor of Bengal issued a notification in exercise of the power conferred on him by section 9 and extended the provisions of the said Act to the territory known as the Khasi and Jaintia Hills and excluded therefrom the jurisdiction of the ordinary civil and criminal courts.
By a majority judgment the Calcutta High Court decided that the said notification had no legal force or effect.
In the Calcutta High Court, Mr. Kennedy, counsel for the Crown, boldly claimed for the Indian Legislative Council the power to transfer legislative functions to the Lieutenant Governor of Bengal and Markby J. framed the question for decision as follows: "Can the Legislature confer on the Lieutenant Governor legislative power?" Answer: "It is a general prin ciple of law in India that any substantial delegation of legislative authority by the Legislature of this country is void." Lord Selbourne after agreeing with the High Court that Act XXII of 1869 was within the legislative 770 power of the Governor General in Council, considered the limited question whether consistently with that view the 9th section of that Act ought nevertheless to be held void and of no effect.
The Board noticed that the majority of the Judges of the Calcutta High Court based their decision on the view that the 9th section was not legislation but was a delegation of legislative power.
They noticed that in the leading judgment Markby J. the principle of agency was relied upon and the Indian Legislature seemed to be regarded an agent delegate, acting under a man.date from the Imperial Parliament.
They rejected this view.
They observed: "The Indian Legislature has powers expressly limited by the Act of the Imperial Parliament.
which created it, and it can, of course, do nothing beyond the limits which circumscribe these powers.
But, when acting within those limits, it is not.
in any sense an agent or delegate of the Imperial Parliament, but has, and was intended to have, plenary powers of legislation, as large, and of the same nature as those of Parliament itself.
The established courts of justice, when a question arises whether the prescribed limits have been exceeded, must of necessity determine that question; and the only way in which they.
can properly do.
so, is by looking to the terms of the instrument by which, affirmatively, the legislative powers were created, and by which, negatively, they are restricted.
If what has been done is legislation, within the general scope of the affirm ative words which give the power, and if it violates no express condition or restriction by which that power is limited . it is not for any court of justice to inquire further, or to enlarge constructively those condi tions and restrictions.
"Their Lordships agree that the Governor General in Council could not, by any form of enactment, create in India and arm with general legislative authority, a new legislative power not created or authorised by the Councils Act.
Nothing of that kind has, in their Lordships opinion, been done or attempted in the present case.
What has been done is this.
The Governor General in Council has deter mined in the 771 due and ordinary course of legislation, to remove a particu lar district from the jurisdiction of the ordinary courts and offices, and to place it under new courts and offices, to be appointed by and responsible to the Lieut.
Governor of Bengal; leaving it to the Lieut.
Governor to say at what time that change shall take place; and also enabling him not to make what laws he pleases for that or any other district, but to apply by public notification to that district any law, or part of a law, which either already was, or from time to time might be, in force by proper legislative authority, in the other territories subject to his gov ernment.
The legislature determined that, so far, a certain change should take place; but that it was expedi ent to leave the time and the manner of carrying it into effect to the discretion of the Lieut.
Governor; and also, that the laws which were or might be in force in the other territories subject to the same Government were such as it might be fit and proper to apply to this district also; but that, as it was not certain that all those laws, and every part of them, could with equal convenience be so applied, it was expedient, on that point also, to entrust a discretion to the Lieut. Governor.
This having been done as to the Garo Hills, what was done as to the Khasi and.
Jaintia Hills ? The legislature decided that it was fit and proper that the adjoining district of the Khasi and Jaintia Hills should also be removed from the jurisdiction of the existing courts and brought under the same provisions with the Garo Hills . if and when the Lieut. Governor should think it desirable to do so; and that it was also possible that it might be expedient that not all, but some only, of those provisions should be applied to that adjoining district; and accordingly the legislature entrusted for these purposes also a discretionary power to the Lieut. Governor.
" The important part of the decision, dealing with the the question before them was in these terms : "Their Lordships think that it is a fallacy to speak of the 772 powers thus conferred upon the Lieut.
Governor (large as they undoubtedly are) as if, when they were exercised the efficacy of the acts done under them would be due to any other legislative authority than that of the Governor Gener al in Council.
Their whole operation is directly and imme diately under and by virtue of this Act (XXI of 1869) it self.
The proper legislature has exercised its judgment as to place, person, laws powers and the result of that judg ment has been to legislate conditionally as to all these things.
The conditions having been fulfilled, the legisla tion is now absolute.
Where plenary powers of legislation exist as to particular subjects, whether in an Imperial or in a Provincial Legislature, they may (in their Lordships judgment) be well exercised, either absolutely or condition ally.
Legislation, conditional on the use of particular powers, or on the exercise of a limited discretion, entrust ed by the legislature to persons in whom it places confi dence, is no uncommon thing;and, in many circumstances, it may be highly convenient.
The British Statute Book abounds with examples of it: and it cannot be supposed that the Imperial Parliament did not, when constituting the Indian Legislature, contemplate this kind of conditional legisla tion as within the scope of the legislative powers which is from time to time conferred.
It certainly used no words to exclude it." (The italics are mine).
They then mentioned by way of illustrations the power given to the Governor General in Council (not in his legislative capacity) to extend the Code of Civil Procedure and Code of Criminal Procedure by section 385, Civil Procedure Code.
and section 445, Criminal Procedure Code, to different territories.
They held that a different conclusion will be casting doubt upon the validity of a long series of legislation, appropriate, as far as they can judge, to the peculiar circumstances of India; great part of which belongs to the period antecedent to the year 1861, and must therefore be presumed to have been known to and in the view of, the Imperial Parliament, when the Coun cils Act of that year was passed.
For such doubt their Lordships were unable 773 to discover any foundation either in the affirmative or in the negative words of the Act before them.
I have quoted in extenso extracts from this judgment because it is considered the foundation for the argument advanced by the learned Attorney General.
In my opinion this judgment does not support the contention as urged.
The Privy Council noted the following:(1) That the Garo Hills were removed by the Act from the jurisdiction of the ordi nary courts.
(2) That in respect of the Khasi and Jaintia Hills the same position had been arrived at.
(:3) That the power was to be exercised over areas which, notwithstanding the Act, remained under the administrative control of the Lieut. Governor.
(4) That the authority given to the Lieut.
Governor was not to pass new laws but only to extend Acts which were passed by the Lieut.
Governor.
or the Gover nor General in respect of the Province both being competent legislatures for the area in question.
He was not given any power to modify any law.
(5) They rejected the view of the majority of the Judges of the Calcutta High Court that the Indian Legislature was a delegate or an agent of the British Parliament.
(6) That within the powers conferred on the Indian Legislature it was supreme and its powers were as plenary and of the same nature as the British Parliament.
(7) That by the legislation the Indian Parliament had not created a legislative body with all the powers which it had.
(8) The objection on the ground of delegation was rejected because what was done was not delegation at all but it was conditional legislation.
Throughout the judgment it is nowhere suggested that the answer of Markby J. to the ques tion framed by him (and quoted earlier in this judgment) was incorrect.
(9) It emphasized that the order of the Lieut Governor derived its sanction from the Act of the Governor General and not because it was an order of the Lieut.
Gover nor.
(10) That in the legislation of the Governor General in Council (legislative) all that was necessary to consti tute legislation was found.
This applied equally to future laws as the appropriate legislative body for the area was 774 the same.
This decision therefore carefully and deliberate ly did not endorse the contention that the power of delega tion was contained in the power of legislation.
The Board after affirming that what was done was no delegation at all held that the legislation was only conditional legislation.
In Emperor vs Benoari Lal Sarma and others (1), the question arose about the Special Criminal Courts Ordinance 1I of 1942, issued by the Governor General under the powers vested in him on the declaration of an emergency on the outbreak of war.
The validity of that Ordinance was chal lenged in India either (1) because the language of the section showed that the Governor General, notwithstanding the preamble, did not consider that an emergency existed but was making provision in case one should arise in future, or (2) else because the section amounted to what was called delegated legislation by which the Governor General without legal authority sought to pass the decision as to whether an emergency existed, to the Provincial Government instead of deciding it for himself.
The relevant provision of the Government of India Act, 1935, was in these terms: "72.
The Governor General may, in cases of emergency, make and promulgate ordinances for the peace and good gov ernment of British India or any part thereof, and any Ordi nance so made shall for the space of not more than six months from its promulgation, have the like force of law as an Act passed by the Indian Legislature;but the power of making Ordinances under this section is subject to the like restrictions as the power of the Indian Legislature to make laws; and any Ordinance made under this section is subject to the like disallowance as an Act passed by the Indian Legislature and may be controlled or superseded by any such Act.
" In rejecting this second objection, their Lordships observed that under paragraph 72 of Schedule 9, the Gover nor General himself must discharge the duty of (I) 72 I.A. 27.
775 legislation and cannot transfer it to other authorities.
But the Governor General had not delegated his legislative powers at all.
After stating again that what was done was not delegated legislation at all, but was.
merely an example of the not uncommon legislative arrangement by which the local application of the provision of a statute is deter mined by the judgment of a local administrative body as to its necessity, their Lordships disagreed with the majority view of the Federal Court that what was done was delegation of legislative functions.
If the power of delegation was contained in the power of legislation as wide as contended by the Attorney General, there appears no reason why the Privy Council should have rejected the argument that the Act was an act of delegation and upheld its validity on the ground that it was conditional legislation.
Moreover they reaffirmed the following passage from Russell vs The Queen (1): "The short answer to this objection (against delegation of legislative power) is that the Act does not delegate any legislative powers whatever.
It contains within itself the whole legislation on the matters with which it deals.
The provision that certain parts of the Act shall come into operation only on the petition of a majority electors does not confer on these persons powers to legislate.
Parliament itself enacts the condition and everything which is to follow upon the condition being fulfilled.
Conditional legislation of this kind is in many cases convenient, and is certainly not unusual, and the power so to legislate cannot be denied to the Parliament of Canada when the subject of legislation is within its competency." (The italics are mine).
Support for this last mentioned statement was found in the decision of the Privy Council in The Queen vs Burah(2).
It is clear that this decision does not carry the matter further.
Even though this was a war measure the Board emphasized that the Governor General must himself discharge the duty of legislation and cannot transfer it to other authorities.
They examined the impugned Act and (1) 7 App.
(2) 5 I.A. 178.
776 came to the conclusion that it contained within itself the whole legislation on the matters with which it dealt and there was no delegation of legislative functions.
A close scrutiny of these decisions and the observations contained therein, in my opinion, clearly discloses that instead of supporting the proposition urged by the Attorney General impliedly that contention is negatived.
While the Judicial Committee has pointed out chat the Indian Legislature had plenary powers to legislate on the subjects falling within its powers and that those powers were of the same nature and as supreme as the British Parliament, they do not endorse the contention that the Indian Legislature, except that it could not create another body with the same powers as it has, or in other words, efface itself, had unlimited powers of delegation.
When the argument of the power of the Indian Legislature to delegate legislative powers in that manner to subordinate bodies was directly urged before the Privy Council, in each one of their deci sions the Judicial Committee has repudiated the suggestion and held that what was done was not delegation but was subsidiary legislation or conditional legislation.
Thus while the Board has reiterated its views that the powers of the Indian Legislature were "as plenary and of the same nature as the British Parliament" no one, in no case, and in no circumstances, during the last seventy years, has stated that the Indian Legislature has power of delegation (as contended in this case) and which would have been a direct, plain, obvious and conclusive answer to the argument.
Instead of that, they have examined the impugned legislation in each case and pronounced on its validity on the ground that it was conditional or subsidiary legislation.
The same attitude is adopted by the Privy Council in respect of the Canadian Constitution.
The expressions "subsidiary" or "conditional legislation" are used to indicate that the powers conferred on the subordinate bodies were not powers of legislation but powers conferred only to carry the enact ment into operation and effect, or that the Legislature having discharged legislative functions had specified the basic conclusions of fact upon 777 ascertainment of which, from relevant data by a designated administrative agency, that body was permitted to bring the statute into operation.
Even in such cases the Board has expressly pointed out that the force of.
these rules, regu lations or enactments does not arise out of the decision of the administrative or executive authority to bring into operation the enactment or the rules framed thereunder.
The authoritative force and binding nature of the same are found in the enactment passed by the legislature itself.
Therefore, a correct reading of these decisions does not support the contention urged by the Attorney General.
Some decisions of the Privy Council on appeal from the Supreme Court of Canada and some decisions of the Supreme Court of Canada, on the point under discussion, on which the learned Attorney General relied for his contention, may be noticed next.
In Hodge vs The Queen(1), which was an appeal from the Court of Appeal, Ontario, Canada, a question about the validity of the Liquor Licences Act arose.
After hold ing that the temperance laws were under section 92 of the British North America Act for "the good government", their Lordships considered the objection that the Imperial Parlia ment had conferred no authority on the local legislature to delegate those powers to the Licence Commissioners.
In other words, it was argued that the power conferred by the Imperial Parliament on the local legislature should be exercised in full by that body and by that body alone.
The maxim delegata potestas non potest delegare was relied upon to support the objection.
Their Lordships observed: "The objection thus raised by the appellants was founded on an entire misconception of the true character and position of the Provincial Legislatures.
They are in no sense delegates of, or acting under mandate from, the Imperial Parliament.
When the British North America Act enacted that there should be a legislature for Ontario and that its Legislative Assem bly should have exclusive authority to make laws for the Province and for Provincial purposes in relation to the matters (1) 9 App.
Cas.117.
778 enumerated in section 92, it conferred powers, not in any sense to be exercised by delegation from, or as agents of, the Imperial Parliament, but authority as plenary and as ample within the limits prescribed by section 92 as the Imperial Parliament in the plenitude of its power possessed and could bestow.
Within these limits of subjects and area the local legislature is supreme and has the same authority as the Imperial Parliament, or the Parliament of the Domin ion, would have had under like circumstances to confide to a municipal institution or body of its own creation authority to make byelaws or resolutions as to subjects specified the enactment, and with the object of carrying the enactment into operation and effect.
It is obvious that such authority is ancillary to legislation ' and without it an attempt to provide for vary ing details and machinery to carry them out might become oppressive or absolutely fail .
It was argued at the Bar that a legislature committing important regulations to agents or delegates effaces itself.
That is not so.
It retains its power intact and can whenever.
it pleases de stroy the agency it has created and set up another or take the matter directly into its own hands.
How far it shall seek the aid of subordinate agencies and how long it shall continue them are matters for the legislature and not for the courts of law to decide." (The italics are mine.) As regards the creation of new offences, their Lordships ob served that if byelaws or resolutions are warranted the power to enforce them seemed necessary and equally lawful.
This case also does not help the Attorney General.
It recognises only the grant of power to make regulations which are "ancillary to legislation".
In In re The Initiative and Referendum Act(1), the Act of the Legislative Assembly of Manitoba was held outside the scope of section 92 of the British North America Act inas much as it rendered the Lieut Governor powerless to prevent the Act from becoming actual law, if approved by the voters, even without his consent.
Their Lordships observed: "Section 92 of the (1) 779 Act of 1867 entrusts the legislative power in a Province to its legislature and to that legislature only.
No doubt a body with power of legislation on the subjects entrusted to it.so ample as that enjoyed by a Provincial Legislature in Canada could, while preserving its own capacity intact, seek the assistance of subordinate agencies as had been done in Hodge vs The Queen(1), but it does not follow that it can create and endow with its own capacity a new legislative power not created by the Act to which it owes its own exist ence.
" In In re George Edwin Gray(2), the question of delega tion of powers in respect of the War Measures Act, 19 14, came for consideration.
The provisions there were very similar to the Defence of India Act and the Rules made thereunder in India during the World War I.
In delivering judgment Sir Charles Fitzpatrick C.J. observed as follows: "The practice of authorising administrative bodies to make regulations to carry out the object of an Act instead of setting out all the details of the Act itself is well known and its legality is unquestioned. ' ' He rejected the argument that such power cannot be granted to the extent as to enable the express provisions of a statute to be amended or re pealed, as under the Constitution, Parliament alone is to make laws under the Canadian Constitution.
He observed that Parliament cannot indeed abdicate its function but within reasonable limits at any rate it can delegate its powers to the executive government.
Such powers must necessarily be subject to determination at any time by Parliament.
He observed: "I cannot however find anything in that Constitu tional Act which would impose any limitation on the authori ty of the Parliament of Canada to which the Imperial Parlia ment is not subject." Against the objection that such wide discretion should not be left to the executive he observed that this objection should have been urged when the regula tions were submitted to Parliament for its approval or better still when the War Measures Act was being discussed.
The Parliament was the delegating authority and it was for that body to put any (1) 9 App.
(2) 57 S.C.R. Canada 150.
780 limitations on the powers conferred upon the executive.
He then stated: "Our legislators were no doubt impressed in the hour of peril with the conviction that the safety of the country was the supreme law against which no other law can prevail.
It is clearly our duty to give effect to their patriotic intentions." In the Chemical Reference case(D, Duff C.J. set out the true effect of the decision in the War Measures Act.
He held that the decision of the Privy Council in the Fort Frances ' case(2) had decided the validity of the War Measures Act and no further question remained in that respect.
He stated: "In In re Gray(3) was involved the principle, which must be taken in this Court to be settled, that an Order in Council in conformity with the conditions prescribed by, and the provisions of, the War Measures Act may have the effect of an Act of Parliament." The Court considered that the regu lations framed by the Governor General in Council to safe guard the supreme interests of the State were made by the Governor General in Council "who was conferred subordinate legislative authority." He stated: "The judgment of the Privy Council in the Fort Frances ' case(2), laid down the principle that in an emergency, such as war, the authority of the Dominion in respect of legislation relating to the peace, order and good government of Canada may, in view of the necessities arising from the emergency, disable or over bear the authority of the Provinces in relation to a vast field in which the Provinces would otherwise have exclusive jurisdiction.
It must not however be taken for granted that every matter within the jurisdiction of the Parliament of Canada even in ordinary times could be validly committed by Parliament to the executive for legislative action in the case of an emergency.
" Unlike the Indian Constitution, in the British North America Act there is no power to suspend the Constitution or enlarge the legislative powers in an emergency like war.
The Courts therefore stretched the langugage of the sections to meet the emergen cy in (1) [1943] S.C.R. Canada 1.
(3) [1918] 57 S.C.R, Canada 150.
(2) 781 the highest interest of the country but it also emphasized that such action was not permissible in ordinary times.
The War Measures Acts were thus considered by the z Supreme Court of Canada on a different footing.
The question was of competence but owing to the unusual circumstances and exigencies what was stated in the legislation was considered a sufficient statement of the legislative policy.
It ap pears to be thought that the same test cannot be applied in respect of legislation made in normal times, in respect of a permanent statute which is not of limited duration.
The discussion in Benaori Lal Sarma 's case(1) in the judgment of the Privy Council mentioned above may be usefully noted in this connection as the legislation in that case was also a war measure but was held valid as conditional legislation.
In so far as the observations in the Canadian decisions go beyond what is held in the Privy Council decisions, with respect, I am unable to agree.
It appears that the word "delegation" has been given an extended meaning in some observations of the Canadian courts, beyond what is found in the Privy Council decisions.
It is important to notice that in all the judgments of the Privy Council, the word "delega tion" as meaning conferment of_legislative functions strict ly, is not used at all in respect of the impugned legisla tion and has been deliberately avoided.
Their validity was upheld on the ground that the legislation was either conditional or subsidiary or ancillary legislation.
An important decision of the Supreme Court of Australia may be noticed next.
In the Victorian Stevedoring and Gener al Contracting Company Proprietary Ltd. vs Dignan(2), the question whether delegation of legislative power was accord ing to the Constitution came to be examined by the High Court of Australia.
It was argued that section 3 of the Act in question was ultra vires and void in so far as it pur ported to authorise the Governor General to make regulations which (nothwithstanding anything in any other Act) shall have (1) 72 I.A. 27.
(2) 782 the force of law.
In the judgment of Gavan Duffy C.J. and Starke J. it was stated: "The attack upon the Act itself was based upon the American Constitutional doctrine that no legislative body can delegate to another department of the Government or to any other authority the power either gener ally or specially to enact laws.
This high prerogative has been entrusted to its own wisdom, judgment and patriotism and not to those of other persons and it will act ultra vires ii it undertakes to delegate the trust instead of executing it.
(Cooley 's Principles of Constitutional Law, 3rd Edition, p. 111).
Roche vs Kronheimer(1) was an authori ty for the proposition that an authority of subordinate law making may be invested in the executive.
Whatever ,may be said for or against that decision I think we should not now depart from it." Mr. Justice Dixon considered the argu ment fully in these terms: "The validity of this provision is now attacked upon the ground that it is an attempt to grant to the executive a portion of the legislative power vested by the Constitution in the Parliament which is incon sistent with the distribution made by the Constitution of legislative, executive and judicial powers.
In support of the rule that Congress cannot invest another organ of gov ernment with legislative power a second doctrine is relied upon in America but it has no application to the Australian Constitution.
Because the powers of Government are consid ered to be derived from the authority of the people of the Union no agency to whom the people have confided a power may delegate its exercise.
The well known maxim delegata potesta non potest delegare applicable to the law of agency in the general and Common Law is well understood and has had wider application in the construction of our Federal and State Constitutions than it has in private laws.
No similar doc trine has existed in respect of British Colonial legisla tures, whether erected in virtue the prerogative or by Imperial Statute.
It is important to observe that in Ameri ca the intrusion of the doctrines of agency into Constitu tional interpretation (1) (1921) 29 Corn.
L.R. 329.
783 has in no way obscured the operation of the separation of powers.
In the opinion of the Judicial Committee a general power of legislation belonging to a legislature constituted under a rigid Constitution does not enable it by any form of enactment to create and arm with general legislative authority a new legislative power not created or authorized by the instrument by which it is established.
" In respect of the legislation passed during the emergency of war and where the power was strongly relied upon, Dixon J. observed: "It might be considered that the exigencies which must be dealt with under the defence power are so many, so great and so urgent and are so much the proper concern of the execu tive that from its very nature the power appears by neces sary intendment to authorise a delegation otherwise general ly forbidden to the legislature . .
I think it certain that such a provision would be supported in America and the passage in Burah 's case appears to apply to it in which the Judicial Committee deny that in fact any delega tion there took place . .
This does not mean that a law confiding authority to the executive will be followed, however extensive or vague the subject matter may be, if it does not fall outside the boundaries of federal power.
Nor does it mean that the distribution of powers can supply no considerations or weight affecting the validity . .
It may be acknowledged that the manner in which the Constitution accomplishes the separation of power itself logically and theoretically makes the Par liament the executive repository of the legislative power of the Commonwealth.
The existence in Parliament of power to authorise subordinate legislation may be ascribed to a conception of that legislative power which depends less upon juristic analysis and perhaps more upon the history and usages of British legislation and the theories of English law . .
Such subordinate legislation remains under Parliamentary control and is lacking in the independent and unqualified authority which is an attribute of true legisla tive power." He concludes: " But whatever it may be, we should now adhere to the interpretation 784 which results from the decision of Roche vs Kronheimer(1).
This whole discussion shows that the learned Judge 12,was refuting the argument that because under the Consti tution of U.S.A. such conferment of power would be invalid it should be held invalid under the Canadian Constitution also.
He was not dealing with the question raised before us.
Ultimately he said that Roche vs Kronheimer(1) was conclu sive.
Mr. Justice Evatt stated that in dealing with the doctrine of the separation of legislative and executive powers "it must be remembered that underlying the Common wealth frame of government there is the notion of the British system of an executive which is responsible to Parliament.
That system is not in operation under the United States ' Constitution.
He formulated the larger proposition that every grant by the Commonwealth Parliament of authority to make rules and regulations, whether the grantee is the executive government or some such authority, is itself a grant of legislative power.
The true nature and quality of the legislative power of the Commonwealth Parlia ment involves as a part of its content power to confer law making powers upon authorities other than Parliament itself.
If such power to issue binding commands may lawfully be granted by Parliament to the executive or other agencies an increase in the extent of such power cannot of itself inval idate the grant.
It is true that the extent of the power granted will often be a very material circumstance in the examination of the validity of the legislation conferring the grant.
" In this paragraph the learned Judge appears certainly to have gone much beyond what had been held in any previous decision but he seems to have made the observations in those terms because (as he himself had stated just previ ously) in his view every conferment of power whether it was by conditional legislation or ancillary legislation was a delegation of legislative power.
He concluded however as follows:"On final analysis therefore the (1) (1921) 29 Corn.
L.R. 329.
785 Parliament of the Commonwealth is not competent to abdicate its powers of legislation.
This is not because Parliament is bound to perform any or all of its legislative powers or functions for it may elect not to do so and not because the doctrine of the separation of powers prevents Parliament from granting authority to other bodies to make laws or byelaws and thereby exercise legislative power for it does so in almost every statute but because each and every one of the laws passed by Parliament must answer the description of law upon one or more of the subject matters stated in the Constitution.
A law by which Parliament gives all its lawmaking authority to another body would be bad merely because it would fail to pass the test last mentioned.
"Read properly, these judgments therefore do not support the contention of the learned Attorney General.
The decisions of the Privy Council on appeal from Canada do not carry the matter further.
In the judgments of the two decisions of the Supreme Court of Canada and the deci sion of the Supreme Court of Australia there are observa tions which may appear to go beyond the limit mentioned above.
These observations have to be read in the light of the facts of the case and the particular regulation or enactment before the court in each case.
These decisions also uniformly reiterate that the legislature must perform its functions and cannot leave that to any other authority.
Moreover the word "delegation" as stated by Evatt J. in his judgment is understood by some Judges to cover what is described as subsidiary or conditional legislation also.
Therefore because at some places in these judgments the word "delegation" is used it need not be assumed that the word necessarily means delegation of legislative functions, as understood in the strict sense of the word.
The actual decisions were on the ground that they were subordinate legislation or conditional legislation.
Again, in respect of the Constitutions of the Dominions of Canada and Austra lia I may observe that the legislatures of those Dominions were not packed, as in India, and their Constitution was 786 on democratic lines.
The principle of fusion of powers between the Legislature and Executive can well be considered in operation in those Dominions, while as I have pointed out above there was no such fusion at all so far as the Indian Constitution in force till 1935 was concerned.
Conclusions therefore based on the fusion of legislative and executive powers are not properly applicable to the Indian Constitu tion.
In my opinion therefore to the extent the observa tions in the Canadian and Australian decisions go beyond what is clearly decided by the Privy Council in respect of the Indian Legislature, they do not furnish a useful guide to determine the powers of the Indian Legislature to dele gate legislative functions to administrative or executive authorities.
The Canadian and Australian Constitutions are both based on Acts of the British Parliament and therefore are crea tures of written instruments.
To that extent they are rigid.
Moreover in the Australian Constitution in distribut ing the powers among the legislative and executive authori ties, the word "vest" is used as in the Constitution of the U.S.A.
To that extent the two Constitutions have common features.
There is however no clear.
separation of powers between the legislature and executive so as to be mutually and completely exclusive and there is fusion of power so that the Ministers are themselves members of the legisla ture.
Our attention was drawn to several decisions of the Supreme Court of the United States of America mostly to draw a distinction between the legislative powers of the Congress in the United States of America and the legislative powers of the legislature under Constitutions prepared on the British Parliament pattern.
It was conceded that as the Constitution itself provided that the legislative and execu tive powers were to vest exclusively in the legislature and the executive authority mentioned in the Constitution, it was not permissible for one body to delegate this authority and functions to another body.
It may be noticed that several decisions of the Supreme Court of U.S.A, 787 are based on the incompetence of the delegate to receive the power sought to be conferred on it.
Its competence to function as the executive body is expressly set out in the Constitution, and it has been thought that impliedly the Constitution has thereby prevented such body from receiving from the legislative body other powers.
In view of my final conclusion I shall very briefly notice the position accord ing to the U.S.A. Constitution.
In Crawford on Statutory Construction, it is stated as follows: "So far however as the delegation of any power to an executive official or Administrative Board is concerned, the legislature must declare the policy of the law and fix the legal principles which are to control in given cases and must provide a standard to guide the official or the ,Board empowered to execute the law.
This standard must not be too indefinite or general.
It may be laid down in broad general terms.
It is sufficient if the legislature will lay down an intelligible principle to guide the executive or administra tive official .
From these difficult criteria it is apparent that the Congress exercises considerable liberali ty towards upholding legislative delegations if a standard is established.
Such delegations are not subject to the objection that the legislative power has been unlawfully delegated.
The filling in mere matters of details within the policy of, and according to, the legal principles and stand ards, established by the Legislature, is essentially minis terial rather than legislative in character, even ' if considerable discretion is conferred upon the delegated authority.
" In Hampton & Co. vs United States(1), Taft C.J. ob served: "It is a breach of the national fundamental law if Congress gives up its legislative power and transfers it to the President or to the judicial branch or if by law it attempts to invest itself or its members with either execu tive or judicial power.
This is not to say that the three branches are not co ordinate parts of one Government and that each in the field of duties (1) ; , 406 & 407.
788 may not invoke the action of the two other branches in so far as the action invoked shall not be an assumption of the constitutional field of action of another branch .
The field of Congress involves all and many varieties of legislative action and Congress has found it frequently necessary to use officers of the executive branch within defined limits to secure the exact effect intended by its act of legislation by vesting discretion in such officers to make public regulations, interpreting a statute and direct ing the details of its executive even to the extent of providing for penalizing a preach of such regulations . .
Congress may feel itself unable conveniently to determine exactly when its exercise of the legislative power should become effective, because dependent on future conditions, and it may leave the determination of such time to the decision of an executive.
" He agreed with the often cited passage from the judgment of Ranny J. of the Supreme Court of Ohio in Cincinnati W. & Z.R. Co. vs Clin ton County Commissioners (1), viz., "The true distinction therefore is between the delegation of power to make the law which necessarily involves a discretion as to what it shall be and conferring an authority or discretion as to its execution to be exercised under and in pursuance of the law.
The first cannot be done; to the latter no valid objection can be made.
" In Locke 's Appeal(2), it.
is slated: "The proper dis tinction is this.
The legislature cannot delegate its power to make a law but it can make a law to delegate a power to determine some fact or state of things upon which the law makes or intends to make its own action depend.
To deny this would be to stop the wheels of Government.
There are many things upon which useful legislation must depend, which cannot be known to the law making power, and must therefore be a subject of enquiry and determination outside the halls of legislature." In Panama Refining Co. vs Ryan (s), it was observed by Hughes C.J. "The Congress is not permitted to (1) (3) ; (2) , 789 abdicate or transfer to others the essential legislative functions with which it is vested.
Undoubtedly legislation must often be adapted to complex conditions involving a host of details with which the National Legislature cannot deal directly.
The Constitution has never been regarded as denying to the Congress the necessary resources of flexibil ity and practicality which will enable it to perform its function in laying down policies and establish standards, while leaving to selected instrumentalities the making of subordinate rules within prescribed limits and the determi nation of facts to which the policy as declared by the legislature is to apply.
Without capacity to give authori sations of that sort we should have the anomaly of a legis lative power which in many circumstances calling for its exertion would be but a futility but the constant recogni tion of the necessity and validity of such provisions and the wide range of administrative authority which has been declared by means of them cannot be allowed to obscure the limitations of the authority to delegate if our constitu tional system is to be maintained.
Similarly, in Schechter vs United States (1), it is stated: "So long as the policy is laid down and standard established by a statuten no unconstitutional delegation of legislative power is involved in leaving to selected instrumentalities the making of subordinate rules within prescribed limits and the determi nation of facts to which the policy as declared by the legislature is to apply.
" The complexity of this question of delegation of power and the consideration of the various decisions in which its application has led to the support or invalidation of Acts has been somewhat aptly put by Schwartz on American Adminis trative Law.
After quoting from Wayman vs Southend (2) the observations of Marshall C.J. that the line has not been exactly drawn which separates those important subjects which must be entirely regulated by the legislature itself from those of less interest in which a general provision may be made and power given to those who are to (1) (2) ; U.S. 1825.
790 act under such general provision to fill up details, the author points out that the resulting judicial dilemma, when the American courts finally were squarely confronted with delegation cases, was resolved by the judicious choice of words to describe the word "delegated power".
The authority transferred was, in Justice Holmes ' felicitous phrase, "softened by a quasi", and the courts were thus able to grant the fact of delegated legislation and still to deny the name.
This result is well put in Prof. Cushman 's syllo gism: "Major premise: Legislative power cannot be constitu tionally delegated by Congress.
Minor premise: It is essential that certain powers be delegated to administrative officers and regulatory commis sions.
Conclusions: Therefore the powers thus delegated are not legislative powers.
They are instead administrative or quasi legislative powers. ' ' It was argued on behalf of the President that the legis lative practice in India for over eighty years has recog nised this kind of delegation and as that is one of the principles which the court has to bear in mind in deciding the validity of Acts of the legislature, this Court should uphold that practice.
In support of this contention a sched ule annexed to the case filed on behalf of the President, containing a list of Acts, is relied upon.
In my opinion, out of those, the very few Acts which on a close scrutiny may be cited as instances, do not establish any such prac tice.
A few of the instances can be supported as falling under the description of conditional legislation or subsid iary legislation.
I do not discuss this in greater detail because unless the legislative practice is overwhelmingly clear, tolerance or acquiescence in the existence of an Act without a dispute about its validity being raised in a court of law for some years cannot be considered binding, when a question about the validity of such practice is raised and comes for decision before the Court.
In my opinion, there fore; this broad 791 contention of the Attorney General that the Indian Legisla ture prior to 1935 had power to delegate legislative func tions in the sense contended by him is neither supported by judicial decisions nor by legislative practice.
A fair and close reading and analysis of all these decisions of the Privy Council, the judgments of the Supreme Courts of Canada and Australia without stretching and straining the words and expressions used therein lead me.
to the conclusion that while a legislature, as a part of its legislative functions, can confer powers to make rules and regulations for carrying the enactment into operation and effect, and while a legislature has power to lay down the policy and principles providing the rule of conduct, and while it may further provide that on certain data or facts being found and ascertained by an executive authority, the operation of the Act can be extended to certain areas or may be brought into force on such determination which is de scribed as conditional legislation, the power to delegate legislative functions generally is not warranted under the Constitution of India at any stage.
In cases of emergency, like war where a large latitude has to be necessarily left in the matter of enforcing regulations to the executive, the scope of the power to make regulations is very wide, but.
in those cases the suggestion that there was delega tion of "legislative functions" has been repudiated.
Simi larly, varying according to the necessities of the case and the nature of the legislation, the doctrine of conditional legislation or subsidiary legislation or ancillary legisla tion is equally upheld under all the Constitutions.
In my opinion, therefore, the contention urged by the learned Attorney General that legislative power carries with it a general power to delegate legislative functions, so that the legislature may not define its policy at all and may lay down no rule of conduct but that whole thing may be left either to the executive authority or administrative or other body, is unsound and not supported by the authorities on which he relies.
I do not think that apart from the sover eign character of 792 the British Parliament which is established as a matter of convention and whose powers are also therefore absolute and unlimited, in any legislature of any other country such general powers of delegation as claimed by the Attorney General for a legislature, have been recognised or permit ted.
It was contended by the learned Attorney General that under the power of delegation the legislative body cannot abdicate or efface itself.
That was its limit.
It was argued that so long as the legislature had power to control the actions of the body to which power was delegated, that so long as the actions of such body were capable of being revoked there was no abdication or effacement.
In support of this argument some reliance was placed on certain obser vations in the judgments of the Privy Council in the cases mentioned above.
It should be noticed that the Board was expressing its views to support the conclusion that the particular piece of legislation under consideration was either a conditional legislation or that the legislation derived its force and sanction from what the legislature had done and not from what the delegate had done.
I do not think that those observations lead to the conclusion that up to that limit legislative delegation was permitted.
The true test in respect of ' 'abdication" or "effacement" appears to be whether in conferring the power to the delegate, the legislature, in the words used to confer the power, retained its control.
Does the decision of the delegate derive sanc tion from the act of the delegate or has it got the sanction from what the legislature has enacted and decided ? Every power given to a delegate can be normally called back.
There can hardly be a case where this cannot be done because the legislative body which confers power on the delegate has always the power to revoke that authority and it appears difficult to visualize a situation in which such power can be irrevocably lost.
It has been recognised that a legisla tive body established under an Act of the British Parliament by its very establishment has not the right to create anoth er legislative body with the same junctions and 793 powers and authority.
Such power can be only in the British Parliament and not in the legislature established by an Act of the British Parliament.
Therefore, to say that the true test of effacement is that the authority which confers power on the subordinate body should not be able to withdraw the power appears to be meaningless.
In my opinion, therefore, the question whether there is "abdication" and "effacement" or not has to be decided on the meaning of the words used in the instrument by which the power is conferred on the au thority.
Abdication, according to the Oxford Dictionary, means abandonment, either formal or virtual, of sovereignty.
Abdication by a legislative body need not necessarily amount to a complete effacement of it.
Abdication may be partial or complete.
When in respect of a subject in the Legisla tive List the legislature says that it shall not legislate on that subject but would leave it to somebody else to legislate on it, why does it not amount to abdication or effacement ? If full powers to do anything and everything which the legislature can do are conferred on the subordi nate authority, although the legislature has power to control the action of the subordinate authority, by recall ing such power or repealing the Acts passed by the subordi nate authority, the power conferred by the instrument, in my opinion, amounts to an abdication or effacement of the legislature conferring such power.
The power to modify an Act in its extension by the order of the subordinate authority has also come in for considera ble discussion.
Originally when power was conferred on the subordinate authority to apply existing legislation to specified areas it was given only to apply the whole or a portion thereof.
That power was further expanded by giving a power to restrict its application also.
In the next stage power was given to modify "so as to adapt the same" to local conditions.
It is obvious that till this stage the clear intention was that the delegate on whom power was con ferred was only left with the discretion to apply what was Considered suitable, as a whole or in part, 794 and to make adaptations which became necessary because of local conditions and nothing more.
Only in recent years in some Acts power of modification is given without any words of limitation on that power.
The learned Attorney General contended that the word "modify" according to the Oxford Dictionary means to limit, restrain, to assuage, to make less severe, rigorous, or decisive ;to tone down.
" It is also given the meaning "to make partial changes in;to alter without radical transformation." He therefore contended that if the done of the power exceeded the limits of the power of modification beyond that sense, that would be exceeding the limits of the power and to that extent the exercise of the power may be declared invalid.
He claimed no larger power under the term "modification.
" On the other hand, in Rowland Burrows ' "Words and Phrases ", the word "modify" has been defined as meaning" vary, extend or enlarge, limit or restrict.
" It has been held that modification implies an alteration.
It may narrow or enlarge the provisions of the former Act.
It has been pointed out that under the powers conferred by the , the Central Government has extended the application of the Bombay Debtors ' Relief Act to Delhi.
The Bombay Act limits its application to poor agriculturists whose agricultural income is less than Rs. SO0.
Under the power of modification conferred on it by the , the Central Government has removed this limit on the income, with the result that the principles, policy and machinery to give relief to poor peasants or agriculturists with an income of less than Rs. 500 is made applicable in Delhi to big landowners even with an income of 20 lakhs.
This shows how the word ' 'modification" is understood and applied by the Central Government and acqui esced in by the Indian Legislature.
I do not think such power of modification as actually exercised by the Central Government is permitted in law.
If power of modification so understood is permitted, it will be open to the Central Legislature in effect to change the whole basis of the legislation and the reason for making the 795 law.
That will be a complete delegation of legislative power, because in the event of the exercise of the power in that manner the Indian legislature has not applied its mind either to the policy under which relief should be given nor the class of persons, nor the circumstances nor the machin ery by which relief is to be given.
The provisions of the Rent Restriction Act in different Provinces are an equally good example to show how dangerous it is to confer the power of modification on the executive government.
Having considered all the decisions which were cited before us and giving anxious consideration to the elaborate and detailed arguments advanced by the learned Attorney General in the discussion of this case, I adhere to what I stated in Jatindra Nath Gupta 's case(1) that the power of delegation, in the sense of the legislature conferring power, on either the executive government or another author ity, "to lay down the policy underlying a rule of conduct" is not permitted.
The word "delegation ", as I have pointed out, has been somewhat loosely used in the course of discus sion and even by some Judges in expressing their views.
As I have pointed out throughout the decisions of the Privy Council the word "delegation" is used so as not to cover what is described as conditional legislation or subsidiary or ancillary legislation, which means the power to make rules and regulations to bring into operation and effect the enactment.
Giving "delegation" the meaning which has always been given to it in the decisions of the Privy Council, what I stated in Jatindra Nath Gupta 's case, as the legisla ture not having the power of delegation is, in my opinion, correct.
Under the new Constitution of 1950, the British Parlia ment, i.e. an outside authority, has no more control over the Indian Legislature.
That Legislature 's powers are de fined and controlled and the limitations thereon prescribed only by the Constitution of India.
But the scope of its legislative power has not become (1) 796 enlarged by the provisions found in the Constitution of India.
While the Constitution creates the Parliament and although it does not in terms expressly vest the legislative powers in the Parliament exclusively, the whole scheme of the Constitution is based on the concept that the legisla tive functions of the Union will be discharged by the Par liament and by no other body.
The essential of the legisla tive functions, viz., the determination of the legislative policy and its formulation as a rule of conduct, are still in the Parliament or the State Legislatures as the case may be and nowhere else.
I take that view.because of the provi sions of article 357 and article 22 (4) of the Constitution of India.
Article 356 provides against the contingency of the failure of the constitutional machinery in the States.
On a proclamation to that effect being issued, it is provid ed in article 357 (1) (a) that the power of the legislature of the State shall be exercisable by or under the authority of the Parliament, and it shall be competent for the Parlia ment to confer on the President the power of the legislature of the State to make laws "and to authorise the President to delegate, subject to such conditions as he may think fit to impose.
the powers so conferred to any other authority to be specified by him in that behalf.
" Sub clause (b) runs as follows : " For Parliament, or for the President or other authority in whom such power to make laws is vested under sub cl.
(a), to make laws conferring powers and imposing duties, or authorising the conferring of powers and the imposition of duties, upon the Union or officers and author ities thereof.
" It was contended that on the breakdown of such machinery authority had to be given to the Parliament or the President, firstly, to make laws in respect of sub jects on which the State Legislature alone could otherwise make laws and, secondly, to empower the Parliament or the President to make the executive officers of the State Gov ernment to act in accordance with the laws which the Parlia ment or the President may pass in such emergency.
It was argued that for this purpose the word "to delegate" is used.
I do not think this argument is sound.
Sub clause (2) re lates to the power 797 of the President to use the State executive officers.
But under clause (a) Parliament is given power to confer on the President the power of the legislature of the State to make laws.
Article 357 (1) (a) thus expressly gives power to the Parliament to authorise the President to delegate his legis lative powers.
If powers of legislation include the power of delegation to any authority there was no occasion to make this additional provision in the article at all.
The word ing of this clause therefore supports the contention that normally a power of legislation does not include the power of delegation.
Article 22 (4) again is very important in this connec tion.
It deals with preventive detention and provides that no law shall be valid which will permit preventive detention of a person for a period over three months, unless the conditions laid down in article 22 (4) (a) are complied with.
The exception to this is in respect of an Act of the Parliament made on the conditions mentioned in article 22 (4) (b).
According to that, the Parliament has to pass an Act consistently with the provisions of article 22 (7).
The important point is that in respect of this fundamental right given to a person limiting the period of his detention up to three months, an exception is made in favour of the Parlia ment by the article.
It appears to me a violation of the provisions of this article on fundamental rights to suggest that the Parliament having the power to make a legislation within the terms of article 22(7) has the power to delegate that right in favour of the executive government.
In my opinion, therefore the argument that under the Constitution of 1950 the power of legislation carries with it the power of delegation, in the larger sense, as contended by the Attorney General cannot be accepted.
Having regard to the position of the British Parliament, the question whether it can validly delegate its legislative functions cannot be raised in a court of law.
Therefore from the fact that the British Parliament has delegated legisla tive powers it does not follow.
that the power of delegation is recognised in law as necessarily included in the power of legislation, Although 798 in the Constitution of India there is no express separation of powers, it is clear that a legislature is created by the Constitution and detailed provisions are made for making that legislature pass laws.
Is it then too much to say that under the Constitution the duty to make laws, the duty to exercise its own wisdom, judgment and patriotism in making laws is primarily cast on the legislatures ? Does it not imply that unless it can be gathered from other provisions of the Constitution, other bodies, executive or judicial, are not intended to discharge legislative functions ? I am unable to read the decisions to which our attention has been drawn as laying down that once a legislature observes the procedure prescribed for passing a bill into an Act, it becomes a valid law, unless it is outside the Legislative Lists in the Seventh Schedule prescribing its respective powers.
I do not read articles 245 and 246 as covering the question of delegation of legislative powers.
In my opinion, on a true construction of articles 245 and 246 and the Lists in the Seventh Schedule, construed in the light of the judicial decisions mentioned above, legislation delegating legislative powers on some other bodies is not a law on any of the subjects or entries mentioned in the Legislative Lists.
It amounts to a law which states that instead of the legislature passing laws on any subject covered by the entries, it confers on the body mentioned in the legislation the power to lay down the policy of the law and make a rule of conduct binding on the persons covered by the law.
As a result of considering all these decisions together it seems to me that the legislature in India, Canada, Aus tralia and the U.S.A. has to discharge its legislative functions, i.e., to lay down a rule of conduct.
In doing so it may, in addition, lay down conditions, or state facts which on being fulfilled or ascertained according to the decision of another body or the executive authority, the legislation may become applicable to a particular area.
This is described as conditional legislation.
The legislature may also, in laying down the rule of conduct, express itself generally if the conditions and circumstances so require.
The extent of the 799 specific and detailed lines of the rule of conduct to be laid down may vary according to the circumstances or exigen cies, of each case.
The result will be that if, owing to unusual circumstances or exigencies, the legislature does not choose to lay down detailed rules or regulations, that work may be left to another body which is then deemed to have subordinate legislative powers.
Having regard to the distinction noticed above between the power of delegation of legislative functions and the authority to confer powers which enables the donee of the power to make regulations or rules to bring into effect or operation the law and the power of the legislature to make conditional legislation, I shall proceed to consider the three specific questions mentioned in the Reference.
It may be noticed that occasions to make legislation of the type covered by the three sections mentioned in the three ques tions began in the early stages of the occupation of India where small bits of territories were acquired and in respect of which there was no regular legislative body.
It was thought convenient to apply to these small areas laws which were made by competent ' legislature in contiguous areas.
That practice was adopted to avoid setting up a separate, sometimes inconvenient and sometimes costly, machinery of legislation for the small area.
Nor might it have been considered possible for the Governor General in Council to enact laws for the day to day administration of such bits of territory or for all their needs having regard to different local conditions.
As local conditions may differ to a cer tain extent, it appears to have been considered also conven ient to confer powers on the administrator to apply the law either in whole or in part or to restrict its operation even to a limited portion of such newly acquired area.
This aspect of legislation is prominently noticed in Act XXII of 1869 discussed in The Queen vs Burah(1).
Under section 22 of the Indian Councils Act of 1861, the Governor General in Council was given power to make laws for all persons and for all places and things whatever within British India.
The Province of Delhi was carved out of the Province of Punjab and was put (1) 5 I.A. 178. 800 under a Chief Commissioner and by section 2 of the the laws in force in the Punjab continued to be operative in the newly created Province of Delhi.
The Province of Delhi had not its legislative body and so far as this Chief Commissioner 's Province is concerned it is not disputed that the power to legislate was in the Governor General in Council in his legislative capacity.
The first question as worded has to be answered according to the powers and position of the legislature in 1912.
Section 7 of the enables the Government (executive) to extend by notification with such restrictions and modifica tions as it thinks fit, to the Province of Delhi or any part thereof, any enactment which is in force in any part of British India, at the date of such notification, i.e., a law which was in force not necessarily in the Province of Punjab only, from which the Province of Delhi was carved out, but any Central or provincial law in force in any Province.
Again, the Government is given power to extend any such law with such restrictions and modifications as it thinks fit.
Moreover it enables the Provincial Government to extend an Act which is in force "at the date of such notification.
" Those words therefore permit extension of future laws which may be passed either by the Central or any Provincial legis lature, also with such restrictions and modifications as the Provincial Government may think fit.
At this stage, sections 8 and 9 of Act XXII of 1869 under which powers were given to the Lieut.
Governor in The Queen vs Burah(1) may be com pared.
They permitted the extension of Acts which were or might be made by the Governor General in Council (legisla tive) or the Lieut.
Governor, both of whom were the competent legislative authorities for the whole area under the admin istrative jurisdiction of the Lieut. Governor.
The power was confined to extend only those Acts, over the area specified in Act XXII of 1869, although that area was declared by Act XXII of 1869 as not subject to the laws of the Province, unless the area was specifically mentioned in the particular Act.
On (1) 5 I.A. 178.
801 the authority of that decision therefore, so far as section 7 of the gives power to the executive (Cen tral) Government to extend Acts passed by the Central Legis lature to the Province of Delhi, the same may be upheld.
The question then remains in respect of the power of the executive government to extend Acts of other Provincial legislatures (with or without restrictions or modifications) to the Chief Commissioner 's Province.
It is obvious that in respect of these Acts the Central Legislature has not ap plied its mind at all.
It has not considered whether the Province of Delhi requires the rule of conduct laid down in those Acts, as necessary or beneficial for the welfare of the people of the Province or for its government.
They are passed by other Provincial legislatures according to their needs and circumstances.
The effect of section 7 of the therefore in permitting the Central Govern ment to apply such Provincial Acts to the Province of Delhi is that, instead of the Central Legislature making up its mind as to the desirability or necessity of making laws on certain subjects in respect of the Province of Delhi, that duty and right are conferred on the executive government.
For example, the question whether a rent act, or an excise act, or what may be generally described as a prohibition act, or a debt relief act is desirable or necessary, as a matter of policy for the Province of Delhi is not considered and decided by the Central Legislature which, in my opinion, has to perform that duty, but that duty and function without any reservation is transferred over to the executive govern ment.
Section 7 of the thus contains an entirely different quality of power from the quality of power conferred by sections 8 and 9 of Act XXII of 1869.
All the decisions of the Privy Council unequivocally affirm that it is not competent for the Indian Legislature to create a body possessing the same powers as the Central Legislature itself.
It is stated that the legislature cannot efface itself.
One may well ask, if section 7 of the has done 802 anything else.
The Privy Council decisions emphasize two aspects in respect of this question.
The first is whether the new body is empowered to make laws.
The second is, does the sanction flow from the legislation made by the legisla ture or from the decision of the newly created body.
As regards the first, it is obvious that in principle there is no difference if the newly created body itself writes out on a sheet of paper different sections of an Act or states that the Act will be what is written or printed on another clear ly identifiable paper.
Therefore if such new body says that the law in Delhi will be the same as Bombay or Madras Act so and so of such and such year it has made the law.
Moreover it may be remembered that in doing so the new body may re strict or modify the provisions of such Act also.
On the second aspect the sanction flows clearly from the notifica tion of the newly created body that Bombay or Madras Act so and so with such modifications as may be mentioned, will be the law.
That has not been the will or decision of the legis lature.
The legislature has not applied its mind and said "Bombay Act . . . is the law of this Province".
In my opinion, it is futile to contend that the sanction flows from the statement of the legislature that the law will be what the newly created body decides or specifies, for that statement only indicates the new body and says that we confer on it power to select a law of another province.
The illustrations of the extension of the Civil and Criminal Procedure Codes, mentioned in the judgment in The Queen vs Burah(1) have to be considered along with the fact that at that time the Governor General in Council, in its legislative capacity, had power of legislation over the whole of India on all subjects.
The Civil and Criminal Procedure Codes were enacted by the Central Legislature and it could have made the same applicable at once to the whole of India.
But having passed the laws, it laid down a condi tion that its application may be referred to certain areas until the particular Provincial Government (executive) considered it convenient for these Codes to be made (1) 5 I.A. 178, 803 applicable to its individual area.
A Provincial Govern ment, e.g., of Bombay, was not empowered to lay down any policy in respect of the Civil Procedure Code or the Crimi nal Procedure Code nor was it authorised to select, if it liked, a law passed by the Legislature of Madras for its application to the Province of Bombay.
If it wanted to do so, the Legislature of the Province of Bombay had to exer cise its judgment and decision and pass the law which would be enforceable in the Province of Bombay.
It may be noticed that the power to extend, mutatis mutandis, the laws as contained in sections 8 and 9 of Act XXII of 1869 brings in t.he idea of adaptation by modification, but so far only as it is necessary for the purpose.
In my opinion, therefore, to the extent section 7 of the permits the Central executive government to apply any law passed by a Provincial legislature to the Province of Delhi, the same is ultra vires the Central Legislature.
To that extent the Central Legislature has abdicated its functions and there fore the Act to the extent is invalid.
Question 2 relates to Ajmer Merwara (Extension of Laws) Act.
Till the Government of India Act, 1915, there was unitary government in India.
By the Act of 1915, Provincial legislatures were given powers of legislation but there was no distribution of legislative powers between the Centre and the Provinces.
That was brought about only by the Govern ment of India Act, 1935.
Section 94 of that Act enumerates the Chief Commissioner 's Provinces.
They include the Prov inces of Delhi and Ajmer Merwara.
Under sections 99 and 100 there was a distribution of legislative powers between Provinces and Centre, but the word "Province" did not in clude a Chief Commissioner 's Province and therefore the Central Legislature was the only law making authority for the Chief Commissioner 's Provinces.
The Ajmer Merwara Act was passed under the Government of India Act as adapted by the Indian Independence Act.
Although by that Act the control of British Parliament over the Government of India 804 and the Central Legislature was removed, the powers of the Central Legislature were still as those found in the Govern ment of India Act, 1935.
The Independence Act therefore made no difference on the question whether the power of delega tion was contained in the legislative power.
The result is that to the extent to which section 7 of the is held ultra vires, section 2 of the Ajmer Merwara Act, 1947, should also be held ultra vires.
This brings me to Question 3.
section 2 of the Part C States (Laws) Act, 1950, is passed by the Indian Parliament.
Under article 239 of the Constitution of India, the powers for the administration of Part C States are all vested in the President.
Under article 240 the Parliament is empowered to create or continue for any State specified in Part C, and administered through a Chief Commissioner or Lieutenant Governor; (a) a body whether nominated or elected or partly nominated or partly elected, to function as a legislature for the State, or (b) a Council of Advisers or Ministers.
It is common ground that no law creating such bodies has been passed by the Parliament so far.
Article 246 deals with the distribution of legislative powers between the Centre and the States but Part C States are outside its operation.
Therefore on any subject affecting Part C States, Parliament is the sole and exclusive legislature until it passes an Act creating a legislature or a Council in terms of article 240.
Proceeding on the footing that a power of legislation does not carry with it the power of delegation (as claimed by the Attorney General), the question is whether section 2 of the Part C States (Laws) Act is valid or not.
By that section the Parliament has given power to the Central Government by notification to extend to any part of such State (Part C State), with such restrictions and modifications as it thinks fit, any enactment which is in force in Part A State at the date of the.notification.
The section although framed on the lines of the and the Ajmer Merwara Act is restricted in 805 its scope as the executive government is empowered to extend only an Act which is in force in any of the Part A States.
For the reasons I have considered certain parts of the two sections covered by Questions 1 and 2 ultra rites, that part of section 2 of the Part C States (Laws) Act, 1950, which empowers the Central Government to extend laws passed by any Legislature of Part A State, will also be ultra vires.
To the extent the Central Legislature or Parliament has passed Acts which are applicable to Part A States, there can be no objection to the Central Government extending, if necessary, the operation of those Acts to the Province of Delhi, be cause the Parliament is the competent legislature for that Province.
To the extent however the section permits the Central Government to extend laws made by any legislature of Part A State to the Province of Delhi, the section is ultra vires.
In view of my conclusion in respect of the first part of section 2 of the Part C States (Laws) Act, 1950, I do not think it necessary to deal with separately the other part of the section relating to the power to repeal or amend a corresponding law for the time being applicable to that Part C State.
Before concluding, I must record the appreciation of the Court in the help the learned Attorney General and the counsel appearing in the Reference have rendered to the Court by their industry in collecting all relevant materials and putting the same before the Court in an extremely fair manner.
My answers to the questions are that all the three sections mentioned in the three questions are ultra vires the Legislatures, functioning at the relevant dates, to the extent power is given to the Government (executive) to extend Acts other than Acts of the Central Legislature as mentioned in the judgment.
FAZL ALI J.
The answer to the three questions which have been referred by the President under article 143 of the Constitution of India, depends upon the proper answer to another question which was the 806 subject of very elaborate arguments before us and which may be stated thus: Can a legislature which is sovereign or has plenary powers within the field assigned to it, delegate its legislative functions to an executive authority or to anoth er agency, and, if so.
to what extent it can do so ? In dealing with this question, three possible answers may be considered.
They are : (1) A legislature which is sovereign in a particular field has unlimited power of delegation and the content of its power must necessarily include the power to delegate legislative functions; (2) Delegated legislation is permissible only within certain limits; and (3) Delegated legislation is not permissible at all by reason of certain principles of law which are wellknown and well recognised.
I will first consider the last alternative, but I should state that in doing so I will be using the expressions, "delegated legislation," and "delegation of legislative authority," in the loose and popular sense and not in the strict sense which I shall explain later.
One of the principles on which reliance was placed to show that legislative power cannot be delegated is said to be embodied in the well known maxim, delegatus non potest delegare, which in simple language means that a delegated authority cannot be redelegated, or, in other words, one agent cannot lawfully appoint another to perform the duties of agency.
This maxim however has a limited application even in the domain of the law of contract or agency wherein it is frequently invoked and is limited to those cases where the contract of agency is of a confidential character and where authority is coupled with discretion or confidence.
Thus, auctioneers, brokers, directors, factors, liquidators and other persons holding a fiduciary position have generally no implied authority to employ deputies or sub agents.
The rule is so stated in Broom 's Legal Maxims, and many other books, and it is also stated that in a number of cases the authority to employ 807 agents is implied.
In applying the maxim to the act of a legislative body, we have necessarily to ask "who is the principal and who is the delegater" In some cases where the question of the power of the Indian or a colonial legisla ture came up for consideration of the courts, it was sug gested that such a legislature was a delegate of the British Parliament by which it had been vested with authority to legislate.
But this view has been rightly repelled by the Privy Council on more than one occasion, as will appear from the following extracts from two of the leading cases on the subject: "The Indian Legislature has powers expressly limited by the Act of the Imperial Parliament which created it, and it can of course do nothing beyond the limits which circum scribe these powers.
But when acting within those limits it is not in any sense an agent or delegate of the Imperial Parliament, but has, and was intended to have, plenary powers of legislation as large, and of the same nature, as those of Parliament itself.
" Reg.
vs Burah (1).
"It appears to their Lordships, however, that the objec tion thus raised by the appellants is founded on an entire misconception of the true character and position of the Provincial Legislatures.
They are in no sense delegates of or acting under any mandate from the Imperial Parliament.
When the British North America Act enacted that there should be a Legislature for Ontario, and that its Legislative Assembly should have exclusive authority to make laws for the Province and for Provincial purposes in relation to the matters enumerated in section 92, it conferred powers, not in any sense to be exercised by delegation from or as agents of the Imperial Parliament, but authority as plenary and as ample, within the limits prescribed by section 92, as the Imperial Parliament in the plenitude of its power possessed and could bestow.
Within these limits of subjects and areas the Local Legislature is supreme, and has the same authority as the Imperial Parliament.": Hodge vs The Queen (2).
(1) 3 App.
(2) 9 App.
117. 808 It has also been suggested by some writers that the legislature is a delegate of the people or the electors.
This view again has not been accepted by some constitutional writers, and Dicey dealing with the powers of the British Parliament with reference to the Septennial Act, states as follows : "That Act proves to demonstration that in a legal point of view Parliament is neither the agent of the electors nor in any sense a trustee for its constituents.
It is legally the sovereign legislative power in the state, and the Sep tennial Act is at once the result and the standing proof of such Parliamentary sovereignty." (1) The same learned author further observes: "The Judges know nothing about any will of the people except in so far as that will is expressed by an Act of Parliament, and would never suffer the validity of a statute to be questioned on the ground of its having been passed or being kept alive in opposition to the wishes of the elec tors." (2) There can be no doubt that members of a legislature represent the majority of their electors, but the legisla ture as a body cannot be said to be an agency of the elec torate as a whole.
The individual members may and often do represent different parties and different shades of opinion, but the composite legislature which legislates, does so on its own authority or power which it derives from the Consti tution, and its acts cannot be questioned by the electorate, nor can the latter withdraw its power to legislate on any particular matter.
As has been pointed out by Dicey, "the sole legal right of electors under the English Constitution is to elect members of Parliament.
Electors have no legal right of initiating, of sanctioning, or of repealing the legislation of Parliament." (3) It seems to me therefore that it will not be quite accurate to say that the legislature being an agent of (1) Dicey 's:"Law of the Constitution", 8th edn., p. 45.
(2) Ibid, p. 72.
(3) Dicey 's "Law of the Constitution", 8th edn., p. 57.
809 its constituents, its powers are subject to the restrictions implied in the Latin maxim referred to.
I shall however advert to this subject again when I deal with another principle which is somewhat akin to the principle underlying the maxim.
The second principle on which reliance was placed was said to be founded on the well known doctrine of "separation of powers.
" It is an old doctrine which is said to have originated from Aristotle, but, as is well known, it was given great prominence by Locke and Montesquieu.
The doc trine may be stated in Montesquieu 's own words: "In every government there are three sorts of power, the legislative; the executive in respect to things dependent on the law of nations; and the executive in regard to matters that depend on the civil law .
When the legislative and the executive powers are united in the same person, or in the same body of magistrates, there can be no liberty; because apprehensions may rise, lest the same monarch or senate should enact tyrannical laws, to execute them in a tyrannical manner.
Again, there is no liberty, if the judi ciary power be not separated from the legislative and the executive.
Were it joined with the legislative, the life and liberty of the subject would be exposed to abritrary control; for the judge would be then the legislator.
Were it joined to the executive power, the judge might behave with violence and oppression.
There should be an end of everything, were the same man or the same body, whether of the nobles or of the people, to exercise those three powers, that of enacting laws, that of executing the public resolu tions, and of trying the causes of individuals.
"(1) The doctrine found many enthusiasts in America and was virtually elevated to a legal principle in that country.
Washington, in his farewell address, said : "The spirit of enroachment tends to consolidate the powers of all governments in one, and thus to (1) Montesquieu 's Spirit of Laws, Vol. 1 by J. V. Pritchard, 1914 edn, pp. 162 3. 810 create, whatever the form of government, a real despotism." John Adams wrote on similar lines as follows:" It is by balancing one of these three powers against the other two that the efforts in human nature toward tyranny can alone be checked and restrained and any degree of free dom preserved." (1) These sentiments are fully reflected in the Constitu tions of the individual States as well as in the Federal Constitution of America.
Massachusetts in her Constitution, adopted in 1780, provided that "in the govern ment of this commonwealth the legislative department shall never exercise the executive and judicial powers or either of them; the executive shall never exercise legislative and judicial powers or either of them; the judicial shall never exercise legislative and executive powers or either of them; to the end that it may be a government of laws and not of men.
"(2) The Constitutions of 39 other States were drafted on similar lines, and so far as the Federal Constitution of the United States was concerned, though it does not express ly create a separation of governmental powers, yet from the three articles stating that the legislative power vests in Congress, the judicial power in the Supreme Court and the executive power in the President, the rule has been deduced that the power vested in each branch of the Government cannot be vested in any other branch.
nor can one branch interfere with the power possessed by any other branch.
This rule has been stated by Sutherland J. in Springer vs Government of the Philiipine Islands(s) in these words : "It may be stated then, as a general rule inherent in the American constitutional system, that unless otherwise expressly provided or incidental to the powers conferred, the Legislature cannot exercise either executive or judicial power; the Executive (1) Vide, Works, Vol. 1, p. 186. (2) Willoughby 's Constitution of the United States, Vol.
III, 1616.
(3) ; at 201, 811 cannot exercise either legislative or judicial power; the Judiciary cannot exercise either executive or legislative power.
" From the rule so stated, the next step was to deduce the rule against delegation of legislative power which has so often been stressed in the earlier American decisions.
It was however soon realized that the absolute rule against delegation of legislative power could not be sustained in practice, and as early as 1825, Marshall C.J. openly stated that the rule was subject to limitations and asserted that Congress "may certainly delegate to others powers which the Legislature may rightfully exercise itself ,,(1).
In course of time, notwithstanding the maxim against delegation, the extent of delegation had become so great that an American writer wrote in 1916 that "because of the rise of the admin istrative process, the old doctrine prohibiting the delega tion of legislative power has virtually retired from the field and given up the fight".(2) This is in one sense an over statement, because the American Judges have never ceased to be vigilant to check any undue or excessive au thority being delegated to the executive as will appear from the comparatively recent decisions of the American Supreme Court in Panama Refining Co. vs Ryan (3) and Schechter Poultry Corp. vs United States(4).
In the latter case, it was held that the National Industrial Recovery Act, in so far as it purported to confer upon the President the author ity to adopt and make effective codes of fair competition and impose the same upon members of each industry for which such a code is approved, was void because it was an uncon stitutional delegation of legislative power.
Dealing with the matter, Cardozo J. observed as follows : ' "The delegated power of legislation which has found expression in this code is not canalized within (1) Wayman vs Southard (2) 41 American Bar Asscn.
Reports, 356 at 368.
(3) ; (4) ; 812 banks that keep it from overflowing.
It is unconfined and vagrant .
Here, in the case before us, is an attempt ed delegation not confined to any single act nor to any class or group of acts identified or described by reference to a standard.
Here in effect is a roving commission to inquire into evils upon discovery to correct them .
This is delegation running riot.
No such plenitude of power is capable of transfer.
"(1) The fact however remains that the American courts have upheld the so called delegated legislation in numerous instances, and there is now a wide gulf between the theoret ical doctrine and its application in practice.
How numerous are the exceptions engrafted on the rule will appear on a reference to a very elaborate and informing note appended to the report of the case of Panama Refining Co. vs Ryan in 79, Lawyer 's Edition at page 448.
In this note, the learned authors have classified instances of delegation upheld in America under the following 8 heads, with numerous sub heads : 1.
Delegation of power to determine facts or conditions on which operation of statute is contingent.
Delegation of non legislative or administrative functions.
Delegation of power to make administrative rules and regulations.
Delegation to municipalities and local bodies.
Delegation by Congress to territorial legislature or commission.
Delegation to private or non official persons or corporations.
Vesting discretion in judiciary.
Adopting law or rule of another jurisdiction.
The learned American Judges in laying down exceptions to the general rule from time to time, have offered various expla nations, a few of which may be quoted as samples: (1) ; at 551. 813 " . however we may disguise it by veiling words we do not and cannot carry out the distinction between legislative and executive action with mathematical precision and divide the branches into watertight compartments, were it ever so desirable to do so, which I am far from believ ing that it is, or that the Constitution requires.
" [Per Holmes J. in Springer vs The Government of Phillipine Is lands(1)] " . too much effort to detail and particularize, so as to dispense with the administrative or fact finding assist ance, would cause great confusion in the laws, and would result in laws deficient in both provision and execution." [Mutual Film Corporation vs Industrial Commission(2)] "If the legislature ' 'were ' strictly required to make provision for all the minutiae of regulation, it would, in effect, be deprived of the power to enact effective legisla tion on subjects over which it has undoubted power." "The true distinction. is this.
The legislature cannot delegate its power to make a law; but it can make a law to delegate a power to determine some fact or state of things upon which the law makes, or intends to make, its own action depend.
To deny this would be to stop the wheels of government.
"(3) "The true distinction is between the delegation of power to make the law which necessarily involves a discretion as to what it shall be.
and conferring authority or discretion as to its execution, to be exercised under and in pursuance of the law.
The first cannot be done; to the latter no valid objection can be made." [Per Ranney J. in Cincinnati W. & Z.R. Co. vs Clinton County Commissioners(4)].
(1) ; (31 Locke 's Appeal, (2) ; (4) 814 "Half the statutes on our books are in the alternative, depending on the discretion of some person or persons to whom is confided the duty of determining whether the proper occasion exists for executing them.
But it cannot be said that the exercise of such discretion is the making of law." [Moore v.Reading(1)] "Congress may declare its will and, after fixing a primary standard, devolve upon administrative officers the power to fill up the details by prescribing administrative rules and regulations." [United States vs Shreveport Grain & E. Co.(2)] . . . . "The Constitution has never been regarded as denying to the Congress the necessary resources of flexibility and practicality which will enable it to perform its functions in laying down policies and establishing standards, while leaving to selected instrumentalities the making of subordi nate rules within the prescribed limits, the determination of facts to which the policy as declared by the legislature is to apply.
Without capacity to give authorizations of that sort, we should have the anomaly of a legislative power which in many circumstances calling for its exertion would be but a futility." [Per Hughes C.J. in Panama Refining Co. Ryan(3)] "This is not to say that the three branches are not co ordinate parts of one government and that each in the field of its duties may not invoke the action of the two other branches in so far as the action invoked shall not be an assumption of the constitutional field of action of another branch." [Per Taft C.J. in J.W. Hampton Jr. & Co. vs U. S.(4)] I have quoted these extracts at the risk of encumbering my opinion for 2 reasons:firstly, because they (1) (3) ; (2) (4) ; 815 show that notwithstanding the prevalence of the doctrine of separation of powers in America, the rule against delega tion of legislative power is by no means an inelastic one in that country, and many eminent Judges there have tried to give a practical trend to it so as to bring it in line with the needs of the present day administration, and secondly, because they show that the rule against delegation is not a necessary corollary from the doctrine of separation of powers.
It is to be noted that though the principle of separa tion of powers is also the basis of the Australian Constitu tion, the objection that the delegation of legislative power was not permissible because of.the distribution of powers contained in the Constitution has been raised in that Com monwealth only in a few cases and in all those cases it has been negatived.
The first case in which this objection was raised was Baxter vs Ah Way(1).
In that case, the validity of section 52 of the Customs Act, 1901, was challenged.
That section after enumerating certain prohibited imports provid ed for the inclusion of "all goods the importation of which may be prohibited by proclamation.
" Section 56 of the Act provided that "the power of prohibiting importation of goods shall authorise prohibition subject to any specified condition or restriction and goods imported contrary to any such condition or restriction shall be prohibited imports.
" The ground on which these provisions were chal lenged was that they amounted to delegation of legislative power which had been vested by the Constitution in the Federal Parliament.
Griffith C.J. however rejected the contention and in doing so relied on Queen vs Burah(2) and other cases, observing : " . . . unless the legislature is prepared to lay down at once and for all time, or for so far into the future as they may think fit, a list of prohibited goods, they must have power to make a prohibition depending upon a condition, and that condition may be the coming into exist ence or the discovery of some fact (1) ; (2) 3 App.
889. 816 . .
And if that fact is to be the condition upon which the liberty to import the goods is to depend, there must be some means of ascertaining that fact, some person with power to ascertain it; and the Governor in Council is the authority appointed to ascertain and declare the fact.
" The other cases in which a similar objection was taken, are Welebach Light Co. of Australasia Ltd. vs The Common wealth(1), Roche vs Kronheimer(2), and Victorian Stevedor ing and General Contracting Co. Pry.
Ltd. and Meakes vs Dignan(3).
In the last mentioned case in which the matter has been dealt with at great length, Dixon J. observed thus : " . . the time has passed for assigning to the constitutional distribution of powers among the separate organs of government, an operation which confined the legis lative power to the Parliament so as to restrain it from reposing in the Executive an authority of an essentially legislative character.
"(4) In England, the doctrine of separation of powers has exer cised very little influence on the course of judicial deci sions or in shaping the Constitution, notwithstanding the fact that distinguished writers like Locke and Blackstone strongly advocated it in the 17th and 18th centuries.
Locke in his treatise on Civil Government wrote as follows : "The legislature cannot transfer the power of making laws to any other hands; for it being a delegated power from the people, they who have it cannot pass it over to others.
(g 141).
Blackstone endorsed this view in these words : Wherever the right of making and enforcing the law is vested in the same man or one and the same body of men, there can be no public liberty.
"(5) Again, Montesquieu, when he enunciated the doctrine of sepa ration of powers, thought that it represented the (1) ; (3) (1931) 46C.L.R. 73.
(2) (4) Ibid, p. 100.
(5) Commentaries on the Laws of England, 1765.
817 quintessence of the British Constitution for which he had great admiration.
The doctrine had undoubtedly attracted considerable attention in England in the 17th and 18th centuries, but in course of time it came to have a very different meaning there from what it had acquired in the United States of America.
In the United States, the empha sis was on the mutual independence of the three departments of Government.
But, in England, the doctrine means only the independence of the judiciary, whereas the emergence of the Cabinet system forms a ]ink between the executive and the legislature.
How the Cabinet system works differently from the so called non parliamentary system which obtains in the United States, may be stated very shortly.
In the United States, the executive power is vested in the Presi dent, to whom, and not to the Congress, the members of the Cabinet are personally responsible and neither the President nor the members of the Cabinet can sit or vote in Congress, and they have no responsibility for initiating bills or seeking their passage through Congress.
In England, the Cabinet is a body consisting of members of Parliament chosen from the party possessing a majority in the House of Com mons.
It has a decisive voice in the legislative activities of Parliament and initiates all the important legislation through one or other of the Ministers, with the result that "while Parliament is supreme in that it can make or unmake Government, the Government once in power tends to control the Parliament.
" The conclusion which I wish to express may now be stated briefly.
It seems to me that though the rule against delega tion of legislative power has been assumed in America to be a corollary from the doctrine of separation of powers, it is strictly speaking not a necessary or inevitable corollary.
The extent to which the rule has been relaxed in America and the elaborate explanations which have been offered to justi fy departure from the rule, confirm this view, and it is also supported by the fact that the trend of decisions in Australia, notwithstanding the fact that its Constitution 818 is at least theoretically based on the principle of separa tion of powers, is that the principle does not stand in the way of delegation in suitable circumstances.
The division of the powers of Government is now a normal feature of all civilised constitutions, and, as pointed out by Rich J. in New South.
Wales vs Commonwealth.(1), ,, it is "well known in all British communities ; yet, except m the United States, nowhere it has been held that by itself it forbids delegation of legislative power.
It seems to me that the American jurists have gone too far in holding that the rule against delegation was a direct corollary from the separa tion of powers.
I will now deal with the third principle, which, in my opinion, is the true principle upon which the rule against delegation may be founded.
It has been stated in Cooley 's Constitutional Limitations, Volume 1 at page 224 in these words : "One of the settled maxims in constitutional law is, that the power conferred upon the legislature to make laws cannot be delegated by that department to any other body or authority.
Where the sovereign power of the State has located the authority, there it must remain; and by the constitutional agency alone the laws must be made until the constitution itself is changed.
The power to whose judgment, wisdom, and patriotism this high prerogative has been in trusted cannot relieve itself of the responsibility by choosing other agencies upon which the power shall be de volved, nor can it substitute the judgment, wisdom, and patriotism of any other body for those to which alone the people have seen fit to confide this sovereign trust.
" The same learned author observes thus in his wellknown book on Constitutional Law (4th Edition, page 138): "No legislative body can delegate to another depart ment of the government, or to any other authority, the power, either generally or specially, to enact (1) ; at 108.
819 laws.
The reason is found in the very existence of its own powers.
This high prerogative has been intrusted to its own wisdom, judgment, and patriotism, and not to those of other persons, and it will act ultra vires if it undertakes to delegate the trust, instead of executing it.
" This rule in a broad sense involves the principle underly ing the maxim, delegatus non potest delegare, but it is apt to be misunderstood and has been misunderstood.
In my judg ment, all that it means is that the legislature cannot abdicate its legislative functions and it cannot efface itself and set up a parallel legislature to discharge the primary duty with which it has been entrusted.
This rule has been recognized both in America and in England, and Hughes C.J. has enunciated it in these words : "The Congress manifestly is not permitted to abdicate, or to transfer to others, the essential legislative func tions with which it is thus vested.
"(1) The matter is again dealt with by Evatt J. in Victorian Stevedoring and General Contracting Co. Pty. Ltd. and Neakes vs Dignan(2), in these words : "On final analysis therefore, the Parliament of the Commonwealth is not competent to 'abdicate ' its powers of legislation.
This is not because Parliament is bound to perform any or all of its legislative powers or functions, for it may elect not to do so; and not because the doctrine of separation of powers prevents Parliament from granting authority to other bodies to make laws or bye laws and thereby exercise legislative power, for it does so in almost every statute; but because each and every one of the laws passed by Parliament must answer the description of a law upon one or more of the subject matters.stated in the Con stitution.
A law by which Parliament gave all its lawmaking authority to another body would be bad merely because it would fail to pass the test last mentioned." (1) , (2) at 121, 820 I think that the correct legal position has been compre hensively summed up by Lord Haldane in In re the Initiative and Referendum Act(3): "No doubt a body, with a power of legislation on the subjects entrusted to it so ample as that enjoyed by a Provincial Legislature in Canada, could, while preserving its own capacity intact, seek the assistance of subordinate agencies, as has been done when in Hodge vs The Queen, the Legislature of Ontario was held entitled to entrust to a Board of Commissioners authority to enact regulations relat ing to taverns; but it does not follow that it can create and endow with its own capacity a new legislative power not created by the Act to which it owes its own existence.
" What constitutes abdication and what class of cases will be covered by that expression will always be a question of fact, and it is by no means easy to lay down any comprehen sive formula to define it, but it should be recognized that the rule against abdication does not prohibit the Legisla ture from employing any subordinate agency of its own choice for doing such subsidiary acts as may be necessary to make its legislation effective, useful and complete.
Having considered the three principles which are said to negative delegation of powers, I will now proceed to consid er the argument put forward by the learned Attorney General that the power of delegation is implicit in the power of legislation.
This argument is based on the principle of sovereignty of the legislature within its appointed field.
Sovereignty has been variously described by constitutional writers, and sometimes distinction is drawn between legal sovereignty and political sovereignty.
One of the writers describes it as the power to make laws and enforce them by means of coercion it cares to employ, and he pro ceeds to say that in England the legal sovereign, i.e., the person or persons who according to the law of the land legislate and administer the Government, is the King in Parliament, whereas the political (1) at 945. 821 or the constitutional sovereign, i.e., the body of persons in whom power ultimately resides, is the electorate or the voting public(1).
Dicey states that the legal conception of sovereignty simply means the power of law making unrestrict ed by any legal limit, and if the term "sovereignty" is thus used, the sovereign power under the English Constitution is the Parliament.
The main attribute of such sovereignty is stated by him in in these words : "There is no law which Parliament cannot change (or to put the same thing somewhat differently, fundamental or so called constitutional laws are under our Constitution changed by the same body and in the same manner as other laws, namely, by Parliament acting in its ordinary legisla tive character) and any enactment passed by it cannot be declared to be void.
According to the same writer, the characteristics of a non sovereign law making body are : ( 1 ) the existence of laws which such body must obey and cannot change;(2) the formation of a marked distinction between ordinary laws and fundamental laws;and (3) the existence of some person or persons, judicial or otherwise, having authority to pro nounce upon the validity or constitutionality of laws passed by such law making body.
Dealing with the Indian or the colonial legislature, the learned writer characterizes it as a non sovereign legislature and proceeds to observe that its authority to make laws is as completely subordinate to and as much dependent upon Acts of Parliament as is the power of London and NorthWestern Railway Co. to make byelaws.
This is undoubtedly an overstatement and is certainly not ap plicable to the Indian Parliament of today.
Our present Parliament, though it may not be as sovereign as the Parlia ment of Great Britain, is certainly as sovereign as the Congress of the United States of America and the Legisla tures of other independent countries having a Federal Con stitution.
But what is more relevant (1) Modern Political Constitutions, by Strong.
822 to our purpose is that Dicey himself, dealing with colonial and other similar legislatures, says that "they are in short within their own sphere copies of the Imperial Parlia ment, they are within their own sphere sovereign bodies, but their freedom of action is controlled by their subordination to the Parliament of the United Kingdom.
" These remarks undoubtedly applied to the Legislative Council of 1912 which passed the , and they apply to the present Parliament also with this very material modification that its freedom of action is no longer controlled by subor dination to the British Parliament but is controlled by the Indian Constitution.
At this stage, it will be useful to refer to certain cases decided by the Privy Council in England in which the question of the ambit of power exercised by the Indian and colonial legislatures directly arose.
The leading case on the subject is Queen vs Burah(1), which has been cited by this court on more than one ' occasion and has been accepted as good authority.
In that case, the question arose whether a section of Act No. XXII of 1869 which conferred upon the Lieutenant Governor of Bengal the power to determine whether a law or any part thereof should be applied to a certain territory was or was not ultra vires.
While holding that the impugned provision was intra vires, the Privy Council made certain observations which have been quoted again and again and deserve to be quoted once more.
Having held that the Indian Legislature was not a delegate of the Imperial Parliament and hence the maxim, delegatus non potest dele gare, did not apply (see ante for the passage dealing with this point), their Lordships proceeded to state as follows:. "Their Lordships agree that the Governor General in Council could not by any form of enactment, create in India, and arm with general legislative authority, a new legisla tive power, not created or authorized by the Councils Act.
Nothing of that kind has, in their Lordships ' opinion, been done or attempted in the (1) 5 I.A. 178.
823 present case.
What has been done is this.
The Governor General in Council has determined, in the due and ordinary course of legislation, to remove a particular district from the jurisdiction of the ordinary Courts and offices, and to place it under new Courts and offices., to be appointed by and responsible to the Lieutenant Governor of Bengal, leav ing it to the Lieutenant Governor to say at what time that change shall take place; and also enabling him, not to make what laws he pleases for that or any other district, but to apply by public notification to that district any law, or part of a law, which either already was, or from time to time might be, in force, by proper legislative authority, 'in the other territories subject to his government '.
" Then, later they added : "The proper Legislature has exercised its judgment as to place, person, laws, powers; and the result of that judgment has been to legislate conditionally as to all these things.
The conditions having been fulfilled, the legislation is now absolute.
Where plenary powers of legislation exist as to particular subjects, whether in an Imperial or in a provin cial legislature, they may (in their Lordships judgment) be well exercised, either absolutely or conditionally.
Legis lation, conditional on the use of particular powers, or on the exercise of a limited discretion, entrusted by the Legislature to persons in whom it places confidence, is no uncommon thing; and, in many circumstances, it may be highly convenient.
The British Statute Book abounds with examples of it; and it cannot be supposed that the Imperial Parlia ment did not, when constituting the Indian Legislature, contemplate this kind of conditional legislation as within the scope of the legislative powers which it from time to time conferred.
" The next case on the subject is Russell vs The Queen (1).
In that case, the Canadian Temperance Act, 1878, was challenged on the ground that it was (1) 7 App, Cas.
824 ultra vires the Parliament of Canada.
The Act was to be brought into force in any county or city if on vote of the majority of the electors of that county city favouring such a course, the Governor General in Council declared the relative part of the Act to be on force.
It was held by the Privy Council that this provision did not amount to a dele gation of legislative power to a majority of the voters in a city or county.
The passage in which this is made clear, runs as follows: "The short answer to this objection is that the Act does not delegate any legislative powers whatever.
It contains within itself the whole legislation on the matters with which it deals.
The provision that certain parts of the Act shall come into operation only on the petition of a majority of electors does not confer on these persons power to legis late.
Parliament itself enacts the condition and everything which is to follow upon the condition being fulfilled.
Conditional legislation of this kind is in many cases con venient, and is certainly not unusual, and the power so to legislate cannot be denied to the Parliament of Canada when he subject of legislation is within its competency.
If authority on.
this point were necessary, it will be found in the case of Queen vs Burah, lately before this Board.
The same doctrine was laid down in the case of lodge vs The Queen (1), where the question arose as to whether the legislature of Ontario had or had not the power of entrust ing to a local authority the Board of Commissioners the power of making regulations with respect to the Liquor Licence Act, 1877, which among other things created offences for the breach of hose regulations and annexed penalties thereto.
their Lordships held that the Ontario Legislature had that power, and after reiterating that the Legislature which passed the Act was not a delegate, they observed as follows : "When the British North America Act enacted that there should be a legislature for Ontario, and that (1) 9 App.
825 its legislative assembly should have exclusive authority to make laws for the Province and for provincial purposes in relation to the matters enumerated in section 92, it con ferred powers not in any sense to be exercised by delegation from or as agents of the Imperial Parliament, but authority as plenary and as ample within the limits prescribed by section 92 as the Imperial Parliament in the plenitude of its powers possessed and could bestow.
Within these limits of subjects and area the local legislature is supreme, and has the same authority as the Imperial Parliament, or the Parliament of the Dominion, would have had under like circumstances to confide to a municipal institution or body of its own creation authority to make byelaws or resolutions as to subjects specified in the enactment, and with the object of carrying the enactment into operation and effect." Another case which may be usefully cited is Powell vs Apollo Candle Co. (1).
The question which arose in that case was whether section 133 of the Customs Regulations Act of 1879 of New South Wales was or was not ultra rites the colonial legislature.
That section provided that "when any article of merchandise then unknown to the collector is imported, which, in the opinion of the collector or the commissioners, is apparently a substitute for any known dutiable article, or is apparently designed to evade duty, but possesses properties in the whole or in part which can be used or were intended to be applied for a similar purpose as such dutiable article, it shall be lawful for the Gover nor to direct that a duty be levied on such article at a rate to be fixed in proportion to the degree in which such unknown article approximates in its qualities or uses to such dutiable article.
" Having repelled the contention that the colonial legislature was a delegate of the Imperial Parliament and having held that it was not acting as an agent or a delegate, the Privy Council proceeded to deal with the question raised in the following manner : (1) 10App.
826 "It is argued that the tax in question has been imposed by the Governor, and not by the Legislature, who alone had power to impose it.
But the duties levied under the Order in Council are really levied by the authority of the Act under which the order is issued.
The Legislature has not parted with its perfect control over the Governor, and has the power, of course, at any moment, of withdrawing or altering the power which they have entrusted to him.
Under these circumstances their Lordships are of opinion that the judgment of the Supreme Court was wrong in declaring section 133 of the Customs Regulations Act of 1879 to be beyond the power of the Legislature.
" Several other eases were cited at the Bar in which the supremacy of a legislature (which would be nonsovereign according to the tests laid down by Dicey) within the field ascribed to its operation, were affirmed, but it is unnec essary to multiply instances illustrative of that princi ple.
I might however quote the pronouncement of the Privy Council in the comparatively recent case of Shannon vs Lower Mainland Dairy Products Board (1), which runs as follows : "The third objection is that it is not within the powers of the Provincial Legislature to delegate so called legislative powers to the Lieutenant Governor in Council, or to give him powers of further delegation.
This objection appears to their Lordships subversive of the rights which the Provincial Legislature enjoys while dealing with matters falling within the classes of subjects in relation to which the constitution has granted legislative powers.
Within its appointed sphere the Provincial Legislature is as supreme as any other Parliament; and it is unnecessary to try to enu merate the innumerable occasions on which Legislatures, Provincial, Dominion and Imperial, have entrusted var ious persons and bodies with similar powers to those con tained in this Act.
" I must pause here to note briefly certain important principles which can be extracted from the cases (1) at 722.
827 decided by the Privy Council which I have so far cited, apart from the principle that the Indian and colonial legis latures are supreme in their own field and that the maxim, delegatus non potest delegare, does not apply to them.
In the first place, it seems quite clear that the Privy Council never liked to commit themselves to the statement that delegated legislation was permissible.
It was easy for them to have said so and disposed of the cases before them, but they were at pains to show that the provisions impugned before them were not instances of delegation of legislative authority but they were instances of conditional legislation which, they thought, the legislatures concerned were compe tent to enact, or that the giving of such authority as was entrusted in some cases to subordinate agencies was ancil lary to legislation and without it "an attempt to provide for varying details and machinery to carry them out might become oppressive or absolutely fail.
" They also laid down: (1) that it will be not correct to describe conditional legislation and other forms of legislation which they were called upon to consider in several cases which have been cited as legislation through another agency.
Each Act or enactment which was impugned before them as being delegated legislation, contained within itself the whole legislation on the matter which it dealt with, laying down the condition and everything which was to follow on the condition being fulfilled; (2) that legislative power could not be said to have been parted with if the legislature retained its power intact and could whenever it pleased destroy the agency it had created and set up another or take the matter directly into its own hands; (3) that the question as to the extent to which the aid of subordinate agencies could be sought by the legislatures and as to how long they should continue them were matters for each legislature and not for the court of law to decide; (4) that a legislature in committing important regulations to others does not efface itself; and (5) that the legislature, like the Governor General in Council, could not by any form of enactment create, and arm with legislative 828 authority, a new legislative power not created or authorised by the Councils Act to which it (the Governor General in Council) owes its existence.
I have already indicated that the expressions "delegated legislation" and "delegating legislative power" are some times used in a loose sense, and sometimes in a strict sense.
These expressions have been used in the loose or popular sense in the various treatises or reports dealing with the so called delegated legislation; and if we apply that sense to the facts before the Privy Council, there can be no doubt that every one of the cases would be an instance of delegated legislation or delegation of legislative au thority.
But the Privy Council have throughout repelled the suggestion that the cases before them were instances of delegated legislation or delegation of legislative authori ty.
There can be no doubt that if the legislature completely abdicates its functions and sets up a parallel legislature transferring all its power to it, that would undoubtedly be a real instance of delegation of its power.
In other words, there will be delegation in the strict sense if legislative power with all its attributes is transferred to another authority.
But the Privy Council have repeatedly pointed out that when the legislature retains its dominant power intact and can whenever it pleases destroy the agency it has created and set up another or take the matter directly into its own hands, it has not parted with its own legislative power.
They have also pointed out that the act of the subordinate authority does not possess the true legislative attribute, if the efficacy of the act done by it is not derived from the subordinate authority but from the legisla ture by which the subordinate authority was entrusted with the power to do the act.
In some of the cases to which reference has been made, the Privy Council have referred to the nature and principles of legislation and pointed out that conditional legislation simply amounts to entrusting a limited discretionary authority to others, and that to seek the aid of subordinate agencies in carrying out the object of the legislation is ancillary to legislation and properly 829 lies within the scope of the powers which every legislature must possess to function effectively.
There is a mass of literature in America also about the socalled delegated legislation, but if the judgments of the eminent American Judges are carefully studied, it will be found that, though in some cases they have used the expression in the popular sense, yet in many cases they have been as careful as the Privy Council in laying down the principles and whenever they have upheld any provision impugned before them on the ground that it was delegation of legislative authority they have rested their conclusion upon the fact that there was in law no such delegation.
The learned Attorney General has relied on the authority of Evatt J. for the proposition that "the true nature and scope of the legislative power of the Parliament involves as part of its content power to confer law making power upon authorities other than Parliament itself"(1).
It is undoubt edly true that a legislature which is sovereign within its own sphere must necessarily have very great freedom of action, but it seems to me that in strict point of law the dictum of Evatt J. is not a precise or an accurate state ment.
The first question which it raises is what is meant by law making power and whether such power in the true sense of the term can be delegated at all.
Another difficulty which it raises is that once it is held as a general proposition that delegation of lawmaking power is implicit in the power of legislation, it will be difficult to draw the line at the precise point where the legislature should stop and it will be permissible to ask whether the legislature is competent to delegate 1, 10 or 99 per cent of its legislative power, and whether the strictly logical conclusion will not be that the legislature can delegate the full content of its power in certain cases.
It seems to me that the correct and the strictly legal way of putting the matter is as the Privy Council have put it in several cases.
The legislature in order to function effectively, has to call for sufficient data, has to (1) See the Victorian Stevedoring case: 830 legislate for the future as well as for the present and has to provide for a multiplicity of varying situations which may be sometimes difficult to foresee.
In order to achieve its object, it has to resort to various types and forms of legislation, entrusting suitable agencies with the power to fill in details and adapt legislation to varying circum stances.
Hence, what is known as conditional legislation, an expression which has been very fully explained and de scribed in a series of judgments, and what is known as subordinate legislation, which involves giving power to subordinate authorities to make rules and regulations to effectuate the object and purpose for which a certain law is enacted, have been recognized to be permissible forms.
of legislation on the principle that a legislature can do everything which is ancillary to or necessary for effective legislation.
Once this is conceded, it follows that the legislature can resort to any other form of legislation on the same principle, provided that it acts within the limits of its power, whether imposed from without or conditioned by the nature of the duties it is called upon to perform.
The conclusions at which I have arrived so far may now be summed up : (1) The legislature must normally discharge its primary legislative function itself and not through others.
(2) Once it is established that it has sovereign powers within a certain sphere, it must follow as a corollary that it is free to legislate within that sphere in any way which appears to it to be the best way to give effect to its intention and policy in making a particular law, and that it may utilize any outside agency to any extent it finds neces sary for doing things which it is unable to do itself or finds it inconvenient to do.
In other words, it can do everything which is ancillary to and necessary for the full and effective exercise of its power of legislation.
(3) It cannot abdicate its legislative functions, and therefore while entrusting power to an outside 831 agency, it must see that such agency, acts as a subordinate authority and does not become a parallel legislature.
(4) The doctrine of separation of powers and the judi cial interpretation it has received in America ever since the American Constitution was framed, enables the American courts to check undue and excessive delegation but the courts of this country are not committed to that doctrine and cannot apply it in the same way as it has been applied in America.
Therefore, there are only two main checks in this country on the power of the legislature to delegate, these being its good sense and the principle that it should not cross the line beyond which delegation amounts to "abdicacation and self effacement".
I will now deal with the three specific questions with which we are concerned in this Reference, these being as follows : (1) Was section 7 of the , or any of the provisions thereof and in what particular or particulars or to what extent ultra vires the legislature which passed the said Act ? (2) Was the Ajmer Merwara (Extension of Laws) Act, 1947, or any of the provisions thereof and in what particular or particulars or to what extent ultra vires the legislature which passed the said Act ? (3) Is section 2 of the Part C States (Laws) Act, 1950, or any of the provisions thereof and in what particular or particulars or to what extent ultra vires the Parliament ? Before attempting to answer these questions, it will be Useful to state briefly a few salient facts about the compo sition and power of the Indian Legislature at the dates on which the three Acts in question were passed.
It appears that formerly it was the executive Government which was empowered to make regulations and ordinances for "the good government of the factories and territories acquired in India", and up to 1833, the laws used to be passed by the Governor General in Council or by the Governors of Madras and 832 Bombay in Council, in the form of regulations.
By the Charter Act of 1833, the Governor General 's Council was extended by the inclusion of a fourth member who was not entitled to sit or vote except at meetings for making laws and regulations.
The Governor General in Council was by this Act empowered to make laws and regulations for the whole of India and the legislative powers which vested in the Governors of Madras and Bombay were withdrawn, though they were allowed to propose draft schemes.
The Acts passed by the Governor General in Council were required to be laid before the British Parliament and they were to have the same force as an Act of Parliament.
In 1853, the strength of the Council of the Governor General was further increased to 12 members, by including the fourth member as an ordinary member and 6 special members for the purpose of legislation only.
Then came the Councils Act of 1861, by which the power of legislation was restored to the Governors of Madras and Bombay in Council, and a legislative council was ap pointed for Bengal; but the Governor General in Council was still competent to exercise legislative authority over the whole of India and could make laws for "all persons and all places and things", and for legislative purposes the Council was further remodelled so as to include 6 to 12 members nominated for a period of 2 years by the Governor General, of whom not less than one half were to be non officials.
In this Council, no measure relating to certain topics could be introduced without the sanction of the Governor General, and no law was to be valid until the Governor General had given his assent to it and the ultimate power of disallowing a law was reserved to the Crown.
Further, local legislatures were constituted for Madras and Bombay, wherein half the members were to be non officials nominated by the Governors, and the assent of the Governor as well as that of the Governor General was necessary to give validity to any law passed by the local legislature.
A similar legislature was directed to be constituted for the lower Provinces of Bengal, 833 and powers were given to constitute legislative councils for certain other Provinces.
In 1892, the Indian Councils Act was passed, by which the legislative councils were further expanded and certain fresh rights were given to the members.
In 1909, came the MorleyMinto scheme under which the strength of the legislative council was increased by the inclusion of 60 additional members of whom 27 were elected and 33 nominated.
Soon after this, in 1912, the was passed, and the points which may be noticed in connection with the legislature which functioned at that time are: firstly, within its ambit, its powers were as plenary as those of the legislature of 1861, whose powers came up for consideration before the Privy Council in Bu rah 's case, and secondly, considering the composition of the legislative council in which the non official and the executive elements predominated, there was no room for the application of the doctrine of separation of powers in its full import, nor could it be said that by reason of that doctrine the legislature could not invest the GovernorGener al with the powers which we find him invested with under the .
It should be stated that in section 7 of that Act as it originally stood, the Governor General was mentioned as the authority who could by notification extend any enactment which was in force in any part of British India at the date of such notification, The "Provincial Government" was substituted for the "Governor General" subsequently.
Coming to the second Act, namely, the Ajmer Merwara (Extension of Laws) Act, 1947, we find that when it was enacted on the 31st December, 1947, the Government of India Act, 1935, as adapted by the India (Provisional Constitu tion) Order, 1947, issued under the Indian Independence Act, 1947, was in force.
Under that Act, there were three Legis lative Lists, called the Federal, Provincial and Concurrent Legislative Lists.
Lists I and II contained a list of sub jects on which the Central Legislature and the Provincial Legislature could respectively legislate, and List III contained subjects on which both the Central and the 834 Provincial Legislatures could legislate.
Section 100(4) of the Act provided that "the Dominion Legislature has power to make laws with ' respect to matters enumerated in the Provin cial Legislative List except for a Province or any part thereof.
" Section 46 (3) stated that the word "Province", unless the context otherwise required, meant a Governor 's Province.
Therefore, section 100 (4) read with the defini tion of "Province", empowered the Dominion Legislature to make laws with respect to subjects mentioned in all the three Lists for Ajmer Merwara, which was not a Governor 's Province.
The Central Legislature was thus competent to legislate for Ajmer Merwara in regard to any subject, and it had also plenary powers in the entire legislative field allotted to it.
Further, at the time the Act in question was passed, the Dominion Legislature was simultaneously functioning as the Constituent Assembly and had the power to frame the Constitution.
The third Act with which we are concerned was passed after the present Constitution had come into force.
Article 245 of the Constitution lays down that "subject to the provisions of this Constitution, Parliament may make laws from the whole or any part of the territory of India, and the Legislature of a State may make laws for the whole or any part of the State.
" On the pattern of the Government of India Act, 1935, Lists I and II in the Seventh Schedule of the Constitution enumerate the subjects on which the Parlia ment and the State Legislatures can respectively legislate, while List 11 enumerates subjects on which both the Parlia ment and the State Legislatures can legislate.
Under article 246 (4), "Parliament has power to make laws with respect to any matter for any part of the territory of India not in cluded in Part A or Part B of the First Schedule notwith standing that such matter is a matter enumerated in the State List.
" The points to be noted in connection with the Part C States (Laws) Act, 1950, are : (1) The present Parliament derives its authority from the Constitution which has been framed by the 835 people of India through their Constituent Assembly, and not from any external authority, and within its own field it is as supreme as the legislature of any other country possess ing a written federal Constitution.
(2) The Parliament has full power to legislate for the Part C States in regard to any subject.
(3) Though there is some kind of separation of govern mental functions under the Constitution, yet the Cabinet system, which is the most notable characteristic of the British Constitution, is also one of the features of our Constitution and the doctrine of separation of powers, which never acquired that hold or significance in this country as it has in America, cannot dominate the interpretation of any of the Constitutional provisions.
I may here refer to an argument which is founded on articles 353 (b) and 357 (a) and (b) of the Constitution.
Under article 353 (b), when a Proclamation of Emergency is made by the President " the power of Parliament to make laws with respect to any matter shall include power to make laws conferring powers and imposing duties, or authorising the conferring of powers and the imposition of duties, upon the Union or officers and authorities of the Union as respects that matter, notwithstanding that it is one which is not enumer ated in the Union List.
" Under article 357, when there is a failure of constitu tional machinery in a State, "it shall be competent (a) for Parliament to confer on the President the power of the Legislature of the State to make laws, and to autho rise the President to delegate, subject to such conditions as he may think fit to impose, the power so conferred to any other authority to be specified by him in that behalf; (b) for Parliament, or for the President or other au thority in whom such power to make laws is vested under sub clause (a), to make laws conferring powers and imposing duties, or authorising the Conferring of 108 836 powers and the imposition of duties, upon the Union or officers and authorities thereof.
In both these articles, the power of delegation is ex pressly conferred, and it is argued that if delegation was contemplated in normal legislation, there would have been an express power given to the ' Parliament, similar to the power given in articles 353(b) and 357(a) and (b).
In other words, the absence of an express provision has been used as an argument for absence of the power to delegate.
It should however be noticed that these are emergency provisions and give no assistance in deciding the question under considera tion.
So far as article 353(b) is concerned, it is enough to say that a specific provision was necessary to empower the Parliament to make laws in respect of matters included in the State List upon which the Parliament was not otherwise competent to legislate.
When the Parliament was specially empowered to legislate in a field in which it could not normally legislate, it was necessary to state all the powers it could exercise.
Again, article 357(a) deals with complete transfer of legislative power to the President, while clause (b) is incidental to the powers conferred on the Parliament and the President to legislate for a State in case of fail ure of constitutional machinery in that State.
These provi sions do not at all bear out the conclusion that is sought to be drawn from them.
Indeed, the Attorney General drew from them the opposite inference, namely, that by these provisions the Constitution makers have recognized that delegation of power is permissible on occasions when it is found to be necessary.
In my opinion, neither of these conclusions can be held to be sound.
I will now deal with the three provisions in regard to which the answer is required in this Reference.
They are as follows: Section 7 of the .
"The Provincial Government may, by notification in the official gazette, extend with such restrictions and modifi cations as it thinks fit to the Province of Delhi or any part thereof, any enactment which is in 837 force in any part of British India at the date of such notification.
" Section 2 of the Ajmer Merwara (Extension of Laws).
Act, 1947.
"The Central Government may, by notification in the official gazette, extend to the Province of Ajmer Merwara with such restrictions and modifications as it thinks fit any enactment which is in force in any other Province at the date of such notification.
" Section 2 of the Part C States (Laws) Act, 1950. "The Central Government may, by notification in the official Gazette, extend to any Part C State (other than Coorg and the Andaman and Nicobar Islands) or to any part of such State, with such restrictions and modifications as it thinks fit, any enactment which is in force in a Part A State at the date of the notification; and provision may be made in any enactment so extended for the repeal or amend ment of any corresponding law (other than a Central Act) which is for the time being applicable to that Part C State.
" At the first sight, these provisions appear to be very wide, their most striking features being these : 1.
There is no specification in the Act by way of a list or schedule of the laws out of which the selection is to be made by the Provincial or the Central Government, as the case may be, but the Government has been given complete discretion to adopt any law whatsoever passed in any part of the country, whether by the Central or the Provincial Legis lature.
The provisions are not confined merely to the laws in existence at the dates of the enactment of these Acts but extend to future laws also.
The Government concerned has been empowered not only to extend or adopt the laws but also to introduce such restrictions and modifications as it thinks fit; and in the Part C States (Laws) Act, 1950, power has been given to the Central Government to make a provision in the enactment extended under the Act for the repeal or amendment of any corresponding law 838 (other than a Central Act) which is for the time being applicable to the Part C State concerned.
There can be no doubt that the powers which have been granted to the Government are very extensive and the three Acts go farther than any Act in England or America, but, in my judgment, nothwithstanding the somewhat unusual features to which reference has been made, the provisions in question cannot be held to be invalid.
Let us overlook for the time being the power to intro duce modifications with which I shall deal later, and care fully consider the main provision in the three Acts.
The situation with which the respective legislatures were faced when these Acts were passed, was that there were certain State or States with no local legislature and a whole bundle of laws had to be enacted for them.
It is clear that the legislatures concerned, before passing the Acts, applied their mind and decided firstly, that the situation would be met by the adoption of laws applicable to the other Prov inces inasmuch as they covered a wide range of subjects approached from a variety of points of view and hence the requirements of the State or States for which the laws had to be framed could not go beyond those for which laws had already been framed by the various legislatures, and second ly, that the matter should be entrusted to an authority which was expected to be familiar and could easily make itself familiar with the needs and conditions of the State or States for which the laws were to be made.
Thus, everyone of the Acts so enacted was a complete law, because it em bodied a policy, defined a standard, and directed the au thority chosen to act within certain prescribed limits and not to go beyond them.
Each Act was a complete expression of the will of the legislature to act in a particular way and of its command as to how its will should be carried out.
The legislature decided that in the circumstances of the case that was the best way to legislate on the subject and it so legislated.
It will be a misnomer to describe such legisla tion as amounting to abdication of powers, because from the very nature of the legislation 839 it is manifest that the legislature had the power at any moment of withdrawing or altering any power with which the authority chosen was entrusted, and could change or repeal the laws which the authority was required to make applica ble to the State or States concerned.
What is even more important is that in each case the agency selected was not empowered to enact laws, but it could only adapt and extend laws enacted by responsible and competent legislatures.
Thus, the power given to the Governments in those Acts was more in the nature of ministerial than in the nature of legislative power.
The power given was ministerial, because all that the Government had to do was to study the laws and make selections out of them.
That such legislation is neither unwarranted on princi ple nor without precedent, will be clear from what follows: 1.
The facts of the case of Queen vs Burah(1) are so familiar that they need not be reproduced, but for the purpose of understanding the point under discussion, it will be necessary to refer to section 8 of Act XXII of 1869 and some of the observations of the Privy Council which obvious ly bear on that section.
The section runs as follows : "The said Lieutenant Governor may from time to time, by notification in the Calcutta Gazette, extend to the said territory any law, or any portion of any law, now in force in the other territories subject to his Government, or which may hereafter be enacted by the Council of the Governor General, or of the said Lieutenant Governor, for making laws and regulations, and may on making such extension direct by whom any powers or duties incident to the provi sions so extended shall be exercised or performed, and make any order which he shall deem requisite for carrying such provisions into operation.
" In their judgment, the Privy Council do not quote this section, but evidently they had it in mind when they made the following observations : (1) 5 I.A. 178. 840 "The legislature determined that, so far, a certain change should take place; but that it was expedient to leave the time and the manner, of carrying it into effect to the discretion of the Lieutenant Governor; and also, that the laws which were or might be in force in the other territo ries subject to the same Government were such as it might be fit and proper to apply to this district also; but that,.as it was not certain that all those laws, and every part of them, could with equal convenience be so applied, it was expedient, on that point also, to entrust a discretion to the Lieutenant Governor.
" The language used here can be easily adapted in the following manner so as to cover the laws in question: "The legislature determined that . . the laws which were or might be in force in the other territories . . (omitting the words "subject to the same Government" for reasons to be stated presently) were such as it might be fit and proper to apply to this State also; but that, as it was not certain that all those laws, and every part of them, could with equal convenience be so applied, it was expedient, on that point also, to entrust a discretion to the Central or Provincial Government.
" It seems to me that this line of reasoning fully fits in with the facts before us.
The words "territories sub ject to the same Government" are not in my opinon material, because in Burah 's case only such laws as were in force in the other territories subject to the same Government were to be extended.
We are not to lay undue emphasis on isolated words but look at the principle underlying the decision in that case.
In the as originally enacted, the agency which was to adapt the laws was the Governor General.
In the other two Acts, the agency was the Central Govern ment.
In 1912, the Governor General exercised jurisdiction over the whole of the territories the laws of which were to be adapted for Delhi.
The same remark applies to the Central Government, while dealing with the other two Acts.
As I have already 841 stated, Burah 's case has been accepted by this Court as having been correctly decided, and we may well say that the impugned Acts are mere larger editions of Act XXII of 1869 which was in question in Burah 's case.
It is now well settled in England and in America that a legislature can pass an Act to allow a Government or a local body or some other agency to make regulations consist ently with the provisions of the Act.
At no stage of the arguments, it was contended before us that such a power cannot be granted by the legislature to another body.
We have known instances in which regulations have been made creating offences and imposing penalties and they have been held to be valid.
It seems to me that the making of many of these regulations involves the exercise of much more legis lative power and discretion than the selection of appropri ate laws out of a mass of ready made enactments.
The fol lowing observations in a well known American case, which furnish legal justification for empowering a subordinate authority to make regulations, seem to me pertinent : "It is well settled that the delegation by a State legislature to a municipal corporation of the power to legislate, subject to the paramount law, concerning local affairs, does not violate the inhibition against the delega tion of the legislative function.
It is a cardinal principle of our system of government that local affairs shall be managed by local authorities, and general affairs by the central authority, and hence, while the rule is also fundamental that the power to make laws cannot be delegated, the creation of municipalities exercising local self government has never been held to trench upon that rule.
Such legislation is not regarded as a transfer of general legislative power, but rather as the grant of the authority to prescribe local regulations, according to immemorial practice, subject, of course, to the interposition of the superior in cases of necessity." (Per Fuller J. in Stoutenburgh vs Hennick(1).
(1) ; 842 3.
A point which was somewhat similar to the one raised before us arose in the case of Sprigg vs Sigcau(1).
In that case, section 2 of the Pondoland Annexation Act, 1894, was brought into question.
That section gave authority to the Governor to add to the existing laws in force in the terri tories annexed, such laws as he shall from time to time by Proclamation declare to be in force in such territories.
Dealing with this provision, the Privy Council observed as follows : "The legislative authority delegated to the Governor by the Pondoland Annexation Act is very cautiously expressed, and is very limited in its scope.
There is not a word in the Act to suggest that it was intended to make the Governor a dictator, or even to clothe him with the full legislative powers of the Cape Parliament.
His only authority, after the date of the Act, is to add to the laws, statutes and ordi nances which had already been proclaimed and were in force at its date, such laws, statutes and ordinances as he 'shall from time to time by proclamation declare to be in force in such territories '.
In the opinion of their Lordships, these words do not import any power in the Governor to make "new laws" in the widest sense of that term; they do no more than authorise him to transplant to the new territories, and enact there, laws, statutes and ordinances which already exist, and are operative in other parts of the Colony.
It was argued for the appellant that the expression "all such laws made" occurring in the proviso, indicates authority to make new laws which are not elsewhere in force; but these words cannot control the plain meaning of the enactment upon which they are a proviso; and, besides that enactment is left to explain the meaning of the proviso by the reference back which is implied in the word "such" (pp. 247 8).
Following the line of reasoning in the case cited, it may be legitimately stated that what the Central or the Provincial Government has been asked to do under the Acts in question is not to enact "new laws" but to transplant" to the territory concerned laws operative (1) , 843 in other parts of the country.
I notice that in section 2 of the Pondoland Annexation Act, 1894, there was a proviso requiring that "all such laws made under or by virtue of this Act shall be ]aid before both Houses of Parliament within fourteen days after the beginning of the Session of Parliament next after the proclamation thereof as aforesaid, and shall be effectual, unless in so far as the same shall be repealed, altered, or varied by Act of Parliament." This provision however does not affect the principle.
It was made only as a matter of caution and to ensure the superin tendence of Parliament, for the laws were good laws until they were repealed, altered or varied by Parliament.
If the Privy Council have correctly stated the principle that the legislature in enacting subordinate or conditional legisla tion does not part with its perfect control and has the power at any moment of withdrawing or altering the power entrusted to another authority, its power of superintendence must be taken to be implicit in all such legislation.
Refer ence may also be made here to the somewhat unusual case of Dorr vs United States(1), where delegation by Congress to a commission appointed by the President of the power to legis late for the Phillipine Islands was held valid.
There are also some American cases in which the adopt ing of a law or rule of another jurisdiction has been per mitted, and one of the cases illustrative of the rule is Re Lasswell(2), where a California Act declaring the existence of an emergency and providing that where the Federal author ities fixed a Code for the government of any industry, that Code automatically became the State Code therefor, and fixing a penalty for violation of such Codes, was held to be constitutional and valid, as against the contention that it was an unlawful delegation of authority by the State legis lature to the Federal government and its administrative agencies.
This case has no direct bearing on the points before us, but it shows that application of laws made (1) ; (2) (1934) 1 Cal.
(2d), 183.
109 844 by another legislature has in some cases been held to be permissible.
There are many enactments in India, which are not without their parallel in England, in which it is stated that the provisions of the Act concerned shall apply to certain areas in the first instance and that they may be extended by the Provincial Government or appropriate author ity to the whole or any part of a Province.
The , is an instance of such enactment, as section 1 thereof provides as follows : "It (the Act) extends in the first instance to all the Provinces of India except Bombay, East Punjab and Delhi.
But this Act or any part thereof may by notification in the official Gazette be extended to the whole or any part of the said Provinces by the Provincial Government concerned.
" It is obvious that if instead of making similar provi sions in 50 or more Acts individually, a single provision is made in any one Act enabling the Provincial Governments to extend all or any of the 50 or more Acts, in which provision might have been but has not been made for extension to the whole or any part of the Provinces concerned there would be no difference in principle between the two alternatives.
It was pointed out to us that in the Acts with which we are concerned, power has been given to extend not only Acts of the Central Legislature, which is the author of the Acts in question, but also those of the Provincial Legislatures.
But it seems to me that the distinction so made does not affect the principle involved.
The real question is: Can authority be given by a legislature to an outside agency, to extend an Act or series of Acts to a particular area ? This really brings us back to the principle of conditional legislation which is too deeply rooted in our legal system to be ques tioned now.
Our attention has been drawn to several Acts con taining provisions similar to the Acts 845 which are the subject of the Reference, these being : 1.
Sections 1 and 2 of Act I of 1865.
Sections 5 and 5A of the Scheduled Districts Act, 1874 (Act XIV of 1874).
The Burma Laws Act, 1898 (Act XIII of 1898).
section 10 (1).
Section 4 of the (Act XLVII of 1947).
The Merchant Shipping Laws (Extension to Acceding States and Amendment) Act, 1949 (Act XVIII of 1949), section 4.
The relevant provisions of two of these Acts, which were passed before the Acts in question, may be quoted, to bring out the close analogy.
The Scheduled Districts Act, 1874.
"The Local Government, with the previous sanction of the Governor General in Council, may, from time to time by notification in the Gazette of India and also in the local Gazette (if any), extend to any of the Scheduled Districts, or to any part of any such District, any enactment which is in force in any part of British India at the date of such extension.
In declaring an enactment in force in a Scheduled District or part thereof under section 3 of this Act, or in extending an enactment to a Scheduled District or part thereof under section 5 of this Act, the Local Government with the previous sanction of the Governor General in Coun cil, may declare the operation of the enactment to be sub ject to such restrictions and modifications as that Govern ment think fit.
" The Burma Laws Act, 1898.
10(1).
"The Local Government, with the previous sanction of the Governor General in Council, may, by notification in the Burma Gazette, extend, with such restrictions and modi fications as it thinks fit, to all or any of the Shan States, or to any specified local area in the Shan State any enactment which is in force 846 in any part of Upper Burma at the date of the extension.
" It is hard to say that any firm legislative practice had been established before the and other Acts we are concerned with were enacted, but one may presume that the legislature had made several experiments before the passing of these Acts and found that they had worked well and achieved the object for which they were intended.
I will now deal with the power of modification which de pends on the meaning of the words "with such modifications as it thinks fit.
" These are not unfamiliar words and they are often used by careful draftsmen to enable laws which are applicable to one place or object to be so adapted as to apply to another.
The power of introducing necessary re strictions and modifications is incidental to the power to apply or adapt the law, and in the context in which the provision as to modification occurs, it cannot bear the sinister sense attributed to it.
The modifications are to be made within the framework of the Act and they cannot be such as to affect its identity or structure or the essential purpose to be served by it.
The power to modify certainly involves a discretion to make suitable changes, but it would be useless to give an authority the power to adapt a law without giving it the power to make suitable changes.
The provision empowering an extraneous authority to introduce modifications in an Act has been nicknamed in England as "Henry VIII clause", because that monarch is regarded popu larly as the personification of executive autocracy.
Sir Thomas Carr, who bad considerable experience of dealing with legislation of the character we are concerned with, refers to "Henry VIII clause" in this way in his book "Concerning English Administrative Law" at page 44: "Of all the types of orders which alter statutes, the so called 'Henry VIII clause ' sometimes inserted in big and complicated Acts, has probably caused the greatest flutter in England.
It enables the Minister 847 by order to modify the Act itself so far as necessary for bringing it into operation.
Any one who will look to see what sort of orders have been made under this power will find them surprisingly innocuous.
The device is partly a draftsman 's insurance policy, in case he has overlooked something, and is partly due to the immense body of local Acts in England creating special difficulties in particular areas.
These local Acts are very hard to trace, and the draftsman could never be confident that he has examined them all in advance.
The Henry VIII clause ought, of course, to be effective for a short time only.
" It is to be borne in mind that the discretion given to modify a statute is by no means absolute or irrevocable in strict legal sense, with which aspect alone we are princi pally concerned in dealing with a purely legal question.
As was pointed out by Garth C.J. in Empress vs Burah(1), the legislature is " 'always in a position to see how the powers, which it has conferred, are being exercised, and if they are exercised injudiciously, or otherwise than in accordance with its intentions, or if, having been exercised, the result is in any degree inconvenient, it can always by another Act recall its powers, or rectify the inconvenience." The learned Chief Justice, while referring to the Civil Procedure Code of 1861, pointed out that it went further than the Act impugned before him, because "it gave the Local Governments a power to alter or modify the Code in any way they might think proper, and so as to intro duce a different law into their respective Provinces from that which was in force in the Regulation Provinces." Nevertheless, the Privy Council considered the Civil Proce dure Code of 1861 to be a good example of valid conditional legislation.
In the course of the arguments, we were sup plied with a list of statutes passed by the Central and some of the Provincil Legislatures giving express power of modi fication to certain authorities, and judging from the number of instances included in it, it is not an unimpressive list.
A few of the Acts which may be mentioned by (1) I.L.R. S Cal. 63 at 140.
848 way of illustration are: The Scheduled Districts Act, 1874, The Burma Laws Act, 1898, The Bombay Prevention of Prostitu tion Act, 1928, The Madras City Improvement Trust Act, 1945, The Madras Public Health Act, 1939, U.P. Kand Revenue Act, 1901.
There are also many instances of such legislation in England, of which only a few may be mentioned below to show that such Acts are by no means confined to this coun try.
In 1929, a Bill was proposed to carry out the policy of having fewer and bigger local authority in Scotland.
During the debate, it was suddenly decided to create a new kind of body called the district council.
There was no time to work out details for electing the new district councillors, and the Bill therefore applied to them the statutory provisions relating to the election of county councillors in rural areas "subject to such modifications and adaptations as the Secretary of State may by order prescribe." In 1925, the Parliament passed the Rating and Valua tion Act, and section 67 thereof provided that if any diffi culty arose in connection with its application to any excep tional area, or the preparation of the first valuation list for any area, the Minister "may by order remove the diffi culty.
" It was also provided that "any such order may modify the provisions of this Act so far as may appear to the Minister necessary or expedient for carrying the order into effect." In 1929, a new Local Government Bill was introduced in Parliament, and section 120 thereof provided that "the Minister may make such order for removing difficulties as he may judge necessary. . and any such order may modify the provisions of this Act.
" Section 1(2) of the Road Transport Lighting Act, 1927, provided that" the Minister of Transport may exempt wholly or partially, vehicles of particular kinds from the require ments of the Act," and sub section (3) empowered him to "add to or vary such requirements" by regulations.
849 By section 1 of the Trade Boards Act, 1918, "the Minis ter of Labour may, by special order, extend the provisions of the Trade Boards Act, 1909, to new trades. . and may alter or amend the Schedule to the Act.
" The Unemployment Insurance Act, 1920, by sec tion 45 provided that "if any difficulty arises with respect to the constitution of special or supplementary schemes. . the Minister of Labour. . may by order do anything which appears to him to be necessary or expedient. . and any such order may modify the provi sions of this Act. . " Similar instances may be multiplied, but that will serve no useful purpose.
The main justification for a provision empowering modifications to be made, is said to be that, but for it, the Bills would take longer to be made ready, and the operation of important and wholesome measures would be delayed, and that once the Act became operative, any defect in its provisions cannot be removed until amending legisla tion is passed.
It is also pointed out that the power to modify within certain circumscribed limits does not go as far as many other powers which are vested by the legislature in high officials and public bodies through whom it decides to act in certain matters.
It seems to me that it is now too late to hold that the Acts in question are ultra vires, merely because, while giving the power to the Government to extend an Act, the legislatures have also given power to the Government to subject it to such modifications and restric tions as it thinks fit.
It must, however, be recognised that what is popularly known as the "Henry VIII clause" has from time to time provoked unfavourable comment in England, and the Committee on Ministers ' Powers, while admitting that it must be occasionally used, have added:" . . we are clear in our opinion, first, that the adoption of such a clause ought on each occasion when it is, on the initiative of the Minister in charge of the Bill, proposed to Parliament to be justified by him up to the essential.
It can only be essential for the limited purpose of 850 bringing an Act into operation and it should accordingly be in most precise language restricted to those purely machin ery arrangements vitally requisite for that purpose;and the clause should always contain a maximum time limit of one year after which the powers should lapse.
If in the event the time limit proves too short which is unlikely the Government should then come back to Parliament with a one clause Bill to extend it.
" It may also be stated that in England "delegated legislation" often requires the regula tions or provisions made by the delegate authority to be laid before the Parliament either in draft form or with the condition that they are not to operate till approved by Parliament or with no further direction.
The Acts before us are certainly open to the comment that this valuable safe guard has not been observed, but it seems to me that however desirable the adoption of this safeguard and other safe guards which have been suggested from time to time may be, the validity of the Acts, which has to be determined on purely legal considerations, cannot be affected by their absence.
I will now deal with section 2 of the Part C States (Laws) Act, 1950, in so far as it gives power to the Central Government to make a provision in the enactment extended under the Act for the repeal or amendment of any correspond ing law which is for the time being applicable to the Part C State concerned.
No doubt this power is a far reaching and unusual one, but, on a careful analysis, it will be found to be only a concomitant of the power of transplantation and modification.
If a new law is to be made applicable, it may have to replace some existing law which may have become out of date or ceased to serve any useful purpose, and the agency which is to apply the new law must be in a position to say that the old law would cease to apply.
The nearest parallel that I can find to this provision, is to be found in the Church of England Assembly (Powers) Act, 1919.
By that Act, the Church Assembly is empowered to propose legislation touching matters concerning the Church of England, and 851 the legislation proposed may extend to the repeal or amend ment of Acts of Parliament including the Church Assembly Act itself.
It should however be noticed that it is not until Parliament itself gives it legislative force on an affirma tive address of each House that the measure is converted into legislation.
There is thus no real analogy between that Act and the Act before us.
However, the provision has to be upheld, because, though it goes to the farthest limits, it is difficult to hold that it was beyond the powers of a legislature which is supreme in its own field; and all we can say is what Lord Hewart said in King vs Minister of Health(1), namely, that the particular Act may be regarded as "indicating the high water mark of legislative provisions of this character," and that, unless the legislature acts with restraint, a stage may be reached when legislation may amount to abdication of legislative powers.
Before I conclude, I wish to make a few general observa tions here on the subject of "delegated legislation" and its limits, using the expression once again in the popular sense.
This form of legislation has become a present day necessity, and it has come to stay it is both inevitable and indispensable.
The legislature has now to make so many laws that it has no time to devote to all the legislative details, and sometimes the subject on which it has to legis late is of such a technical nature that all it can do is to state the broad principles and leave the details to be worked out by those who are more familiar with the subject.
Again, when complex schemes of reform are to be the subject of legislation, it is difficult to bring out a selfcontained and complete Act straightaway, since it is not possible to foresee all the contingencies and envisage all the local requirements for which provision is to be made.
Thus, some degree of flexibility becomes necessary, so as to permit constant adaptation to unknown future conditions without the necessity of having to amend the law again and again.
The advantage of such a course is that it enables the delegate authority (1) at 236.
110 852 to consult interests likely to be affected by a particular law, make actual experiments when necessary, and utilize the results of its investigations and experiments in the best way possible.
There may also arise emergencies and urgent situations requiring prompt action and the entrustment of large powers to authorities who have to deal with the var ious situations as they arise.
There are examples in the Statute books of England and other countries, of laws, a reference to which will be sufficient to justify the need for delegated legislation.
The British Gold Standard (Amendment) Act, 1931, empowered the Treasury to make and from time to time vary orders authorising the taking of such measures in relation to the Exchanges and otherwise as they may consider expedient for meeting difficulties arising in connection with the suspension of the Gold Standard.
The National Economy Act, 1931, of England, empowered "His Majesty to make Orders in Council effecting economies in respect of the services specified in the schedule" and proved that the Minister designated in any such Order might make regulations for giving effect to the Order.
The Food stuffs (Prevention of Exploitation) Act, 1931, authorised the Board of Trade to take exceptional measures for prevent ing or remedying shortages in certain articles of food and drink.
It is obvious that to achieve the objects which were intended to be achieved by these Acts, they could not have been framed in any other way than that in which they were framed.
I have referred to these instances to show that the complexity of modern administration and the expansion of the functions of the State to the economic and social sphere have rendered it necessary to resort to new forms of legis lation and to give wide powers to various authorities on suitable occasions.
But while emphasizing that delegation is in these days inevitable, one should not omit to refer to the dangers attendant upon the injudicious exercise of the power of delegation by the legislature.
The dangers in volved in defining the delegated power so loosely that the area it is intended to cover cannot be clearly ascertained, and in giving 853 wide delegated powers to executive authorities and at the same time depriving a citizen of protection by the courts against harsh and unreasonable exercise of powers, are too obvious to require elaborate discussion.
For the reasons I have set out, I hold that none of the provisions which are the subject of the three questions referred to us by the President is ultra vires and I would answer those questions accordingly.
PATANJALI SASTRI J. The President of India by an order, dated the 7th January, 1951, has been pleased to refer to this Court, under article 14:3 (1) of the Constitution, for consideration and report the following questions: 1.
Was section 7 of the , or any of the provisions thereof and in what particular or particu lars or to what extent ultra vires the legislature which passed the said Act ? 2.
Was the Ajmer Merwara (Extension of Laws) Act, 1947, or any of the provisions thereof and in what particular or particulars or to what extent ultra vires the legislature which passed the said Act ? 3.
Is section 2 of the Part C States (Laws) Act, 1950, or any of the provisions thereof and in what particular or particulars or to what extent ultra rites the Parliament ? The reasons for making the reference are thus set out in the letter of reference: "And whereas the Federal Court of India in Jatindra Nath Gupta vs The Province of Bihar(1) held by a majority that the proviso to sub section (3) of section 1 of the Bihar Maintenance of Public Order Act, 1947, was ultra vires the Bihar Legislature inter alia on the ground that the said proviso conferred power on the Provincial Government to modify an act of the Provincial Legislature and thus amounted to a delegation of legislative power; And whereas as a result of the said decision of the Federal Court, doubts have arisen regarding (1) 854 the validity of section 7 of the , section 2 of the Ajmer Merwara (Extension of Laws) Act, 1947, and section 2 of the Part C States (Laws) Act, 1950, and of the Acts extended to the Provinces of Delhi and Ajmer Merwara and various Part C States under the said sections respectively, and of the orders and other instru ments issued under the Acts so extended; And whereas the validity of section 7 of the , and section 2 of the Ajmer Merwara (Extension of Laws) 'Act, 1947, and of the Acts extended by virtue of the powers conferred by the said sections has been challenged in some cases pending at present before the Punjab High Court, the Court of the Judicial Commissioner of Ajmer, and the District Court and the Subordinate Courts in Delhi.
" The provisions referred to above are as follows: Section 7 of the : The Provincial Government may, by notification in the official Gazette, extend with such restrictions and modifi cations as it thinks fit to the Province of Delhi or any part thereof, any enactment which is in force in any part of British India at the date of such notification.
" Section 2 of the Ajmer Merwara (Extension of Laws) Act, 1947: "Extension of enactments to Ajmer Merwara.
The Central Government may, by notification in the official Gazette, extend to the Province of Ajmer Merwara with such restric tons and modifications as it thinks fit any enactment which is in force in any other Province at the date of such noti fication.
Section 2 of the Part C States (Laws) Act 1950: "Power to extend enactments to certain Part C States.
The Central Government may, by notification in the official Gazette, extend to any Fart C State (other than Coorg and the Andaman and Nicobar Islands) or to any part of such State, with such restrictions and modifications as it thinks fit, any 855 enactment which is in force in a Part A State at the date of the notification; and provision may be made in any enactment so extended for the repeal or amendment of any corresponding law (other than a Central Act) which is for the time being applicable to that Part C State.
" The Central Legislature, which enacted these provisions, had, at all material times, the power to make laws itself for the designated territories.
But, instead of exercising that power, it empowered the Provincial Government in the first mentioned case, and the Central Government in the others, to extend, by notification in the official Gazette, to the designated territories laws made by Provincial Legis latures all over India for territories within their respec tive jurisdiction.
The principal features of the authority thus delegated to the executive are as follows: (1) The laws thus to be extended by the executive are laws made not by the delegating authority itself, namely, the Central Legislature, but by different Provincial Legis latures for their respective territories.
(2) In extending such laws the executive is to have the power of restricting or modifying those laws as it thinks fit.
(3) The law to be extended is to be a law in force at the time of the notification of extension, that is to say, the executive is empowered not only to extend laws in force at the time when the impugned provisions were enacted, which the Central Legislature could be supposed to have examined and found suitable for extension to the territories in question, but also laws to be made in future by Provincial Legislatures for their respective territories which the Central Legislature could possibly have no means of judging as to their suitability for such extension.
(4) The power conferred on the executive by the enact ments referred to in Question No. a is not only to extend to the designated territories laws made by other legislatures but also to repeal or amend any corresponding law in force in the designated territories.
856 The question is: Was the delegation of such sweeping discretionary power to pick and choose laws made by other legislatures to operate elsewhere and to apply them to the territories in question within the competence of the Central Legislature ? In Jatindra Nath Gupta vs The Province of Bihar (1), which has led to this reference, the Federal Court of India held by a majority (Kania C.J., Mahajan and Mukher jea JJ.) that the proviso to sub section (3) of section 1 of the Bihar Maintenance of Public Order Act, 1937, pur porting to authorise the Provincial Government, on cer tain conditions which are not material here, to extend by notification, the operation of the Act for a further speci fied period after its expiry with or without modifications amounted to a delegation of legislative power and as such was beyond the competence of the legislature.
The deci sion proceeded to some extent on the concession by counsel that delegation of legislative power was incom petent though it must be admitted there are observations in the judgments of their Lordships lending the weight of their authority in support of that view.
Fazl Ali J. in a dissenting judgment held that the power to extend and the power to modify were separate powers and as the Provincial Government had in fact extended the operation of the Act without making any modification in it, the proviso operated as valid conditional legislation.
While agreeing with the conclusion of the majority that the detention of the petitioners in that case was unlawful, 1 preferred to rest my decision on a narrower ground which has no rele vancy in the present discussion.
In the light of the fuller arguments addressed to us in the present case, I am unable to agree with the majority view.
The Attorney General, appearing on behalf of the Presi dent, vigorously attacked the majority view in Jatindra Nath Gupta 's case(1) as being opposed alike to sound con stitutional principles and the weight of authority.
He cited numerous decisions of the Privy (1) 857 Council and of the American, Australian and Canadian Courts and also called attention to the views expressed by various writers on the subject in support of his contention that legislative power involves as part of its content a power to delegate it to other authorities and that a legislative body empowered to make laws on certain subjects and for a certain territory is competent, while acting within its appointed limits, to delegate the whole of its legislative power to any other person or body short of divesting itself completely of such power.
It is now a commonplace of constitutional law that a legislature created by a written constitution must act within the ambit of its powers as defined by the constitu tion and subject to the limitations prescribed thereby, and that every legislative act done contrary the provisions of the constitution is void.
In England no such problem can arise as there is no constitutional limitation on the powers of Parliament, which, in the eye of the law, is sovereign and supreme.
It can, by its ordinary legislative procedure, alter the constitution, so that no proceedings passed by it can be challenged on constitutional grounds in a court of law.
But India, at all material times, in 1912, 1947 and 1950 when the impugned enactments were passed had a written constitution, and it is undoubtedly the function of the courts to keep the Indian legislatures within their consti tutional bounds.
Hence, the proper approach to questions of constitutional validity is "to look to the terms of the instrument by which, affirmatively, the legislative powers were created, and by which, negatively, they were restrict ed.
If what has been done is legislation within the general scope of the affirmative words which gave the power and if it violates no express condition or restriction by which the power is limited (in which category would, of course, be included any Act of the Imperial Parliament at variance with it) it is not for any court of justice to inquire further or, to enlarge constructively those conditions and restrictions.": Empress vs Burah(1).
We (1) s I.A. 178.
858 have,therefore, to examine Whether the delegation of author ity made in each of the impugned enactments is contrary to the tenor of the constitution under which the enactment itself was passed.
No provision is to be found in the relevant constitutions authorising or prohibiting in express terms the delegation of legislative power.
Can a prohibi tion against delegation be derived inferentially from the terms of the constitution and, if so, is there anything in those terms from which such a prohibition can be implied ? Before examining the relevant constitutions to find an answer to the question, it will be useful to refer to the two main theories of constitutional law regarding what has been called delegated legislation.
Though, as already explained, no question of constitutionality of such legisla tion could arise in England itself, such problems have frequently arisen in the British commonwealth countries which have written constitutions, and British Judges, trained in the tradition of parliamentary omnipotence, have evolved the doctrine that every legislature created by an Act of Parliament, though bound to act within the limits of the subject and area marked out for it, is, while acting within such limits, as supreme and sovereign as Parliament itself.
Such legislatures are in no sense delegates of the Imperial Parliament and, therefore, the maxim delegatus non potest delegare is not applicable to them.
A delegation of legislative functions by them, however extensive, so long as they preserve their own capacity, cannot be challenged as unconstitutional.
These propositions were laid down in no uncertain terms in the leading case of Hodge vs Queen(1) decided by the Privy Council in 1883.
Upholding the validity of an enactment by a Provincial Legislature in Canada where by authority was entrusted to a Boar6 of Commissioners to make regulations in the nature of bylaws or municipal regu lations for the good government of taverns and thereby to create offences and annex penalties thereto, their Lordships observed as follows: (1) 9 App.
117 859 "It was further contended that the Imperial Parliament had conferred no authority on the local legislature to delegate those powers to the Licence Commissioners, or any other persons.
In other words, that the power conferred by the Imperial Parliament on the local legislature should be exercised in full by that body, and by that body alone.
The maxim delegatus non potest delegare was relied on.
It appears to their Lordships, however, that the objection thus raised by the appellant is founded on an entire misconcep tion of the true character and position of the provincial legislatures.
They are in no sense delegates of or acting under any mandate from the Imperial Parliament.
When the British North America Act enacted that there should be a legislature for Ontario, and that its legislative assembly should have exclusive authority to make laws for the Prov ince and for provincial purposes in relation to the matters enumerated in section 92, it conferred powers not in any sense to be exercised by delegation from or as agents of the Imperial Parliament, but authority as plenary and as ample within the limits prescribed by section 92 as the Imperial Parliament in the plenitude of its power possessed and could bestow.
Within these limits of subjects and area the local legislature is supreme. . .
It was argued at the bar that a legislature committing important regulations to agents or delegates effaces itself.
That is not so.
It retains its powers intact, and can, whenever it pleases, destroy the agency it has created and set up another, or take the matter directly into its own hands.
How far it can seek the aid of subordinate agencies, and how long it shall continue them, are matters for each legislature, and not for courts of law, to decide.
Here is a clear enunciation of the English doctrine of what may be called "supremacy within limits"; that is to say, within the circumscribed limits of its legislative power, a subordinate legislature can do what the Imperial Parliament can do, and no constitutional limit on its power to delegate can be imported (1) 9 App.
Cas. 117 131, 111 860 on the strength of the maxim delegatus non potest delegare, because it is not a delegate.
The last few words of the quotation are significant.
They insist, as does the pas sage already quoted from Burah 's case(1), that the scope of the enquiry when such an issue is presented to the court is strictly limited to seeing whether the legislature is acting within the bounds of its legislative power.
The remarks about "authority ancillary to legislation" and "abundance of precedents for this.
legislation entrusting a limited des cretionary authority to others " have, obviously, reference to the particular authority delegated on the facts of that case which was to regulate taverns by issuing licences, and those remarks cannot be taken to detract from or to qualify in any way the breadth of the general principles so unmis takably laid down in the passages quoted.
The same doctrine was affirmed in Powell vs Apollo Candle Co. Ltd.(2), where, after referring to Burah 's case (1) and Hodge 's case(3), their Lordships categorically stated: "These two cases have put an end to a doctrine which appears at one time to have had some currency, that a Colo nial Legislature is a delegate of the Imperial Legislature.
It is a legislature restricted in the area of its powers, but within that area unrestricted, and not acting as an agent or a delegate.
" An objection that the legislature of New South Wales alone had power to impose the tax in ques tion and it could not delegate that power to the Governor, was answered by saying "But the duties levied under the Order in Council are really levied by the authority of the Act under which the order is issued.
The legislature has not parted with its perfect control over the Governor, and has the power, of course, at any moment, of withdrawing or altering the power which they have entrusted to him"(4).
If Hodge 's ease(3) did not involve an extensive dele gation of legislative power, Shannon 's case(5) did.
(1) 5 I.A. 178.
(4) 10 App.
282, 291.
(2) 10 App.
(5) (3) 9 App.
861 A provincial legislature in Canada had passed a compulsory Marketing Act providing for the setting up of Marketing Boards but leaving it to the Government to determine what powers and functions should be given to those Boards.
One of the objections raised to the legislation was that it was only a "skeleton of an Act" and that the legislature had practically "surrendered its legislative responsibility to another body." Lord Haldane 's dictum in what is known as the Referendum case(1) (to which a more detailed reference will be made presently) suggesting a doubt as to a provin cial legislature 's power to "create and endow with its own capacity a new legislative power not created by the Act to which it owes its existence" was cited in support of the objection.
The objection, however, was summarily repelled without calling upon Government counsel for an answer.
Their Lordships contented themselves with reiterating the English doctrine of "plenary powers of delegation within constitu tional limits" and said: "This objection appears to their Lordships subversive of the rights which the provincial legislature enjoys while dealing with matters falling within the classes of subjects in relation to which the constitu tion has granted legislative powers.
Within its appointed sphere the provincial legislature is as supreme as any other parliament. .
Martin C.J. appears to have disposed of this objection very satisfactorily in his judgment on the reference, and their Lordships find no occasion to add to what he there said.
" What Martin C.J. said is to be found in Re Natural Products Marketing (B.C.) Act(2).
He said "1 shall not, however, pursue at length this subject (delega tion of legislative powers) because, to use the language of the Privy Council in Queen vs Burah(3), 'The British Statute book abounds with examples of it ' and a consideration for several days of our early and late 'statute book ' discloses such a surprising number of delegations to various persons and bodies in all sorts of subject matters that it would (1) (3) 3 App.
Cas. 889, 906.
(2) , 310. 862 take several pages even to enumerate them, and it would also bring about a constitutional debacle to invalidate them.
I must, therefore, content myself by selecting four statutes only." The learned Judge then proceeded to refer, among others, to a statute whereby "carte blanche powers were delegated over affected fruit lands areas to cope with a pest", and to another "whereby power was conferred upon the Lieutenant Governor in Council to make rules of the widest scope" and the first importance in our system of jurisprudence whereby our whole civil practice and proce dure, appellate and trial, are regulated and constituted to such an extent that even the sittings we hold are thereto subjected.
" This recent pronouncement of the Privy Council on the Eng lish view of the delegability of legislative power is, in my opinion, of special interest for the following reasons : (1) The case involved such an extensive delegation of legislative power counsel thought the ' 'limit" had been reached that it squarely raised the question of the constitutional validity of surrender or abdication of such power and Lord Haldane 's dictum in the Referendum case(1) was relied upon.
(2) Nevertheless, the objection was considered so plainly unsustainable that Government counsel was not called upon to answer, their Lordships having regarded the objection as "subversive" of well established constitutional princi ples.
(3) Martin C.J. 's instances of "carte blanche delegation" were approved and were considered as disposing of the objection "very satisfactorily.
" (4) All that was considered necessary to repel the objection was a plain and simple statement of the English doctrine, namely, within its appointed sphere the provin cial legislature was as supreme as any other parliament, or, in other words, as there can be no legal limit to Parliament 's power to delegate, so can there (1) 863 be none to the power of the provincial legislature to dele gate legislative authority to others.
Thus, the English approach to the problem of delegation of legislative power is characterised by a refusal to regard legislation by a duly constituted legislature as exercise of a delegated power, and it emphatically repudiates the application of the maximum delegatus non potest delegate.
It recognises the sovereignty of legislative bodies within the limits of the constitutions by which they are created and concedes plenary powers of delegation to them within such limits.
It regards delegation as a revocable entrustment of the power to legis late to an appointed agent whose act derives its validity and legal force from the delegating statute and not as a relinquishment by the delegating body of its own capacity to legislate.
On the other hand, the American courts have approached the problem along wholly different lines which are no less the outcome of their own environment and tradition.
The American political scene in the eighteenth century was dominated by the ideas of Montesque and Locke that concen tration of legislative, executive and judicial powers in the hands of a single organ of the State spelt tyranny, and many State constitutions had explicitly provided that each of the great departments of State, the legislature, the executive and the judiciary, shall not exercise the powers of the others.
Though the Federal Constitution contained no such explicit provision, it was construed, against the background of the separatist ideology, as embodying the principle of separation of powers, and a juristic basis for the conse quent non delegability of its power by one of the depart ments to the others was found in the old familiar maxim of the private law of agency delegatuts non potest delegare which soon established itself as a traditional dogma of American constitutional law.
But the swift progress of the nation in the industrial and economic fields and the result ing complexities of administration forced the realisation on the American Judges of the unavoidable necessity for 864 large scale delegation of legislative powers to administra tive bodies, and it was soon recognised that to deny this would be "to stop the wheels of government.
" The result has been that American decisions on this branch of the law consist largely of attempts to disguise delegation "by veiling words" or "by softening it by a quasi" (per Holmes J. in Springer vs Government of the Phillipine Islands(1).
"This result", says a recent writer on the subject, "is well put in Prof. Cushman 's syllogism ' Major premise: Legislative power cannot be constitu tionally delegated by Congress.
Minor premise: It is essential that certain powers be delegated to administrative officers and regulatory commis sions.
Conclusion: Therefore the powers thus delegated are not legislative powers.
" They are instead "administrative"or "quasi legisla tive" (American Administrative Law by Bernard Schwartz, p. 20).
After considerable confusion and fluctuation of opin ion as to what are "essentially" legislative powers which cannot be delegated and what are mere "administrative" or "ancillary" powers, the delegation of which is permissible, the recent decisions of the Supreme Court would seem to place the dividing line between laying down a policy or establishing a standard in respect of the subject legislated upon on the one hand and implementing that policy and en forcing that standard by appropriate rules and regulations on the other: (vide Schechter Poultry Corpn.
vs United States(2) and Panama Refining Co. vs Ryan(3)), a test which inevitably gives rise to considerable divergence of judicial opinion as applied to the facts of a given case.
I will now turn to the questions in issue.
The first question which relates to the validity of section 7 of the .
has to be determined with reference to the competency of "the legislature which (1) ; (3) ; (2) ; 865 passed the said Act", that is, with reference to the consti tution then in force.
It may be mentioned her, e that the , as well as the AjmerMerwara (Extension of Laws) Act, 1947, to which the second question relates, were repealed by section 4 of the Part C States (Laws) Act, 1950, but the Acts already extended under the repealed provisions have been continued in force and hence the neces sity for a pronouncement on the constitutional validity of the repealed provisions.
In 1912 the Indian Legislature was the Governor General in Council, and his law making powers were derived from section 22 of the Indian Councils Act, 1861 (24 and 25 Vic.
Ch. 7) which conferred power "to make laws and regulations for repealing, amending or altering any laws or regulations whatever now in force or hereafter to be in force in the Indian territories now under the dominion of Her Majesty and to make laws and regulations for all persons whether British or native, foreigners or others, and for all courts of justice whatever and for all places and things whatever within the said territories," subject to certain conditions and restrictions which do not affect the impugned provi sions.
The composition and powers of the Governor General in Council were altered in other respects by the Councils Acts of 1892 and 1909, but his law making powers remained essentially the same in 1912.
The question accordingly arises whether section 7 of the , was within the ambit of the legislative powers conferred on himby section 22 of the Indian Councils Act, 1861.
As the power is defined in very wide terms " for all persons. . and for all places and things whatever " within the Indian territories the issue of competency reduces itself to the question whether section 7 was a "law" within the meaning of section 22 of the Indian Councils Act of 1861.
This question is, in my opinion, concluded by the decision of the Privy Council in Empress vs Burah(1).
(1) 5 I.A. 178.
866 That was an appeal by the Government from a judgment of the majority of a Full Bench of the Calcutta High Court holding that sections 8 and 9 of Act XXII of 1869 were ultra vires the Governor General in Council as being an unautho rised delegation of legislative power to the Lieutenant Governor of Bengal.
The combined effect of those provisions was to authorise the Lieutenant Governor to extend to cer tain districts by notification in the Calcutta Gazette "any law or any portion of any law now in force in the other territories subject to his government or which may hereafter be enacted by the Council of the Governor General or of the said Lieutenant Governor, for making laws and regulations. . "Markby J., who delivered the leading judgment of the majority, held (1) that section 9 amounted to a delegation of legislative authority to the Lieutenant Governor by the Indian Legislature which, having been en trusted with such authority as a delegate of the Imperial Parliament, had no power in its turn to delegate it to another, and (2) the Indian Legislature could not "change the legislative machinery in India without affecting the provisions of the Acts of Parliament which created that machinery and if it does in any way affect them, then ex consensu omnium its Acts are void." The learned Judge referred to the argument of Government counsel, namely, "where Parliament has conferred upon a legislature the general power to make laws, the only question can be 'Is the disputed Act a law '.
If it is, then it is valid unless it falls within some prohibition." The learned Judge remarked that this argument was "sound", but met it by holding that "it was clearly intended to restrict the Legislative Council to the exercise of functions which are properly legislative, that is, to the making of laws, which (to use Blackstone 's expression)are rules of action prescribed by a superior to an inferior or of laws made in furtherance of those rules.
The English Parliament is not so restricted.
It is not only a legislative but a paramount sovereign body.
The Legislative Council, when it merely grants permission 867 to another person to legislate, does not make a law within the meaning of the Act from which it derives its authority"(1) The learned Judge rejected the argument based on previous legislative practice as the instances relied on were not "clear and undisputed instances of a transfer of legislative authority.
" Garth C.J. in his dissenting opinion pointed out that "by the Act of 1833 the legislative powers which were then conferred upon the Governor General in Council were in the same language, and (for the purposes of the present case) to the same effect, as those given by the Councils Act in 1861; and from the time when that Act was passed, the Governor General in Council has constantly been in the habit of exercising those powers through the instru mentality of high officials and public bodies, in whom a large discretion has been vested for that purpose.
"(2) It could not therefore be supposed that "the Imperial Parlia ment would have renewed in the Councils Act of 1861 the legislative powers which the Governor General in Council had so long exercised, if they had disapproved of the course of action which the Legislature had been pursuing.
The fact that with the knowledge of the circumstances which they must be assumed to have possessed, Parliament did in the Councils Act renew the powers which were given by the Act of 1833, appears to me to amount to a statutory acknowledgment that the course of action which had been pursued by the legisla ture in the exercise of those powers was one which the Act had authorised.
"(3) The learned Chief Justice accordingly came to the conclusion that Act XXII of 1869 was a law "which the legislature was justified in passing.
" I have referred at some length to the reasoning and conclusions of the learned Judges in the High Court as I think they will be helpful in understanding the full import of the judgment of the Privy Council.
It will be seen, in the first place, that the line of approach adopted by Government counsel in the High (1)I.L.R. at 90, 91.
(3) Ibid 144.
(2) Ibid, 140.
112 868 Court was endorsed by their Lordships as the correct ap proach to the problem, that is to say, the court has to see whether "what has been done is legislation within the gener al scope of affirmative words which give the power, and if it violates no express condition by which that power is limited it is not for any court to inquire further or to enlarge constructively those conditions and restrictions" (italics mine).
This passage clearly lays down [what we have already seen was reiterated in Hodge 's case(1)]: (1) that the scope of judicial review in such cases is limited only to determining whether the impugned enactment is within the law making power conferred on the legislature and wheth er it violates any express condition limiting that power, and (2) that in determining the latter question the court should have regard only to express conditions and should not enlarge them inferentially by a process of interpretation.
In the second place, their Lordships repudiated the doctrine [as they did also in respect of a provincial legislature in Canada in Hodge 's case(1)] that the Indian Legislature is in any sense an agent or delegate of the Imperial Parliament, and that the rule against delegation by an agent applies to the situation.
Thirdly, the distinction made by Markby J. between Parliament and the Indian Legislature that the latter is "restricted to the. making of laws" in the sense defined by Blackstone, while Parliament was not so restricted, or, in other words, that while Parliament could make a "law" delegating its legislative power, the Indian Legislature could not make such a "law, ' was rejected, and the English doctrine of supremacy within limits was laid down specifically in regard to the Indian.
Legislature, which, when acting within the limits circumscribing its legislative power "has and was intended to have plenary powers of legislation as large and of the same nature as those of Parliament itself" (italics mine).
It must follow that it is as competent for the Indian Legislature to make a law delegating legislative power, both quantitatively and qualitatively, as it is for (1) 9 App.
117. 869 Parliament to do so, provided, of course, it acts within the circumscribed limits.
Fourthly, their Lordships "agree that the Governor General in Council could not by any form of enactment create in India and arm with general legisla tive authority a new legislative power not created or autho rised by the Councils Act.
Nothing of that kind has in their Lordships ' opinion been done or attempted in the present case." Mr. Chatterjee, on behalf of the opposite party, submit ted that the remark regarding the incompetency of the Gover nor General in Council to create in India a new legislative power had reference to the subordinate agency or instrumen tality to which the legislative authority was to be delegat ed and thus negatived the legislature 's right to delegate.
The context, however, makes it clear that their Lordships were expressing agreement on this point with Markby J. who, as we have seen, had stated that the Indian Legislature could not "change the legislative machinery in India without affecting the provisions of the Acts of Parliament which created that machinery." This shows that their Lordships were envisaging the setting up of a new legislative machin ery not authorised by the Councils Act, that is, a new legislature in the sense in which the Central and Provincial Legislatures in the country were legislatures.
While they agreed that that could not.
be done (because it would be a contravention of the Act of Parliament which confers no power to create such legislatures) their Lordships proceeded to point out that that was not what was done by the impugned Act and that Markby J. fell into an error in thinking that it was.
Their Lordships gave two reasons: first, because "it is a fallacy to speak of the powers thus conferred upon the Lieutenant Governor (large as they undoubtedly are) ' as if, when they were exercised, the efficacy of the acts done under them would be due to any other legislative authority than that of the Governor General in Council.
Their whole operation is, directly and immediately, under and by virtue of this Act (No. XXll of 1869) itself." Here, indeed, their Lordships touch the core of the problem by indicating 870 the true nature of delegated legislation as distinct from creating a new legislative body.
The point is developed to its logical consequence in later cases as will be seen presently, but here they expose to view the not uncommon "fallacy" of treating the one as of the same nature and as having constitutionally the same consequence as the other, a fallacy which perhaps accounts for much of the confusion of thought on the subject.
It will be recalled that in Hodge 's case(1) it was made clear that in delegated legislation the delegating body does not efface itself but retains its legislative power intact and merely elects to exercise such power through an agency or instrumentality of its choice.
There is no finality about this arrangement, the delegating body being free to "destroy the agency it has created and set up another or take the matter directly into its own hands.
" In Burah 's case(2) their Lordships emphatically stated one consequence of that view, namely, that the act done by the authority to which legislative power is delegat ed derives its whole force and efficacy from the delegating legislature, that is to say, when the delegate acts under the delegated authority, it is the legislature that really acts through its appointed instrumentality.
On the other hand, in the creation of a new legislative body with general legislative authority and functioning in its own right, there is no delegation of power to subordinate units, but a grant of power to an independent and co ordinate body to make laws operating of their own force.
In the first case, according to English constitutional law, no express provi sion authorising delegation is required.
In the absence of a constitutional inhibition, delegation of legislative power, however extensive, could be made so long as the delegating body retains its own legislative power intact.
In the second case, a positive enabling provision in the constitutional document is required.
The second reason why their Lordships regarded the majority view as erroneous was that Act XXII of 1869 was, in truth, nothing more than conditional legislation (1) 9 App.
(2) 5 I.A. 178.
871 and there was no question of delegating legislative power.
Their Lordships were of opinion that neither in fixing the time for commencement of the Act nor in enlarging the area of its operation was the Lieutenant Governor exercising "an act of legislation." "The proper legislature has exercised its judgment as to place, person, laws, powers; and the result of that judgment has been to legislate conditionally as to all these things.
The conditions having been ful filled, the legislation is now absolute.
Where plenary powers of legislation exist as to particular subjects, whether in an Imperial or in a Provincial Legislature, they may (in their Lordships ' judgment) be well exercised, either absolutely or conditionally.
Legislation, conditional on the use of particular powers or on the exercise of a limited discretion, entrusted by the Legislature to persons in whom it places confidence, is no uncommon thing; and, in many circumstances, it may be highly convenient.
The British Statute book abounds with examples of it; and it cannot be supposed that the Imperial Parliament did not, when consti tuting the Indian Legislature, contemplate this kind of conditional legislation as within the scope of the legisla tive powers which it from time to time conferred.
It cer tainly used no words to exclude it.
" Their Lordships finally proceeded to refer to the legis lative practice in this country of delegating to the execu tive government a discretionary power of extending enact ments to new territories subject in certain cases to such "restriction, limitation or proviso" as the Government may think proper, and they expressed their approval of the reasoning of Garth C.J. based on such practice.
"If their Lordships," they said, "were to adopt the view of the major ity of the High Court they would (unless distinction were made on grounds beyond the competency of the judicial of fice) be casting doubt upon the validity of a long course of legislation appropriate, as far as they can judge to the peculiar circumstances of India. .
For such doubt their Lordships are unable to discover any foundation either in the affirmative or the negative words of that Act" 872 (Indian Councils Act, 1861).
The parenthetic remark (which I have italicised) is significant.
It is not com petent for the court, according to their Lordships, to dis criminate between degrees of delegation.
It might be extensive in some cases and slight in others.
Its validity must, however, be founded "on the affirmative or the nega tive words" of the Constitution Act.
Another logical consequence of the British theory of dele gation has been worked out in Co operative Committee on Japanese Canadians vs Attorney General for Canada(1), where the question arose as to whether an order made by the Governor in Council pursuant to authority delegated by the Parliament of Canada was a law made by the Parliament of Canada within the meaning of the Statute of Westminster and, if so, whether it was such a law made after the pass ing of that Statute.
The delegation of authority to the Governor was made before that Statute was passed but the Governor 's order was promulgated after the Statute.
Holding that the order was a "law" made by the Parliament of Canada after the Statute of Westminster their Lordships observed: "Undoubtedly, the law as embodied in an order or regulation is made at the date when the power conferred by the Parlia ment of the Dominion is exercised.
Is it made after that date by the parliament of the Dominion ? That Parliament is the only legislative authority for the Dominion as a whole and it has chosen to make the law through machinery set up and continued by it for that purpose.
The Governor in Council has no independent status as a law making body.
The legislative activity of Parliament is still resent at the time when the orders are made, and these orders are" law".
In their Lordships ' opinion they are law made by the Parlia ment at the date of their promulgation.
"(2) Mr. Chatterice has urged that in Burah 's case(3) the Privy Council did no more than hold that the type of legis lation which their Lordships there called conditional legis lation was within the competence of the (1) (3) S I.A. 178.
(2) Ibid 106 107.
873 Indian legislature and was valid, and that the con siderations adverted to 'by their Lordships in upholding such legislation have no relevancy in determining the validity of the provisions impugned in the present case.
It is true that the kind of legislation here in question does not belong to that category, for the operation of the impugned Acts is not made to depend upon the exercise of a discretion by an external authority, but it is not correct to say that Burah 's case(1) has application only to facts involving conditional legislation.
As I have endeavoured to show, it lays down general principles of far reaching importance.
It was regarded in Powell 's case(2) referred to above as "laying down the general law" and as "putting an end" to the false doctrine that a subordinate legislature acts as an agent or a delegate.
Mr. Chatterjee next relied on the dictum of Lord Haldane in the Referendum case.
(3) In that case their Lordships held that the Initiative and Referendum Act of Manitoba (Canada) was, in so far as it compelled the Lieutenant Governor to submit a proposed law to a body of voters total ly distinct from the legislature of which he was the consti tutional head and rendered him powerless to prevent it from becoming an actual law if approved by those voters, ultra vires the Provincial Legislature, as the power to amend the Constitution of the Province conferred upon that Legislature by the British North America Act, 1867, excluded from its scope "the office of the Lieutenant Governor ".
Lord Hal dane, however, proceeded to make the following observations: "Section 92 of the Act of 1867 entrusts the legislative power in a Province to its Legislature, and to that Legisla ture only.
No doubt, a body, with a power of legislation on the subjects entrusted to it so ample as that enjoyed by a Provincial Legislature in Canada, could, while preserving its own capacity intact, seek the assistance of subordinate agencies, as had been done when in Hodge vs The Queen(4) the Legislature of Ontario was (1) 5 I.A. 178.
(3) (2) 10 App.
(4) 9 App.
Cas. 117, 874 held entitled to entrust to a Board of Commissioners au thority to enact regulations relating to taverns; but it does not follow that it can create and endow with, its own capacity a new legislative power not created by the Act to which it owes its own existence.
Their Lordships do no more than draw attention to the gravity of the constitutional questions which thus arise.
"(1) Mr. Chatterjee submitted that the grave constitutional question, to which Lord Haldane drew attention, arose in the present case.
I do not think so.
The dictum, like the obser vation of Lord Selborne in Burah 's case(2) regarding the power of the Governor General in Council "to create in India and arm with general legislative authority a new legislative power," to which reference has been made, seems to envisage the unauthorised creation of a new legislature with an independent status as a law making body, which, for reasons already indicated, is quite different from delegation of legislative power, and my remarks in connection with that observation equally apply here.
The only other decision of the Privy Council to which reference need be made is King Emperor vs Benoari Lal Sarma.
(3) It was an appeal from a judgment of the majority of the Federal Court of India (reported in holding, inter alia, that sections 5, 10 and 16 of the Special Criminal Courts Ordinance (No. II of 1942) passed by the Governor General in exercise of his emergency powers were ultra vires and invalid.
The ground of decision was that although the powers of the High Court were taken away in form by section 26 of the Ordinance, they were, in fact, taken away by the order of the executive officer to whom it was left by sections 5, 10 and 16 to direct what offences or classes of offences and what cases or classes of cases should be tried by the special courts established under the Ordinance.
In so far as these sections thus purported to confer on the executive officers absolute and uncontrolled discretion without any legislative provision or direction laying down (1) , 945.
(2) 5 I.A. 178.
(3) 72 I.A. 57.
875 the policy or conditions with reference to which that power was to be exercised, they were beyond the competence of the Governor General.
Varadachariar C.J., with whom Zafrulla Khan J. concurred, went elaborately into the whole question of delegation of legislative powers, and while conceding, in view of the Privy Council decisions already referred to, that the Governor General (whose legislative power in emer gencies was co extensive with that of the Indian Legisla ture) could not be regarded as a delegate of the Imperial Parliament and that, therefore, the maxim delegatus non potest delegare had no application, nevertheless expressed the opinion that "there is nothing in the above decisions of their Lordships that can be said to be inconsistent with the principle laid down in the passage from the American author ity which the Advocate General of India proposed to adopt as his own argument.
" That principle was this: "The true distinction is between the delegation of power to make the law, which necessarily involves a discretion as to what it shall be, and conferring authority or discretion as to its execution, to be exercised under and in pursuance of the law.
The first cannot be done, to the latter no valid objection can be made :" (per Judge Ranney of the Supreme Court of Ohio, often cited in American decisions).
The learned Chief Justice then proceeded to examine the American decisions bearing upon the delegation of powers and the opinions expressed by writers on administrative law and came to the following conclusion : "As we have already observed, the considerations and safeguards suggested in the foregoing passages may be no more than considerations of policy or expediency under the English Constitution.
But under Constitutions like the Indian and the American, where the constitutionality of legislation is examinable in a court of law, these consider ations are, in our opinion, an integral and essential part of the limitation on the extent of delegation of responsi bility by the legislature to the executive.
In the present case, it is impossible to deny that the Ordinance making 113 876 authority has wholly evaded the responsibility of laying down any rules or conditions or even enunciating the policy with reference to which cases are to be assigned to the ordinary criminal courts and to the special courts respec tively and left the whole matter to the unguided and uncontrolled action of the executive authorities.
This is not a criticism of the policy of the law as counsel for the Crown would make it appear but a complaint that the law has laid down no policy or principle to guide and control the exercise of the undefined powers entrusted to the execu tive authorities by sections 5, 10 and 16 of the Ordinance.
"(1) I have set out at some length the reasoning and conclu sion of the learned Chief Justice because it summarises and accepts most of what has been said before us by Mr. Chatter jee in support of his contention that the American rule as to delegation of legislative powers should be followed in this country in preference to the views of English Judges on the point and that the delegation of a too wide and uncon trolled power must be held to be bad.
The Privy Council, however, rejected the reasoning and conclusion of the major ity of the 'Court in a clear and emphatic pronouncement.
Their Lordships scouted the idea that what might be no more than considerations of policy or expediency under the Brit ish Constitution could, in India, as in America, become.
constitutional limitations on the delegation of legislative responsibility merely because the constitutionality of legislation was open to judicial review under the constitu tion of this country.
They said: "With the greatest respect to these eminent Judges, their Lordships feel bound to point out that the question whether the Ordinance is intra vires or ultra vires does not depend on considerations of juris prudence or of policy.
It depends simply on examining the language of the Government Of India Act and of comparing the legislative authority conferred on the Governor General with the provisions of the ordinance by which he is 'purporting to exercise that authority" the old traditional approach, "It (1) , 139 140, 877 may be that as a matter of wise and well framed legislation it is better, if circumstances permit, to frame a statute in such a way that the offender may,know in advance before what court he will be brought if he is charged with a given crime; but that is a question of policy, not of law.
There is nothing of which their Lordships are aware in the Indian constitution to render invalid a statute, whether passed by the Central legislature or under the Governor General 's emergency powers, which does not accord with this principle.
There is not, of course, the slightest doubt that the Parliament of Westminster could validly enact that the choice of courts should rest with an executive authori ty, and their Lordships are unable to discover any valid reason why the same discretion should not be conferred 'in India by the law making authority, whether that authority is the legislature or the Governor General, as an exercise of the discretion conferred on the authority to make laws for the peace order, ' and good government of India.
"(1) The English doctrine of supremacy within limits is here asserted once again, and its corollary is applied as the determining test: "What the British Parliament could do, the Indian legislature and the Governor General legislating within their appointed sphere could also do.
" There was here a 'delegation of an "unguided and uncontrolled" discretion ary power affecting the liberty of the subject.
In the lan guage of an American Judge,it was "unconfined and vagrant" and was not "canalised within banks that kept it from over flowing :"(per Cardozo J. in Panama Refining Co. vs Ryan.(2) Yet, the delegation was upheld.
Why? Because "their Lordships are unable to find any such constitutional limita tion is imposed.
" There is, however, a passage in the judgment of their Lordships, which, torn from its context, may appear, at first blush, to accept the maxim of delegatus non potest delegare as a principle of English constitutional law, notwithstanding its consistent repudiationby the same tribu nal in the previous decisions already (1) 72 I.A. 57, 70 72.
(2) ; 878 referred to, and Mr. Chatterjee was not slow to seize on it as making a veering round to the American point of view.
I do not think that their Lordships meant anything so revolutionary.
The passage is this: "It is undoubtedly true that the Governor General, acting under section 72 of Schedule IX, must himself discharge the duty of legislation there cast on him, and cannot transfer it to other authorities"(1) (italics mine).
This was said, however, in answering the "second objection" which was that section 1 (3) of the Ordinance "amounted to what was called delegated legislation by which the Governor Gener al, without legal authority, sought to pass the decision whether an emergency existed to the Provincial Governmen tinstead of deciding it for himself.
" Now, the opening words of section 72 of Schedule IX of the Government of India Act declare: "The Governor General may, in case of an emergency, make and promulgate ordinances for the peace and good government of British India or any part thereof." The ordinance was thus passed avowedly in exercise of a special power to legislate to meet an emergency, and the argument was that the very basis of this ordinance making power must be an exercise of per sonal judgment and discretion by the Governor General which he could not delegate to the Provincial Government or its officers.
Their Lordships accepted the major premise of this argument but went on to point out that there was no delegation of his legislative power by the Governor General at all and that "what was done is only conditional legislation.
" It was with reference to this special ordinance making power to meet emergencies that their Lordships said that the Governor General must himself exercise it and could not transfer it to other authorities.
The words "acting under section 72 of Sched ule IX" and "there, cast on him" make their meaning clear, and the passage relied on by Mr. Chatterjee lends no support to his argument regarding the nondelegability of legislative power in general.
In the light of the authorities discussed above and adopting the line of approach laid down there, I am 879 of opinion that section 7 of the , fell within the general scope of the affirmative words of section 22 of the Indian Councils Act, 1861, which conferred the law making power on the Governor.
General in Council and that the provision did not violate any of the clauses by which, negatively, that power was restricted.
The same line of approach leads me to the conclusion that section 2 of the Ajmer Merwara (Extension of Laws) Act, 1947, was also constitutional and valid.
This Act was passed by the Dominion Legislature of India, and the governing constitutional provision was section 99 (1) of the Govern ment of India Act, 1935.
The Indian Independence Act, 1947, authorised the removal of certain restrictions on the law making powers of the Central Legislature and section 108 of the Constitution Act was omitted; but the material words in section 99 (1) which granted the legislative power remained the same, namely, "may make laws for the whole or any part of the Dominion.
" No doubt, as between the Dominion and the Provinces there was a distribution of legislative power according to the Lists in Schedule VII, but such distribu tion did not affect the power of the Dominion Legislature to make laws for what are known as Chief Commissioners ' Prov inces, of which Ajmer Merwara is one.
This was made clear by section 100 (4) read with section 46.
Section 2 of the impugned Act was, therefore a "law" which the Dominion Legislature was competent to make and the restrictive words "subject to the provisions of this Act" had no application to the case, as no provision was brought to our notice which affected the validity of the law.
There was some discussion as to the scope and meaning of the words "restrictions" and "modifications".
It was sug gested by Mr. Chatterjee that these words occurring in the impugned provisions would enable the executive authority to alter or amend any law which it had decided to apply to the territories in question and that a power of such undefined amplitude could not be validly delegated by the legislature.
On 880 the other hand, the Attorney General submitted that in such context "modification" was usually taken to connote "making a change without altering the essential nature of the thing changed," and that the use of the word would make no difference to the delegability or otherwise of the legislative power.
He drew attention to an instance men tioned by the Privy Council in Burah 's case, where their Lordships thought that the power given to the local govern ment by Act XXIII of 1861 to extend the Civil Procedure Code of 1859 "subject to any restriction, limitation or proviso".
which it may think proper was not bad.
In the view I have expressed above, however wide a meaning may be attributed to the expression, it would not affect the constitutionality of the delegating statute, because no constitutional limitation on the delegation of legislative power to a subordinate unit is ' to be found in either of the constitutions discussed above.
That, I apprehend, is also the reason why the Privy Council too attached no importance to the words in section 39 of Act XXIII of 1861 referred to above.
Turning next to section 2 of the Part C States (Laws) Act, 1950, it is framed on the same lines as the other two impugned provisions save for the addition of a clause empow ering repeal or amendment of any corresponding law (other than a Central Act) which is for the time being in force in the State.
This additional clause, however, need not detain us, for, if there is no constitutional inhibition against delegation of legislative power under the present Constitu tion, delegation can as Well extend to the power of repeal as to the power of modification and the Court cannot hold such ' delegation to be ultra vires.
The Constitutional validity of the additional clause thus stands or falls with that of the first part of the section and the only question is: What is the position in regard to delegated legislation under the present Constitution ? Here we do not have the advantage of Privy Council decisions bearing on the question as we had in Burah 's case (1) on the Indian Councils Act, 1861, and Benoari Lal (1) 5 I.A. 178.
881 Sarma 's case(1) on the Government of India Act, 1935.
But the line of approach laid down in those cases and in numer ous others, to which reference has been made, must be fol lowed, not because of the binding force of those decisions, but because it is indubitably the correct approach to prob lems of this kind.
Indeed, there is no difference between the English and the American decisions on this point.
In both countries it is recognised that the correct way of resolving such problems is to look to the terms of the constitutional instrument, and to find out whether the impugned enactment falls within the ambit of the lawmaking power conferred on the legislature which passed the enact ment and, if so, whether it transgresses any restrictions and limitations imposed on such power.
If the enactment in question satisfies this double test, then it must be held to be constitutional.
We therefore begin by looking to the terms of the Con stitution and we find that article 245 confers lawmaking power on Parliament in the same general terms as in the other two cases discussed above.
The article says "subject to the provisions of this Constitution, Parliament may make laws for the whole or any part of the territory of India. "Then we have the scheme of distribution of legislative powers worked out in article 246 as between Parliament and the legislatures of the States specified in Part A and Part B of the First Schedule, which, however, does not affect the question we have to determine, for article 246 (4), like section 100 (4) of the Government of India Act, 1935, provides that Parliament has power to make laws with respect to any matter for any part of the.territo ry of India not included in Part A or Part B notwithstanding that such matter is a matter enumerated in the State List.
The position, therefore, is substantially similar to that under the Indian Councils Act, 1861, and the Government of India Act, 1935, so far as the words conferring law making power are concerned.
Is then this impugned enact ment, which merely purports to (1) 72 I.A. 57. 882 delegate law making power to the Central Government for Part C ,States, a "law" within the meaning of article 245 (1) ? There can be no question but that the Act was passed by Parliament in accordance with the prescribed legislative procedure, and I can see no reason why it should not be regarded as a law.
It will be recalled that the restricted interpretation which Markby J. (1) put on the word in sec tion 22 of the Indian Councils Act in accordance with Black stone 's definition (formulation of a binding rule of conduct for the subject) was not accepted by the Privy Council in Burah 's case.
Even if a mere delegation of power to legis late were not regarded as a law ' 'with respect to" one or other of the "matters" mentioned in the three Lists, it would be a law made in exercise of the residuary powers under article 248.
The question next arises whether there is anything in the Constitution which prohibits the making of such a law.
The main restrictions and limitations on the legislative power of Parliament or of the States are those contained in Part III of the Constitution relating to Fundamental Rights.
Our attention has not been called to any specific provision in that Part or elsewhere in the Constitution which prohib its or has the effect of prohibiting the making of a law delegating legislative power to a subordinate agency of Parliament 's choice.
What Mr. Chatterjee strenuously urged was that, having regard to the Preamble to the Constitution, whereby the people of India resolved, in exercise of their sovereign right, "to adopt, enact and to give to themselves the Constitution," Parliament, which is charged with the duty of making laws for the territories of the Union, must, as in the American Constitution, be deemed to be a delegate of the people, and that this fundamental conception, which approximates to the conception ' underlying the American Constitution, attracts the application of the maxim delega tus non potest delegare, and operates as an implied prohibi tion against the delegation of legislative power by Parlia ment or, for that matter, by any other legislature (1) I.L.R. , 91, 883 in the country.
It is true to say that, in a sense, the people delegated to the legislative, executive and the judicial organs of the State their respective powers while reserving to themselves the fundamental right which they made paramount by providing that the State shall not make any law which takes away or abridges the rights con ferred by that Part.
To this extent the Indian Constitution may be said to have been based on the American model, but this is far from making the principle of separation of powers, as interpreted by the American courts, an essential part of the Indian Constitution or making the Indian Legis latures the delegates of the people so as to attract the application of the maxim.
As already stated, the historical background and the political environment which influenced the making of the American Constitution were entirely absent here, and beyond the creation of the three organs of the State to exercise their respective functions as a matter of convenient governmental mechanism, which is a common feature of most modern civilised governments, there ' is not the least indication that the framers of the Indian Constitution made the American doctrine of separation of powers, namely, that in their absolute separation and vesting in different hands lay the basis of liberty, an integral and basic fea ture of the Indian Constitution.
On the contrary, by provid ing that there shall be a Council of Ministers to aid and advise the President in the exercise of his functions and that the Council shall be collectively responsible to the House of the People, the Constitution following the British model has effected a fusion of legislative and executive powers which spells the negation of any clear cut division of governmental power into three branches which is the basic doctrine of American constitutional law.
Without such a doctrine being incorporated in the Constitution and made its structural foundation, the maxim delegatus non potest dele gare could nave no constitutional status but could only have the force of a political precept to be acted upon by legis latures in a 884 democratic polity consisting of elected representatives of the people in the discharge of their function of making laws, but cannot be enforced by the court as a rule of constitutional law when such function is shirked or evaded.
The American courts are able to enforce the maxim because it has been made by the process of judicial construction an integral part of the American Constitution as a necessary corollary of the doctrine of separation of powers.
But the position in India, as pointed out above, is entirely differ ent, and the courts in this country cannot strike down an Act of Parliament as unconstitutional merely because Parlia ment decides in a particular instance to entrust its legis lative power to another in whom it has confidence, or, in other words to exercise such power through its appointed instrumentality, however repugnant such entrustment may be to the democratic process.
What may be regarded as politi cally undesirable is constitutionally competent.
Mr. Chatterjee also attempted to spell out an implied prohibition against delegation on the strength of article 357 (1) (a) which provides specifically for delegation by the President of the law making powers conferred on him by Parliament in case of failure of constitutional machinery in States.
This express provision, it is claimed, shows that whenever the makers of the Constitution wanted to authorise delegation of legislative powers they have made specific provision in that behalf and, in the absence of any such provision in other cases, no delegation of such powers is permissible.
I see no force in this argument.
Merely be cause in a particular instance of rare and extraordinary occurrence an express provision authorising the President to delegate to another the law making powers conferred on him by Parliament is made in the Constitution, it is not reason able to infer that it was intended to prohibit the delega tion of powers in all other cases.
The maxim expressio unius est exclusio alterius is not one of universal applica tion, and it is inconceivable that the framers of the Con stitution could have intended to deny to the Indian Legisla tures 885 a power which, as we have seen, has been recognised on all hands as a desirable, if not, a necessary con comitant of legislative activity in modern States America, having started with a rule against delegation as a necessary corollary of the constitutional doctrine of separation of powers, has made and is making numerous inroads on the rule, and English constitutional law has allowed, as we have seen, even to subordinate legislatures, the widest latitude to delegate their legislative powers so long as they retain their own law making capacity intact.
In such circumstances, a provision for express delegation in a remote contingency is far too flimsy a ground for infer ring a general prohibition against delegation of legislative power in all other eases.
In this connection, it will be useful to recall Lord Selborne 's observation in Burah 's case that all that the court has to see in adjudging an enactment constitutional is "that it violates no express condition or restriction by which the law making power conferred on the legislature is limited, and that it is not for the court to enlarge constructively those conditions and restrictions," and as recently as 1944, the Privy Council, as we have seen in Benoari Lal Sharma 's case referred to what has always been regarded as an established doctrine of English consti tutional law, namely, that the Indian legislature could do, in the matter of delegating its legislative powers, what the British Parliament could do.
It would indeed be strange if, in framing the constitution of the Independent Republic of India at the present day, its makers were to ignore the experience of legislative bodies all the world over and to deny to Parliament a power which its predecessors unques tionably possessed.
I have no hesitation in rejecting this argument.
In the result, I hold that section 7 of the , section 2 of the Ajmer Merwara (Extension of Laws) Act, 1947, and section 2 of the Part C States (Laws) Act, 1950, are in their entirety constitutional and valid and I answer the reference accordingly.
886 MAHAJAN J.
In exercise of the powers conferred by clause (1) of article 143 of the Constitution the Presi dent of India has referred the following questions to this Court for its opinion : (1) Was section 7 of the , or any of the provisions thereof and in what particular or particulars and to what extent ultra vires the legislature which passed the said Act ? (2) Was the Ajmer Merwara (Extension of Laws) Act, 1947, or any of the provisions thereof and in what particular or particulars and to what extent ultra vires the legislature which passed the said Act ? (a) Was section 2 of Part C States (Laws)Act, 1950, or any of the provisions thereof and in what particular or particulars and to what extent ultra vires the Parliament ? The reference raises questions of great importance concerning the administration of the affairs of the Republic and is the first one of the kind since the inauguration of the new constitution.
The only point canvassed in the reference is as to the vires of the laws mentioned therein.
It was contended by the learned Attorney General that legis lative power without authority or power to delegate is a futility and that unless legislative power includes.
the power to delegate, power to administer will be ineffective.
It was suggested that the true nature and scope of the legislative power of Parliament involves as part of its content power to confer law making powers upon authorities other than Parliament itself and that this is a natural consequence of the doctrine of the supremacy of Parliament.
It was said that the Indian legislature when acting within the ambit of its legislative power has plenary powers of legislation as large and of the same nature as the British Parliament and unless the prescribed limits are exceeded, no question of ultra vires can possibly arise, that the proper approach to the question is "Look at the terms of the in strument by which affirmatively the legislative powers are created and by which negatively they are restricted.
If what 887 has been done is legislation within the general scope of the affirmative words which give the power and if it violates no express condition or restriction by which the power is limited, it is not for any court of justice, to enquire or to enlarge constructively those conditions and restrictions.
"(1) Reliance was also placed on the legisla tive practice in India and other countries of the the Com monwealth sanctioning constitutionality of statutes drawn up in the same form as the impugned enactments.
The questions referred cover 'three distinct periods of legislation in the constitutional and political history of this country.
The first question relates to the period when the government of this country was unitary in form and was constituted under the Indian Councils Act, 1861, as amended from time to time up to the stage of the introduction of the Morley Minto Reforms, when the Indian Legislature achieved the status of a political debating society and when as a result of the undoing of the partition of Bengal the capital of India was transferred from Calcutta to Delhi.
The unitary form of government was changed after the different Round Table Conferences in London into a Federation by the Consti tution Act 'of 1935.
This Act with certain adaptations remained in force till 26th January, 1950, when the new constitution was inaugurated.
Under the Independence Act, 1947, India became a Dominion of the British Empire but the legislative power of the Parliament of the Dominion remained within the ambit of the Constitution Act of 1935, though the Parliament as a Constituent Assembly was conferred unlimited powers like that of a sovereign.
The federal form of govern ment that had been adopted 'by the Constitution Act of 1935 was also adopted by the framers of the new constitution.
The second question relates to the period when India had at tained the status of a dominion under the Indian Independ ence Act, while the last question concerns the legislative competency of Parliament under the new constitution of the Republic of India.
(1) Queen vs Burah, 5 I.A. 178.
888 It is futile to ask in the year of grace 1951 whether delegated legislation is necessary or not.
This kind of legislation is only a special aspect of the problem of administrative discretion.
The necessity of delegating rule making power on the largest scale to administrative authorities is as much a basic fact of modern industrial society as the assumption by the State of certain obliga tions of social welfare.
The problem, however, is how dele gated legislation and administrative discretion are confined and controlled so as to comply with the elementary princi ples of law in a democratic society.
The answer to the problem has to be found within the ambit of the constitution of the country concerned and on the construction that a lawyer or a jurist would place on it with a constructive and not a purely legalistic approach.
In this back ground it is instructive to see how the question has been solved in other countries.
It was customary for the mother of Parliaments told ele gate minor legislative power to subordinate authorities and bodies.
Some people took the view that such delegation was wholly unwise and should be dispensed with.
Prof. Dicey, however, pointed out that it was futile for Parliament to endeavour to work out details of large legislative changes and that such anendeavour would result in cumbersome and prolix statutes.
Blackstone remarked that power of this kind were essential to the effective conduct of the government.
Constitutional practice grew up gradually as and when the need arose in Parliament, without a logical system, and power was delegated by Parliament for various reasons: because 'the topic required much detail, or because it was technical, or because of pressure of other demands on par liamentary time.
The Parliament being supreme and its power being unlimited, it did what it thought was right.
The doctrine of ultra vires has no roots whatever in a country where the doctrine of supremacy of Parliament holds the field.
The sovereignty of Parliament is an idea fundamental ly inconsistent with the notions which govern inflexible and rigid constitutions existing in countries 889 which have adopted any scheme of representative government.
In England supremacy of law only means the right of judges to control the executive and it has no greater constitution al value than that.
The basis of power in England is the legal supremacy of Parliament and its unrestricted power to make law.
In the words of Coke, "It is so transcendent and absolute as it cannot be confined either for causes or persons within any bounds," or again, as Blackstone put it, "An act of Parliament is the exercise of the highest author ity that this kingdom acknowledges upon earth.
It hath power to bind every subject in the land, and the dominions there unto belonging; nay, even the King himself, if particularly named therein.
And it cannot be altered amended, dispensed with, suspended or repealed, but in the same forms and by the same authority of Parliament." (1).
The Parliament being a legal omnipotent despot, apart from being a legislature simpliciter, it can in exercise of its sovereign power delegate its legislative functions or even create new bodies conferring on them power to make laws.
The power of delegation is not necessarily implicit in its power to make laws but it may well be implicit in its omnipotence as an absolute sovereign.
Whether it exercises its power of delegation of legislative power in its capacity as a mere legislature or in its capacity as an omnipotent despot, it is not possible to test it on the touchstone of judicial precedent or judicial scrutiny as courts of justice in England cannot inquire into it. 'The assertion therefore that this power Parliament exercises in its purely legisla tive capacity has no greater value than that of an ipse dixit.
For these reasons I am in respectful agreement with the view of that eminent judge and jurist, Varadachariar J., expressed in Benoari Lal arma 's case(2) that the constitu tional position in India approximates more closely to the American model than to the English model and on this subject the decisions of the United States so far as they lay down any principle are a valuable guide on this question.
(1) Vide Allen "Law in the Making " 3rd Edn., p. 367.
(2) 890 This view finds support also from the circumstance that the constitutions of the two countries are fundamentally different in kind and character.
They fail in two distinct classes having different characteristics.
England has a unitary form of ' government with a flexible constitution, while in India we have always had a rigid constitution and since 1935 it is federal in form.
It is unsafe, therefore, to make any deductions from the legislative power exercised under a system of government which is basically different in kind and not merely in degree from the other on the question of its legislative competency and reach conclusions on the basis of such deductions.
In my opinion, search for a solu tion of the problem referred to us in that direction is bound to produce no results.
I have, therefore, no hesita tion in rejecting the contention of the learned Attorney General that the answer to the questions referred to us should be returned by reference to, the exercise of power of Parliament in the matter of delegation of legislative power to the executive.
It may, however, be observed that in spite of the widest powers possessed by the British Parliament, it has adopted a policy of self abnegation in the matter of delegated legis lation.
A committee was appointed to report on the Minis ters ' powers, popularly known as the Donoughmore Committee.
It made its recommendations and stated the limits within which power of delegated legislation should be exercised.
Means were later on adopted for keeping a watchful eye on such legislation.
The Donoughmore Committee discovered a few instances of cases where delegation had gone to the extent of giving a limited power of modifying Parliamentary statutes.
One of these instances was in section 20 of the Mental Treatment Act, 1930 (20 & 21 Geo.
V, c. 23).
It empowered the Minister of Health by order to modify the wording of an enactment so far as was necessary to bring it into conformity with the provisions of the section.
The whole section related to terminology, its intention being to replace certain statutory expressions in previous use by others which at the moment were regarded less 891 offensive.
The other instance was found in section 76 of the Local Government Scotland Act, 1929, (19 & 20 Geo.
V, c. 25).
By this section the Secretary of State was empowered between 16th May, 1929, and 31st December, 1930, by order to make any adaptation or modification in the provisions of any Act necessary to bring these provisions in conformity with the provisions of other Acts.
Such a clause in a statute bore the nickname "Henry VIII clause".
Concerning it the Committee made the following recommendation: "The use of the so called Henry VIII clause conferring power on a Minister to modify the provisions of Acts of Parliament (hitherto limited to such amendments as may appear to him to be neces sary for the purpose of bringing the statute into operation) should be abandoned in all but most exceptional cases and should not be permitted by Parliament except upon special grounds stated in a ministerial memorandum to the bill.
Henry VIII clause should never be used except for the sole purpose of bringing the Act into operation but subject to the limit of one year.
" The language in which this recommendation is couched clearly indicates that even in a country where Parliament is supreme the power of modifying Parliamentary statutes has never been exercised except in the manner indicated in the above recommendation, and even as regards that limited power the recommendation was that the exercise of it should be abandoned.
It is significant that since then Henry VIII clause has not been used by Parliament.
The Dominion of Canada has a written constitution, The British North Amercia Act (30 & 31 Vict., c. 31).
It is not modelled on the doctrine of exclusive division of power between the departments of State, legislative, executive and judicial.
It does not place them in three water tight compartments and it is somewhat similar in shape in this respect to the British constitution where the King is still a part of the legislature, the House of Lords still a part of the judicial as well as legislative and where all parts of government form 892 a mutual check upon each other.
This similarity, however, does not mean that the legislature in Canada is of the same kind as the British Parliament.
It falls in the class of non sovereign legislatures, like all colonial parliaments.
The decisions of Canadian courts are by no means uniform on the power of the Canadian Parliament to delegate legislative power.
Those cited to us of recent date seem to have been given under the pressure of the two world wars and under the provisions of the War Measures Act.
With great respect and in all humility, I am constrained to observe that in these decisions, to establish the vires of the powers delegated, arguments have been pressed into service which are by no means convincing or which can be said to be based on sound juristic principles.
They can only be justified on the ground that during a period of emergency and danger to the State the dominion parliament can make laws which in peace time it has no competency to enact.
There are a number of Privy Council decisions which have concerned themselves with the vires of legislative enactments in Canada which purported to transfer legislative power to outside authorities and it seems to me that these decisions furnish a better guide to the solution of the problem before us than the later decisions of the Supreme Court of Canada which seemingly derive support from these Privy Council decisions for the rules stated therein.
The first of these decisions is in the case of Russell vs The Queen(1) decided in 1882.
Two questions were raised in the appeal.
The first was as to the validity of the Canada Temperance Act, 1878.
It was urged that having regard to the provisions of the British North America Act, 1867, relating to the distribution of legislative powers it was not competent for the Parliament of Canada to pass the Act in question.
The second question was that even if the Dominion Parliament possessed the powers which it assumed to exercise by the Act, it had no power to delegate them (1) 7 App.
Cas. 829, 893 and to give local authorities the right to say whether the provisions of the Act should be operative or not.
It is the second question which is relevant to the present enquiry the mode of bringing the second part of the Act into force, stating it succinctly, was as follows: "On a petition to the Governor in Council, signed by not less than one fourth in number of the electors of any county or city in the Dominion qualified to vote at the election of a member of the House of Commons, praying that the second part of the Act should be in force and take effect in such county or city, and that the votes of all the electors be taken for or against the adoption of the petition, the GovernorGeneral, after certain prescribed notices and evi dence, may issue a proclamation, embodying such petition, with a view to a poll of the electors being taken for or against its adoption.
When any petition has been adopted by the electors of the county or city named in it, the Gover nor General in Council may, after the expiration of sixty days from the day on which the petition was adopted, by Order in Council published in the Gazette, declare that the second part of the Act shall be in force and take effect in such county or city, and the same is then to become of force and take effect accordingly.
" It was urged before their Lordships that assuming that the Parliament of Canada had authority to pass a law for prohibiting and regulating the sale of intoxicating liquors, it could not delegate its powers, and that it had done so by delegating the power to bring into force the prohibitory and penal provisions of the Act to a majority of the electors of counties and cities.
Their Lordships ' answer to the coun sel 's contention was in these words : "The short answer to this objection is that the Act does not delegate any legislative powers whatever.
It contains within itself the whole legislation on the matters with which it deals.
The provision that certain parts of the Act shall come into operation only 894 on the petition of a majority of electors does not confer on these persons power to legislate.
Parliament itself enacts the condition and everything which is to follow upon the condition being fulfilled.
Conditional legislation of this kind is in many cases convenient, and is certainly not unusual, and the power so to legislate cannot be denied to the Parliament of Canada, when the subject of legislation is within its competency.
Their Lordships entirely agree with the opinion of Chief Justice Ritchie on this objection.
If authority on the point were necessary, it will be found in the case of Queen vs Burah(1), lately before this Board.
" It seems to me that their Lordships acquiesced and assented in the proposition urged by the learned counsel that delegation of legislative power was not permissible when they combated his arguments with the remark that the Act does not delegate any legislative power whatever.
Otherwise, the short answer to the objection was that dele gation of legislative power was implicit within the power of legislation possessed by the legislature.
It was not neces sary to base the decision on the ground of conditional legislation.
Though Queen vs Burgh(1) was an appeal from the High Court of Bengal, a reference was made to it and the decision therein was mentioned as laying down an apposite rule for the decision of cases arising under the British North Ameri ca Act, 1867.
In order to appreciate and apprehend the rule to which their Lordships gave approval in the above men tioned case, it seems necessary to state precisely what Queen vs Burgh(1) decided.
Act XXII of 1869 of the Council of the Governor General of India which is entitled "An Act to remove the Garo Hills from the jurisdiction of the tribu nals established under the General Regulations and Acts, and for other purposes" among other things provided as follows : "Sec. 4.
Save as hereinafter provided, the territory known as the Garo Hills. is hereby removed from the jurisdiction of the Courts of Civil and (1) 5 I.A, 178.
895 Criminal Judicature, and from the control of the offices of revenue constituted by the Regulations of the Bengal Code and the Acts passed by any legislature now or heretofore established in British India, as well from the law pre scribed for the said courts and offices by the Regulations and Acts aforesaid.
And no Act hereafter passed by the Council of the Governor General for making Laws and Regula tions shall be deemed to extend to any part of the said territory, unless the same be specially named therein.
Sec. 5.
The administration of civil and criminal jus tice, and the superintendence of the settlement and realiza tion of the public revenue, and of all matters relating to rent, within the said territory, are hereby vested in such officers as the said Lieutenant Governor may, for the pur pose of tribunals of first instance or of reference and appeal, from time to time appoint.
The officers so appointed shall, in the matter of the administration and superin tendence aforesaid, be subject to the direction and con trol of the said Lieutenant Governor and be guided by such instructions as he may from time to time issue.
Sec. 8.
The said Lieutenant Governor may from time to time by notification in the Calcutta Gazette, extend to the said territory any law, or any portion of any law, now in force in the other territories subject to his Government, or which may hereafter be enacted by the Council of the Gover nor General, or of the said Lieutenant Governor, for making laws and regulations, and may on making such extension direct by whom any powers or duties incident to the provi sions so extended shall be exercised or performed, and make any order which he shall deem requisite for carrying such provisions into operation.
Sec. 9.
The said Lieutenant Governor may from time to time, by notification in the Calcutta Gazette extend mutatis mutandis all or any of the provisions contained in the other sections of this Act to the Jaintia Hills, the Naga Hills, and to such portion of the Khasi Hills as for the time being forms part of British India.
" 896 Under the provisions of the Act the Lieutenant Governor of Bengal on the 14th October, 1871, issued a notification and in exercise of the powers conferred upon him by section 9, he extended the provisions of the said Act to the terri tory known as the Khasi and Jaintia Hills and excluded therefrom the jurisdiction of the Courts of Civil and Crimi nal Judicature, and specified in the notification the bound aries of the said territory.
The notification extended all the provisions of the Act to the districts of Khasi and Jaintia Hills.
The Lieutenant Governor did not exercise the power of selecting parts of these Acts for purposes of local application.
Section 9 of the Act did not empower the Lieu tenant Governor to modify any of the provisions of the Act.
The High Court of Bengal by a majority judgment held that the notification had no legal force or effect in removing the said territories from the jurisdiction which the High Court had previously possessed over it, inasmuch as the Council of the Governor General of India for making laws and regulations had under its constitution, by the Councils Act, 1861, no power to delegate such authority to the Lieutenant Governor as it had by Act XXII of 1869 in fact purported to delegate.
The Indian Councils Act, 1861, 24 & 25 Vict.
c. 67, by section 22, gave the Governor General in Council power for the purpose of making laws and regulation$, power for repealing, amending or altering any laws or regulations whatever then in force or thereafter to be in force and to make laws and regulations for all per sons, whether British or native, foreigners or others, and for all courts of justice whatever, and for all places and things whatever within the said territories, and for all servants of the Government of India within the dominions of princes and states, provided always that the said Governor General in Council shall not have the power of making any laws or regulations which shall repeal or in any way affect any of the provisions of the Act.
As regards section 9 of the Act their Lordships made the following observations : 897 "The ground of the decision to that effect of the major ity of the Judges of the High Court was, that the 9th section was not legislation, but was a delegation of legis lative power.
In the leading judgment of Mr. Justice Mark by, the principles of the doctrine of agency are relied on; and the Indian Legislature seems to be regarded as, in effect, an agent or delegate, acting under a mandate from the Imperial Parliament, which must in all cases be executed directly by itself. "Their Lordships cannot but observe that, if the princi ple thus suggested were correct, and justified the conclu sion drawn from it, they would be unable to follow the distinction made by the majority of the Judges between the power conferred upon the Lieutenant Governor of Bengal by the 2nd and that conferred on him by the 9th section.
If, by the 9th section, it is left to the Lieutenant Governor to determine whether the Act, or any part of it, shall be applied to a certain district, by the 2nd section it is also left to him to determine at what time that Act shall take effect as law anywhere.
Legislation which does not directly fix the period for its own commencement, but leaves that to be done by an external authority, may with quite as much reason be called incomplete, as that which does not itself immediately determine the whole area to which it is to be applied, but leaves this to be done by the same external authority.
If it is an act of legislation on the part of the external authority so trusted to enlarge the area within which a law actually in operation is to be applied, it would seem a fortiori to be an act of legislation to bring the law originally into operation by fixing the time for its com mencement.
"But their Lordships are of opinion that the doctrine of the majority of the Court is erroneous, and that it rests upon a mistaken view of the powers of the Indian Legisla ture, and indeed of the nature and principles of legisla tion.
The Indian Legislature has powers expressly limited by the Act of the Imperial Parliament which created it, and it can, of course, do 898 nothing beyond the limits which circumscribe these powers.
But, when acting within those limits, it is not in any sense an agent or delegate of the Imperial Parliament, but has, and was intended to have, plenary powers of legislation, as large and of the same nature as those of Parliament itself.
The established courts of justice, when a question arises whether the prescribed limits have been exceeded, must of necessity determine that question; and the only way in which they can properly do so, is by looking to the terms of the instrument by which, affirmatively, the legislative powers were created, and by which, negatively, they are restricted.
If what has been done is legislation, within the general scope of the affirmative words which give the power, and if it violates no express condition or restriction by which that power is limited (in which category would, of course, be included any Act of the Imperial Parliament at variance with it), it is not for any court of justice to inquire further, or to enlarge constructively those conditions and restrictions.
" The learned Attorney General placed considerable reli ance on these observations in support of his proposition that if the legislation is within the ambit of the field prescribed for exercise of legislative power, then from it it follows that within that field power can be exercised to delegate to the widest extent.
This quotation, however, cannot be torn off from the context and read by itself.
Meaning can only be given to these observations in the light of the observations that follow the quotation cited above and which are in these terms : " "Their Lordships agree that the Governor General in Council could not, by any form of enactment, create ' in India, and arm with general legislative authority a new legislative power not created or authorised by the Councils Act.
Nothing of that kind has, in their Lordships ' opinion, been done or attempted in the present case.
What has been done is this.
The Governor General in Council has deter mined, in the due and ordinary course of legislation, to remove a particular district from the 899 jurisdiction of the ordinary courts and offices, and to place it under new courts and offices, to be appointed by and responsible to the Lieutenant Governor of Bengal; leav ing it to the Lieutenant Governor to say at what time that change shall take place; and also enabling him, not to make what law he pleases for that or any other district, but to apply by public notification to that district any law, or part of law, which either already was, or from time to time might be, in force, by proper legislative authority, in the other territories subject to his government.
The legisla ture determined that, so far, a certain change should take place; but that it was expedient to leave the time, and the manner of carrying it into effect to the discretion of the Lieutenant Governor; and also, that the laws which were or might be in force in the other territories subject to the same government were such as it might be fit and proper to apply to this district also; but that, as it was not certain that all those laws, and every part of them, could with equal convenience be so applied, it was expedient, on that point also, to entrust a discretion to the Lieutenant Gover nor. "Their Lordships think that it is a fallacy to speak of the powers thus conferred upon the Lieutenant Governor (large as they undoubtedly are) as if, when they were exercised, the efficacy of the acts done under them would be due to any other legislative authority than that of the Governor General in Council.
Their whole operation is, directly and immediately, under and by virtue of this Act (XXII of 1869) itself.
The proper legislature has exercised its judgment as to place, person, laws, powers; and the result of that judgment has been to legislate conditionally as to all these things.
The conditions having been ful filled, the legislation is now absolute.
Where plenary powers of legislation exist as to particular subjects, whether in an Imperial or in a provincial legislature, they may (in their Lordships ' judgment) be well exercised, either absolutely or conditionally.
Legislation, conditional on the use of particular powers, or on the exercise of a limit ed 116 900 discretion, entrusted by the legislature to persons in whom it places confidence, is no uncommon thing; and, in many circumstances, it may be highly convenient.
The British Statute book abounds with examples of it; and it cannot be supposed that the Imperial Parliament did not, when consti tuting the Indian Legislature, contemplate this kind of conditional legislation as within the scope of the legisla tive powers which it from time to time conferred.
It cer tainly used no words to exclude it.
" Towards the close of the judgment certain illustrations were mentioned of legislation in India described as condi tional legislation.
Reference was made to the Codes of Civil and Criminal Procedure and particularly, section 39 of Act XXIII of 1861 which authorised the Local Government with the previous sanction of the Governor General in Council (not in his legislative capacity) to extend the provisions of the Act "subject to any restriction, limitation or proviso which the Local Government may think 'proper.
" In my opinion, in this case their Lordships did not affirmatively assent to the proposition that the Indian Legislature had full power of delegation within the ambit of its legislative field and they did not dissent from the conclusion of Markby J. in the concluding part of the judg ment that under general principles of law in India any substantial delegation of legislative power by the legisla ture of the country was void.
On the other hand, they re marked that legislation of this kind was conditional legis lation and it only becomes complete on the fulfilment of those conditions and that the determination of those condi tions could be left to an external authority.
In spite of expressing their disapproval of the view of the majority of the Full Bench in applying the principles of the doctrine of agency and in treating the Indian Legislature as an agent of the Imperial Parliament, their Lordships clearly expressed the opinion that the exercise of the legislative will and judgment could not be transferred to an external authority and that it was for the proper legislature to exercise its own judgment as to the.
901 place, persons, laws and powers.
It seems to me that though their Lordships were not prepared to assent to the proposi tion that the matter should be dealt with on principles deducible from the doctrine of the law of agency, they were also not prepared to depart from the rule that apart from the doctrine of the law of agency a person to whom an office or duty is assigned or entrusted by reason of a special qualification cannot lawfully devolve that duty upon another unless expressly authorised so to do.
Public func tionaries charged with the performance of public duties have to execute them according to their own judgment and discre tion except to the extent that it is necessary to employ ministerial officers to effectively discharge those duties.
For the reasons given above presumably the Privy Council was not prepared to lay down that delegation of legislative power was a content of the power itself.
It contented itself by holding the law valid under the name and style of condi tional legislation.
It is difficult to conceive that the Privy Council would have hesitated in saying so if it felt that delegation of legislative power was a content of the power itself.
Reference in this connection may be made to a passage in the judgment of Markby J. which reads thus : The various Parliamentary statutes nowhere confer any express power upon the Indian Legislature to change the machinery of legislation in India.
But they do confer that power subject to important restrictions upon the executive government.
Mr. Kennedy boldly claimed for the Indian Legislative Council the power to transfer legislative func tions to the Lieutenant Governor of Bengal.
Indeed as I understand him, the only restriction he would attempt was that the Legislative Council could not destroy its own power to legislate though I see no reason why he should stop there.
The Advocate General did not go so far.
There are no words in the Acts of Parliament upon which the legislative authority could be made transferable in one class of cases and not in others because I do not 902 for a moment suggest that every time a discretion is en trusted to others there is the transfer of legislative authority.
Every Act of the legislature abounds with exam ples of discretion entrusted to judicial and executive officers of government, the legality of which no one would think of questioning. 'the broad question, however, is ' Can the legislature confer on the Lieutenant Governor legisla tive power? ' Answer: 'It is a general principle of law in India that any substantial delegation of legislative author ity by the legislature of this country is void '.
" It was then contended that the illustration cited in the concluding part of the judgment of their Lordships suggests their approval of the proposition that the legislative power could be delegated conferring power to modify a statute passed by the legislature itself.
This contention seems to be based on a misapprehension of what their Lordships decid ed.
In the Full Bench decision of the Calcutta High Court in Empress vs Burgh & Book Singh(1) Markby J. made the following observations while dealing with these illustra tions : "Lastly it was argued that the Indian Legislature had done so (delegated power) for a long series of years, and a long list of Acts passed between 1845 and 1868 has been handed in to us, all of which, it is said, must be treated as instances of delegation of legislative authority and Act XXII of 1869 should be so treated.
The Acts contained in the list do not appear to me to afford (as was asserted) so many clear and undisputed instances of transfer of legisla tive authority.
I may observe that as to the provisions which these and many other Acts contain for the making of rules by executive government in conformity with the Act we have the highest authority in Biddie vs Tariney Churn Baner jee(2) that the power to make such rules may be conferred without delegation of legislative authority. .
The list of Acts does not seem to me to show any clear practice of transferring legislative authority.
" (1) I.L.R. (2) 1 Tay.
& Bell, 390.
903 Ainslie J. specifically considered the provisions of section 39 of Act XXIII of 1861 and the meaning of the words "reservations ", "limitations" and "provisos" and said as follows : "The provisions of section 39, Act XXIII of 1861, do not affect my view of this matter.
This section allows a local Government, with the previous sanction of the Governor General in Council, to annex any restriction, limitation, or proviso it may think proper when extending the Code of Civil Procedure to any territory not subject to the general regu lations; but this is merely another form of delaying the full extension of the Code.
So far as the Code obtains operation, it is still, because the extension is pro tanto, a carrying out of the intention of the superior legislature that this shall be sooner or later the law in the particular tract of country.
As I read the section, no power is given to amend the law itself; it is only a power to keep some portion in abeyance or to make its operation contingent on something external to it, which again is only another form of postponing its full operation." No doubt was cast on this construction of the language of section 39 either in the minority judgment of the High Court or in the judgment of their Lordships of the Privy Council.
In view of this clear expression of opinion of Ainslie J. as to the meaning of the language used in section 39 and not disapproved by their Lordships of the Privy Council it cannot with any force be contended that their Lordships in Burahs case(1) gave approval to the proposition that the power of conditional legislation included the power of amendment or modification of the Act of the legis lature itself.
In my opinion, the result of the decision in Burah 's case(1) is that it was decided that the Indian Legislature had power to conditionally legislate.
This case is no authority for the proposition that it could delegate the exercise of its judgment on the question as to what the law should be to an external agency.
This case does not support the (1) 5 I.A. 178.
904 proposition that amendment of a statute of the legislature itself is a matter which could form the subject of delegated legislation.
The expression that Indian Legislature could not arm with legislative power a new legislative body not created by the Indian Councils Act only means that it must function itself in making laws and not confer this power on any other body.
In other words, it could not create a person having co extensive power of legislation and could not clothe it with its own capacity of law making, that is in laying down principles and policies.
The possession of plenary powers within the ambit laid down only means that within that particular field it can make any laws on those subjects, but it does not mean that it can shirk its duty in enacting laws within the field by making a law that it shall not itself operate on that field but somebody else will operate on its behalf.
In my opinion, their Lordships ' judgment amounts to saying that though within the field prescribed it has the largest power of legislation, yet at the same time it is subject to the condition that it cannot abandon formally or virtually its high trust.
Hodge vs The Queen(1) was the next Canadian case decid ed by the Privy Council in 1883.
The appellant Hodge, was the holder of a liquor licence issued on 25th April, 1881, by the Board of Licence Commissioners for the City of Toron to under the Liquor Licence Act of the Province of Ontario in respect of the St. James Hotel.
He was also the holder of a licence under the authority of the Municipal Act, authorising him to carry on the business or calling of a keeper of a billiard saloon with one table for hire.
The appellant did on the 7th May, 1881, unlawfully permit and suffer a billiard table to be used and a game of billiards to be played thereon, in his tavern during the time prohib ited by the Liquor Licence Act for sale of liquor therein.
It was urged that the Ontario Assembly was not competent to legislate in regard to licences for the sale of liquor and that even if the Ontario legislature could, it could not delegate its power to Licence Commissioners.
( 1) 9 App.
905 The local legislature had assigned to three officials the power to define offences and impose penalties.
This conten tion was met with the plea that there was no delegation of legislative authority but only of the power to make by laws.
The Court of the King 's Bench Division held that the local legislature had no power to delegate in the matter and that such power could be exercised by the legislature alone.
The Court of Appeal reversed this decision and it was upheld by their Lordships of the Privy Council.
It was found that sections 4 and 5 of the Liquor Licence Act were intra vires the constitution.
In the course of their judgment their Lordships made the following observations: "It appears to their Lordships, however, that the objec tion thus raised by the appellants is founded on an entire misconception of the true character and position of the provincial legislatures.
They are in no sense delegates of or acting under any mandate from the Imperial Parliament.
When the British North America Act enacted that there should be a legislature for Ontario, and that its legislative assembly should have exclusive authority to make laws for the Province and for provincial purposes in relation to the matters enumerated in section 92, it conferred powers not in any sense to be exercised by delegation from or as agents of the Imperial Parliament, but authority as plenary and as ample within the limits prescribed by section 92 as the Imperial Parliament in the plenitude of its power possessed and could bestow.
Within these limits of subjects and area the local legislature is supreme, and has the same authority as the Imperial Parliament, or the Parliament of the Domin ion, would have had under like circumstances to confide to a municipal institution or body of its own creation authority to make by laws or resolutions as to subjects specified in the enactment, and with the object of carrying the enactment into operation and effect.
It is obvious that such an authority is ancillary to legislation, and without it an attempt for varying details and machinery to carry them out might 906 become oppressive, or absolutely fail, The very full and very elaborate judgment of the Court of Appeal con tains abundance of precedents for this legislation, entrusting a limited discretionary authority to others, and has many illustrations of its necessity and convenience.
It was argued at 'the bar that a legislature committing important regulations to agents or delegates effaces itself.
That is not so.
It retains its powers intact, and can, whenever it pleases, destroy the agency it has created and set up another, or take the matter directly into its own hands.
How far it shall seek the aid of subordinate agencies, and how long it shall continue them, are matters for each legis to decide. "lature, and not for courts of law This case, in my opinion, decided the following points : (1) Power to make by laws or regulations as to subjects specified in the enactment and with the object of carrying that enactment into operation and effect can be transferred to municipal 'institutions or local bodies.
(2) Such an authority is ancillary to legislation.
(3) Giving such power of making regulations to agents and delegates does not amount to an effacement of the legislature itself.
The case does not sanction the proposition that power to amend or to modify a statute passed by the legislature itself can be delegated.
Power of amending a statute or altering it cannot be described as ancillary to legislation, nor is such a power within the armit of the doctrine of subsidiary legis lation.
It is significant, that their Lordships of the Privy Council never gave their approval to the wide propo sition that what the legislature itself can do, it can employ an agent with coextensive powers for doing the Same.
They have been careful in saying to what extent and in what measure delegation was permissible.
All that they sactioned was delegation of authority ancillary to legislation or delegation to municipal institutions to make regulations and by laws and no more.
It was not held by their Lordships that power to declare what the law shall be could ever be delegated or that such delegation will be intra vires the Parliament of Canada or of the 907 Indian Legislature.
It was contended that by implication their Lordships held in this case that short of effacing itself the legislature could delegate.
In my opinion, there is no justification for placing such a construction on the language used by their Lordships while they were combat ing an argument that was placed before them by the learned counsel.
In re The Initiative and Referendum Act (1) is the third Canadian case decided by the Privy Council.
By the Initia tive and Referendum Act of Manitoba the Legislative Assembly sought to provide that the laws of the province will be made and repealed by the direct vote of the electors instead of only by the Legislative Assembly whose members they elect.
It was held that the powers conferred on a provin cial legislature by section 92 include the power of amend ment of the constitution of the province except as regards the office of the Lieutenant Governor and that the Initia tive and Referendum Act of Manitoba excludes the Lieu tenant Governor wholly from the new legislative authority set up and that this was ultra rites the provincial legisla ture.
The Act was therefore held void.
Lord Haldane who delivered the opinion of the Privy Council, after having found that the Act was ultra vires the legislature, made the following observations: "Having said so much, their Lordships, following their usual practice of not deciding more than is strictly neces sary, will not deal finally with another difficulty which those who contend for the validity of this Act have to meet.
But they think it right, as the point has been raised in the court below, to advert to it.
Section 92 of the Act of 1867 entrusts the legislative power in a province to its legisla ture and to that legislature only.
No doubt a body, with a power of legislation on the subjects entrusted to it so ample as that enjoyed by a provincial legislature in Canada, could, while preserving its own capacity intact, seek (1) 117 908 the assistance of subordinate agencies as had been done when in Hodge vs The Queen (1) the Legislature of Ontario was held entitled to entrust to a Board of Commissioners authority to enact regulations relating to taverns; but it does not follow that it can create and endow with its own capacity a new legislative power not created by the Act to which it owes its own existence.
Their Lordships do no more than draw attention to the gravity of the constitutional questions which thus arise.
" These observations reiterate the ratio of the decision in Hodge vs The Queen(1) and they do not amount to saying that power to amend or modify Acts of the legislature itself could be given by delegation of legislative power.
It is, however, important that their Lordships in clear and unam biguous language laid it down that section 92 entrusts legislative power to its legislature and to that legisla ture only and to no other.
The principle underlying Lord Haldane 's remarks is thus stated in Street 's book on the Doctrine of Ultra Vires, at page 430: "The decision in this case, that the statute was ultra vires, did not turn precisely on the ground of delegation, but these remarks suggest that a legislature will not ordi narily be permitted to shift the onus of legislation, though it may legislate as to main principles and leave details to subordinate agencies.
" Reference may also be made to the case of King vs Nat Bell Liquors Ltd.(2) The Liquor Act (6 Geo.
V, c. 4, Alber ta) was held intra vires the power of the province under the British North America Act, 1867, and it was found that it was not ultra vires by reason of being passed pursuant to a popular vote under the Direct Legislation Act (4 Geo.
V, c. 3, Alberta).
Here the law was made by the provincial legis lature itself and it was passed in accordance with the regular procedure of the Houses of Legislature.
This case is no authority for the contention raised by the learned Attorney General.
Il) 9 App.
117 (21 909 The next Canadian case decided by the Privy Council is reported in Croft vs Dunphy(1).
Antismuggling provisions enacted operating beyond territorial limits which had long formed part of Imperial customs legislation and presumably were regarded as necessary for its efficacy were held valid and within the ambit of the constitutional powers.
This case does not suggest any new line of thought, not already con sidered in Queen vs Burah(2), or Hodge vs The Queen(3).
Shannon vs Lower Mainland Dairy Products Board (4) is a case in which the question arose whether Natural Products Market ing Legislation Scheme of control or regulation and imposi tion of licence fees were intra vires the provincial legis lature.
It was argued that it was not within the powers of the provincial legislature to delegate legislative power to the Lieutenant Governor in Council or to give him further power of delegation.
This contention was met with the fol lowing observations : "The objection seems subversive of the rights which the provincial legislature enjoys while dealing with matters within its ambit.
It is unnecessary to enumerate the innu merable occasions on which legislature has entrusted similar powers to various persons and bodies.
On the basis of past practice the delegation was upheld.
" So far as I have been able to ascertain, the past prac tice was in respect of conferring necessary and ancillary powers to carry on the policy of a statute.
Reference was also made to Powell vs Apollo Candle Co. (5) decided in the year 1885.
There the question arose as to the validity of section 133 of the Customs Regulating Act of 1879 which authorizes the levy of certain duties under an Order in Council.
The section was held intra vires the constitution.
It was argued that the power given to the colonial legislature to impose duties was to be executed by themselves (1) (4) (2) 5 I.A. 178.
(5) 10 App.
(3) 9 App.
117. 910 only and could not be entrusted wholly or in part to the Governor or anybody else.
This objection was answered in the following way "The duties levied under the Order in Council are really levied by authority of the Act under which the order was issued.
The legislature has not parted with its perfect control of the Governor and has the power of withdrawing or altering the power entrusted.
" On this construction of the power delegated, that what the delegate was doing was done under the authority of the Act no question of delegation of lawmaking power arises.
Fort Frances Pulp & Power Co. vs Manitoba Free Press (1), Co operative Committee on Japanese Canadians vs Attorney General for Canada (2), and Cooperative Committee vs Attorney General of Canada (3) cited at the Bar are not helpful in giving an opinion on the present matter.
Four recent Canadian cases were cited for the extreme view that short of effacing itself Parliament or a legisla ture has the widest power of delegation and that it acts intra vires the constitution in doing so.
The first of these cases is In re George Edwin Gray(4).
The case was under section 6 of the War Measures Act, 1914, which con ferred very wide powers on the Governor General in Council for the efficient prosecution of the war.
The decision was given by a majority of four to two and in the majority judgment the following observations occur : "The practice of authorizing administrative bodies to make regulations to carry out the objectives of an act instead of setting out all details in the Act itself is well known and its legality is unquestioned but it is said that the power to make such regulations could not constitu tionally be granted to such an extent as to enable the express provisions of the statute to be amended or repealed; that under the constitution (1) (3) (2) (4) 57 S.C.R. (Canada) 150.
911 Parliament alone is to make laws, the Governor General to execute them and the court to interpret them, then it fol lows that no one of the fundamental branches of government can constitutionally either delegate or accept the function of any other branch.
In view of Rex vs Halliday(1), I do not think this broad proposition can be maintained.
Parliament cannot indeed abdicate its functions, within reasonable limits at any rate it can delegate its power to execute government orders.
Such powers must necessarily be subject to determination at any rate by Parliament and needless to say that the acts of the executive under its delegated authority must fall within the ambit of the legislative pronouncement by which this authority is measured.
It is true that Lord Dunedin in Rex vs Halliday(1) said that the British Constitution has entrusted to the two Houses of Parliament subject to assent by the King an absolute power untrammelled by any other circumstance, obedience to which may be compelled by a judicial body.
That undoubtedly is not the case in this country.
Nothing in the Act imposes any limitations on the authority of the Parliament.
" To the proposition stated in the opening part of the quotation there can be no possible objection.
But when the learned Judges proceed to lay down the rule that in the absence of any limitations in the constitution Parliament can delegate the power to amend and repeal laws made by itself to an external authority unless it amounts to an abdication of its functions does not in my humble opinion seem to be sound.
In the first instance, these observations seem inconsistent with the fundamental proposition that a duty entrusted to a particular body of persons and which is to be performed according to certain procedure by that body can be entrusted to an external agency which is not con trolled by any rules of procedure in the performance of that duty and which would never have been entrusted to perform it.
Moreover, abdication by a legislative body need not necessarily amount to a (1) ; 912 complete effacement of it.
Abdication may be partial or complete.
It would certainly amount to abdication when in respect of a subject of legislative list that body says it shall not legislate on that subject but would leave it to somebody else to legislate on it.
That would be delegation of the law making power which is not authorized.
There is no justification for the assumption that the expression "abdi cation" is only applicable when there is a total effacement or a legal extinction of such a body.
In my opinion, it is the abdication of the power to legislate when a legislature refuses to perform its duty of legislating on a particular subject and entrusts somebody else to perform that function for it.
"Abdication" according to the Oxford Dictionary means abandonment, either formal or virtual, of sovereignty or other high trust.
It is virtual abandonment of the high trust when the person charged with the trust says to some body else that the functions entrusted to him in part or whole be performed by that other person.
Be that as it may, the point of view contained in the above quotation cannot be supported on the decisions of their Lordships of the Privy Council discussed in the earlier part of this judgment.
Duff J. stated his view in the following way : "The true view of the effect of this type of legisla tion is that the subordinate body in which a lawmaking authority is vested by it is intended to act as the agent or the organ of the legislature and that the acts of the agent take effect by virtue of the antecedent declaration that they shall have the force of law." These observations, in my opinion, and I speak with great respect cannot again be justified on any juristic principle.
In the matter of making law there cannot be an anticipatory sanction of a law not yet born or even con ceived.
Moreover, an organ of the legislature for making laws can only be created by the constitution and not by the legislature which is itself confided with that power by the constitution.
The learned dissenting Judge in this case observed that a wholesale surrender of the will of the people to any 913 autocratic power would not be justified either in cons titutional law or by the past history of their ancestors.
These observations were made in respect to the power of amendment or repeal conferred on the delegate.
As I have pointed out earlier in this judgment, such a power has not even been exercised by the British Parliament and the Do noughmore Committee recommended that its exercise as far as possible should be abandoned.
The decision in this case, in my opinion, is not an apposite authority for arriving at a correct conclusion on the questions involved in the refer ence.
The next case to which our attention was drawn is Ref.
re Regulations (Chemicals)(1).
This case arose in connection with the regulations respecting chemicals made pursuant to powers conferred by the Department of Munitions and Supply Act and by the War Measures Act.
The question was whether these regulations were ultra vires the constitution.
It was held that except in one part the regulations were intra rites, and it was observed that the War Measures Act does not attempt to transform the executive government into a legislature in the sense in which the Parliament of Canada and the legislatures of provinces are legislatures and that the regulations derive legal force solely from the War Measures Act.
Reliance was placed on Queen vs Burah(2) and Hodge vs The Queen(3).
One of the learned Judges observed that the maxim delegatus non potest delegare is a rule of the law of agency and has no applica tion to Acts of a legislature, that the power of delegation being absolutely essential in the circumstances for which the War Measures Act has been enacted so as to prove a workable Act, power must be deemed to form part of the powers conferred by Parliament in that Act.
Another learned Judge observed that the maxim was not confined to the law of agency alone but that it had no application to legislation.
A third learned Judge, however, said that the maxim quoted above also had application to grants of legislative power but that the Parliament has not (1) [1943] S.C.R. (Canada) 1 (3) 9 App.
Cas. 117, (2) 5 I.A. 178.
914 effaced itself, in the ultimate analysis it had full power to amend or repeal the War Measures Act.
In my opinion, for the reasons already stated, the observations in this case also go beyond the rule laid down by their Lordships of the Privy Council in Queen vs Burah(1) and Hodge vs The Queen(s), and are not a true guide to the solution of the problem.
Our attention was also drawn to Attorney General of Nova Scotia vs Attorney General of Canada(3).
This case does not lend full support to the view taken in the cases cited above.
Therein it was laid down that neither the Parliament of Canada nor the legislature of any province can delegate one to the other any of the legislative authority respec tively conferred upon them by the British North America Act, especially by sections 91 and 92 thereof.
The legislative authority conferred upon Parliament and upon a provincial legislature is exclusive and in consequence, neither can bestow upon or accept power from the other, ' although each may delegate to subordinate agencies.
On the question of delegation of legislative power, the learned Chief Justice remarked that "delegations such as were dealt with in In re George Edwin Gray(4) and in Ref.
re Regulations (Chemicals)(5) under the War Measures Act were delegations to a body subordinate to Parliament and were of a character different from the delegation meant by the bill now submit ted to the courts." In this case on the general question of delegation the Supreme Court did not proceed beyond the rule enunciated in In re The Initiative and Referendum Act (6), or what was stated in Hodge vs The Queen(7).
Lastly reference may also be made to the case of Oimuit vs Bazi (8).
The learned Attorney General placed reliance on certain obiter dicta of Davies J. to the effect that the Parliament of Canada could delegate its legislative power and such delegation was within its power.
The learned Chief Justice did not express (1) 5 I.A. 178.
(5) (2) 9 App.
(6) (3) (1950)4 D.L.R 369. ' (7) 9 App.
57 S.C.R. 150 (8) 46 S.C.R.L. (Canada)502. 915 any opinion on the point, while Idington J. was not prepared to subscribe to this view.
The other Judges did not consid er the point at all.
In my opinion, these remarks, the soundness of which was doubted by other Judges, are not of much assistance to us in this case.
Having examined the Canadian cases on this subject it seems pertinent at this stage to refer to a passage from Street on the Doctrine of Ultra Vires, which states the true position of colonial legislatures and appositely brings out the meaning of the language used by the Privy Council in the cases that the legislatures are not the agents of the Imperial Parliament : "However true it may be that colonial legislatures are not mere agents of the Imperial Government, it is also true that they are not unfettered principals.
Within the terms of their constitution they are limited at least as to subjects and area, and, to the extent suggested, perhaps also as to power of delegation.
If an ultra vires colonial ' statute may be ratified by the Imperial Parliament, there is an implica tion of agency.
To do anything outside the scope of their constitution as when the Dominion of Canada established the Province of Manitoba(1), an imperial statute is required.
It would appear that a legislature cannot, as an ordinary principal, ratify acts purporting to be done under its authority (2).
Taking a broad view, non sovereign legisla tures are, and so long as they do not repudiate their con stitutions must remain, delegates of the Imperial Parlia ment.
They have been so regarded by the Privy Council(3).
But just as in the case of the prerogative it would be impolitic to apply a formula too strictly, so also the law of agency must be accommodated to meet the solid fact that the colonies, or the most important of them, enjoy real independence.
" The decisions of American courts on the constitutionality of delegation of legislative power are, as in (1) 34 Vict.
c. 28.
(2) Commonwealth vs Colonial Ammunition Co. ; , 221.
(3) [1906] A.C. 542; , 254.
118 916 the case of other countries, by no means uniform.
Judicial opinion has sometimes taken a strict view against the valid ity of such delegation and on other occasions it has liber ally upheld it as constitutional on grounds which again by no means are based on logical deductions from any juristic principle, but generally on grounds of convenience or under the doctrine of "determining conditions" and sometimes on historical considerations.
The Supreme Court of America has, however, never departed from the doctrine that legislative power cannot be delegated to other branches of government or to independent bodies or even back to the people.
The rule against delegation of legislative power is not based merely on the doctrine of separation of powers between the three state departments, legislative, executive and judicial, evolved by the constitution.
This doctrine puts a restraint on delegation to other branches of government.
Prohibition against delegation to independent bodies and commissions rests on Coke 's maxim, delegatus non potest delegare.
The maxim, though usually held applicable to the law of agency embodies a sound juristic principle applicable to the case of persons entrusted with the performance of public duties and the discharge of high trusts.
The restraint on delega tion back to the people is tied up with some notion of representative democracy.
Reference was made to a number of decisions of, the Supreme Court during the arguments and quotations from several books on constitutional law were cited.
It is not useful to refer to all of them in my opinion, but a few important ones may be mentioned.
The first American case that needs mention is Waman vs Southard (1), a decision of Marshall C.J. given in the year 1825.
The question concerned the validity of certain rules framed by the courts.
The learned Chief Justice observed that it could not be contended that Congress could delegate to courts or to any other tribunal powers which are strictly or exclusively legislative.
(1) 6 Law.
Edn. 262.
917 In Killbourn vs Thompson (1), it was held that judicial power could not be exercised by the legislative department.
Field vs Clark C) is one of the leading cases in America on this subject.
In this case power had been delegated to the executive to impose certain duties.
Delegation of power was upheld on the ground that the policy of the law having been determined by the legislature, working out of the details could be left to the President who could not be said to be exercising any legislative will but was merely authorised to execute the law as an agent of the legislature in execut ing its policy.
It was asserted that it was a principle universally recognised as vital to the maintenance of the system of government that Congress could not delegate legislative power to the President.
In Springer vs Phillipine Islands C), the same view was expressed.
On similar lines is the decision in U.S. vs Gravenport etc.
Co. (4).
It was observed that after fixing a primary standard, power to fill up details could be devolved by appropriate legislation.
The provision attacked there was held as not delegation of legislative power but merely giving power to make administrative rules.
O 'Donouhue vs
U.S. (5) concerned the question of compensation payable to Judges of the Supreme Court and it was held that it could not be lawfully diminished.
It was remarked that the object of the creation of the three departments of government was not a mere matter of convenience but was basic to avoid commingling of duties so that acts of each may not be called to have been done under the coercive influence of the other departments.
The decision in Hampton & Co. vs
U.S.(6) is the oft quoted judgment of Taft C.J.
The following extracts from that judgment may be quoted with advantage : "It is a breach of the national fundamental law if Congress gives up its legislative power and transfers it to the President, or to the judicial branch, or, if by ; (4) (2) ; (5) ; (3) (8) ; 918 law it attempts to invest itself or its members with either executive power or judicial power.
This is not to say that the three branches are not co ordinate parts of one govern ment and that each in the field of duties may not invoke the action of the other two branches in so far as the action invoked shall not be an assumption of the constitu tional field of action of another branch.
In determining what it may do in seeking assistance from another branch, the extent and character of that assistance must be fixed according to commonsense and the inherent necessities of governmental co ordination.
The field of Congress involves all and many varieties of legislative action and Congress has found it frequently necessary to use officers of the executive branch, within defined limits, to secure the exact effect intended by its acts of legislation, by vesting direction in such officers to make public regulations inter preting a statute and directing the details of its execu tion, even to the extent of providing for penalizing a breach of such regulations. .
Congress may feel itself unable conveniently to determine exactly when its exercise of the legislative power should become effective, because dependent on future conditions, and it may leave the determination of such time to the decision of an executive, or, as often happens in matters of State legislation, it may be left to a popular vote of the residents of a district to be affected by legislation.
" Panama Refining Co. vs
U.S. (1) is another leading decision of the Supreme Court on this subject.
In Benoari Lal Sarma 's ease (2) considerable reliance was placed by Varadachariar J. on this decision for arriving at his con clusion against non delegation of power in India.
The following observations from the judgment of Hughes C.J. may appositely be cited : The Congress is not permitted to abdicate, or to trans fer to others, the essential legislative functions with which it is vested.
Undoubtedly, legislation must often be adapted to complex conditions involving (1) 293 U.S. a88.
(2) 919 a host of details with which the national legislature cannot deal directly.
The Constitution has never been regarded as denying to the Congress the necessary resources of flexibil ity and practicality, which will enable it to perform its function in laying down policies and establishing standards, while leaving to selected instrumentalities the making of subordinate rules within prescribed limits and the determi nation of facts to which the policy as declared by the legislature is to apply.
" Cardozo J. observed as follows :"An attempted delegation not confined to any single act nor to any class or group of acts identified or described by reference to standards is in effect a roving commission.
" In Opp Cotton Mills vs Administrator (1), it was said that essential legislative power could not be delegated but fact finding agencies could be created.
Yakus vs
U.S. C) is to the same effect.
In Lichter vs U.S. (3) it was held that a constitutional power implies a power of delegation of authority under it sufficient to effect its purpose.
This power is especially significant in connection with war powers under which the exercise of discretion as to methods to be employed may be essential to an effective use of its war powers by Congress.
The degree to which Congress must specify its policies and standards in order that the admin istrative authority granted may not be an unconstitutional delegation of its own legislative power is not capable of precise specification.
These decisions seem to indicate that judicial opinion in America is against delegation of essential powers of legislation by the Congress to administrative bodies or even to independent commissions.
It is unnecessary to refer to all the passages that were quoted from the different text books which apart from the opinions of the text book writers merely sum up (1) ; (3) ; (2) ; 920 the result of the decisions given by the various courts on this point.
This result has been, in my opinion, very accurately summarized by Crawford in his book on Construc tion of Statutes at pages 215, 26 in the following words and represents the present state of constitutional law in that country on this subject : "Legislative power has been delegated, as a general rule, not so often as an effort to break down the triparte theory of the separation of powers, but from necessity and for the sake of convenience.
More and more with a social system steadily becoming increasingly complex, the legisla ture has been obliged in order to legislate effectively, efficiently and expeditiously, to delegate some of its functions: not purely legislative in character, to other agencies, particularly to administrative officials and boards.
Most prominent among the powers thus delegated have been the power to ascertain facts, and the power to promul gate rules and regulations.
Many of the other delegated powers, upon analysis, fall within one of these two major or basic classifications.
"So far, however, as the delegation of any power to an executive official or administrative board is concerned, the legislature must declare the policy of the law and fix the legal principles which are to control in given cases and must provide a standard to guide the official or the board empowered to execute the law.
This standard must not be too indefinite or general.
It may be laid down in broad general terms.
It is sufficient if the legislature will lay down an intelligible principle to guide the executive or administra tive official.
From these typical criterions, it is apparent that the courts exercise considerable liberality towards upholding legislative delegations, if a standard is established.
Such delegations are not subject to the objec tion that legislative power has been unlawfully delegated.
The filling in of mere matters of detail within the policy of, and according to, the legal principles and standards established by the legislature is essentially ministerial rather than legislative in character, even if considerable 921 discretion is conferred upon the delegated authority.
In fact, the method and manner of enforcing a law must be left to the reasonable discretion of administrative officers, under legislative standards.
" On one point, however, there is uniformity of judicial decisions in the American courts and even amongst the text book writers.
Delegation of general power to make and repeal laws has uniformly been held as unconstitutional: [vide observations of Dixon J. in Victoria etc.
Co. & Meakes vs Dignam(1)].
It was there pointed out that no instance could be cited of a decision of the Supreme Court of America in which Congress had allowed or empowered the executive to make regulations or ordinances which may overreach existing statutes.
In Moses vs Guaranteed Mortgage Co. of New York(2) a section of the Emergency Banking Law of 1933 was held uncon stitutional delegation of power.
There a banking board was given power to adapt, rescind, alter or amend rules and regulations inconsistent with and in contravention of any law.
In his second edition on Administrative Law, at p. 110, Walter Gellhorn states as follows : "Delegations of power to alter or modify statutes are, in effect, nothing more than delegations of the dispensing, suspending or rule making powers, or a combination thereof.
Yet the mere use of the terms 'alter ' or 'modify ' in the statute, has brought unexpected repercussions from courts and commentators.
" In a number of decisions mentioned in this book the courts have held that delegation of power to alter or modify a statute is unconstitutional delegation of power.
As observed by Prof. Salmond (Jurisprudence 10th Edn.
p. 159), a legislative Act passed by the supreme legislature cannot be amended by any other body than the supreme legislature itself.
In Rowland Burrow 's Words and Phrases, the word "modify" has been defined as meaning "vary, extend or en large, limit or restrict.
" In Oxford Dictionary, one of the (1) ; (2) 239 App.
703, 922 meanings of this word is "the making of partial changes or altering without radical transformation." The same diction ary gives the following meaning to the word "modification": ' 'the result of such alteration, a modified form or varie ty.
" In Stevens vs General Steam Navigation Co. Ltd.(1) it was stated that modification implies an alteration.
It may narrow or enlarge the provisions of a former Act.
In my opinion, the view taken in American decisions that delega tion of authority to modify an Act of the Congress is uncon stitutional is fully borne out by the meaning of the expres sion "modify", though this view is not liked by Walter Gellhorn.
Before concluding, it is apposite to quote a passage from Baker 's Fundamental Law which states the prin ciple on which the American decisions are based and which coincides with my own opinion in respect of those decisions.
The passage runs thus: "The division of our American government into three co ordinate branches necessarily prevents either of the three departments from delegating its authority to the other two or to either of them, but there are other reasons why the legislative power cannot be delegated.
Representative government ' vests in the persons chosen to exercise the power of voting taxes and enacting laws, the most important and sacred trust known to civil government.
The representa tives of the people are required to exercise wise discretion and sound judgment, having due regard for the purposes and needs of the executive and judicial departments, the ability of the tax payers to respond and the general public welfare.
It follows as a self evident proposition that a representa tive legislative assembly must exercise its own judgment; that in giving its consent to a tax levied it must distinct ly and affirmatively determine the amount of the tax by fixing a definite and certain rate or by fixing an aggregate amount on the tax payers and that in enacting a law it must so far express itself that the Act when it leaves the legis lative department is a complete law.
It is therefore a maxim of constitutional law that a legislative body (1) 923 cannot delegate its power.
If it was competent for a repre sentative legislative body to delegate its power it would be open to make the delegation to the executive which would be destructive of representative government and a return to despotism.
Not only the nature of the legislative power but the very existence of representative government depends upon the doctrine that this power cannot be transferred.
" The Australian Constitution follows the American model (63 & 64, Vic., c. 12, passed in July 1900).
The legislative power of the Commonwealth is vested in a Federal Parliament.
The executive power is vested in the Queen, while the judicial power is vested exclusively in the courts.
The extent of the legislative power is stated in sections 51 and 52 of the Constitution Act.
The residuary powers vest in the States.
The first Australian case cited to us is Baxter vs Ah Way(1).
This was decided in the year 1909.
It was held that section 52, sub section (g), of the Customs Act of 1901, which provides that all goods the importation of which shall be prohibited by proclamation shall be prohibited imports, is not a delegation of legislative power but conditional legislation and is within the power conferred on Parliament by section 51 of the Constitution.
It was further held that prohibition of importation is a legislative act of the Parliament itself, the effect of sub section (g) being to confer upon the Governor General in Council the discretion to declare to what class of goods the prohibition will apply.
In the course of his judgment the learned Chief Justice observed as follows : "The foundation of the argument that this power cannot be delegated by the legislature is to be found in the case of. .
It is of course obvious that every legislature does in one sense delegate some of its functions. .
Nor is it to the purpose to say that the legislature could have done the thing itself.
Of course, it could.
In one sense this is delegation of authority because it authorizes another body to do (1) ; 119 924 something which it might have done itself.
It is too late in the day to contend that such a delegation,if it is a delegation is objectionable m any sense.
The objection cannot be supported on the maxim delegatus non potest dele gate or on any other ground. .
There being no objec tion to conditional legislation being passed, this is a case of that sort.
" O 'Connor J. said as follows : "Power is given in section 51 in respect of trade and commerce with other countries on taxation and there is also power to make laws incidental to the exercise of any power vested in Parliament.
It is a fundamental principle of the constitution that everything necessary to the exercise of a power is included in the grant of a power.
Everything necessary to the effective exercise of the power of legisla tion must be taken to be conferred by the constitution with that power. .
Exercise of such discretion cannot be said to be making of the law." Higgins J. said : "According to my view, there is not here in fact any delegation of the law making power." This case rests on the principle that legislative power cannot be delegated and it was for that reason that the impugned statute was justi fied on the ground of conditional legislation.
If delega tion of legislative power was permissible, it was wholly unnecessary to justify the enactment as a form of condition al legislation.
Roche vs Kronheimer(1), decided in the year 1921, was argued by Dixon (as he then was).
The question in that case concerned the validity of the Treaty of Peace Act, 1919, which by section 2 authorized the making of regulations conferring the delegation of powers on certain persons.
The legislation was held constitutional.
In the argument by Mr. Dixon, its validity was attacked on the following grounds: "It is not conditional legislation as in the case of.
Baxter vs Ah Way(2), but it bestows on the executive full ; (2) 925 legislative power upon a particular subject.
Vesting of legislative power to any other hands than Parliament is prohibited.
The making of a law that another body may make laws upon a particular subject matter is not making a law on that subject.
" The decision was given in these terms : It was said that if Parliament had authority to legis late, it had no power to confer that authority on the Gover nor General.
On this topic we were referred to Hodge vs The Queen (1) and Rex vs Halliday(2) and In re The Initiative and Referendum Act(3), and much interesting argument was devoted to the real meaning and effect of the first of those cases.
It is enough to say that the validity of legislation in this form has been upheld in Farey vs Burvett(4); Pank hurst vs Kierman(5); Ferrando vs Pearce(6); and Sickerdick vs Ashton(D, and we do not propose to enter into any inquiry as to the correctness of those decisions.
" This case therefore was decided on the ground of cursus curiae, and the point raised by Mr. Dixon remained unan swered.
In the year 1931 two cases came before the Supreme Court, one of which was decided in February, 1931, and the other in November, 1931.
The first of these is the case of Huddart Parker Ltd. vs The Commonwealth(3), in which Dixon J. was one of the presiding Judges.
The question in that ease concerned the validity of section 33 of the Transport Workers Act which empowered the Governor General to make regulations in respect of transport workers.
The learned Judge observed that Roche vs Kronheimer(9) had decided that a statute conferring on the executive power to legislate upon some matters, is law with respect to that subject.
On this construction of the decision in Roche vs Kronheimer(9) the case was decided.
(1) 9 App.
(6) ; 12} ; (7) ; (3) iI919] A.C. 935. t8) ; (4) ; (9) ; (5) ; 926 So far as I have been able to see, Roche vs Kronhei mer(1) decided nothing and it was based on the rule of stare decisis.
Victorian etc.
Co. & Meakes vs Dignan(2) was decided in November, 1931.
The question in that case was whether section 3 of the Transport Workers Act was intra rites the constitution inasmuch as it delegated power of making regu lations notwithstanding anything else contained in other Acts.
The delegation was under the name and style of confer ring "regulative power.
" The appellants in that case were informed that they were guilty of an offence against the Waterside Employment rights, picking up for work as a water side worker at Melbournea person not a member of the Water side Workers ' Federation, while transport workers who were members of the Federation were available for being picked up for the work at the said port.
The attack on the Act itself was based on the American constitutional doctrine that no legislative body can delegate to another department of government or to any other authority the power, either generally or specially, to enact laws.
The reason, it was said, was to be found in the very existence of its own powers '.
This high prerogative having been entrusted to its own wisdom, judgment and patriotism and not to those of other persons, it will act ultra rites if it undertakes to delegate the trust instead of executing it.
It was, however, said that this principle did not preclude conferring local powers of government upon local authorities.
The defence was that the Act did not impinge upon the doctrine because in it the Parliament confined the regulating power on certain specific matters within the ambit of the trade and commerce power and accordingly merely exercised its own legislative power within that ambit, and did not delegate any part of it.
Reference was made to the decision of Higgins J. in Baxter vs Ah Way(3), in which it was observed that the Federal Parliament had within its ambit full power to frame its own laws in any fashion using any agent, any agency, any machinery that in its wisdom it thinks (1) ; (2) ; (3) 927 fit for the peace, order and good government of the Common wealth.
Rich 3. held that the authority of subordinate law making may be invested in the executive.
Reference was made to Roche vs Kronheimer(1) The learned Attorney General placed considerable reliance on the judgment of Dixon J.
The learned Judge expressed his opinion on the American decisions in these words : "But in what does the distinction lie between the law of Congress requiring compliance with direction upon some specified subject which the administration thinks proper to give and a law investing the administration with authority to legislate upon the same subject? The answer which the decisions of the Supreme Court supply to this question is formulated in the opinion of that Court delivered by Taft C.J. in Hampton & Co: v.U.S.(2).
The courts in America had never had any criterion as to the validity of statutes except that of reasonableness, the common refuge of thought and expression in the face of undeveloped or unascertainable standards.
" The learned Judge then reached the conclusion that no judicial power could be given or delegated, but from that it did not follow that Parliament was restrained from transfer ring any power essentially legislative to another organ or body.
In an earlier decision the learned Judge had ex pressed the opinion that time had passed for assigning to the constitutional distribution of powers among.the separate organs of government, an operation which confined the legis lative power to the Parliament so as to restrain it from reposing in the executive an authority essentially legisla tive in character and he remarked that he was not prepared to change that opinion or his expression to the effect that Roche vs Kronheirner(1) did decide that a statute conferring upon the executive a power to legislate on some matters contained within one of the subjects of the legislative power of Parliament is a law with respect to that subject and the distribution of powers (1) ; (2) ; , 406.
928 does not restrain Parliament to make the law.
The learned Judge then proceeded to say: "This does not mean that a law confiding authority " to the executive will be valid, however extensive or vague the subject matter may be, if it does not fall outside the boundaries of federal power.
Nor does it mean that the distribution of powers can supply no considerations of weight affecting the validity.
It may be acknowledged that the manner in which the constitution accomplished the separation of power does logically or theoretically make the Parliament the exclusive repository of the legislative power of the Commonwealth.
The existence in Parliament of power to authorize subordinate legislation may be ascribed to a conception of that legislative power which depends less upon juristic analysis and perhaps more upon the history and usages of British legislation and the theories of English law.
Such subordinate legislation remains under Parliamen tary control and is lacking in the independent and unquali fied authority which is an attribute to true legislative power.
" It seems to me that in its ultimate analysis the judgment of the learned Judge proceeded, as pointed out by him, upon the history and the usages of British legislation and theories of English law and not on the strict construction of the Australian Constitution with respect to which the learned Judge frankly conceded that logically or theoretically the power of delegation of the quality held valid in that case could not be justified on the framework of the constitution.
I have also not been able precisely to follow the distinction drawn by the learned Judge that delegation held justified by him did not include delegation in the fullest extent of any matter falling within the boundaries of federal power.
After a careful consideration of the observations of this very learned and eminent Judge I venture to think that these are not a safe guide for deci sion of the present reference.
Not only were the constitu tional limitations of the written constitution over reached, but the decision was based on the theories of British legis lation and English law which could 929 hardly be applied to a written constitution with a complete separation of power.
Mr. Justice Evatt in this case stated the rule differ ently.
He observed "every grant by the Parliament of author ity to make regulations is itself a grant of legislative power and the true nature and quality of legislative power of the Commonwealth Parliament involves as part of its contents power to confer law making powers upon author ities other than the Parliament itself." The theory that legislative power has a content of delegation in it, to my mind, is not based on any principles of jurisprudence or of legislation and I venture to think that it is inconsistent with the fundamental principle that when a high trust is confided to the wisdom of a particular body which has to be discharged according to the procedure prescribed, such trust must be discharged by that person in whom it is confided and by no other.
This decision is moreover inconsistent with the decisions of the Privy Council above mentioned.
If the mere existence of power of legislation in a legislature automati cally authorized it to delegate that power, then there was hardly any necessity for their Lordships of the Privy Coun cil to justify delegation in the cases referred to above on the ground of conditional legislation and to state affirma tively that the cases considered by them were not cases of delegation of legislative authority.
This view is certainly in conflict with the observations of the Privy Council in Benoari Lal Sarma 's case (1), given under the Government of India Act, 1935, wherein their Lordships said: "It is true that the Governor General acting under section 72 of Sched ule IX himself must discharge the duty of legislation there cast on him and cannot transfer it to any other authority.
" Evatt J. after enunciating the rule discussed above remarked : "It is true that the extent of the power granted will often be a material circumstance in the examination of the validity of the legislation conferring the grant. .
The nature of the legislative power of the (1) 930 Commonwealth authority is plenary, but it must be possible to predicate of every law passed by the Parliament that it is a law with respect to one or other of the specific subject matters mentioned in sections 51 and 52 of the constitution." After referring to a number of circumstances considered by the learned Judge material in reaching at a result as to the constitutionality of a statute, he observed as follows: "As a final analysis the Parliament of the Commonwealth is not competent to abdicate its powers of legislation.
This is not because Parliament is bound to perform all or any of its legislative functions though it may elect not to do so, or because of the doctrine of sepa ration of powers, but because each and every one of the laws passed by Parliament must answer the description of a law upon one or more of the subject matters stated in the con stitution.
A law by which Parliament gave all its law making authority to another body will be bad because it will fail to pass the test last mentioned.
" Frankly speaking, I have not been able to apprehend on what principles, if any, of construction, the relevancy of the matters considered by the learned Judge as material circumstances in judging the validity of an Act so far as the question of the vires of the Act is concerned could be justified.
Another Australian case cited is Wishart vs Fraser(1).
There the attack was on section 5 of the National Security Act, 1939 40, which empowered the making of regulations for securing public safety and defence of the Commonwealth etc.
It proceeds on the same line as the earlier case discussed above.
In my opinion, the decision in Baxter vs Ah Way(2) is based on a correct construction of the provisions of the Australian Constitution and the later decisions cannot be considered as any guide.
in this country for a decision of the point involved m the reference.
The argument pressed by Mr. Dixon, as he then was, in (1) ; (2) ; 931 Roche vs Kronheirner(1) in my opinion, states the principle correctly.
The decisions of their Lordships of the Privy Council from India are not many.
The first and the earliest of these is in Queen vs Burah(2), which has already been dis cussed at considerable length in the earlier part of this judgment and as stated already, it is no authority for the proposition that the Indian Legislature constituted under the Indian Councils Act, 1861, had power to delegate author ity to the executive authorising them to modify or amend the provisions of an Act passed by the legislature itself.
King Emperor vs Benoari Lal Sarma(3) is the last Indian decision of the Privy Council on this subject.
Conviction of fifteen individuals made by a special magistrate purporting to act under Ordinance II of 1942, promulgated by the Gover nor General on the 2nd January, 1942, was set aside by a special Bench of the High Court at Calcutta and this deci sion was affirmed by the majority of the Federal Court of India.
The ground on which the conviction was set aside was that the Ordinance was ultra vires.
In appeal before their Lordships of the Privy Council it was contended that the Ordinance was valid.
The Ordinance did not itself set up any of the special courts but provided by sub section (3) of section 1 that the Ordinance "shall come into force in any Province only if the Provincial Government, being satisfied of the existence of an emergency arising from any disorder within the Province or from a hostile attack on India or on a country neighbour ing on India or from the imminence of such an attack, by notification in the official gazette, declare it to be in force in the Province and shall cease to be in force when such notification is rescinded." In view of this last provision it was contended that the Ordinance was invalid either because the language showed that the Governor General notwithstanding the preamble did not consider that an emergency existed but was making provi sion in case one should arise in ; (2) 5 I.A. 178, (3) 120 932 future, or else because the section amounted to what was called "delegated legislation" by which the Governor General without legal authority sought to pass the deci sion whether an emergency existed to the Provincial Govern ment instead of deciding it for himself.
On this last point their Lordships observed as follows : "It is undoubtedly true that the Governor General acting under section 72 of Schedule IX, must himself discharge the duty of legislation there cast on him, and cannot trans fer it to other authorities.
But the Governor General has not delegated his legislative powers at all.
His powers in this respect, in cases of emergency, are as wide as the powers of the Indian legislature which, as already pointed out, in view of the proclamation under section 102, had power to make laws for a province even in respect of matters which would otherwise be reserved to the Provincial legislature.
Their Lordships are unable to see that there was any valid objection, in point of legality, to the Governor General 's ordinance taking the form that the actual setting up of a special court under the terms of the ordinance should take place at the time and within the limits judged to be neces sary by the provincial government specially concerned.
This is not delegated legislation at all.
It is merely an exam ple of the not uncommon legislative arrangement by which the local application of the provision of a statute is deter mined by the judgment of a local administrative body as to its necessity.
Their Lordships are in entire agreement with the view of the Chief Justice of Bengal and of Khundkar J. on this part of the case.
The latter Judge appositely quotes a passage from the judgment of the Privy Council in the well known decision in Russell vs The Queen(1).
" This case brings out the extent to which conditional legislation can go, but it is no authority justifying dele gation of legislative power authorising an external authori ty to modify the provisions of a legislative enactment.
It may be pointed out that the opening part of the passage quoted above seems to approve the view (1) 7 App.
933 of the Federal Court expressed by Varadachariar J. in that case when his Lordship relying on a passage from Street on the Doctrine of Ultra Vires observed that a legislature will not ordinarily be permitted to shift the onus of legisla tion though it may legislate as to main principles and leave the details to subordinate agencies.
The decision of the Federal Court in Jatindra Nath Gupta vs The Province of Bihar and Others(1) to which I was a party and wherein I was in respectful agreement with the judgment of the learned Chief Justice and my brother Mukher jea, in my opinion, correctly states the rule on the subject of delegation of legislative power.
The Bihar Maintenance of Public Order Act, 1947, in sub section (3) of section 1 provided as follows : "It shall remain in force for a period of one year from the date of its commencement.
Provided that the Provincial Government may, by notifi cation, on a resolution passed by the Bihar Legislative Assembly and agreed to by the Bihar Legislative Council, direct that this Act shall remain in force for a further period of one year with such modifications, if any, as may be specified in the notification.
" Acting under the proviso the Provincial Government on the 11th March, 1948, extended by notification the life of the Act by one year.
The validity of the proviso to sub section (3) of section 1 of the Act was attacked on the ground that it amounted to delegation of legislative power by the Provincial Legislature and this it was not competent to do.
On the authority of the decision of the Privy Council in Benoari Lal Sarma 's case (2) I held the proviso void.
The question was posed by me in the following way : "It may be asked what does the proviso purport to do in terms and in substance ? The answer is that it empowers the Provincial Government to issue a notification saying that the Provincial Act shall remain (1) (2) 934 in force for a further period of one year with such modifi cations, if any, as may be specified in the notification.
As stated in the earlier part of this judgment, unless the power of the Provincial Government is co extensive with the power of the Provincial Legislature, it is difficult to see how it can have the power to modify a statute passed by that legislature, Modification of statute amounts to re enacting it partially.
It involves the power to say that certain parts of it are no longer parts of the statute and that a statute with X sections is now enacted with Y sections.
In the act of modification is involved a legislative power as a discretion has to be exercised whether certain parts of the statute are to remain law in future or not or have to be deleted from it.
The power to modify may even involve a power to repeal parts of it.
A modified statute is not the same original statute.
It is a new Act and logically speak ing, it amounts to enacting a new law.
The dictionary mean ing of the word 'modify ' is to make something existing much less severe or to tone it down or to make partial changes in it.
What modifications are to be made in a statute or whether any are necessary is an exercise of law making power and cannot amount merely to an act of execution of a power already conferred by the statute.
The extent of changes is left to external authority, i.e., the Provincial Government.
Nothing is here being done in pursuance of any law.
What is being delegated is the power to determine whether a law shall be in force after its normal life has ended and if so, what that law will be, whether what was originally enacted or something different.
The body appointed as a delegate for declaring whether a penal Act of this character shall have longer life than originally contemplated by the legislature and if so, with what modification, is a new kind of legisla ture than that entrusted with the duty under the Government of India Act, 1935.
" I still maintain the view that the question of the life of an Act is a matter for the judgment of the competent legislature.
It is a matter of policy whether a certain enactment is to be on the statute 935 book permanently or temporarily.
Such a question does not fall within conditional legislation as it concerns the extension of the life of a temporary Act.
Such an Act dies a natural death when the period fixed for its duration ex pires.
It automatically ceases to operate and there is no real analogy between conditional legislation which author izes a known authority to determine the commencement or termination of an Act and an act done in exercise of any power conferred by the Act itself.
It was said by the learned Attorney General that this decision had created considerable difficulties and that the various High Courts in India on its authority had held certain enactments void, the validity of which had never been questioned before this decision was given.
In my humble judgment, there is nothing whatever in that decision which m any way unsettled the law as settled by their Lordships of the Privy Council in Bu rah 's case(1).
This decision did not lay down that the Indian legislature did not possess power of delegation necessary for effectively carrying out its legislative functions.
All that it held was and I think rightly that essential legislative function could not be delegated to an external authority and that the legislature could not shirk its own duty and lay the burden of discharging that duty on others.
If I was convinced that the decision laid down a wrong rule of law, I would have required no sugar coated phrases to own the error.
Our attention is not drawn to a single decision of their Lordships of the Privy Council during the whole administration of this country by the British in which the highest court in the land upheld the contention urged by the learned Attorney General.
On the other hand, learned Judges in this country of the eminence of Markby J. and Varadachariar J. in very clear and unambig uous terms affirmed the rule that delegation of essential legislative power was not within the competence of the Indian legislatures.
Reference may also be made to the case of The State of Bombay vs Narottamdas(2), decided recently and to (1) 5 IA.
(2) ; 936 which I was a party.
Therein it was explained that Jatindra Nath Gupta 's case(1) was no authority prohibiting delegation of legislative power in case where the principle and policy of the law had been declared in the enactment itself and ancillary powers had been delegated to the provincial gov ernment for bringing into operation the provisions of an Act.
To sum up, judicial opinion on this subject is still in a fluid state and it is impossible to reconcile all the judgments cited to us on the basis of any rigid principles of constitutional law.
In England the Parliament is for the time being following the recommendations of the Donough more Committee.
In America the doctrine against delegation of legislative power still holds the field.
In Canada as well as.in India the rule laid down by their Lordships of the Privy Council in Burah 's case(2) has never been departed from in theory.
The same view was maintained in the earlier Australian decisions.
Recently Australian decisions however have gone to the length of holding that even essential legislative power can be delegated so long as the principal does not completely efface itself.
In my opinion, the true solution of the problem of delegation of legislative power is to be found in the oft quoted passage from the judgment of Ranney J. of the Supreme Court of Ohio in Cincinnati W. & Z.R. Co. vs Clinton County Comrs.(3).
This quotation is in these terms: "The true distinction is between the delegation of power to make the law, which necessarily involves a discretion as to what it shall be, and conferring authority or discretion as to its execution, to be exercised under and in pursuance of the law.
The first cannot be done; to the latter no valid objection can be made.
" The decision in Locke 's Appeal(4) is also based on this rule.
There it was said : (1) (3) 5 I,A. 178.
(4) , 937 "To assert that a law is less than a law, because it is made to depend on a future event or act, is to rob the legislature of the power to act wisely for the public wel fare whenever a law is passed relating to a state of affairs not yet developed, or to things future and impossi ble to fully know.
" The proper distinction the court said was this: "The legislature cannot delegate its power to make a law, but it can make a law to delegate a power to determine some fact or state of things upon which the law makes, or intends to make, its own action depend. 'To deny this would be to stop the wheels of government.
There are many things upon which wise and useful legislation must depend which cannot be known to the law making power, and must, therefore, be a subject of inquiry and determination outside of the halls of legislation.
" The Federal Court of India in its opinion, expressed by Varadachariar J. in Benoari Lal Sarma 's case(1) considered a contention of the Advocate General of India made to it based on the above quotation of Ranney J. and observed as follows: "We are of the opinion that there is nothing in the above decisions of their Lordships that can be said to be inconsistent with the principle laid down in the passage from the American authority which the Advocate General of India proposed to adopt as his own argument.
" The majority of the court approved the rule stated by Chief Justice Hughes in Panama Refining Co. vs U.S.(2), and it was stated that the rule therein held had nothing whatev er to do with maxim delegatus non potest delegate, but was only the amplification of what was referred to by the Judi cial Committee in Burah 's case(3) as "the nature and princi ples of legislation.
" The question can be posed thus: Why is delegation pecul iarly a content of legislative power and not of judicial power ? In my judgment, it is a content of none of the three State powers, legislative, judicial or executive.
It is, on the other hand, incidental to the (1) (2) ; (3) 5 I.A. 178.
938 exercise of all power inasmuch as it is necessary to dele gate for the proper discharge of all these three public duties.
No public functionary can himself perform all the duties he is privileged to perform unaided by agents and delegates, but from this circumstance it does not follow that he can delegate the exercise of his judgment and dis cretion to others.
One may well ask, why is a legislature formed with such meticulous care by all constitution makers ? Why do they take pains to lay down the procedure to be followed by an elected legislature in its function of law making ? Why do they define its different functions and lay down the methods by which it shall act ? The only answer that reasonably can be given to these queries is: "Because the constitution trusts to the judgment of the body consti tuted in the manner indicated in the constitution and to the exercise of its discretion by following the procedure pre scribed therein.
" On the same principle the judges are not allowed to surrender their judgment to others.
It is they and they alone who are trusted with the decision of a case.
They can, however, delegate ancillary powers to others, for instance, in a suit for accounts and in a Suit for dissolu tion of partnership, commissioners can be entrusted with powers authorising them to give decisions on points of difference between parties as to items in the account.
Again it may be enquired why cannot other public functionaries entrusted in the matter of appointment of public servants delegate this particular duty to others.
The answer again is found in the same principle.
I put this query to the learned Attorney General but I could not elicit any very satisfactory answer.
He contented himself by saying that possibly there was something in the nature of the power itself which requires the personal attention of the authori ties concerned and that therefore delegation was there impliedly forbidden.
To my mind, the same principle forbids delegation of essential legislative power.
It is inherent in the nature of the power that has to be exercised by the legislature elected for the purpose subject to the qualifi cations already stated, It would be a breach of 939 the constitutional duty to bestow this power on someone else.
In the words of Sir John Salmond, "In general, in deed, the power of legislation is far too important to be committed to any person or body of persons save the incor porate community itself.
The great bulk of enacted law is promulgated by the state in its own person.
But in excep tional cases it has been found possible and expedient to entrust this power to private hands.
" In the words of Mr. Dixon (as he then was), the making of a law that another body may make laws upon a particular subject matter is not making a law on that subject.
The quotation cited in the earlier part of this judgment from Baker 's book appositely states the rule when it says: "It is an axiom of constitu tional law that representative legislative bodies cannot delegate legislative power because representative government vests in the persons chosen to exercise the power of voting taxes and enacting laws, :the most important and sacred trust known to civil government.
" In the words of another jurist, "Legislation is the formal utterance by the legisla tive organ of the society and by no others.
Its words constitute the law and not the words of the delegate.
" In private law the rule is well settled that an arbitra tor cannot lawfully devolve his duty on another unless so expressly authorized.
The nature of the duty itself is such that it demands exercise of his own judgment and discretion.
It is again well settled that fiduciary duties cannot be made the subject of delegation, though trustees in order to discharge certain functions can use machinery or subordinate agencies for effectively carrying on the duties which attach to their constitution.
Delegation is permissible in cases where there is a legal or physical necessity to do so be cause without trusting some person or persons it would be impossible efficiently to discharge the duties.
It cannot be denied that municipal and other corporations cannot delegate the by law making power to the executive officers.
It is so because power is entrusted to them in their corporate capac ity and has to be exercised in that capacity.
I am not able to apprehend 121 940 why this principle which is well settled in.
private law cannot appositely be applied to the discharge of duties by public functionaries and by a legislature.
It seems to me that the nature of the duty is such that it is implicit within it that it should be discharged by the person en trusted with it and by no others.
In other words, the nature of the public duty itself demands it and the principles of legislation require it.
For the reasons given above I cannot accept the proposi tion contended for by the learned Attorney General that in the absence of an express or implied provision in the con stitution legislative authority can be bestowed on other persons.
In my opinion, the correct proposition, on the other hand, is that unless expressly or impliedly author ized, such delegation is not permissible.
The exceptions to this rule fall in two classes which have been stated in the quotation from Crawford 's book earlier cited in this judg ment.
It is now convenient to examine the provisions of our Constitution in order to appreciate the contention of the learned Attorney General that it has been modelled on the British system and that the Parliament of India is as omnip otent as in England and that in the matter of delegation of legislative power it is in an analogous situation.
In my opinion, our Constitution is a judicious combination of the American model with the British Parliamentary system.
In its main scheme it follows the Government of India Act, 1935, which provides for a federation of States and provides for an executive responsible to the legislature.
As a matter of fact, the framers of the constitution, though they have borrowed ideas from other constitutions, have not rigidly adhered to any particular model.
Certain provisions in our constitution are such for which there is no precedent in the constitution of any other country.
It seems to ,me that they were as much alive to the doctrine of administrative convenience as to the dangers of a system which permits delegation of unfettered legislative power to the execu tive.
The country had recently emerged from the bonds of a bureaucratic system which had killed 941 its very soul and they.
apparently did not wish it to get engulfed again m the rigours of that system.
Bureaucratic rule is a necessary corollary to the existence of unfettered delegation of legislative power.
To avoid this, the consti tution makers made detailed provision in the Constitution on all matters.
It has to be emphasized that no country in the world has such an elaborate and comprehensive constitution as we have in this country and it would not be proper to construe such a constitution with the help of decisions given elsewhere on the construction of constitutions shaped differently.
It is only after a consideration of all the provisions of the Constitution and its whole scheme that it has to be decided whether delegation of power legislative, executive or judicial is implict in the grant of any of these powers or has been expressly provided for, to the extent it was considered necessary on grounds of administra tive convenience in peace or war time and therefore confer ment of this power by implication cannot be upheld on its true construction.
It has also to be borne in mind that our Constitution is fundamentally different from the British system inasmuch as the doctrine of supremacy of Parliament has its limitations here.
The courts are empowered to declare Acts of Parliament unconstitutional if they are inconsistent with Part III of the Constitu tion or when they trespass on fields demarcated for State legislatures.
Obviously, it is implict in the demarcation of legislative fields that one legislature cannot by delega tion of subjects that are exclusively within its field clothe the other with legislative capacity to make laws on that subject as it will amount to an infringement of the Constitution itself.
It seems clear, therefore, that dele gation of legislative power to that extent is prohibited by the Constitution.
Illustratively, defence is a Union sub ject, while law and order is a State subject.
Can it be argued with any reason that by delegation Parliament can arm a State legislature with the law making power on the subject of defence and that a State legislature can arm Parliament with 942 power to make law on the subject of law and order ? In my opinion, any argument on those lines has to be negatived on the ground that the delegation of such power would be contrary to the Constitution itself and that this kind of transfer of power is outside its contemplation.
For a simi lar reason if such transfer of power is not possible in the case of one legislature to the other, it is difficult to justify it if the transfer is made in favour of the execu tive except to the extent allowed by the Constitution or to the extent that it had already been recognised under the designation "conditional legislation" or "rule making power", of which presumably the constitution makers were fully aware.
I have again no hesitation in holding that our constitution makers accepted the American doctrine against delegation of legislative power, and on grounds of adminis trative convenience and to meet particular circumstances they carefully made express provisions within the Constitu tion for devolution of power in those eventualities.
Article 53 of the Constitution concerns the executive power of the Union.
It is vested in the President and in express terms it is stated in that article that it shall be exercised by him either directly or through officers subor dinate to him in accordance with this Constitution.
The Parliament is authorized by law to confer functions on authorities other than the President.
A careful reading of this article shows that an elaborate provision has been made in the Constitution for employing agencies and machinery for the exercise of the executive power of the Union.
The President is vested with the supreme command of the Defence Forces and in addition to this power, power of delegation has been conferred on Parliament even in its executive field in article 53 (3) (b).
Similar provision has been made in regard to the executive power of each State:(vide article 154).
In article 77 provision has been made as to how the business of the Government of India has to be conducted.
The President has been conferred the power of making rules for the more convenient transaction of the business 943 of the Government of India and for the allocation among Ministers of the said business.
Such a detailed provision regarding the exercise of executive power does not exist in the other constitutions to which our attention was drawn.
Article 79 provides that there shall be a Parliament for the Union.
Provision has then been made in the various articles how the Parliament has to be constituted and how it has to conduct its business, what officers and secretariat it can employ and with what powers.
Articles 107 to 119 relate to legislative procedure.
It is implicit in these elaborate provisions that the Constitution bestowed the lawmaking powers on the body thus constituted by it, and it was this body in its corporate capacity that had to exercise its judgment and discretion in enacting laws and voting taxes and that judgment had to be arrived at by following the rules of procedure expressly laid down therein.
Article 123 confers legislative power on the President when Parlia ment is not in session and this power is co extensive with the legislative power of the Parliament itself.
Article 124 deals with the Union judiciary.
It prescribes the number of Judges and the method of their appointment and it lays down the procedure that the President has the power in making the appointments.
In article 140 provision has been made under which Parliament can confer on the Supreme Court such sup plemental powers as may appear to be necessary for the purpose of enabling the court more effectively to exercise the jurisdiction conferred upon it by or under this Consti tution.
An express provision of this kind, in my opinion, very clearly negatives the proposition which the learned Attorney General has been contending for.
If the power of delegation of legislative powers is implict in the power of legislation itself, the constitution makers would not have made an express provision in article 140 bestowing authority on Parliament for conferment of ancillary powers on the Supreme Court.
Parliament obviously had authority to legis late on "Supreme Court" as it is one of the subjects in the Union List.
Article 145 (1) (a)again very strongly 944 negatives the proposition of the learned Attorney General.
The constitution has authorized the Supreme Court to make rules as to the persons practising before the court.
This is one of the subjects in the Union List and this conferment of power by the Constitution on the Supreme Court is subject to the provision of any law made by the Parliament.
In other words, Parliament has been given express power to take away this power or supplement it by making a law.
In my judgment, such a provision is quite foreign to a constitution in which delegation of law making powers is implicit.
Detailed provi sion has been made for the appointment of High Court Judges in article 217, and rule making powers have been given to the High Courts under article 227.
In article 243 the Presi dent has been given the power to make regulations for the peace and good government of territories enumerated in Part D of the First Schedule and in exercise of that power he can repeal or amend any law made by Parliament or an existing law.
The Constitution itself has delegated the powers of the Parliament to the President wherever it thought that such delegation was necessary.
Articles 245 and 246 demarcate the field of legislation between the Parliament and the State legislature and in article 248 provision has been made that residuary powers of legislation remain in the Parliament.
Article 250 makes provision for cases of emergency.
Parlia ment in that event has power to make laws for the whole or any part of the territory of India with respect to any matters enumerated in the State lists.
Article 252 is a somewhat peculiar provision.
Under it Parliament can legis late for two or more States with their consent.
This is a form of exercise of legislative power by Parliament as a delegate of the State as by its consent alone Parliament gets the power of legislation.
By article 258 the President has been authorized with the consent of the Government of a State to entrust either conditionally or unconditionally to that Government or to its officers functions in relation to any matter to which the executive power of the Union ex tends.
In that article provision has also been made.
for 945 delegation of powers by a law made by Parliament.
By article 349 the power of the Parliament to enact laws in respect of language has been restricted.
Article 353 states the effect of a proclamation of emergency and provides that the execu tive power of the Union in such a case shall extend to the giving of directions to any State as to the manner in which the executive power thereof is to be exercised.
Clause (2) of this article requires emphasis.
It provides that the power of Parliament to make laws with respect to any matters shall include power to make laws conferring powers and imposing duties, or authorizing the conferring of powers and he imposition of duties, upon the Union, or officers and authorities of the Union, as respects that matter, notwith standing that it is one which is not enumerated in the Union List.
Parliament in an emergency under article 250 has full power to make laws on subjects within the State List and is certainly entitled to delegate that power if that power is a content of legislative power but the constitution makers thought otherwise and made an express provision for delega tion of power in such a situation.
Article 357 provides that where by proclamation issued under clause (1) of article 356, it has been declared that the powers of the legislature of the State shall be exercisable by or under the authority of Parliament, it shall be competent for Parliament to confer on the President the power of the legislature of the State to make laws, and to authorize the President to dele gate, subject to such conditions as he may think fit to impose, the power so conferred to any other authority to be specified by him in that behalf.
This is the only article by which the Constitution has authorized the delegation of essential legislative power.
Possibly it was thought that in that contingency it was necessary that Parliament should have power to confer legislative power on the executive and to clothe it with its own legislative capacity in the State field and further to authorize the President to delegate that legislative power to any other authority specified by him.
A reference to the entries in the three Lists of the Seventh Schedule further 946 illustrates this point.
Entry 93 of List I is Offences against laws with respect to any of the matters in this List.
" Entry 94 is "Inquiries, surveys and statistics for the purpose of any of the matters in this List. ' ' Entry 96 is "Fees in respect of any of the matters in this List, but not including fees taken in any court.
" Entry 95 is "Jurisdiction and powers of all courts, except the Supreme Court, with respect to any of the matters in this List.
" All these entries are instances of subjects incidental and ancillary to the main subjects of legislation contained in the List.
Similar entries are to be found in Lists II and III as well.
The Constitution seems to have taken care to confer legislative power in express terms even regarding incidental matters and it is therefore unnecessary to read by implication and introduce by this process within such a constitution any matter not expressly provided therein.
I am satisfied that the constitution makers considered all aspects of the question of delegation of power, whether executive, legislative or judicial, and expressly provided for it whenever it was thought necessary to do so in great detail.
In this situation there is no scope for the applica tion of the doctrine contended for by the learned Attorney General and it must be held that in the absence of express powers of delegation allowed by the Constitution, the Par liament has no power to delegate its essential legislative functions to others, whether State legislatures or executive authorities, except, of course, functions which really in their true nature are ministerial, The scheme of the Consti tution and of the Government of India Act, 1935, is that it expressly entrusted with legislative capacity certain bodies and persons and it also authorised the creation of law making bodies wherever it thought necessary but gave no authority to create a new law making body not created by itself.
It even created the executive as a legislature in certain contingencies.
In these circumstances it is not possible to add to the list of legislative authorities by a process of delegation.
As pointed out by Crawford on Statu tory 947 Construction, at page 333.
"If a statute enumerates the things upon which it is to operate, everything else must necessarily and by implication be excluded from its opera tion and effect.
So if a statute directs certain acts to be done in a specified manner by certain persons, their per formance in any other manner than{ that specified, or by any other person than is there named, is impliedly prohibited.
" The ordinary rule is that if authority is given expressly by affirmative words upon a defined condition, the expression of that condition excludes the doing of the act authorised under other circumstances than those as defined.
Under the Government of India Act, 1935, the executive enjoyed a larger power of legislation than is contained in the new constitution.
It seems to have been cut down to a certain extent.
The new constitution confers authority on Parliament to make laws for the State of Delhi.
It also authorizes it to create a legislature for that State.
The Constitution therefore has made ample provision indicating bodies who would be competent to make laws for the State of Delhi.
In my opinion, therefore, delegation of legislative power to the executive in matters essential is unconstitutional.
Any legislative practice adopted during the pre constitution period for undeveloped and excluded areas can have no rele vancy in the determination of this point.
Having examined the provisions of the new constitution, the constitutional position of the Indian legislature under the Indian Councils Act of 1861 and of the Government of India Act, 1935, as subsequently adapted by the Indian Independence Act, 1947, may now be examined.
As already stated, the Government of India Act, 1935, envisaged a federal constitution for India with a demarca tion of the legislative field between the Federation and the States and it is the scheme of this Act which has been adopted in the new constitution.
I have already expressed my respectful agreement with the view expressed by Varadachari ar J. in Benoari Lal Sarrna 's case(1) that the constitution al (1) 122 948 position in India under this Act approximates more closely to the American model than to the English model and it seems to me that delegation of legislative power in its essenti ality is not allowed by its provisions.
During a period of emergency the Governor General could himself under his own proclamation become the executive as well as the legislature and the necessities of administrative convenience were not a compelling circumstance for introducing into the scheme of the Act by implication, authority in Parliament for the delegation of legislative power.
This Act also contains detailed provisions authorizing delegation of power both in the executive and legislative field wherever it was consid ered necessary to confer such power.
The Indian Independence Act by section 6 conferred the power of legislation on the Dominion Parliament within the ambit of the Act of 1935.
By other provisions of the Indian Independence Act it made the Dominion Parliament a Constituent Assembly for the purpose of making the new constitution for India and it also gave it authority to repeal Acts of Parliament.
For the purpose of ordinary law making it had the same powers as the legisla tures in India enjoyed under the Government of India Act, 1935, and the question referred to us in regard to the Ajmer Merwara Act, 1947, has to be answered on the provi sions of the constitution contained in the Constitution Act of 1935.
The constitutional position in India prior to the Act of 1935 may now be briefly stated.
Before the Charter Act of 1833 there was a division of legislative power between the Governor General and the Presidencies.
By that Act the power of the Presidencies as legislatures was terminated and the whole law making power was vested in the Governor General in Council.
Mr. Macaulay was added as a legislative member to the executive council without a right to vote.
In sub stance the executive and the legislative functions were performed by the same body, of course, with the help and advice of Mr. Macaulay.
With slight modifications the situation remained the same till the Indian Councils Act, 1861.
Under this Act the 949 Governor General in Council in legislative meetings could legislate for the whole of India and local legislatures could also legislate for the provinces.
By section 10 of the Act the legislative power was vested in the Governor General in Council.
In section 15 it was laid down how that power was to be exercised.
For conduct of the legislative business power was given to the Governor General to make rules in section 18.
Section 22 laid down the ambit of the legislative power.
Section 23 bestowed power on the Gover nor General in emergencies to make ordinances.
Section 44 empowered the Governor General to create local legislatures and confer on them legislative power.
It appears that the scheme of the Councils Act was that whenever Parliament wanted the Governor General in Council to have power to create legislatures or to make rules or regulations, that power was conferred in express terms.
By another statute in the year 1870 summary power to make law was conferred on the Governor General in his executive capacity in respect to less advanced areas, i.e., non regulation provinces.
Another charter would not have been necessary if the Governor Gener al could arm himself with legislative power by a process of delegation from his own Council.
In my opinion, the consti tution as envisaged by the Indian Councils Act, 1861, does not authorize the delegation of essential legislative power by any of the legislative authorities brought into existence by that Act to the executive and it was for this reason that their Lordships of the Privy Council in Burgh 's case(1) did not base their decision on this ground but merely upheld the enactment as intra vires on the ground of conditional legis lation.
I am in respectful agreement with the opinion of Markby J. expressed in the year 1877 in these terms:" that any substantial delegation of legislative authority by the legislature of this country is void.
" The Privy Council on appeal did not dissent from this view.
It was argued that legislative practice in India since a long time has been such as would validate statutes (1) 5 I.A. 178.
950 designed on the model of the three statutes under reference to us.
Reference was made to the following observations in U.S.v.
Curriss Wright(1) : "Uniform, long continued and undisputed legislative practice resting on an admissible view of the constitution goes a long way to the direction of proving the presence of unas sailable grounds for the constitutionality of the prac tice.
" In my opinion, there is no evidence in this case of any uniform, long continued and undisputed legislative practice for validating statutes which have been drafted on lines similar to the statutes in question.
The material on which this argument was based is of a most meagre character and does not warrant the conclusion contended for.
Annexure (A) annexed to the case stated on behalf of the President mentions two instances only before the year 1912 of this alleged long continued legislative practice, but even these instances are not analogous to the statutes which have been given in the reference, The scheme of those enact ments in vital matters is different from the enactments in question.
The first instance of this legislative practice is said to be furnished by section 5(a) which was added to the Scheduled Districts Act, 1874, by Act XII of 1891.
It pro vided that with the previous sanction of the Governor Gener al in Council in declaring an enactment in force in the scheduled districts or in extending an enactment to a sched uled district the Local Government may declare the applica tion of the Act subject to such restriction and modification as the Government may think fit.
It is noticeable that,section 7 of the has not been drafted in the same terms as section 5(a) of the Scheduled Districts Act.
Though constitutionally speaking, the Governor General discharged the executive and legislative functions in meet ings held separately for the two purposes and with the help of some additional members, for all practical purposes the Governor General was truly ; 951 speaking in both executive and legislative matters the real authority in this country, and if previous sanction of this authority was necessary before declaring the law even with modifications, this instance cannot be such as would constitute legislative practice for what has been enacted in section 7 of the .
The second instance cited is of the Burma Laws Act, 1898.
In section 10 of this Act it was provided that the Local Government may, with the previous sanction of the Governor General in Council by notification, with such restrictions and modifications as he thinks fit, extend certain Acts in force in any part of Upper Burma at the date of the extension to certain areas.
In section 4 a schedule was given of all the Acts that were in force in Upper Burma at the time of the enactment.
This instance also does not furnish evidence of legislative practice for the validation of section 7 of the in which there is no provision like the one contained in section 4 of the Burma Laws Act, 1898, and which also contains a provision similar to section 5(a) of the Scheduled Districts Act requiring the previous sanction of the Governor General in Council.
Both these important things are lacking in the .
Between 1861 and 1912, a period of over fifty years, two instances of this kind which occurred within seven years of each other cannot fail within the criterion laid down in the case cited above.
After the year 1912 three other illustrations were men tioned.
The first of these is in sections 68 and 73 of the Inland Steam Vessels Act, 1917.
Section authorised modifica tion of an enactment for the purpose of adaptation.
This certainly is no instance of the kind of legislation.
con tained in the , section 7, or in the Ajmer Merwara Act, 1947.
Section 68 authorized the extension of certain chapters to certain areas with modifications.
The next instance mentioned was the .
By section 9 of this Act it was provided that the Central Government may by notification exclude from the operation of any part of this Act the 952 whole or any part of a cantonment or direct that any provi sions of this Act shall in the case of any cantonment apply with such modifications as may be so specified.
The third instance mentioned was in section 30 of the .
Here it was provided that the Central Government may by notification apply all or any of the provisions of this Act with such modifications as it may think fit to any other dangerous inflammable substance.
This is an instance of adding certain items to the schedule annexed to an Act.
These three instances show that between the year 1917 and 1934, a period of seventeen years, three instances occurred of legislation, though not of the same kind as contained in the , but bearing some similarity to that kind of legislation.
No conclusion from those instances of any uniform legislative practice can be drawn.
The learned counsel appearing for the Government of Uttar Pradesh submitted a note in which an instance is mentioned of the Uttar Pradesh Land Revenue Act, III of 1901, which in section 1 of subsection (2) provided that the State Government may by notification extend the whole or any part of this Act to all or any of the areas so excepted subject to such exceptions or modifications as it thinks fit.
This instance does not materially affect the situation.
After the research of a fortnight the learned Attorney General gave us a supplementary list of instances in support of his contention.
Two instances contained in this list are from sections 8 and 9 of Act XXII of 1869 discussed in Burah 's case(1).
The third instance is from section 39 of Act XXIII of 1861, again considered in that case, and these have already been discussed in an earlier part of this judgment.
The only new instance cited is from the Aircraft Act of 1934, which authorized modification in the specification of an aircraft.
It confers no authority to modify any law.
Two instances in ' this list are from the Airforce Act 1950, which was enacted subsequent to (1) 5 I.A. 178.
953 the enactment under reference to us and cannot be considered relevant on this subject.
The last instance cited is from the Madras Local Boards Act, 1920, which authorizes the Governor to extend the Act with certain modifications to areas to which it originally had not been made applica ble.
This instance of 1920 bears no relevancy for deter mining the validity of section 7 of the Act of 1912, enacted eight years before this instance came into existence.
A seemingly similar instance to the enactment contained in section 7 of the is in section 8 of Act XXII of 1869, considered by the Privy Council in Burah 's case(1).
That instance, however, when closely examined, has no real resemblance to section 7 of the .
Act XXII of 1869 was enacted to remove the Garo Hills from the jurisdiction of tribunals established under the General Regulations.
That was its limited purpose.
By section 5 the administration of this part was vested in the officers appointed by the Lieutenant Governor of Bengal and those officers had to be under his control and were to work under his instructions.
The executive administration of this territory was, therefore, vested in the Lieutenant Governor of Bengal.
By section 8 of the Act, already cited, the Lieutenant Governor was authorized by notification in the Calcutta Gazette to extend to the excluded territories laws in force in the other territories subject to his government or laws which might thereafter be enacted by the Council of the Governor General or the Lieutenant Governor in respect of those territories.
Both these authorities were competent to make laws for the province of Bengal.
The validity of section 8 was not questioned in Burah 's case(1) and no argument was addressed about it.
Regarding this section, however, the following observations occur in the judgment of their Lordships which were emphasized before us: "The Governor General in Council has determined, in the due and ordinary course of legislation, to remove (1) 5 t.
A. 178 954 a particular district from the jurisdiction of the ordinary courts and offices, and to place it under new courts and offices, to be appointed by and responsible to the Lieu tenant Governor of Bengal; leaving it to the Lieutenant Governor to say at what time that change shall take place; and also enabling him, not to make what laws he pleases for that or any other district but to apply by public notifica tion to that district any law, or part of a law, which either already was, or from time to time might be, in force, by proper legislative authority, in the other territories subject to his government. ' The legislature determined that, so far, a certain change should take place; but that it was expedient to leave the time, and the manner, of carrying it into effect to the discretion of the Lieutenant Governor; and also, that the laws which were or might be in force in the other territories subject to the same Govern ment were such as it might be fit and proper to apply to this district also.
" All that these observations mean is that a law 'having been made by a competent legislature for the territory under his jurisdiction could be made applicable to a district excluded for certain purposes by a notification of the LieutenantGovernor.
As already pointed out, the Lieutenant Governor could make laws for the whole province of Bengal and similarly, the Governor General in Council could do so.
The law having been made by a competent legislature for the territory for which it had power to legislate, the only power left in the Governor General was to extend that legis lation to an excluded area; but this is not what 'the had done.
As will be shown later, the in section 7 has authorized the Governor General in his executive capacity to extend to Delhi laws made by legisla tures which had no jurisdiction or competence to make laws for Delhi.
Having stated the principles on which answer has to be given to the questions referred to us, I now proceed to give my opinion on each of the three questions.
955 The first question relates to section 7 of the , and concerns its validity in whole or in part.
The section as enacted in 1912 was in these terms : "The Governor General in Council may by notification in the official gazette extend with such restrictions and modifications as he thinks fit to the Province of Delhi or any part thereof any enactment which is in force in any part of British India at the date of such notification.
" The section gives a carte blanche to the GovernorGeneral to extend to the newly formed province any enactment in force in any part of British India at the date of the noti fication and not necessarily any enactment in force in British India at the date of the passing of the .
No schedule was annexed to the Act of the enactments that were in force in any part in British India at the date of the passing of the Act.
As regards the enactments that may be in force in any part of British India at the date of any notification, there was no knowing what those laws would be.
Laws that were to be made after 1912, their principle and policy could not be known to the legislature that enact ed section 7 of the .
It seems obvious that the legislature could not have exercised its judgment, nor its discretion in respect of those laws.
It also conferred on the Governor General power of modifying existing and future enactments passed by different legislatures in the country.
The power of modification implies within it the power of amending those statutes.
To use the words of a learned Judge, the section conferred a kind of a vague, wide, vagrant and uncanalised authority on the Governor General.
There is no provision within the section by virtue of which the mind of the legislature could ever be applied to the amendments maple by the Governor General in the different statutes passed by different legislatures in India and extended to Delhi.
123 956 Illustratively, it may be pointed out that numerous rent control Acts have been passed by different legislatures in India, laying down basically different policies and princi ples.
The Provincial Government under the is authorised to apply the policy of any one of these Acts to Delhi or the policy which it might evolve by combining different such statutes passed by different State legisla tures.
Legislative policy in the matter of rent control had not been evolved by the year 1912.
Another illustration may be taken from the law of prohibition.
Different State gov ernments have adopted a policy of either complete prohibi tion or of local option.
What policy is to be applied to Delhi and who is to decide that policy ? Obviously, under section 7 the Provincial Government can without going to the legislature adopt any policy it likes whether of partial or of complete prohibition and may apply to Delhi any law it thinks fit.
It is obvious therefore that within the wide charter of delegated power given to the executive by section 7 of the it could exercise essential legisla tive functions and in effect it became the legislature for Delhi.
It seems to me that by enacting section 7 the legis lature virtually abdicated its legislative power in favour of the executive.
That, in my judgment, was not warranted by the Indian Councils Act, 1861, or by any decision of the Privy Council or on the basis of any legislative practice.
The section therefore, in my opinion, is ultra vires the Indian Councils Act, 1861, in the following particulars: (i)inasmuch as it permits the executive to apply to Delhi laws enacted by legislatures not competent to make laws for Delhi and which these legislatures may make within their own legislative field, and (ii) inasmuch as it clothes the executive with co extensive legislative authority in the matter of modification of laws made by legislative bodies in India.
If any list of the existing laws passed by the Governor General in Council in his legislative capacity and of laws adopted by it though passed by other legislatures was annexed to the Act, to that extent the delegation of power, but 957 without any power of modifications in favour of the execu tive, might have been valid, but that is not what was enact ed in section 7 of the .
Power to extend laws made in the future by the GovernorGeneral in Council for the whole of India or adopted by it though passed later by other legislatures would also be intra vires, but farther than that the legislature could not go.
If one may say so, sec tion 7 declares that the legislature has no policy of its own and that the Governor General in Council can declare it and can determine what laws would be in force in Delhi.
The second question concerns section 2 of the Ajmer Mer wara (Extension of Laws) Act, 1947, which provides for extension of enactments to Ajmer Merwara.
It says: "The Central Government may by notification in the official gazette extend to the province of AjmerMet warn with such restrictions and modifications as it thinks fit any enactment which is in force in any other province at the date of such notification.
" For the reasons given for holding that section 7 of the is ultra vires the constitution in two par ticulars, this section also is ultra vires the Government of India Act, 193s, in those particulars.
The section does not declare any law but gives the Central Government power to declare what the law shall be.
The choice to select any enactment in force in any province at the date of such notification clearly shows that the legislature declared no principles or policies as regards the law to be made on any subject.
It may be pointed out that under the Act of 1935 different provinces had the exclusive power of laying down their policies in respect to subjects within their own legiSlative field.
What policy was to be adopted for Delhi, whether that adopted in the province of Punjab or of Bombay, was left to the Central Government.
Illustratively, the mischief of such law making may be pointed out with refer ence to what happened in pursuance of this section in Ajmer Merwara.
The Bombay Agricultural Debtors ' Relief Acco, 1947, has been 958 extended under cover of this section to Ajmer Merwara and under the power of modification by amending the definition of the word 'debtor ' the whole policy of the Bombay Act has been altered.
Under the Bombay Act a person is a debtor who is indebted and whose annual income from sources other than agricultural and manly labour does not exceed 33 per cent of his total annual income or does not exceed Rs. 500, whichev er is greater.
In the modified statute "debtor" means an agriculturist who owes a debt, and "agriculturist" means a person who earns his livelihood by agriculture and whose income from such source exceeds 66 per cent of his total income.
The outside limit of Rs. 500 is removed.
The exer cise of this power amounts to making a new law by a body which was not in the contemplation of the Constitution and was not authorized to enact any laws.
Shortly stated, the question is, could the Indian legislature under the Act of 1935 enact that the executive could extend to Delhi laws that may be made hereinafter by a legislature in Timbuctoo or Soviet Russia with modifications.
The answer would be in the negative because the policy of those laws could never be determined by the law making body entrusted with making laws for Delhi.
The Provincial legislatures in India under the Constitution Act of 1935 qua Delhi constitutionally stood on no better footing than the legislatures of Timbuctoo and Soviet Russia though geographically and politically they were in a different situation.
The third question concerns section 2 of the Part C States (Laws) Act, 1950, which provides that " The Central Government may by notification in the official gazette extend to any Part C State (other than Coorg and the Andaman and Nicobar Islands) or to any part of such State, with such restrictions or modifications as it thinks fit any enactment which is in force in a Part A State at the date of the notification and provision may be made in any enactment so extended for the repeal or amendment of any corresponding law (other than a Central Act) which is for the time being applicable to that Part C State." 959 For reasons given for answering questions 1 and 2 that the enactments mentioned therein are ultra rites the consti tution in the particulars stated, this question is also answered similarly.
It might, however, be observed that in this case express power to repeal or amend laws already applicable in Part C States has been conferred on the Cen tral Government.
Power to repeal or amend laws is a power which can only be exercised by an authority that has the power to enact laws.
It is a power co ordinate and co exten sive with the power of the legislature itself.
In bestowing on the Central Government and clothing it with the same capacity as is possessed by the legislature itself the Parliament has acted unconstitutionally.
In offering my opinion on the questions mentioned in the reference I have approached this matter with great caution and patient attention and having in mind the rule that the benefit of reasonable doubt on questions on the constitu tional validity of a statute has to be resolved in favour of legislative action.
The legislative action, however, in the enactments which are the subject matter of the reference has been of such a drastic and wide and indefinite nature con sidered in its full amplitude that it is not possible to hold that in every particular these enactments are constitu tional.
MUKHERJEA J. This is a reference made by the President of India, under article 143 (1) of the Constitution, invit ing this Court to consider and report to him its opinion on the three following questions : (1) Was section 7 of the , or any of the provisions thereof, and in what particular or particu lars or to what extent ultra vires the Legislature which passed the said Act ? (2) Was the Ajmer Merwara (Extension of Laws) Act, 1947, or any of the provisions thereof, and in what particular or particulars or to what extent ultra vires the Legislature which passed the said Act ? (3) Is section 2 of the Part C States (Laws) Act, 1950, or any of the provisions thereof, and in what 960 particular or particulars or to what extent ultra vires the Parliament ? The necessity of seeking the advisory opinion of this Court is stated to have arisen from the fact that because of the decision of the Federal Court in Jatindra Nath Gupta vs The Province of Bihar(1), which held the proviso to sub section (3) of section 1 of the Bihar Maintenance of Public Order Act, 1947, ultra vires the Bihar Provincial Legisla ture, by reason of its amounting to a delegation of its legislative powers to an extraneous authority, doubts have arisen regarding the validity of the three legislative provisions mentioned above, the legality of the first and the second being actually called in question in certain judicial proceedings which are pending before some of the High Courts in India.
The , which is the earliest of the enactments referred to above, was passed in 1912 by the Governor General in Council at its legislative meeting, that being the legislature constituted for British India at that time, under the provisions of the group of statutes known as Indian Councils Acts (1861 1909).
Delhi, which up till the 17th of September, 1912, was a part of the province of the Punjab, was created a Chief Commissioner 's Province on that date and on the following date the Governor General 's Legis lative Council enacted the (Act XIII) 1912 which came into force on and from the 1st of October, 1912.
Section 7 of the Act, in regard to which the controversy has arisen, provides as follows : "The Provincial Government may, by notification in the official gazette, extend with such restrictions and modifi cations as it thinks fit, to the province of Delhi or any part thereof any enactment which is in force in any part of British India at the date of such notification.
" The Ajmer Merwara (Extension of Laws) Act was enacted on the 31st December, 1947, by the Dominion (1) 961 Legislature of India under the provisions of the Government of India Act, 1935 (as adapted under the Indian Independence Act of 1947).
Section 2 of the Act is in the following terms : "2. 'Extension of enactments to Ajmer Merwara.
The Central Government may be notification in the official gazette extend to the province of Ajmer Merwara with such restrictions and modifications as it thinks fit any enact ment which is in force in any other province at the date of such notification.
" Part C States (Laws) Act, 1950, has been enacted by the Indian Parliament after the new Constitution came into force and the provision of section 2 of the Act to which the dispute relates is worded thus: "2.
Power to extend enactments to certain Part C States.
The Central Government may, by notification in the official gazette, extend to any Part C State (other than Coorg and the Andaman and Nicobar Islands) or to any part of such State with such ' restrictions and modifications as it thinks fit any enactment which is in force in a Part A State at the date of the notification; and provision may be made in any enactment so extended for the repeal or amendment of any corresponding law (other than a Central Act) which is for the time being applicable to that Part C State.
" It will be noticed that in all the three items of legis lation, mentioned above, there has been, what may be de scribed, as conferment by the legislatures, which passed the respective enactments, to an outside authority, of some of the powers which the legislative bodies themselves could exercise; and the authority in whose favour the delegation has been made has not only been empowered to extend to particular areas the laws which are in force in other parts of India but has also been given a right to introduce into such laws, any restrictions or modifications as it thinks fit.
The controversy centres round the point as to whether such delegation was or is within the competency of the particular legislature which passed these enactments, 962 The contention of the learned Attorney General, who represents the President of, India, in substance is that a legislature which is competent to legislate on a particular subject has the competence also to delegate its legislative powers in respect of that subject to any agent or external authority as it thinks proper.
The extent to which such delegation should be made is entirely a matter for consider ation by the legislature itself and a court of law has no say in the matter.
There could be according to the learned Attorney General, only two possible limitations upon the exercise of such right of delegation by a competent legis lative body.
One is that the legislature cannot abdicate or surrender its powers altogether or bring into existence a new legislative power not authorised by the constitutional instrument.
The second is that if the constitutional docu ment has provided for distribution of powers amongst differ ent legislative bodies, one legislature cannot delegate to another, powers, which are vested in it, exclusively under the Constitution.
It is argued that, save and except these two limitations, the doctrine of inhibition of delegation by legislative authority has no place in a Constitution mo delled on the English system which does not recognise the principle of separation of powers as obtains in the American system.
These questions are of great constitutional impor tance and require careful consideration.
In America the rule of inhibition against delegation of legislative powers is based primarily upon the traditional American doctrine of "separation of powers".
Another principle is also called in to aid in support of the rule, which is expressed in the wellknown maxim of Private Law, "delegatus non potest delegare", the authority for the same, being based on one of the dieta of Sir Edward Coke.
The modern doctrine of , 'separation of powers" was a leading tenet in the political philosophy of the 18th century.
It was elaborated by Montesquieu in his "Lesprit des lois" in explanation of the English political doctrine and was adopt ed, in theory at least, in all its fulness and 963 rigidity by the constitution makers of America.
The consti tution of America provides for the separation of the govern mental powers into three basic divisions the executive, the legislative, and the judicial and the powers appertaining to each department have been vested in a separate body of public servants.
It is considered to be an essential princi ple(1) underlying the constitution that powers entrusted to one department should be exercised exclusively by that department without encroaching upon the powers confided to others.
As is said by Cooley,(2) "The different classes of power have been apportioned to different departments; and as all derive their authority from the same instrument, there is an implied exclusion of each department from exercising the functions conferred upon the others.
" The other doctrine that is invoked in support of the anti delegation rule is the well accepted principle of municipal law, which prevents a person upon whom a power has been conferred, or to whom a mandate has been given, from delegating his powers to other people.
The legislature is supposed to be a delegate deriving its powers from the 'people ' who are the ultimate repository of all powers, and hence it is considered incapable of transferring such powers to any other authority.
These doctrines, though well recognised in theory, have a restricted and limited application in actual practice.
Mr. Justice Story said(3) "But when we speak of a separation of the three great departments of Government and maintain that that separation is indispensable to public liberty, we are to understand this maxim in a limited sense.
It is not meant to affirm that they must be kept wholly and entirely separate and distinct, and have no common link of connection or depend ence, the one upon (1) See Kilbourn vs Thomson, ; at p. 190.
i2) See Cooley 's "Constitutional Limitations", 7th Edition, page 126.
(3) Story 's Constitution, section 525, 124 964 the other, in the slightest degree.
The true meaning is that the whole power of one of these departments should not be exercised by the same hands which possess the whole power of either of the other departments: and that such exercise of the whole would subvert the principles of free constitu tion.
" As regards the maxim delegatus non potest delegare, its origin and theoretical basis are undoubtedly different from those of the doctrine of separation of powers.
But, for practical purposes, both these doctrines are linked together and are used as arguments against the Congress attempting to invest any other authority with legislative powers.
Accord ing to Willis, the disability of the Congress to delegate its legislative powers to the executive, purports to be based upon the doctrine of separation of powers; while its incapacity to bestow its authority upon an independent body like a Board or Commission is said to rest on the maxim delegatus non potest delegare(1).
As said above, a considerable amount of flexibility was allowed in the practical application of these theories even from early times.
The vast complexities of social and eco nomic conditions of the modern age, and the ever growing amount of complicated legislation that is called for by the progressive social necessities, have made it practically impossible for the legislature to provide rules of law which are complete in all their details.
Delegation of some sort, therefore, has become indispensable for making the law more effective and adaptable to the varying needs of society.
Thus in America, despite the theory which prohibits delegation of legislative power, one comes across numerous rules and regulations passed by non legislative bodies in exercise of authority bestowed on them by the legislature in some shape or other.
The legislature has always been deemed competent to create a municipal authority and empower it to make by laws.
In fact, such legislation is based upon the immemorial (1) Willis on Constitutional Law, p. 965 Anglo Saxon practice of leaving to each local community the management and control of local affairs.
The Congress can authorise a public officer to make regulations, or the Judges of the Court to frame rules of procedure which are binding in the same way as laws proper.
It can authorise some other body to determine the conditions or contingencies under which a statute shall become operative and can empower administrative functionaries to determine facts and apply standards.
"The separation of powers between the Congress and the Executive", thus observed Cardozo, J. in his dis senting judgment in Panama Refining Company vs Ryan(1), "is not a doctrinaire concept to be made use of with pedantic rigour.
There must be sensible approximation, there must be elasticity of adjustment in response to the practical neces sities of Government which cannot foresee today the develop ments of tomorrow in their nearly infinite variety".
In fact, the rule of non delegation has so many exceptions engrafted upon it that a well known writer(2) of constitu tional law has tersely expressed that it is difficult to decide whether the dogma or the exceptions state the rule correctly.
It does not admit of any serious dispute that the doc trine of separation of powers has, strictly speaking, no place in the system of government that India has at the present day under her own Constitution or which she had during the British rule.
Unlike the American and Australian Constitutions, the Indian Constitution does not expressly vest the different sets of powers in the different organs of the State.
Under article 53(1), the executive power is indeed vested in the President, but there is no similar vesting provision regarding the legislative and the judicial powers.
Our Constitution, though federal in its structure, is modelled on the British Parliamentary system, the essen tial feature of which is the responsibility of the executive to the legislature.
The President, as the head of the executive, is to act on the advice of the Council of (1) ; at 440.
(2) See Willis on Constitutional Law, p. 137, 966 Ministers, and this Council of Ministers, like the British Cabinet, is a "hyphen which joins, a buckle which fastens, the legislative part of the State to the executive part.
" There could undoubtedly be no question of 'the executive being responsible to the legislature in the year 1912, when the Delhi Act X111 of 1912 was passed, but at that time it was the executive which really dominated the legislature, and the idea of a responsible government was altogether absent.
It was the Executive Council of the GovernorGeneral which together with sixty additional members, of whom 33 were nominated, constituted the GovernorGeneral 's Legisla tive Council and had powers to legislate for the whole of British India.
The local legislatures in the provinces were constituted in a similar manner.
The first advance in the direction of responsible government was made by the Govern ment of India Act, 1919, which introduced dyarchy in the provinces.
The Government of India Act, 1935, brought in Provincial autonomy, and ministerial responsibility was established in the provinces subject to certain reserved powers of the Governor.
In the Centre the responsibility was still limited and apart from the discretionary powers of the Governor General the Defence and External Affairs were kept outside the purview of ministerial and legislative control.
Thus whatever might have been the relation between the legislature and the executive in the different constitu tional set ups that existed at different periods of Indian history since the advent of British rule in this country, there has never been a rigid or institutional separation of powers in the form that exists in America.
The maxim delegatus non potest delegare is sometimes spoken of as laying down a rule of the law of agency; its ambit is certainly wider than that and it is made use of in various fields of law as a doctrine which prohibits a person upon whom a duty or office has devolved or a trust has been imposed from delegating his duties or powers to other per sons.
The 967 introduction of this maxim into the constitutional field cannot be said to be altogether unwarranted, though its basis rests upon a doubtful political doctrine.
To attract the application of this maxim, it is essential that the authority attempting to delegate its powers must itself be a delegate of some other authority.
The legislature, as it exists in India at the present day, undoubtedly is the creature of the Indian Constitution, which defines its powers and lays down its duties; and the Constitution itself is a gift of the people of India to themselves.
But it is not a sound political theory, that the legislature acts merely as a delegate of the people.
This theory once popula rised by Locke and eulogized by early American writers is not much in favour in modern times.
With regard to the Indian Legislature as it existed in British days constitut ed under the Indian Councils Act, it was definitely held by the Judicial Committee in the well known case of Queen vs Burah (1) that it was in no sense a delegate of the British Parliament.
In that case the question arose as to the validity of section 9 of Act XXII of 1869 passed by the Governor General 's Legislative Council.
The Act provided that certain special laws, which had the effect of excluding the jurisdiction of the High Court, should apply to a cer tain district.
known as Garo Hills, and section 9 empowered the Lieutenant Governor of Bengal to extend the operation of these laws to certain other areas if and when the Lieuten ant Governor, by notification in the Calcutta Gazette, would declare that they should be so applied.
The majority of the Judges of the Calcutta High Court upheld the contention of the respondent, Burah, that the authority conferred on the Lieutenant Governor to extend the Act in this way was in excess of the powers of the Governor General in Council, and in support of this view, one of the learned Judges relied inter alia upon the principles of the law of agency.
This view was negatived by the Judicial Committee, and Lord Selborne, in delivering the judgment, observed as follows: (1) 5 I.A. 178.
968 "The Indian Legislature has powers expressly limited by the Act of the Imperial Parliament which created it, and it can, of course, do nothing beyond the limits which cir cumscribe these powers.
But when acting within those limits, it is not in any sense an agent or delegate of the Imperial Parliament, but has, and was intended to have, plenary powers of legislation as large and of the same nature as those of parliament itself." Practically the same observations were reiterated by the Judicial Committee in the case of Hodge vs The Queen(1) while describing the position of the Provincial Legislature under the Canadian Constitution and stress was laid upon the plenitude of power which such Legislature could exercise when acting within the limits prescribed for it by the Imperial Parliament.
I am quite willing to concede that the doctrine of separation of powers cannot be of any assistance to us in the solution of the problems that require consideration in the present case.
In my opinion, too much importance need not also be attached to the maxim delegatus non potest delegare, although as an epigrammatic saying it embodies a general principle that it is not irrelevant for our present purpose.
But even then I am unable to agree with the broad proposition enunciated by the learned Attorney General that a legislative power per se includes within its ambit a right for the legislative body to delegate the exercise of that power in any manner it likes to another person or authority.
I am unable also to accept his contention that in this respect the authority of the Indian Legislature is as ple nary as that of the British Parliament, and, provided the subject matter of legislation is not one outside the field of its legislative competence, the legislature in India is able to do through an agent anything which it could do itself.
It is to be noted that so far as the British Parliament is concerned, there is no constitutional limitation upon its authority or power.
In the words of Sir 9 App.
969 Edward Coke (1), "the power and jurisdiction of Parliament is so transcendent and absolute that it cannot be confined, either for causes or persons, within any bounds. . . .
It hath sovereign and uncon trollable authority in the making, confirming, enlarging, abrogating, repealing, reviving and expounding of laws. . . . this being the place where that absolute despotic power which must in all governments reside somewhere is entrusted by the constitution of these king doms.
" The British Parliament can not only legislate on any subject it likes and alter or repeal any law it likes, but being both "a legislative and a constituent assembly", it can change and modify the so called constitutional laws and they can be changed by the same body and in the same manner as ordinary laws; and no act of the Parliament can be held to be unconstitutional in a British Court of Law.
(2) This sovereign character was not, and could not be, predicated of the Legislative Council of British India as it was constituted under the Indian Councils Act, even though it had very wide powers of legislation and within the scope of its authority could pass laws as important as those passed by the British Parliament (3).
It is not present also in the Indian Parliament of the present day which is a creature of the Indian Constitution and has got to exercise its legislative powers within the limits laid down by the Constitution itself.
Acting in its ordinary capacity as a legislative body, the Indian Parliament cannot go beyond the Constitution or touch any of the Constitutional or fundamen tal laws, and its acts can always be questioned in a court of law.
Consequences of great constitutional importance flow from this difference and they have a material bearing on the question before us.
The contention of the learned Attorney General in substance is that the power of delegation of legislative authority without any limitation as to its extent is (1) See Coke 's Fourth Institute, p. 36.
(2) See Dicey 's Law of the Constitution, p. 88 (9th Edi tion.) (3) See Dicey 's Law of the Constitution, p. 99 (9th Edition).
970 implicit in the exercise of the power itself, and in support of his contention he refers to the unrestricted rights of delegation which are exercised by the British Parliament.
But the validity or invalidity of a delegation of legisla tive power by the British Parliament is not and cannot be a constitutional question at all in the United Kingdom, for the Parliament being the omnipotent sovereign is legally competent to do anything it likes arid no objection to the constitutionality of its acts can be raised in a court of law.
Therefore, from the mere fact that the British Parlia ment exercises unfettered rights of delegation in respect of its legislative powers, the conclusion does not follow that such right of delegation is an inseparable adjunct of the legislative power itself.
The position simply is this that in England, no matter, to whichever department of the powers exercisable by the British Parliament the right of delega tion of legislative authority may be attributed and there is no dispute that all the sovereign powers are vested in the Parliament no objection can be taken to the legality of the exercise of such right.
But in India the position even at the present day is different.
There being a written constitution which defines and limits the rights of the legislature, the question whether the right of delegation, either limited or unlimited, is included within, and forms an integral part of, the right of legislation is a question which must be answered on a proper interpretation of the terms of the Constitution itself.
We need not for this purpose pay any attention to the American doctrine of sepa ration of powers; we must look to the express language of our own Constitution and our approach should be to the essential principles underlying the process of law making which our Constitution envisages.
According to the Indian Constitution, the power of law making can be exercised by the Union Parliament or a State Legislature which is to be constituted in a particular manner and the process of legis lation has been described in detail in various articles(1).
Powers have been given to the President (1) Vide Articles 107 and 111; 196 to 200, 971 in article 123 and to the Governor of a State under article 213 to promulgate Ordinances during recess of the respective legislatures.
Specific provisions have also been made for exercise of the legislative powers by the President on proclamation of emergency and in respect of Part D territo ries.
Law making undoubtedly is a task of the highest impor tance and responsibility, and, as our Constitution has entrusted this task to particular bodies of persons chosen in particular ways, and not only does it set up a machinery for law making but regulates the methods by which it is to be exercised and makes specific provisions for cases where departure from the normal procedure has been sanctioned, the prima facie presumption must be that the intention of the Constitution is that the duty of law making is to be per formed primarily by the legislative body itself.
The power of the Parliament to confer on the President legislative authority to make laws and also to authorise the President to delegate the power so conferred to any other authority has been recognised only as an emergency provision in arti cle 357 of ' the Constitution.
Save and except this, there is no other provision in the Constitution under which the legislature has been expressly authorised to delegate its legislative powers.
"It is a well known rule of construction that if a statute directs that certain acts shall be done in a specified manner or by certain persons, then performance in any other manner than that specified or by any other persons than those named is impliedly prohibited(1).
" It has been observed by Baker in his treatise on "Fundamental Laws" that quite apart from the doctrine of separation of powers, there are other cogent reasons why legislative power cannot be delegated.
"Representative government," thus observes the ]earned author,(2) "vests in the persons chosen to exercise the power of voting taxes and enacting laws, the most important and sacred trust known to civil government.
The representatives of the people are (1) Vide Crawford 's Statutory Construction, p. 334.
(2) Baker 's Fundamental Laws, Vol.
I, p. 287.
125 972 required to exercise wise discretion and a sound judgment, having due regard for the purposes and the needs of the executive and judicial department, the ability of the tax payer to respond and the general public welfare.
It follows as a self evident proposition that a responsible legis lative assembly must exercise its own judgment.
" In the same strain are the observations made by Cooley in his "Constitutional Law ,,(1) that the reason against delegation of power by the legislature is found in the very existence of its own powers. "This high prerogative has been entrusted to its own wisdom, judgment and patriotism, and not to those of other persons, and it will act ultra vires if it under takes to delegate the trust instead of executing it.
" The same considerations are applicable with regard to the legislative bodies which exercised the powers of law making at the relevant periods when the of 1912 and the Ajmer Merwara Act of 1947 were enacted.
Under the Indian Councils Act, 1861, the power of making laws and regulations was expressly vested in a distinct body consist ing of the members of the Governor General 's Council and certain additional members who were nominated by the Governor General for a period of two years.
The number of such additional members which was originally from 6 to 12 was increased by the subsequent amending Acts and under the Indian Councils Act 'of 1909, it was fixed at 60, of which 27 were elected and the rest nominated by the Governor General.
It was this legislative body that was empowered by the Indian Councils Act to legislate for the whole of Brit ish India and there were certain local legislatures in addition to this in some of the provinces.
Section 18 of the Indian Councils Act of 1861 empowered the Governor General to make rules for the conduct of busi ness at meetings of the Council for the purpose of making laws; section 15 prescribed the quorum necessary for such.
meetings and further provided that the seniormost ordinary member could preside in the absence of the Governor General.
This was (1) Vide Fourth Edition, p. 138, 973 the normal process of law making as laid down by the Indian Councils Act.
Special provisions were made for exceptional cases when the normal procedure could be departed from.
Thus section 23 of the Act of 1861 empowered the Governor General to make ordinances having the force of law in case of urgent necessity; and later on under section 1 of the Indian Councils Act of 1870 the executive government was given the power to make regulations for certain parts of India to which the provisions of the section were declared to be applicable by the Secretary of State.
Besides these exceptions for which specific provisions were made, there is nothing in the parliamentary Acts passed during this period to suggest that legislative powers could be exercised by any other person or authority except the Legislative Councils mentioned above.
The Ajmer Merwara Act was passed by the Dominion Legis lature constituted under the Government of India Act, 1935, as adapted under the Indian Independence Act of 1937.
The provisions of the Constitution Act of 1945 in regard to the powers and functions of the legislative bodies were similar to those that exist under the present Constitution and no detailed reference to them is necessary.
The point for consideration now is that if this is the correct position with regard to exercise of powers by the legislature, then no delegation of legislative function, however small it might be, would be permissible at all.
The answer is that delegation of legislative authority could be permissible but only as ancillary to, or in aid of, the exercise of law making powers by the proper legislature, and not as a means to be used by the latter to relieve itself of its own responsibility or essential duties by devolving the same on some other agent or machinery.
A constitutional power may be held to imply a power of delegation of authori ty which is necessary to effect its purpose; and to this extent delegation of a power may be taken to be implicit in the exercise of that power.
This is on the principle "that everything necessary to the exercise of a power 974 is implied in the grant of the power.
Everything necessary to the effective exercise of legislation must, therefore be taken to be conferred by the Constitution within that power.
But it is not open to the legislature to strip itself of its essential legislative function and vest the same on an extraneous authority.
The primary or essential duty of law making has got to be discharged by the legisla ture itself; delegation may be resorted to only as a second ary or ancillary measure.
Quite apart from the decisions of American courts, to some of which I will refer presently, the soundness of the doctrine rests, as I have said already, upon the essential principles involved in our written Constitution.
The work of law making should be done primarily by the authority to which that duty is entrusted, although such authority can employ an outside agency or machinery for the purpose of enabling it to discharge its duties properly and effectively; but it can on no account throw the responsibility which the Constitution imposes upon it on the shoulders of an agent or delegate and thereby practically abdicate its own powers.
The learned Attorney General in support of the position he took up placed considerable reliance on the observations of the Judicial Committee in the case of Queen vs Burah(2), which I have referred to already and which have been repeat ed almost in identical language in more than one subse quent pronouncement of the Judicial Committee.
The Privy Council made those observations for the purpose of clearing up a misconception which prevailed for a time in certain quarters that the Indian or the Colonial Legislatures were mere agents or delegates of the Imperial Parliament, and being in a sense holders of mandates from the latter, were bound to execute these mandates personally.
This concep tion, the Privy Council pointed out, was wrong.
The Indian Legislature, or for the matter of that the Colonial Parlia ment could, of course, do nothing beyond the limits (1) Per O 'Connor J. in Baxter vs Ah Way, ; at 637.
(2) 5 IA.
975 prescribed for them by the British Parliament.
But acting within these limits they were in no sense agents of another body and had plenary powers of legislation as large and of the same nature as those of the Parliament itself.
It should be noted that the majority of the Judges of the Calcutta High Court in Queen vs Burgh(1) proceeded on the view that the impugned provision of Act XXII of 1869 was not a legislation but amounted to delegation of legislative power and Mr. Justice Markby in his judgment relied express ly upon the doctrine of agency.
This view of Mr. Justice Markby was held to be wrong by the Privy Council in the observations mentioned above and as regards the first and the main point the Judicial Committee pointed out that the majority of the Judges of the High Court laboured under a mistaken view of the nature and principles of legislation, for as a matter of fact nothing like delegation of legisla tion was attempted in the case at all.
It seems to me that the observations relied on by the Attorney General do not show that in the opinion of the Privy Council the Indian, Legislative Council had the same unrestricted rights of delegation of legislative powers as are possessed by the British Parliament.
If that were so there was no necessity of proceeding any further and the case could have been disposed of on the simple point that even if there was any delegation of legislative powers made by the Indian Legisla tive Council it was quite within the ambit of its authority.
In my opinion, the object of making the observations was to elucidate the character in which the Indian Legislative Council exercised its legislative powers.
It exercised the powers in its own right and not as an agent or delegate of the British Parliament.
If the doctrine of agency is to be imported, the act of the agent would be regarded as the act of the principal, but the legislation passed by the Indian Legislature was the act of the Legislature itself acting within the ambit of its authority and not of the British Parliament, although it derived its authority from the latter.
This view has been clearly 5 I.A.78.
976 expressed by Rand J. of the Supreme Court of Canada while the learned Judge was speaking about the essential character of the legislation passed by the legislative bodies in Canada (1).
The observations of the learned Judge are as follows : "The essential quality of legislation enacted by these bodies is that it is deemed to be the law of legislatures of Canada as a self governing political organization and not law of Imperial Parliament.
It was law within the Empire and law within the Commonwealth, but it is not law as if enacted at Westminster, though its source or authority is derived from that Parliament.
" It should be noted further that in their judgment in Burah 's case(2) the Privy Council while dealing with the matter of delegated authority was fully alive to the implications of a written constitution entrusting the exercise of legislative powers to a legisla ture constituted and defined in a particular manner and imposing a disability on such legislature to go beyond the specific constitutional provisions.
Just after stating that the Indian Legislature was in no sense a delegate of the Imperial Parliament the Privy Council observed: "The Gover nor General in Council could not by any form of an enactment create in India and arm with legislative authority a new legislative power not created and authorised by the Coun cils Act." Almost in the same strain were the observations of the Judicial Committee in In re The Initiative and Referendum Act, 1919 (3); and while speaking about the powers of the Provincial Legislature under the Canadian Act of 1867 Lord Haldane said : "Section 92 of the Act of 1867 entrusts the legislative power in a province to its legislature and to that legisla ture only.
No doubt a body with a power of legislation on the subjects entrusted to it so ample as that enjoyed by the provincial legislature in Canada could, while preserving its own capacity intact, seek (1) See Attorney General of Nova Scotia vs Attorney General of Canada, at p. 383.
(2) 5 I.A. 178.
(3) at p. 945.
977 the assistance of subordinate agencies as had been done when in Hodge vs Queen(1) the legislature of Ontario was held entitled to entrust to a Board of Commissioners authority to enact regulations relating to taverns; but it does not follow that it can create and endow with its own capacity a new legislative power not created by the Act to which it owes its own existence.
" It is not correct to say that what these observations contemplate is a total effacement of the legislative body on surrender of all its powers in favour of another authority not recognised by the constitution.
Such a thing is almost outside the range of practical consideration.
The observa tions of Lord Haldane quoted above make it quite clear that his Lordship had in mind the distinction between "seeking the assistance of a subordinate agency in the framing of rules and regulations which are to become a part of the law," and "conferring on another body the essential legisla tive function which under the constitution should be exer cised by the legislature itself.
" The word "abdication" is somewhat misleading, but if the word is to be used at all, it is not necessary in my opinion to constitute legal abdi cation that the legislature should extinguish itself com pletely and efface itself out of the pages of the constitu tion bequeathing all its rights to another authority which is to step into its shoes and succeed to its rights.
The abdication contemplated here is the surrender of essential legislative authority even in respect of a particular sub ject matter of legislation in favour of another person or authority which is not empowered by the constitution to exercise this function.
I will now attempt to set out in some detail the limits of permissible delegation, in the matter of making laws, with reference to decided authorities.
For this purpose it will be necessary to advert to some of the more important cases on the, subject decided by the highest courts of America, Canada and Australia.
We have also a number of pronouncements of the Judicial Committee in appeals from India and the Colonies.
I confess that no uniform view can be gathered from (1) 9 App.
978 these decisions and none could possibly be expected in view of the fact that the pronouncements emanate from Judges in different countries acting under the influence of their respective traditional theories and the weight of opinion of their own courts on the subject.
None of these authorities, however, are binding on this court and it is not necessary for us to make any attempt at reconciliation.
We are free to accept the view which appears to us to be well founded on principle and based on sound juridical reasoning.
Broadly speaking, the question of delegated legislation has come up for consideration before courts of law in two distinct classes of cases.
One of these classes comprises what is known as cases of "conditional legislation," where according to the generally accepted view, the element of delegation that is present relates not to any legislative function at all, but to the determination of a contingency or event, upon the happening of which the legislative provi sions are made to operate.
The other class comprises cases of delegation proper, where admittedly some portion of the legislative power has been conferred by the legislative body upon what is described as a subordinate agent or authority.
I will take up for consideration these two types of cases one after the other.
In a conditional legislation, the law is full and com plete when it leaves the legislative chamber, but the opera tion of the law is made dependent upon the fulfilment of a condition, and what is delegated to an outside body is the authority to determine, by the exercise of its own judgment, whether or not the condition has been fulfilled.
"The aim of all legislation", said O 'Connor J. in Baxter vs Ah Way (1) "is to project their minds as far as possible into the future and to provide in terms as general as possible for all contingencies likely to arise in the application of the law.
But it is not possible to provide specifically for all cases and therefore legislation from the very earnest times, and particularly in more (1) ; at 637, 979 modern times, has taken the form of conditional legis lation, leaving it to some specified authority to deter mine the circumstances in which the law shall be applied or to what its operation shall be extended, or the particular class of persons or goods or things to which it shall be applied.
" In spite of the doctrine of separation of powers, this form of legislation is well recognised in the legisla tive practice of America, and is not considered as an en croachment upon the anti delegation rule at all.
As stated in a leading Pennsylvania case (1), "the legislature cannot delegate its power to make a law; but it can make a law to delegate a power to determine some fact or state of things upon which the law makes or intends to make its own action depend.
To deny this would be to stop the wheels of Govern ment.
There are many things upon which wise and useful legislation must depend, which cannot be known to the law making power and must, therefore, be a subject of inquiry and determination outside the halls of legislation.
" One of the earliest pronouncements of the Judicial Committee on the subject of conditional legislation is to be found in Queen vs Burah(2).
In that case, as said already, the Lieutenant Governor of Bengal was given the authority to extend all or any of the provisions contained in a statute to certain districts at such time he considered proper by notification in the official gazette.
There was no legisla tive act to be performed by the Lieutenant Governor himself.
The Judicial Committee observed in their judgment : "The proper legislature has exercised its judgment as to place, persons, laws, powers, and the result of that judg ment has been to legislate conditionally as to those things.
The conditions being fulfilled, the legislation is now absolute." Just four years after this decision was given, the case of Russell vs The Queen(3) came up before the (1) Locke 's Appeal, (8) 7 App.
829 (2) 5 I.A. 178.
126 980 Judicial Committee.
The subject matter of dispute in that case was the Canadian Temperance Act of 1878, the prohibito ry and penal provisions of which were to be operative in any county or city, only if upon a vote of the majority of the electors of that county or city favouring such a course the Governor General by Order in Council declared the relative part of the Act to be in force.
One of the contentions raised before the Judicial Committee was that the provision was void as amounting to a delegation of legislative author ity to a majority of voters in the city or county.
This contention was negatived by the Privy Council, and the decision in Queen vs Burah(1) was expressly relied upon. ', The short answer to this question," thus observed the Judi cial Committee, "is that the Act does not delegate any legislative powers whatsoever.
It contains within itself the whole legislation on the matter with which it deals.
The provision that certain parts of the Act shall come into operation only on the petition of a majority of electors does not confer authority or power to legislate.
Parliament itself enacts the condition and everything which is to follow upon the condition being fulfilled.
Conditional legislation of this kind is in many cases convenient and is certainly not unusual and the power so to legislate cannot be denied to the Parliament of Canada when the subject of legislation is within its competency.
" The same principle was applied by the Judicial Commit tee in King vs Benoari Lal Sarma(2).
In that case, the validity of an emergency ordinance by the Governor General of India was challenged inter alia on the ground that it provided for setting up of special criminal courts for particular kinds of offences, but the actual setting up of the courts was left to the Provincial Governments which were authorised to set them up at such time and place as they considered proper.
The Judicial Committee held that "this is not delegated legislation at all.
It is merely an example of the not uncommon legislative power by which the local appli cation of the provisions of a statute is determined (1) 5 I.A. 178.
(2) 72 I.A. 57.
981 by the judgment of a local administrative body as to its necessity.
" Thus, conditional legislation has all along been treated in judicial pronouncements not to be a species of delegated legislation at all.
It comes under a separate category, and, if in a particular case all the elements of a conditional legislation exist, the question does not arise as to whether in leaving the task of determining the condition to an outside authority, the legislature acted beyond the scope of its powers.
I now come to the other and more important group of cases where admittedly a. portion of the law making power of the legislature is conferred or bestowed upon a subordinate authority and the rules and regulations which are to be framed by the latter constitute an integral portion of the statute itself.
As said already, it is within powers of Parliament or any competent legislative body when legislat ing within its legislative field, to confer subordinate administrative and legislative powers upon some other au thority.
The question is what are the limits within which such conferment or bestowing of powers could be properly made? It is conceded by the learned Attorney General that the legislature cannot totally abdicate its functions and invest another authority with all the powers of legislation which it possesses.
Subordinate legislation, it is not disputed, must operate under the control of the legislature from which it derives its authority, and on the continuing operation of which, its capacity to function rests.
As was said by Dixon J. (1) "a subordinate legislation cannot have the independent and unqualified authority which is an attribute of true legislative power.
" It is pointed out by this learned Judge that several legal consequences flow from this doctrine of subordinate legislation.
An offence against subordinate legislation is regarded as an offence against the statute and on the repeal of the statute the regulations automatically collapse.
So far, the propositions cannot, and need not, be disputed.
But, (1) Vide Victoria Stevedoring and General Contracting Company vs Dignan, ; at 102.
982 according to the learned Attorney General all that is neces sary in subordinate legislation is that the legislature should not totally abdicate its powers and that it should retain its control over the subordinate agency which it can destroy later at any time it likes.
If this is proved to exist in a particular case, then the character or extent of the powers delegated to or conferred upon such subordinate agent is quite immaterial and into that question the courts have no jurisdiction to enter.
This argument seems plausible at first sight, but on closer examination, I find myself unable to accept it as sound.
In my opinion, it is not enough that the legislature retains control over the subor dinate agent and could recall him at any time it likes, to justify its arming the delegate with all the legislative powers in regard to a particular subject.
Subordinate legis lation not only connotes the subordinate or dependent char acter of the agency which is entrusted with the power to legislate, but also implies the subordinate or ancillary character of the legislation itself, the making of which such agent is entrusted with.
If the legislature hands over its essential legislative powers to an outside authority, that would, in my opinion, amount to a virtual abdication of its powers and such an act would be in excess of the limits of permissible delegation.
The essential legislative function consists in the determination or choosing of the legislative policy and of formally enacting that policy into a binding rule of conduct.
It is open to the legislature to formulate the policy as broadly and with as little or as much details as it thinks proper and it may delegate the rest of the legis lative work to a subordinate authority who will work out the details within the framework of that policy. "So long as a policy is laid down and a standard established by statute no constitutional delegation of legislative power is involved in leaving to selected instrumentalities the making of subordinate rules within prescribed limits and the determi nation of facts to which the legislation is to apply"(1).
(1) Vide Schechter Poultry Corp. vs United States, 295 U.S. 495 983 The Supreme Court of America has held in more cases than one that the policy of the law making body and the standards to guide the administrative agency may be laid down in very broad and general terms.
It is enough if the legislature lays down an intelligible principle which can be implemented by the subordinate authorities for specific cases or classes of cases(1).
The Court has been exceedingly loath to find violation of this principle and in fact there are, only two cases, viz., Panama Refining Co. vs Ryan(2) and Schechter Poultry Corp. vs
U.S.(3) where the federal legislation was held invalid on the ground that the standard laid down by the Congress for guiding administrative discretion was not sufficiently definite.
In Panama Refining Co. vs Ryan(2) Chief Justice Hughes very clearly stated "that the Congress manifestly is not permitted to abdicate or transfer to others the essential legislative functions with which it is invested." "In every case" the learned Chief Justice contin ued," in which the question has been raised the court has recognised that there are limits of delegation which there is no constitutional authority to transcend.
We think that section 9(c) goes beyond those limits; as to transpor tation of oil production in excess of state permission the Congress has declared no policy, has established no stand ard, has laid down no rule.
There is no requirement, no definition of circumstances and conditions in which the transportation is to be allowed or prohibited." Mr. Justice Cardozo differed from the majority view m this case and held that a reference express or implied to the policy of Con gress as declared in section 1 was a sufficient definition of a standard to make the statute valid.
"Discretion is not unconfined and vagrant" thus observed the learned Judge.
"It is confined within banks that keep it from overflowing.
" It is interesting to note that in the later case of Schechter Poultry Corporation(3), where the legislative power was held to be unconstitutionally delegated by the provision of section 3 of the National Industrial (1) Vdie J. IV.
Hampton vs
U.S.; , (2) ; (3) ; 184 Recovery Act of 1933 as no definite standard was set up or indicated by the legislature, Cardozo J. agreed with the opinion of the Court and held that the delegated power of legislation which had found expression in that Code was not canalised within banks but was unconfined and vagrant. "Here in the case before us" thus observed the learned Judge, "is an attempted delegation not confined to any single act nor to any class or group of acts identified or described by reference to a standard.
This is delegation running riot.
No such plenitude of powers is capable of transfer.
" As said above, these are the only two cases up till now in which the statutes of Congress have been de clared invalid because of delegation of essential legis lative powers.
In the later cases the court has invari bly found the standard established by the Congress suffi ciently definite to satisfy the prohibition against delega tion of legislative powers, and in all such cases a most liberal construction has been put upon the enactment of the legislature(1).
We are not concerned with the actual decisions in these cases.
The decisions are to be valued in so far as they lay down any principles.
The manner of applying the principles to the facts of a particular case is not at all material.
The decisions referred to above clearly lay down that the legislature cannot part with its essential legislative function which consists in declaring its policy and making it a binding rule of ' conduct.
A surrender of this essen tial function would amount to abdication of legislative powers in the eye of law. 'the policy may be particularised in as few or as many words as the legislature thinks proper and it is enough if an intelligent guidance is given to the subordinate authority.
The Court can interfere if no policy is discernible at all or the delegation is of such an indef inite character as to amount to abdication, but as the discretion vests with the legislature in determining wheth er there is necessity (1) See Opp Cotton Mills vs Administrator of Wages, ; ; Yakus vs United States, ; ; American Pt.
& Lt. Co. vs Securities and Exchange Commission, ; 985 for delegation or not, the exercise of such discretion is not to be disturbed by the court except in clear cases of abuse.
These I consider to be the fundamental principles and in respect to the powers of the legislature the constitu tional position in India approximates more to the American than to the English pattern.
There is a basic difference between the Indian and the British Parliament in this re spect.
There is no constitutional limitation to restrain the British Parliament from assigning its powers where it will, but the Indian Parliament qua legislative body is lettered by a written constitution and it does not possess the sover eign powers of the British Parliament.
The limits of the powers of delegation in India would therefore have to be ascertained as a matter of construction from the provisions of the Constitution itself and as I have said the right of delegation may be implied in the exercise of legislative power only to the extent that it is necessary to make the exercise of the power effective and complete.
It is said by Schwartz in his work on American Administrative Law "that these doctrines enable the American courts to ensure that the growth of executive power necessitated by the rise of the administrative process will not be an uncontrollable one.
Delegation of powers must be limited ones limited either by legislative prescription of ends and means, or even of details or by limitations upon the area of the power delegated.
The enabling legislation must, in other words, contain a framework within which the executive action must operate"(1).
It would be worth while mentioning in this connection that the report of the Committee on Ministers ' Power recom mended something very much similar to this American doctrine as a proper check on delegated legislation.
The report says that "the precise limits of a law making power which Parlia ment intends to confer on a Minister should always be ex pressly defined in clear language by the statute which confers it, when discretion is conferred its limits should be defined with (1) Schwartz 's American Administrative Law, p. 22.
986 equal clearness"(1).
It is true that what in America is a question of vires and is subject to scrutiny by courts, in the United Kingdom it is a question of policy having a purely political significance.
But the recommendation of the Committee would clearly indicate that the rules laid down and acted upon by the American Judges particularly in later years can be supported on perfectly clear and sound democratic principles.
I will now advert to the leading Canadian and Australi an cases on the subject and see how far these decisions lend support to the principles set out above.
Many of these Canadian cases, it may be noted, went up on appeal to the Judicial Committee.
I will start with the case of Hodge vs The Queen(2) which came up before the Judicial Committee on appeal from the decision of the Court of Appeal for Ontario in the year 1883.
The facts of the case are quite simple.
The appellant was convicted for permitting and suffering a billiard table to be used and a game of billiard to be played thereon in violation of a resolution of the License Commissioners who were authorised by the Liquor License Act of 1877 to enact regulations regulating the use of taverns, with power to create offences and annex penalties there to.
One of the questions raised was whether the Ontario Legisla ture could delegate powers to the License Commissioners to frame regulations by which new offences could be created.
The Privy Council agreed with the High Court in holding that the legislature for Ontario was not in any sense exercising delegated authority from the Imperial Parliament and it had full authority to confide to a municipal institution or body of its own creation authority to make by laws or resolutions as to subjects specified in the enactment and with the object of carrying the enactment into operation and effect.
It was observed : "Such an authority is ancillary to legislation;. the very full and very elaborate judgment of the (1) Vide Report, page 65.
(2) 9 App, Cas, 117.
987 Court of Appeal contains abundance of precedents for the legislature entrusting a limited discretionary authority to others and as many illustrations of its necessity and con venience.
" It will be seen that what was delegated by the Ontario Legislature to the License Commissioners was simply the power to regulate tavern licenses.
There was no question of parting with substantial legislative powers in this case.
But although the Privy Council stated clearly that the Ontario legislature was quite supreme within its own sphere and enjoyed the same authority as the Imperial or the Dominion Parliament, they described the power delegated as authority ancillary to legislation and expressly referred to the "abundance of precedents for the legislature entrusting a limited discretionary authority to others.
" There was no necessity for the Privy Council to use the guarded language it used if in fact the Ontario legislature had the same right of delegating its powers as the British Parliament.
It would be pertinent to note that Davey, Q.C., who appeared for the Crown in support of the judgment appealed against.
did not contend before the Privy Council that the Ontario legislature had full rights of delegation like the British Parliament and consequently its acts could not be challenged as unconstitutional.
His argument was that in this ease there was no delegation of legislative authority and what was delegated was only the power to make by laws.
By legis lative authority the learned Counsel apparently meant the essential legislative function as distinguished from the power to make rules and regulations and the argument implied that the essential legislative powers could not be delegated at all.
The case of Powell vs Appollo Candle Co. (1) is the next case in point of time which has a bearing on the question before us.
That case came up on appeal from a decision of the Supreme Court of New South Wales, and the question arose whether section 133 of (1) 10 App.
127 988 the Customs Regulation Act of 1879of the Colony, was or was not ultra vires the Colonial legislature.
The attack on the validity of the legislation was inter alia on the ground that it conferred upon the Government power to levy duty on certain articles which in the opinion of the Collector were substituted for other dutiable articles.
The question was whether such power could be validly conferred.
The Privy Council had no difficulty in holding that the provision was perfectly valid and it was quite within the competence of the Colonial legislature which was in no sense a delegate of the Imperial Parliament, to confer a discretion of this character on the executive for the purpose of making the statute properly effective.
The policy of the law as well as the main principles were laid down in the Act itself.
What was left to the executive was a power to enforce the provisions of the Act more properly and effectively by levying duties on articles which could be used for similar purposes as the dutiable articles mentioned in the statute.
The legislature itself laid down the standard and it was sufficiently definite to guide the executive officers.
I now come to the decision of the Supreme Court of Canada in In re Gray (1), which was decided during the first world war.
The Dominion War Measures Act, 1914, passed by the Dominion Parliament of Canada empowered the Governor General to make "such regulations as he may, by reason of the existence of real or apprehended war. . deem necessary or advisable for the security, defence, peace, order and welfare of Canada"; and the question arose whether such transfer of power was permitted by the British North America Act.
The Supreme Court decided by a majority of four to two that the Act was valid, though the Judges who adopted the majority view were not unanimous regarding the reasons upon which they purported to base their decision.
The Chief Justice was of the opinion that there was nothing in the Constitutional Act which so far as material to the question (1) 57 S.C.R. 150. 989 under consideration would impose any limitation on the authority of the Parliament of Canada to which the Imperial Parliament was not subject.
Anglin J. referred to the deci sion in Hodge vs The Queen(1) (supra) in the course of his judgment.
He seemed to think that the British North America Act did not contemplate complete abdication of its legisla tive powers by the Dominion Parliament, but considered such abdication to be something so inconceivable that the consti tutionality of an attempt to do anything of that kind was outside the range of practical consideration.
Apparently the learned Judge gave the expression "abdication" a very narrow meaning.
The opinion of Duff J. was much the same, and he considered that there was no abandonment of legislative powers in this case, as the powers granted could at any time be revoked and anything done thereunder nullified by the Parliament.
Idington and Brodeur JJ.
dissented from this majority view.
This decision was followed in the "Reference in the Matter of the Validity of the Regulations in Relation to Chemicals Enacted by the Governor General of Canada under the War Measures Act ", which is to be found reported in In this case the question raised related to the validi ty of certain regulations made by an Order in Council in terms of the powers conferred upon the Governor in Council by the War Measures Act and the Department of Munitions and Supply Act.
It was held that with the, exception of para graph 4 of the Order in Council the rest of the Order was not ultra vires.
It appears from the report that in this case it was not disputed before the court that powers could be delegated by the legislature to the Governor in Council under the War Measures Act.
The question raised was whether the Governor in Council could further delegate his powers to subordinate agencies.
The question was answered in the affirmative, the reason given being that the power of dele gation being absolutely essential in the circumstances for which the War Measures Act has been designed so as to have a workable Act, the power (1) 9 App.
990 delegated must be deemed to form part of the powers con ferred by Parliament in the Act.
These are war time decisions and it is apparent that the doctrine of delegation has been pushed too far in the Chemical Reference case.
In In re Gray (1) the learned Chief Justice at the conclusion of his judgment expressly stated that the security of the country was the supreme law against which no other law could prevail.
I agree with the Attorney General that the competency of the Parliament to legislate could not be made dependent upon the fact as to whether the law was a war time or a peace time measure.
But on the other hand, it is possible to argue that in a legis lation passed by a Parliament in times of war when the liberty and security of the country are in jeopardy, the only policy which the legislature can possibly formulate is the policy of effectively carrying on the war and this necessarily implies vesting of all war operations in the hands of the executive.
There appears to be considerable substance in the observations made by Dixon J.(2) that "it may be considered that the exigencies which must be dealt with under the defence powers are so many, so great and so urgent and so much the proper concern of the executive that from its very nature the power appears by necessary intend ment to authorise delegation otherwise generally forbidden by the legislature.
" It may be mentioned here that the decision in In re Gray(1) was sought t6 be distinguished in a subsequent Canadian case on the ground that in case of emergency it was possible to pass legislation of this sort by taking recourse to the residuary powers conferred on the Dominion Parliament by section 91 of the North America Act (3).
In point of time, the case of In re The Initiative and Referendum Act(4) comes immediately after that of In re Gray(1).
The dispute in this case related to an Act (1) 57 S.C.R. 150.
(2) Vide Victoria Stevedoring and General Contracting Co. vs Dignan; , at p. 99.
| IN-Abs | Section 7 of the , provided that "The Provincial Government may by notification in the official gazette extend, with such restrictions and modifications as it thinks fit, to the Province of Delhi, or any part there of, any enactment which is in force in any part of British India at the date of such notification".
Section 2 of the Ajmer Merwara (Extension of Laws) Act, 1947, provided that "The Central Government may, by notification in the official gazette, extend to the Province of Ajmer Merwara, with such restrictions and modifications as it thinks fit, any enact ment which is in force in any other Province at the date of such notification.
Section 2 of the Part C States (Laws) Act, 1950, provided that "The Central Government may, by notification in the official gazette extend to any Part C State . . or to any part of such State, with such restrictions and modifications as it thinks fit, any enact ment which is in force in a Part A State at the date of the notification and provision may be made in any enactment so extended for the repeal or amendment of any corresponding law . which is for the time being applicable to that Part C State.
As a result of a decision of the Federal Court, doubts were entertained with regard to the validity of laws delegating legislative powers to the executive Government and the President of India made a reference to the Supreme Court under article 143 (1) of the Constitution for considering the question whether the above mentioned sec tions or any provisions thereof were to any extent, and if so to what extent 748 and in what particulars, ultra vires the legislatures that respectively passed these laws, and for reporting to him the opinion of the Court thereon: Held, (1)per FAzL ALl, PATANJALI SASTRI, MUKHERJEA, DAS and Bose JJ., (KANIA C.J., and MAHAJAN J., dissenting).
Section 7 of the , and section 2 of the Ajmer Merwara (Extension of Laws) Act, 1947, are wholly intra vires.
KANIA C.J. Section 7 of the , and section 2 of the Ajmer Merwara (Extension of Laws) Act, 1947, are ultra vires to the extent power is given to the Government to extend Acts other than Acts of the Central Legislature to the Provinces of Delhi and Ajmer Merwara respectively inasmuch as to that extent the Central Legisla ture has abdicated its functions and delegated them to the executive government.
MAHAJAN J.
The above said sections are ultra vires in the following particulars: (i) inasmuch as they permit the executive to apply to Delhi and Ajmer Merwara, laws enacted by legislatures not competent to make laws for those territories and which these legislatures may make within their own legislative field, and (ii) inasmuch as they clothe the executive with co extensive legislative authority in the matter of modification of laws made by legislative bodies in India.
(2) Per FAZL ALI, PATANJALI SASTRI, MUKHERJEA, DAS and BOSE JJ.
The first portion of section 2 of the Part C States (Laws) Act, ;950, which empowers the Central Government to extend to any Part C State or to any part of such State with such modifications and restrictions as it thinks fit any enactment which is in force in a Part A State, is intra vires.
Per KANIA C.J., MAHAJAN, MUKHERJEA and Boss JJ.
The latter portion of the said section which empowers the Cen tral Government to make provision in any enactment extended to a Part C State, for repeal or amendment of any law (other than a Central Act) which is for the time being applicable to that Part C State, is ultra vires.
Per FAzL ALI, PATAN JALI SASTRI and DAS JJ.
The latter portion of section 2 of the Part C States (Laws) Act, 1950, is also intra vires.
KANIA C.J.
To the extent that section 2 of the Part C States (Laws) Act, 1950, empowers the Central Government to extend laws passed by any Legislature of a Part A Slate to a Part C State it is ultra vires.
MAHAJAN J. Section 2 of the Part C States (Laws) Act, 1950, is ultra vires in so far as it empowers the Central Government (i) to extend to a Part C State laws passed by a legislature which is not competent to make laws for that Part C State and (ii) to make modifications of laws made by the legislatures of India and (iii) to repeal or amend laws already applicable to that Part C State.
749 KANIA C.J. (i) The essentials of a legislative function are the determination of the legislative policy and its formulation as a rule of conduct and these essentials are the characteristics of a legislature by itself.
Those essentials arc preserved when the legislature specifies the basic conclusions of fact upon the ascertainment of which from relevant data by a designated administrative agency it ordains that its statutory command is to be effective.
The legislature having thus made its laws, every detail for working it out and for carrying the enactment into operation and effect may be done by the legislature or may be left to another subordinate agency or to some executive officer.
While this is also sometimes described as delegation of legislative powers, in essence it is different from delega tion of legislative power as this does not involve the delegation of the power to determine the legislative policy and formulation of the same as a rule of conduct.
While the so called delegation which empowers the making of rules and regulations has been recognised as ancillary to legislative power, the Indian Legislature had no power prior to 1935 to delegate legislative power in its true sense.
Apart from the sovereign character of the British Parliament whose powers are absolute and unlimited, a general power in the legislature to delegate legislative powers is not recognised in any state.
The powers of the Indian Legislature under the Constitution Acts of 1935 and 1950 are not different in this respect.
(ii)An "abdication" of its powers by a legis lature need not necessarily amount to complete effacement of itself.
It may be partial.
If full powers to do everything that the legislature can do are conferred on a subordinate authority, although the legislature retains the power to control the action of the subordinate authority by recalling such power or repealing the Acts passed by the subordinate authority, there is an abdication or effacement of the legislature conferring such power.
FAzL ALl J. (i) The legislature must formally dis charge its primary legislative function itself and not through others.
(ii) Once it has been established that it has sovereign powers within a certain sphere, it is free to legislate within that sphere in any way which appears to it to be the best way to give effect to its intention and policy in making a particular law and it may.utilise any outside agency to any extent it finds necessary for doing things, which it is unable to do itself or finds it incon venient to (iii) It cannot, however abdicate its legislative functions and therefore, while entrusting power to an out side agency, it must see that such agency acts as a subordi nate authority and does not become a parallel legislature.
(iv) As the courts of India are not committed to the doc trine of separation of powers and the judicial interpreta tion it has received in America, there are only two main checks in this country on the power of the legislature to delegate, these being its good sense and the principle that it should not cross the line beyond which delegation amounts to 750 'abdication and self effacement. ' (v) The power to intro duce necessary restrictions and modifications is incidental to the power to adapt or apply the law.
The modifications contemplated are such as can be made within the framework of the Act and not such as to affect its identity or structure or the essential purpose to be served by it.
PATANJALI SASTRI J. (i) It is now established beyond doubt that the Indian Legislature, when acting within the limits circumscribing its legislative power, has and was intended to have plenary powers of legislation as large and of the same nature as those of the British Parliament itself and no constitutional limitation on the delegation of legislative power to a subordinate unit is to be found in the Indian Councils Act, 1861, Or the Government of India Act, 1935, or the Constitution of 1950.
It is therefore as competent for the Indian Legislature to make a law delegating legislative power, both quantitatively and qualitatively.
as it is for the British Parliament to do so, provided it acts within the circumscribed limits.
(ii) Delegation of legislative au thority is different from the creation of a new legislative power.
III the former, the delegating body does not efface itself but retains its legislative power intact and merely elects to exercise such power through an agency or instru mentality of its choice.
In the latter, there is no delega tion of power to subordinate units but a grant Of power to an independent and co ordinate body to make laws operative of their own force.
For the first, no express provision authorising delegation is required.
In the absence of a constitutional inhibition, delegation of legislative power, however extensive, could be made so long as the delegating body retains its own legislative power intact.
For the second, however, a positive enabling provision in the con stitutional document is required.
(iii) The maxim delegates non potest delegare is not part of the constitutional law of India and has no more force than a political precept to be acted upon by legislatures in the discharge of their func tion of making laws, and the courts cannot strike down an Act of parliament as unconstitutional merely because Parlia ment decides in a particular instance to entrust its legis lative power to another in whom it has confidence or, in other words, to exercise such power through its appointed instrumentality, however repugnant such entrustment may be to the democratic process.
What may be regarded as politi cally undesirable is constitutionally competent.
(iv) Howev er wide a meaning may be attributed to the expression "restrictions and modifications," it would not affect the constitutionality of the delegating statute. 'MAHAJAN J. (i) It is a settled maxim of constitu tional law that a legislative body cannot delegate its power.
Not only the nature of legislative power but the very existence of representative government depends on the doc trine that legislative powers cannot be transferred.
The legislature cannot substitute the 751 judgment, wisdom, and patriotism of any other body, for those to which alone the people have seen fit to confide this sovereign trust.
The view that unless expressly prohib ited a legislature has a general power to delegate its legislative functions to a subordinate authority is not supported by authority or principle.
The correct view is that unless the power to delegate is expressly given by the constitution, a legislature cannot delegate its essential legislative functions.
As the Indian Constitution does not give such power to the legislature, it has no power to delegate essential legislative functions to any other body.
(ii) Abdication by a legislative body need not necessarily amount to complete effacement.
There is an abdication when in respect of a subject in the Legislative List that body says in effect that it will not legislate but would leave it to another to legislate on it.
MUKHERJEA J.
As regards constitutionality of the delegation legislative powers, the Indian Legislature cannot be in the same position as the omnipotent British Parliament and how far delegation is permissible has to be ascertained in India as a matter of construction from the express provisions of the Indian Constitution.
It cannot be said that an unlimit ed right of delegation is inherent in the legislative power itself.
This is not warranted by the provisions of the constitution and the legitimacy of delegation depends en tirely upon its being used as an ancillary measure which the legislature considers to be necessary for the purpose of exercising its legislative powers effectively and complete ly.
The legislature must retain in its own hands the essen tial.
legislative functions which consist in declaring the legislative policy and laying down the standard which is to be enacted into a rule of law and what can be delegeted is the task of subordinate legislation which by its very nature is ancillary to the statute which delegates the power to make it.
Provided the legislative policy is enunciated with sufficient clearness or a standard is laid down, the courts should not interfere with the discretion that undoubtedly rests with the legislature itself in determining the extent of delegation necessary in a particular case.
Das J. (i) The principle of non delegation of legisla tive powers founded either on the doctrine of separation of powers or the theory of agency has no application to the British Parliament or the legislature constituted by an Act of the British Parliament;(ii) in the ever present complex ity of conditions with which governments have to deal, the.power of delegation is necessary for, and ancillary to, the exercise of.
legislative power and is a component part of it; (iii) the operation of the act performed under dele gated power is directly and immediately under and by virtue of the law by which the power was delegated and its efficacy is referable to that antecedent law; (iv) if what the legis lature does is legislation within the general scope of the affirmative words which give the power and if it violates no express 752 Condition or restriction by which that power is limited, then it is not for the court to inquire further or enlarge constructively those conditions or restrictions; (v) while the legislature is acting within its prescribed sphere there is, except as herein after stated, no degree of, or limit to, its power of delegation of its legislative power, it being for the legislature to determine how far it should seek the aid of subordinate agencies and how long it shall continue them, and it is not for the court to prescribe any limit to the legislature 's power of delegation; (vi) the power of delegation is however subject to the qualification that the legislature may not abdicate or efface itself, that is, it may not, without preserving its own capacity intact, create and endow with its own capacity a new legislative power not created or authorised by the Act to which it owes its own existence.
(vii) The impugned laws may also be supported as instances of conditional legislation within the meaning of the decision in Queen vs Burah.
Bose J.
The Indian Parliament can legislate along the lines of Queen vs Burgh, that is to say, it can leave to another person or body the introduction or application of laws which are, or may be, in existence at that time in any part of India which is subject to the legislative control of Parliament, whether those laws are enacted by Parliament or by a State Legislature set up by the constitution.
But delegation of this kind cannot proceed beyond that; it cannot extend to the repealing or altering in essential particulars laws which are already in force in the area in question.
|
Appeal No. 153 of 1955.
Appeal by Special Leave from the judgment and decree dated August 30, 1954, of the Allahabad High Court in Civil Revision Application No. 540 of 1951, arising out of the judgment and decree dated March 31, 1951, of the Court of the Additional Civil Judge, Mathura, in Suit No. 19 of 1950.
G. C. Mathur, for the appellants.
C. B. Aggarwala and Ganpat Rai, for the respondent.
December 5.
The Judgment of the Court was delivered by KAPUR, J.
This is an appeal by special leave against the decision of the High Court of Judicature at Allahabad passed in revision under section 115 of the Code of Civil Procedure.
The landlord who was the plaintiff in the trial court is the appellant before us and the tenant who was the defendant is the respondent.
The facts of this appeal are that in 1938 the respondent took on rent the accommodation in dispute which is termed a ' tal ' on a monthly agreed rent of Rs. 21 4 as.
and was using the same for the purpose of stacking timber.
A portion of it was a covered godown which had three walls and a kucha roof.
On January 28, 1950, the appellant made an application to the House Allotment Officer under section 3 A of the United Provinces (Temporary) Control of Rent and Eviction Act, 1947 (U. P. III of 1947) (hereinafter termed the Act) for the fixation of " reasonable annual rent " of the accommodation in dispute.
He therein alleged that in January 1949 he had " constructed anew " a big godown 80 x 25 x 11 feet according to the instructions of the respondent and expended a fairly large sum of money on it and was therefore entitled to a monthly rent of Rs. 165.
The House Allotment Officer fixed on February 18, 1950, the rent at Rs. 35 736 per mensem which on review was raised on May 25, 1950, to Rs. 40 per mensem.
He held that the accommodation was not a newly constructed accommodation as the respondent had been a tenant from 1938.
He determined the increase of rent on the basis of the building that was added by the new construction.
He also held that: " The cost of land, the floor area of godown and rent of other similar premises would be irrelevant as all of these existed before new construction and were included in rent before new construction ".
The appellant thereupon instituted a suit on the ground of inadequacy of the reasonable annual rent under section 5(4) of the Act alleging that he had constructed the portion of the accommodation " anew " and put up ferro concrete roof 80 x 25 feet and that the construction was undertaken at the request of the respondent who had agreed to pay enhanced rent but had refused to do so; that although the House Allotment officer, Mathura, had fixed the rent of the accommodation at Rs. 35 which wag subsequently raised to Rs. 40 per mensem, the proper rent should not be less than Rs. 115 per mensem and therefore prayed for the enhancement of " reasonable annual rent ".
The defence was that there was no construction at the request of the respondent but it had been undertaken in order to put up another storey on the top of the old building; that as far as the accommodation in possession of the respondent was concerned there was no new construction of accommodation after June 30, 1946; that the ferro concrete roof had in no way benefited him, on the other hand the space at his disposal had diminished because of the number of pillars constructed and the lowering of the roof.
He also pleaded that the suit was not maintainable under the Act and that no suit could be filed " after the order of the House Allotment Officer ".
The relevant issues raised were : (1)" Whether the suit is not maintainable in view of any provisions of the Act No. 3 of 1947 ? (2)Whether the suit after the fixation of rent by the House Allotment Officer is not maintainable ? 737 (5) What should be the reasonable and proper rent of the accommodation in suit ? " The learned Additional Civil Judge found that the suit was not barred because of the Act; that the suit against the order of the House Allotment Officer was maintainable; that newly constructed accommodation on the whole was bigger and more spacious than the old kacha hall and that the accommodation had increased and after taking into consideration the amount spent on the construction be increased the " reasonable adequate rent " to Rs. 55 8 0.
Against this decree of the learned Judge the respondent took a revision to the High Court under section 115 of the Code of Civil Procedure.
The High Court was of the opinion that if the accommodation was a new construction erected after June 30, 1946, the suit was maintainable and the High Court could not interfere with the finding of the Civil Judge as to the amount of rent.
If on the other hand, the construction was an old one, the suit did not lie and the agreed rent would continue to be payable.
It also held that the construction on the upper storey was a new construction but as far as the accommodation in the occupation of the respondent was concerned the construction could not be called new construction and therefore B. 3 A was not applicable and as no suit lay at the instance of the landlord to have the agreed rent enhanced, the tenant was only liable to pay the agreed rent and no more.
The revision petition was therefore allowed and the suit of the appellant was dismissed.
The main controversy raised between the parties was whether the High Court could, in revision under section 115 of the Code of Civil Procedure, interfere with this decision of the trial court.
The respective contentions were these: The appellant contended that it was within the jurisdiction of the Additional Civil Judge to decide the question of the date of construction of the accommodation and in doing so he could decide rightly or wrongly as the matter was within his 93 738 jurisdiction and therefore the High Court had no power to interfere merely because in its opinion the decision was erroneous.
In other words, this question was merely one of the facts in issue between the parties unconnected with jurisdiction.
He also contended that the House Allotment Officer having decided in his favour the question of the date of construction which section 3 A of the Act authorises him to decide, his right to bring the suit was established and therefore the High Court could not in revision under section 115, Code of Civil Procedure, go into the correctness of that decision.
The respondent 's counsel on the other hand submitted that the decision of the court as to the date of construction was in this case a jurisdictional fact i.e. a fact which went to the root of the jurisdiction of the court because unless the accommodation was held to have been a new construction made after June 30, 1946, the appellant would be bound by the agreed rent and would have no right of suit under section 5(4) and the court would have no jurisdiction to entertain the suit.
In order to decide the question at issue, it is necessary at this stage to refer to the scheme of the Act.
The object of the Act was to control letting and the rents of residential and nonresidential accommodations.
"Accommodation" was defined in section 2(a) as follows: 2.(a) "accommodation means residential and non residential accommodation in any building or part of the building and includes. . . . " Reasonable annnal rent " is defined in section 2(f): 2.(f) " Reasonable annual rent in the case of accommodation constructed before July 1, 1946, means (1)if it is separately assessed to municipal assessment, its municipal assessment plus 25 per cent thereon ; (2)if it is a part only of the accommodation so assessed, the proportionate amount of the municipal assessment of such accommodation plus 25 per cent.
thereon ; (3) if it is not assessed to municipal assessment 739 (i)but was held by a tenant on rent between April 1, 1942, and June 30, 1946, fifteen times the rent for the one month nearest to and after April 1, 1942, and (ii)if it was not so held on rent, the amount determined under section 3 A and in the case of accommodation constructed on or after July 1, 1946, means the rent determined in accordance with section 3 A ".
As to how reasonable annual rent of a building was to be determined was provided for in section 3 A: S.3 A " (1) In the case of any accommodation constructed after June 30, 1946, or falling under subclause (ii) of clause (3) of sub _ section (f) of section 2, the District Magistrate may, on the application of the land lord or the tenant, determine the reasonable annual rent thereof.
(2)In determining the reasonable annual rent under sub section (1) the District Magistrate shall take into account (a)if the accommodation was constructed after June 30, 1946, the cost of construction and of maintenance and repairs of the accommodation, its situation and any other matter, which in the opinion of the District Magistrate, is material and (b) if it is accommodation (i) falling under clause (2) or sub clause (1) of clause (3) of sub section (f) of section 2, the principles therein ,set forth, and (ii)falling under sub clause(1) of clause (3) of subsection (f) aforesaid, the principles set forth in clause (a) of sub section (1) of section 6.
(3)Subject to the result of any suit filed under sub section (4) of section 5, the rent fixed by the District Magistrate under this section shall be the annual reasonable rent of the accommodation." " Agreed rent " was defined in section 5(1) of the Act to be. . . . the rent payable for any ac commodation to which this Act applies shall be such as may be agreed upon between the landlord and the tenant.
" Section 5(4) of the Act provided: 740 " If the landlord or the tenant, as the case may be, claims that the annual reasonable rent of any accommodation to which the Act applies is inadequate or excessive, or if the tenant claims that the agreed rent is higher than the annual reasonable rent, he may institute a suit for fixation of rent in the Court of the Munsif having territorial jurisdiction, if the annual rent claimed or payable is Rs. 500 or less, and in the Court of the Civil Judge having territorial jurisdiction if it exceeds Rs. 500, provided that the Court shall not vary the agreed rent unless it is satisfied that the transaction was unfair, and in the case of lease for a fixed term made before April 1, 1942, that the term has expired ".
Section 6 provided for the procedure as follows (1) " In determining the amount of annual or monthly rent in any suit under section 5 the court shall take into account (a)in the case of accommodation constructed before July 1, 1946, the pre war rent, the reasonable annual or monthly rent, the prevailing rent on the date of the suit for similar accommodation in the locality, the cost of maintenance and repairs of such accommodation and any material circumstances proved by the plaintiff or the defendant, (b)in the case of accommodation constructed on or after July 1, 1946, the cost of construction and of maintenance and repairs of accommodation, its situation and any other circumstance which the court may consider material.
(2)No appeal shall lie from any decree or order of the Munsiff or the Civil Judge in a suit brought under sub section (4) of section 5: Provided that (except as regards the rate of rent but no further) the decree or order so passed shall not operate as res judicata between the parties or their representatives in interest in any suit or proceedings under any other law It is not necessary to refer to other sections of the Act.
The Act therefore in the preamble sets out the objects of the Act.
In section 2(a) it defined the meaning of 741 the word accommodation ' to mean residential and non residential accommodation in any building or part of the building and in section 2(f) it laid down in three parts what the reasonable annual rent was, one part dealing with accommodation constructed before July 1, 1946, and assessed to municipal assessment, the second part with accommodation so constructed and not assessed to municipal assessment but held by a tenant between April 1, 1942, and June 30, 1946, and the third part with accommodation constructed on or after July 1, 1946, and these last two were to be determined in accordance with the provisions of section 3 A which empowered the District Magistrate to do so.
Sub section (1) of this section gave power to the District Magistrate to determine the reasonable annual rent in the case of accommodation constructed after June 30, 1946, or falling under cl.
(ii) of sub section
3 of section 2 (f) i.e. if it was not assessed to municipal assessment though constructed before July 1, 1946, and was not held by a tenant between April 1, 1942, and June 30,1946.
Subsection 2 of section 3 A laid down the factors to be taken into consideration in determining the reasonable annual rent and under sub section 3 the rent so fixed was to be the annual reasonable rent of the accommodation but this was subject to the result of a suit filed under section 5(4).
Therefore under section 3 A the District Magistrate was entitled to determine the amount of reasonable annual rent when either of the two facts on which his power depended was shown to exist i.e. (1) the accommodation was constructed after June 30, 1946, or (2) although it existed previously it was not assessed to municipal assessment and had not been held by a tenant on rent between April 1, 1942, and June 30, 1946.
The District Magistrate 's power to determine the rent under section 3 A therefore was not confined to accommodation constructed after June 30,1946, alone.
The rent determined by the District Magistrate under section 3 A was the reasonable annual rent under the Act subject to the result of any suit filed under sub section
(4) of section 5.
A wrong decision by the District Magistrate under section 3 A or an order made by him in excess of his 742 powers under that section could be rectified by a suit under section 5(4).
This provision of the Act i.e. section 5(4) provided for three classes of suits, one by a landlord that the reasonable annual rent was inadequate and (2) by the tenant that the annual rent was excessive and (3) also by the tenant that the agreed rent was higher than the reasonable annual rent.
Hence under this section the appellant landlord 's right of suit was restricted to challenging the inadequacy of the reasonable annual rent but he could not sue for varying the agreed rent.
The appellant in the present case brought his suit on the around of inadequacy of the reasonable rent as determined under section 3 A and consequently its maintainability depended on the determination of the jurisdictional fact i. e. date of its construction, whether it was before or after June 30, 1946, on the decision of which would depend his right to bring the suit; because if there was no new construction, the agreed rent would be operative and the appellant would have no right of suit under section 5(4) of the Act.
Consequently, by wrongly deciding this question the court would be entertaining a suit by the landlord for enhancement of the agreed rent and thereby assuming jurisdiction it did not possess and the landlord would be circumventing the restriction on his right to sue for enhancement of agreed rent which the law did not allow.
As the issues raised show the learned Additional Civil Judge was alive to the fact that the maintainability of the suit depended on the determination of this question.
The appellant had specifically alleged that the accommodation had been constructed after June 30, 1946, a fact which was denied by the respondent.
That gave rise to the first two issues and the learned Civil Judge held: " I am therefore of the opinion that portion of the building in suit which has been newly replaced must be treated as a new accommodation, and hence this Court can determine its rent under the provisions of section 5(4).
In view of the fact that it is a new 743 accommodation no question of agreed rent arises and the landlord can bring a suit for fixation of rent ".
Two facts therefore stand out clearly in the judgment of the trial court (1) that it was the existence of a newly constructed accommodation which gave jurisdiction to the court to determine its reasonable annual rent and (2) that as it was a newly constructed accommodation, the question of agreed rent did not arise.
The High Court, in our view, approached the question quite correctly when it stated that the question for determination was whether the accommodation had been constructed before or after June 30, 1946, and that if it was constructed before that date the suit was incompetent and if after, the suit would lie.
The contention raised by the appellant in this Court was that the decision of the trial Court as to whether the accommodation was constructed before or after July 1, 1946, cannot be challenged in revision in the High Court and he relied on the following observation of Lord Esher, M. R., in the Queen vs Commissioner for Special Purposes of the Income Tax (1): " When an inferior court or tribunal or body, which has to exercise the power of deciding facts, is first established by Act of Parliament, the legislature has to consider, what powers it will give that tribunal or body.
It may in effect say that, if a certain state of facts exists and is shown to such tribunal or body before it proceeds to do certain things, it shall have jurisdiction to do such things, but not otherwise.
There it is not for them conclusively to decide whether that state of facts exists, and, if they exercise the jurisdiction without its existence, what they do may be questioned, and it will be held that they have acted without jurisdiction.
But there is another state of things which may exist.
The legislature may intrust the tribunal or body with a jurisdiction, which includes the jurisdiction to determine whether the preliminary state of facts exists as well as the jurisdiction, on finding that it does exist, to proceed further or do something more.
When the legislature are establishing such a tribunal or body with limited jurisdiction, (1) , 319. 744 they also have to consider, whatever jurisdiction they give them, whether there shall be any appeal from their decision, for otherwise there will be none.
In the second of the two cases I have mentioned it is an erroneous application of the formula to say that the tribunal cannot give themselves jurisdiction by wrongly deciding certain facts to exist, because the legislature gave them jurisdiction to determine all the facts, including the existence of the preliminary facts on which the further exercise of their jurisdiction depends; and if they were given jurisdiction so to decide, without any appeal being given, there is no appeal from such exercise of their jurisdiction.
These observations which relate to inferior courts or tribunals with limited jurisdiction show that there are two classes of cases dealing with the power of such a tribunal (1) where the legislature entrusts a tribunal with the jurisdiction including the jurisdiction to determine whether the preliminary state of facts on which the exercise of its jurisdiction depends exists and (2) where the legislature confers jurisdiction on such tribunals to proceed in a case where a certain state of facts exists or is shown to exist.
The difference is that in the former case the tribunal has power to determine the facts giving it jurisdiction and in the latter case it has only to see that a certain state of facts exists.
In the present case the appellant asked for a determination of reasonable annual rent under section 3 A on the ground that the accommodation was constructed after June 30, 1946, and the House Allotment Officer therefore had power to determine the reasonable annual rent.
In order to give jurisdiction to the civil court there bad to be in existence a reasonable annual rent as defined under section 2(f) whether it fell within its first two clauses or was determined under section 3 A. The reason.
able annual rent could be varied at the instance of the landlord or the tenant on the ground of its inadequacy or excess but the landlord could not.
bring a suit to vary the agreed rent nor could the court entertain such a suit although it was open to the tenant to do so and the court could at his instance entertain 745 such a suit.
The proceedings before the civil court are not by way of an appeal from any order under section 3 A made by the District Magistrate.
Section 115, Code of Civil Procedure, empowers the High Court, in cases where no appeal lies, to satisfy itself on three matters: (a) that the order made by the subordinate court is within its jurisdiction; (b) that the case is one in which the court ought to exercise its jurisdiction; (e) that in exercising the jurisdiction the court has not acted illegally, that is, in breach of some provision of law or with material irregularity that is by committing some error of procedure in the course of the trial which is material in that it may have affected the ultimate decision.
Per Sir John Beaumont in Venkatagiri Ayyangar vs Hindu Religious Endowment Board, Madras (1).
Therefore if an erroneous decision of a subordinate court resulted in its exercising jurisdiction not vested in it by law or failing to exercise the jurisdiction so vested or acting with material irregularity or illegality in the exercise of its jurisdiction the case for the exercise of powers of revision by the High Court is made out.
In Joy Chand Lal Babu vs Kamalaksha Chaudhury (2), the subordinate court gave an erroneous decision that the loan was a commercial loan and therefore refused to exercise jurisdiction vested in it by law and the Privy Council held that it was open to the High Court to interfere in revision under section 115.
Sir John Beaumont said at p. 142: " There have been a very large number of decisions of Indian High Courts on section 115, to many of which their Lordships have been referred.
Some of such decisions prompt the observation that High Courts have not always appreciated that although error in a decision of a subordinate court does not by itself involve that the subordinate court has acted illegally or with material irregularity so as to justify interference in revision under sub section
(c), nevertheless, if the erroneous decision results in the subordinate court exercising a jurisdiction not vested in it by law, (1)(1949) L.R. 76 I.A. 67, 73.
(2) (1949) L.R. 76 I.A. 131.
94 746 or failing to exercise a jurisdiction so vested, a case for revision arises under sub section
(a) or sub.s.
(b), and subs.
(c) can be ignored.
The cases of Babu Ram vs Munnalal (1) and Hari Bhikaji vs Naro Vishvanath (2), may be mentioned as cases in which a subordinate court by its own erroneous decison (erroneous, that is, in the view of the High Court), in the one case on a point of limitation and in the other on a question of res judicata, invested itself with a jurisdiction which in law it did not possess; and the High Court held, wrongly their Lordships think, that it had no power to interfere in revision to prevent such a result.
In the present case their Lordships are of opinion that the High Court, on the view which it took that the loan was not a commercial loan, had power to interfere in revision under sub section
(b) of section 115 ".
In Keshardeo Chamria vs Radha Kissen Chamria (3) both these judgments of the Privy Council as also the previous judgments in Rajah Amir Hassan Khan vs Sheo Baksh Singh (4 ) and Balakrishna Udayar vs Vasudeva Aiyar (5) were reviewed and it was held that section 115 of the Code of Civil Procedure applies to matters of jurisdiction alone, the irregular exercise or non exercise of it or the illegal assumption of it.
Thus if a subordinate court had jurisdiction to make the order it made and has not acted in breach of any provision of law or committed any error of procedure which is material and may have affected the ultimate decision, then the High Court has no power to interfere.
But if on the other hand it decides a jurisdictional fact erroneously and thereby assumes jurisdiction not vested in it or deprives itself of jurisdiction so vested then the power of interference under section 115 becomes operative.
The appellant also relied on Rai Brij Raj Krishna vs section K. Shaw and Bros. (6) where this Court quoted with approval the observations of Lord Esher in Queen vs Commissioner for Special Purposes of the Income Tax(7) and The Colonial Bank of Australia vs Willan where Sir James Co] ville said : (1)(1927) I.L.R. 49 All. 454.
(3)[1953] S.C.R. 136.
(5)(1917) L.R. 44 I.A. 261.
(7)(1888) , 319.
(2) Bom.
(4) (1884) L.R. 11 I.A.237.
(6) ; (8) , 443. 747 " Accordingly the authorities. . . establish that an adjudication by a Judge having jurisdiction over the subject matter is, if no defect appears on the face of it, to be taken as conclusive of the facts stated therein and that the Court of Queen 's Bench will not on certiorari quash such an adjudication on the ground that any such fact, however essential has been erroneously found ".
But these observations can have no application to the judgment of the Additional Civil Judge whose jurisdiction in the present case is to be determined by the provisions of section 5(4) of the Act.
And the power of the High Court to correct questions of jurisdiction is to be found within the four corners of section 115.
If there is an error which falls within this section the High Court will have the power to interfere, not otherwise.
The only question to be decided in the instant case is as to whether the High Court had correctly interfered under section 115 of the Code of Civil Procedure with the order of the Civil Judge.
As we have held above, at the instance of the landlord the suit was only maintainable if it was based on the inadequacy of the reasonable annual rent and for that purpose the necessary jurisdictional fact to be found was the date of the construction of the accommodation and if the court wrongly decided that fact and thereby conferred jurisdiction upon itself which it did not possess, it exercised jurisdiction not vested in it and the matter fell within the rule laid down by the Privy Council in Joy Chandlal Babu vs Kamalaksha Chaudhury (1).
The High Court had the power to interfere and once it had the power it could determine whether the question of the date of construction was rightly or wrongly decided.
The High Court held that the Civil Judge had wrongly decided that the construction was of a date after June 30, 1946, and therefore fell within section 3 A.
In these circumstances the appeal must fail and is dismissed with costs throughout.
Appeal dismissed.
(1) (1949) L.R 76 I.A. 131.
| IN-Abs | Landlord and Tenant Accommodation Agreed monthly rent New construction Enhancement of rent House Allotment Officer 's findings Power of the civil courts to interfere U. P. Templeton Control of Rent and Eviction Act, 1947 (U.P. 3 of 1947), SS.
2(a)(f) 3A, 5(4), 6.
In 1938 the respondent took on rent from the appellant the accommodation in dispute on a monthly rent of Rs. 21 4as.
On January 28, 1950, the appellant made an application to the House Allotment Officer under section 3A of the U.P. Temporary Control of Rent and Eviction Act, 1947, for an increase in rent, on the allegation that according to the instruction of the respondent lie had made a new construction in January, 1949.
The 734 Officer considered that the accommodation was not a newly constructed one as the respondent had been a tenant from 1938, but he increased the rent to Rs. 40 per mensem on the basis of the building that was added by the new construction.
The appellant thereupon instituted a suit under section 5(4) Of the Act for the enhancement of " reasonable annual rent ".
The respondent 's defence inter alia, was that the new construction was undertaken in order to put up another storey on the top of the old building, that so far as the accommodation in his possession was concerned there was no new construction of accommodation after June 30, 1946, and that, therefore, the suit was not maintainable.
The trial court found that as a result of the new construction the accommodation had increased and was of the opinion that the portion of the building which had been newly replaced must be treated as a new accommodation and hence the, court could determine its rent under section 5(4).
In revision, the High Court held that though the construction on the upper storey was a new construction, so far as the accommodation in the occupation of the respondent was concerned the construction could not be called a new one and therefore section 3A of the Act was not applicable.
Accordingly the revision petition was allowed and the suit was dismissed.
On appeal by special leave to the Supreme Court it was contended for the appellant that the House Allotment Officer having decided in his favour the question of the date of construction which section 3A of the Act authorised him to decide, the High Court could not in revision go into the correctness of the decision ; and, in any case, it was within the jurisdiction of the trial court to decide the question of the date of construction and in doing so it could decide rightly or wrongly, and as the matter was one of fact the High Court had no power to interfere under section 115 Of the Code of Civil Procedure.
Held:(1) that a wrong decision made by the House Allot ment Officer under section 3A of the Act or an order made by him in excess of his powers under that section could be rectified by a suit under section 5(4) of the Act; and (2)that the maintainability of the suit brought under section 3A of the Act depended on the determination of the jurisdictional fact i.e., date of construction of the accommodation, whether it was after June 30, 1946, and if the court wrongly decided that fact and thereby assumed jurisdiction not vested in it, the High Court had the power to interfere under section 115 of the Code of Civil Procedure, and once it had the power it could determine whether the question of the date of construction was rightly or wrongly decided.
Joy Chand Lal Babu vs Kamalaksha Chaudhury, (1949) L.R. 76 I.A. 131, relied on.
Queen vs Commissioner for Special Purposes of the Income Tax, ; Venkatagiri Ayyangar vs Hindu Religious Endowment Board, Madras, (1949) L.R. 76 I.A. 67 and Keshardeo Chamria vs Radha Kissen Chamria, [1953] S.C.R. 136, considered.
735 Rai Brij Raj Krishna vs section K. Shaw and Bros., [1951] S.C.R. 145, distinguished The relevant provisions of the Act are set out in the judg ment.
|
Civil Appeal No. 1401 of 1991.
From the Judgment and Order dated 26.10.1987 of the Karnataka High Court in W.A. No. 607 of 1982.
S.R. Bhat and Prabir Chaudhury (NP) for the Appellants.
A.B. Rohtagi, M. Veerappa, R.L. Bhardwaj and Vishnu Mathur for the Respondents.
The Judgment of the Court was delivered by FATHIMA BEEVI, J.
The Karnataka Slum Areas (Improvement and Clearance) Act, 1973, which received the assent of the President on 1st October, 1974, is an Act to provide for improvement and clearance of slums in the State of Karnataka.
Section 3 of the Act empowers the Government to declare certain areas as slum areas.
If the Government is satisfied that any area which is likely to be a source of danger to health, safety or convenience of the public of that area or of its neighbourhood by reason of the area being low lying, unsanitary, squalid, over crowded or otherwise, the Government may by notification declare the areas as 'slum area '.
Under Section 11, when the Government is satisfied on a report from the competent authority that the most satisfactory method of dealing with the conditions in the area is the clearance of such area and demolition of the buildings in the area, it may, by notification, declare the area to be the 'slum clearance area '.
The Notification No. HMA 59 MCS 76 dated 17.1.1977 was issued by the Karnataka Government declaring an extent of one acre in Timber Yard slum by the side of Main Road, Cottonpet, Bangalore, as 'slum area '.
After considering the objections, another notification dated 30.12.1977 was issued under Section I(1) of the Act declaring 978 the entire land as 'slum clearance area '.
However, on January 20, 1981, the Government issued notification under Section 3(1) cancelling the earlier notification dated 30.12.1977 and re declaring an extent of 14 1/2 guntas only as 'slum area '.
The notification dated 20.1.1981 had been challenged by the appellants mainly on the grounds that it is in violation of the principle of natural justice and Article 14 of the Constitution has been violated.
It was contended that slum dwellers who are affected by the Government 's action have not been given an opportunity of being heard and they have been denied equality by denying basic human needs since a major part of the slum area has been excluded from the operation of the scheme.
The single Judge of the High Court took the view that the appellants had no locus standi to challenge the impugned notification and even on merits there was no case.
The Division Bench of the High Court agreed on the question of locus standi and without going into the merits confirmed the judgment.
The appellants have approached this Court under Article 136 of the Constitution of India.
We have granted special leave to appeal.
The learned counsel for the appellants relying on the decisions of this Court in section P. Gupta vs Union of India, [1982] 2 SCR 365 and Olga Tellis vs Bombay Municipal Corporation, [ 1985] Suppl.
2 SCR 51 vehemently contended that the High Court has erred in holding that the petitioners have no locus standi.
He also submitted that in view of the purpose of the legislation and the scheme contemplated thereunder once action has been taken declaring a larger area as 'slum clearance area ', any change thereafter which would directly affect the slum dwellers could not be taken without giving the affected persons an opportunity of being heard and, there is, therefore, the clear violation of the principle of natural justice.
It was also urged that there is no specific provision under the statute enabling the Government to rescind the notification and assuming that it exists, there was no proper exercise of the power.
Mr. Rohtagi, counsel appearing on behalf of the 3rd respondent, submitted that the first notification dated 17.1.1977 was challenged by the owners of the land in a writ petition as they were not heard as required and the fresh notification have been issued on the assurance given before the Court that they would be heard.
It was pointed out that there was no need to hear the owners or occupiers at the stage of issuing the notification under Section 3(1) of the Act and Section 11 979 does not confer any Statutory right to the occupiers.
Relying on Section 21 of the General Clauses Act, it was maintained that the power to withdraw or rescind the notification was inherent and the authority who is empowered to issue the notification is entilitled to rescind the same.
It was also pointed out that there had been dispute over the title of the land in question that civil litigation was in progress and that the earlier declaration was made without proper basis.
Action has been taken by the owners against the tenants for eviction and orders have been obtained in their favour and the petitioners have no case and are not entitled to any relief.
The counsel for the State adopted these arguments.
The first question that falls for consideration is whether the appellants can challenge the action of the Government.
This question need not detain us when the law is now settled that in such situation even a public interest litigation would lie.
The first appellant Association represents the interests of the slum dwellers and the second appellant himself is one of the residents in the area.
The action of the Government on the averments made affects a class of persons and if that group of persons is represented by the Association, they have a right to be heard in the matter.
Where a member of the public acting bona fide moves the Court for enforcement of a fundamental right on behalf of a person or class of persons who on account of poverty or disability or socially or economically disadvantaged position cannot approach the Court for relief, such member of the public may move the Court even by just writing a letter as held by this Court in Bandhua Mukti Morcha vs Union of India & Ors., ; We are, therefore, of the view that the High Court was wrong in concluding that appellants were incompetent to invoke the jurisdiction of the Court.
We shall now consider the argument that the State Government had no power to rescind the notification issued under Sections 3 and 11 in the absence of any specific provision in the Act.
Section 21 of the General Clauses Act is in pari materia with Section 10 of the Karnataka General Clauses Act.
This Section reads: "21.
POWER TO ISSUE TO INCLUDE, POWER TO ADD TO, AMEND, VARY OR RESCIND NOTIFICATIONS,ORDERS, RULES OR BYE LAWS.
Where, by any Central Act or Regulation, a power to issue notifications, orders, rules, or bye laws is conferred, then that power includes a power, exercisable in the like manner and subject to the like sanction and conditions (if any) to add 980 to, amend, vary or rescind any notifications, orders, rule or bye laws so issued.
" Under Section 21 of the General Clauses Act, the power to issue a notification includes the power to rescind it.
It is always open to the Government to rescind the notification.
We shall refer to the decisions of this Court in State of Kerala vs K. G. Madhavan Pillai, ; ; State of M. P. vs, V. P. Sharma, [ ; and Lt. Governor of H. P. vs Sri Avinash Sharma,[1970] 2 SCC 149.
In these cases arising under the Land Acquisition Act, the issue before the Court was whether the Government could exercise powers only under Section 48 of the Land Acquisition Act to withdraw a notification for acquisition made under Section 4(1) of the Act.
When the Government issued successive notifications under Section 6 covering different portions of the land notified for acquisition under Section 4(1), the validity of the last of the notification was challenged on the ground that a notification under Section 4(1) could be followed only by one notification under Section 6.
In repelling the contention, this Court incidentally observed at page 693 thus: "That the only way in which the notification under Section 4(1) can come to an end is by withdrawal under Section 48(1)" is not correct because "under Section 21 of the General Clauses Act, the power to issue a notification includes the power to rescind it and therefore it is always open to the Government to rescind a notification under Section 4 or under Section 6 and a withdrawal under Section 48(1) is not the only way in which a notification under Section 4 or Section 6 can be brought to an end." In Lt. Governor of H.P. vs Sri Avinash Sharma, (supra) the Court observed at page 151 thus: "Power to cancel a notification for compulsory acquisition is, it is true, not affected by Section 48 of the Act; by a notification under Section 21 of the General Clauses Act, the Government may cancel or rescind the notification issued under Sections 4 and 6 of the Land Acquisition Act.
But the power under Section 21 of the General Clauses Act cannot be exercised after the land statutorily vests in the State Government.
" In Lachmi Narain vs Union of India, ; , this 981 Court observed at page 808 thus: "Section 21, as pointed out by this Court in Gopichand vs Delhi Admn., [1959] Suppl.
2 SCR 87, embodies only a rule of constructions and the nature and extent of its application must be governed by the relevant statute which confers the power to issue the notification.
" In State of Bihar vs D.N. Ganguly & Ors., ; , it was held that it is well settled that the rule of construction embodied in S.21 of the General Clauses Act can apply to the provisions of a statute only where the subject matter, context or effect of such provisions are in no way inconsistent with such application.
In that case, the question was where an industrial dispute has been referred to a tribunal for adjudication by the appropriate government under Section 10(1)(d) of the Industrial Disputes Act, can the said government supersede the said reference pending adjudication before the tribunal constituted for that purpose? The Court held the notification to be invalid and ultra vires pointing our that is would be necessary to examine carefully the scheme of the ACt, its object and all its relevant and material provisions before deciding the application of the rule of construction enunciate by Section 21.
After examining the relevant provisions of the Act, the Court said that once an order in writing is made by the appropriate government under Section 10(1)(d), the proceedings before the tribunal are deemed to have commenced and if the appropriate government has by implication the power to cancel its order passed under Section 10(1), the proceedings before the tribunal would be rendered wholly ineffective by the exercise of such power and Section 21 cannot be invoked.
In Kamla Prasad Khetan vs Union of India, ; , this Court considred the scope of Section 21 of the General Clause Act.
At page 1068, the Court observed thus: "The power to issue an order under any Central Act includes a power to amend the order; but this power is subject to a very important qualification and the qualification is contained in the words `exercisable in the like manner and subject to the like sanction and conditions (if any) '. . . . . .
The true scope and effect of the expression `subject to the like conditions (if any) ' occurring in Section 21 of the General Clauses Act has been explained.
" 982 Relying on these decisions, the learned counsel for the appellants contended that even if source of power could be traced under Section 21, the exercised of that power could only be in the same manner as provided and when a notification under Section 3(1) had been issued declaring certain areas as `slum area ', the power to rescind the notification and limit the extent could be exercised only after hearing the affected parties, for the Government to satisfy itself that what has already been declared does not come within the scope of the proposed scheme.
The object of the statute and the relief that was sought to be conferred are matters to be taken into consideration in such action.
It has been brought to our notice that about 100 persons had been living in the area under conditions which require the implementation of the scheme under the Act for their redressal and once steps have been taken in that direction any variation that could affect the occupants in the areas was required to be made only after giving them an opportunity of being heard.
It is thus maintained that there had been no proper exercise of the power assuming that the power is vested on the Government and there is clear violation of the principle of natural justice.
It is one of the fundamental rules of our constitutional set up that every citizen is protected against exercise of arbitrary authority by the State or its officers.
If there is power to decide and determine to the prejudice of a person, duty to act judicially is implicit in the exercise of such power and the rule of natural justice operates in areas not covered by any law validly made.
What particular rule of natural justice should apply to a given case must depend to an extent on the facts and circumstances of that case, the frame work of the law under which the enquiry is held and the body of persons appointed for the purpose.
It is only where there is nothing in the statue to actually prohibit the giving of an opportunity to be heard, but on the other hand, the nature of the statutory duty imposed itself necessarily implied an obligation to hear before deciding, that the audi alteram partem rule could be imported.
The Mysore Slum Areas (Improvement and Clearnance) ACt, 1958, this Court held in Government of Mysore & Ors.
vs J.V. Bhat etc.
; , thus: There can be no two opinions about the need to hear the affected persons before declaring an area to be a slum area under section 3 or an area as a clearance area under section 9 or before taking action under section 10.
All these difficulties will be removed if the affected persons are given 983 an opportunity to be heard in respect of the action proposed.
" The Preamble to the present Act itself states that the Act is to provide for the improvement and clearance of slums in the State.
Under the existing law, it has not been possible effectively to check the increase and to eliminate congestion and to provide for basic needs such as streets, water supply, and drainage and to clear the slums which are unfit for human habitation.
To obviate this difficulty, it is considered expedient to provide for the removal of unhygenic and insanitary conditions prevailing in the slums for better accommodation and improved living conditions for slum dwellers for the promotion of public health generally.
These are the objectives sought to be achieved by the enactment which has been made in implementation of the Directive Principles of State Policy to improve public health.
It is, therefore, obvious that when a declaration has been made in implementation of the Directive Principles of State Policy to improve public health.
It is, therefore, obvious that when a declaration is made under section 3 and a further declaration is made under section 11, the inhabitants of the areas are affected and any further action in relation to the area which areas are affected and any further action in relation to the area which is declared to the `slum clearance area ' without affording such persons an opportunity of being heard would prejudicially affect their rights.
The right to be heard in the matter has been acquired by the earlier action of the authority in considering the area for the purpose of the scheme.
This is clear from the proviso to sub sec.
(1) of Section 11 of scheme.
This is clear from the proviso to sub sec.
(1) of Section 11 of the Act.
When any alternation is sought to be made in the original scheme, it becomes incumbent upon the authorities to give an opportunity to the persons who had been affected by the earlier order and required to adopt a certain course of action.
In this view of the matter it is to be held that when a notification is made rescinding the earlier notifications without hearing the affected parties, it is clear violation of the principle of natural justice.
Such action is exercise of the implied power to rescind cannot then be said to have been exercised implied power to rescind cannot then be said to have been exercised implied power to rescind cannot then be said to have been exercised subject to be quashed on this ground.
It shall be open to the Government to proceed after affording the slum dwellers an opportunity of being heard on the basis of the earlier notifications that were in force.
In the result, the appeal is allowed and the order of the High Court is set aside.
The impugned notification is quashed subject to the observations made.
We make no order as to costs.
Appeal allowed.
| IN-Abs | Under Section 3 of the Karnataka Slum Areas (Improvement and Clearance) Act, 1973 Notification No. HMA 59 MCS 76 dated 17.1.1977 was issued by the State Government declaring an extent of one acre in the city of Bangalore, as 'slum area '.
After considering the objections, another notification dated 30.12.1977 was issued under Section 11(1) of the Act declaring the entire land as 'slum clearance area '.
However, on January 20, 1981, the Government issued notification under Section 3(1) cancelling the earlier notification dated 3.12.1977 and re declaring an extent of 14 1/2 guntas only as 'slum area '.
The appellants, an Association representing the interest of slum dwellers and a resident of the area challenged notification dated 20.1.1981 on the ground that it was in violation of the principle of natural justice and Article 14 of the Constitution inasmuch as the slum dwellers affected by the Government 's action were not given an opportunity of being heard and were denied equality, since a major part of the slum area has been excluded from the operation of the scheme.
A Single Judge of the High Court held that the appellants had no locus standi to challenge the notification and that even on merits there was no case.
The Division Bench agreed on the question of locus standi but did not go into the merits.
975 The appellants filed an appeal by special leave before this Court, contending that the High Court had erred in holding that the petitioners had no locus standi, that in view of the purpose of the legislation and the scheme contemplated thereunder, once action had been taken declaring a larger area as 'slum clearance area ', any change thereafter which directly affected the slum dwellers could not be taken without giving the affected persons an opportunity of being heard and, there was, therefore, clear violation of the principle of natural justice, and that there was no specific provision under the statute enabling the Government to rescind the notification, and even assuming that it existed there was no proper exercise of the power.
On behalf of Respondent No. 3 it was submitted that there was no need to hear the owners or occupiers at the stage of issuing notification under Section 3(1) of the Act and Section 11 did not confer any statutory right on the occupiers, and that under Section 21 of the General Clauses Act, the power to withdraw or rescind the notification was inherent and the authority who was empowered to issue the notification was entitled to rescind the same.
The State adopted the contentions of Respondents No. 3.
Allowing the appeal, this Court, HELD: 1. 1.
Where a member of the public acting bona fide moves the Court for enforcement of a fundamental right on behalf of a person or class of persons who, on account of poverty or disability or socially or economically disadvantaged position cannot approach the Court for relief, such member of the public may move the Court even by just writing a letter.
[979E] Bandhua Mukti Morcha vs Union of India & Ors.
, ; , relied on.
section P. Gupta vs Union of India, [19821 2 SCR 365; Olga Tellis vs Bombay Municipal Corporation, [1985] Suppl.
2 SCR 51, referred to. 1.2.
The first appellant Association represents the interests of the slum dwellers and the second appellant himself is one of the residents in the area.
The action of the Government affects a class of persons and if that group of persons is represented by the Association, they have a right to be heard in the matter.
Even a public interest litigation would lie in such a situation.
Therefore, the High Court was wrong in concluding that appellants were incompetent to invoke the jurisdiction of the Court.[979D, F] 976 2.1.
What particular rule of natural justice should apply to a given case must depend to an extent on the facts and circumstances of that case, the framework of the law under which the enquiry is held and the body of persons appointed for that purpose.
It is only where there is nothing in the statute to actually prohibit the giving of an opportunity to be heard but, on the other hand, the nature of the statutory duty imposed itself necessarily implied an obligation to hear before deciding, that the audi alteram partem rule could be imported.
1982F] 2.2.
It is one of the fundamental rules of our constitutional set up that every citizen is protected against exercise of arbitrary authority by the State or its officers.
If there is power to decide and determine to the prejudice of a person, duty to act judicially is implicit in the exercise of such power and the rule of natural justice operates in areas not covered by any law validly made.
[982E] 2.3.
When a declaration is made under Section 3 and a further declaration is made under Section 11, the inhabitants of the areas are affected and any further action in relation to the area which is declared to be 'slum clearance area ' without affording such persons an opportunity of being heard would prejudicially affect their rights.
The right to be heard in the matter has been acquired by the earlier action of the authority in considering the area for the purpose of the scheme.
This is clear from the proviso to sub section (1) of Section 11 of the Act.
When any alteration is sought to be made in the original scheme, it becomes incumbent upon the authorities to give an opportunity to the persons who had been affected by the earlier order and required to adopt a certain course of action.
[983D E] 2.4.
It is true that under Section 21 of the General Clauses Act, the power to issue a notification includes the power to rescind it, and it is always open to the Government to rescind the notification.
[980B] State of Kerala vs K. G. Madhavan Pillai, ; ; State of M.P. vs V.P. Sharma, [1966]3 SCR557; Lt. Governor of H.P. vs Sri Avinash Sharma, [ ; ; Lachmi Narain vs Union of India,[ ; ; State of Bihar vs D. N. Ganguly & Ors., [ ; and Kamia Prasad Khetan vs Union of India, ; , referred to.
But when a notification is made rescinding the earlier notifications without hearing the affected parties, it is clear violation of the principles of natural justice.
Such action in exercise of the implied 977 power to rescind cannot then be said to have been exercised subject to the like conditions within the scope of Section 21 of the General Clauses Act.
[983F] In the circumstances, the notification dated 20.1.1981 is liable to be quashed.
It shall be open to the Government to proceed after affording the slum dwellers an opportunity of being heard on the basis of the earlier notifications that were in force.
[983F G]
|
N: Criminal Appeal No.647 48 of 1979.
From the Judgment and Order dated the 9.3.1979 of the Additional Sessions Judge, Ahmedabad in Crl.
Revision Application Nos.
356 & 357 of 1978.
P. Chidambram, A.T. Patra, S.R. Aggarwal Ms. Monika Mohil and Ms.
Bina Gupta for the Appellants.
S.K. Dholakia, and Anip Sachthey for the Respondents.
The Judgment of the Court was delivered by K.JAYACHANDRA REDDY, J.
The question of general importance that arises in these three appeals is whether criminal proceedings can be instituted under Section 14 of the (`Act ' for short) against an establishment exempted under Section 17 of the for the contravention of the provisions of Section 6 of the ? The appellants, who are common in each of these three appeals, were connected with the management of M/S Shri Subhlaxmi Mills Ltd. (hereinafter referred to as the "said Company") an establishment governed by the .
By a Notification dated 17th October, 1957 the Central Government in exercise of the powers under Section 17 of the granted exemption to the said Company subject to the conditions specified in Schedule 2 annexed to the said Notification.
As a result of the said exemption the provisions of the employees ' Provident Fund Scheme 1952 framed under Section 5 of the did not apply to the said Company which created a Trust and the management made contributions of provident fund to the said trust and admittedly the exemption continued to be in operation at all material times.
In or about September/October, 1975 the Inspector of Provident Fund filed criminal complaints in the Court of the Judicial Magistrate Cambay against the appellant on the allegation that they being incharge of the 945 management failed to pay the contributions to the provident fund trust and thereby committed offences punishable under Sections 14(1A), 14(2), 14(2A), 14A(1), 14A(2) and Paragraph 76 of the Employees ' Provident Fund Scheme, 1952.
The appellants also received notice dated 15th September, 1975 from the Inspector threatening to cancel the exemption granted under Section 17 of the .
However, some time in September, 1975 the said Company 's Mill had to be closed down and liquidation proceedings were initiated.
The criminal complaints persuant to an order of the High Court were transferred to the Court of the Second Metropolitan Magistrate, Ahmedabad.
The respondent No. 1, the complainant was examined who in his evidence admitted that the Government of India had exempted the said Company under Section 17 of the and the same had not been subsequently canceled and was in existence at all material times.
The appellants filed an application praying that the proceedings against them should be dropped and they should be acquitted on the ground that Section 6 of the was not applicable to the establishment exempted under Section 17 of the and therefore no proceedings under Section 14 can be initiated against them.
The learned Metropolitan Magistrate by his order dated 28th November, 1978 rejected the aforesaid application.
Being aggrieved they filed three criminal revision applications in the Court of the Additional Sessions Judge, Ahmedabad who by a common order dismissed the same taking the view that Section 6 of the covers and attracts all the establishments including the exempted establishment.
Against that order in those three revision applications, the present appeals have been filed.
Shri P. Chidambram, learned counsel for the appellants, submitted that none of the Sections of the mentioned in the complaints can be applied as against the appellants since the establishment in question is exempted under Section 17 of the and consequently is not governed by the 1952 Scheme nor by Section 6 of the .
According to the learned counsel, the does not provide for prosecution in respect of any of the offences enumerated under Section 14 in case of breach by an exempted establishment in not paying the provident fund contributions to the trust and therefore no prosecution can be launched and that if at all the management of the establishment had not deposited the provident fund contributions with the trust, the Government was empowered only to cancel the exemption which also amounts to a penalty.
The learned counsel appearing on both sides addressed elaborate arguments and referred to various provisions of the and 946 Employees ' Provident Fund Scheme 1952 and also took us through several citations and also some passages in various text books.
Before we proceed to consider the same, we must note some undisputed facts.
The establishment in question was governed by the provisions of the and it was exempted under Section 17 of the and it had its own trust in respect of the provident fund contributions but failed to pay the provident fund contributions to the trust for some period during 1974 and thus there was a default.
The controversy therefore is whether such failure attracts the prosecution or only warrants the cancellation of the exemption granted.
This Act (No. 19 of 1952) was enacted to provide for institution of provident fund for employees in factories and other establishments and is made applicable to every establishment which comes within the meaning of 'factory '.
The underwent major amendments by No. 16 of 1971 and also by some amendments thereafter.
We are mainly concerned with the provisions of the that were in force at the relevant time i.e. in 1974.
Section 2 contains various definitions and commences with the words "In this , unless the context otherwise requires," and thereafter the definitions are enumerated.
"Contribution" is defined in Section 2(c) which means a contribution payable in respect of a member under the Scheme.
The words "Contribution", "employer", "employee", "factory", "fund" and "scheme" are defined in Sections 2(c), 2(e), 2(f), 2(g), 2(h) and 2(1) respectively.
They reads as under: 2.
In this , unless the context otherwise requires, "2(c).
"contribution" means a contribution payable in respect of a member under a Scheme (or the contribution payable in respect of an employee to whom the Insurance Scheme applies);" "2(e) "employer" means (i) in relation to an establishment which is a factory, the owner or occupier of the factory, including the agent of such owner or occupier, the legal representative of a deceased owner or occupier and, where a person has been named as a manager of the factory under clause (f) of sub section ( 1) of Section 8 of the , the named; and;person so 947 (ii) in relation to any other establishment, the person who, or the authority which, has the ultimate control over the affairs of the establishment and where the said affairs are entrusted to a manager, managing director or managing agent, such manager, managing director or managing agent; "2(f) "employee" means any person who is employed for wages in any kind of work, manual or otherwise, in or in connection with the work of an establishment, and who gets his wages directly or indirectly from the employer, and includes any person employed by or through a contractor in or in connection with the work of the establishment;" "2( 'g) "factory" means any premises, including the precints thereof, in any part of which a manufacturing process is being carried on or is ordinarily so carried on, whether with the aid of power or without the aid of power;" "2( 'h) "fund" means the provident fund established under a Scheme ," "2(1) "scheme" means the Employees ' Provident Fund Scheme framed under Section 5;" Section 5 provides for framing a scheme which is in the following terms: "5(1) The Central Government may, by notification in the Official Gazette, frame a Scheme to be called the Employees ' Provident Fund Scheme for the establishment of provident funds under this for employees or for any class of employees and specify the establishments or class of establishments to which the said scheme shall apply and there shall be established, as soon as may be after the framing of the Scheme, a Fund in accordance with the provisions of this and the Scheme.
xx xx xx We may mention here that the Employees ' Provident Fund Scheme 1952 was duly framed as provided under Section 5 and the relevant provisions of the Scheme shall be referred to at the appro 948 priate stages.
Section 6 is an important provision which deals with the contribution and allied matters and reads thus: "6.
The contribution which shall be paid by the employer to the Fund shall be six and a quarter per cent of the basic wages, dearness allowance and retaining allowance (if any) for the time being payable to each of the employees (whether employed by him directly or by or through a contractor), and the employees ' contribution shall be equal to the contribution payable by the employer in respect of him and may, if any employee so desires and if the Scheme makes provision therefor, be an amount not exceeding eight and one third per cent, of his basic wages, dearness allowance and retaining allowance (if any); Provided that in its application to any establishment or class of establishments which the Central Government, after making such enquiry as it deems fit, may by notification in the Official Gazette specify this section shall be subject to the modification that for the words "six and a quarter per cent," the words "eight per cent" shall be substituted: Provided further that where the amount of any contribution payable under this involves a fraction of a rupee, the Scheme may provide for the rounding off of such fraction to the nearest rupee, half of a rupee or quarter of a rupee.
Explanation 1 For the purposes of this section, dearness allowance shall be deemed to include also the cash value of any food concession allowed to the employee.
Explanation 2 For the purposes of this section, "retaining allowance" means an allowance payable for the time being to an employee of any factory or other establishment during any period in which the establishment is not working, for retaining his services.
The next important Section is Section 14 which deals with penalties.
For the purposes of the present case it would be enough if we extract the relevant provisions of Section 14 as mentioned in the complaints.
949 Penalties: 14(IA) An employer who contravenes or makes default in complying with the provisions of section 6 or clause (a) of sub section (3) of section 17 in so far as it relates to the payment of inspection charges, or paragraph 38 of the Scheme in so far as it relates to the payment of administrative charges, shall be punishable with imprisonment for a term which may extend to six months but (a) which shall not be less than three months in case of default in payment of the employees ' contribution which has been deducted by the employer from the employees ' wages; (b) which shall not be less than one month, in any other case; and shall also be liable to fine which may extend to two thousand rupee; Provided that the court may, for any adequate and special reasons to be recorded in the judgment, impose a sentence of imprisonment for a lesser term or of fine only in lieu of imprisonment;" " 14(2) Subject to the provisions of this , the Scheme (,the Family Pension Scheme or the Insurance Scheme) may provide that any person who contravenes, or makes default in complying,with, any of the provisions thereof shall be punishable with imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.
" 14(2A) Whoever contravenes or makes default in complying with any provisions of this or of any condition subject to which exemption was granted under Section 17 shall, if no other penalty is elsewhere provided by or under this for such contravention or non compliance, be punishable with imprisonment which may extend to three months, or with fine which may extend to one thousand rupees, or with both." 14A(l) If the person committing an offence under this , the Scheme (the Family Pension Scheme or the Insurance 950 Scheme) is a company, every person, who at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly; Provided that nothing contained in this sub section shall render any such person liable to any punishment, if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.
"14A(2) Notwithstanding anything contained in sub section (1), where an offence under this , the Scheme or the Family Pension Scheme or the Insurance Scheme has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to, any neglect on the part of, any director or manager, secretary or other officer of the company, such director, manager, secretary or other officer shall be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.
Explanation For the purposes of this Section, (a) "company" means any body corporate and includes a firm and other association of individuals; and (b) "director" in relation to a firm, means a partner in the firm," The next important Section to be noted is Section 17(1) ( 'a) which empowers the Government to grant exemption which is in the following terms: "17(1) The appropriate Government may, by notification in the Official Gazette and subject to such conditions as may be specified in the notification, exempt from the operation of all or any of the provisions of any Scheme (a) any establishment to which this applies if, in the opinion of the appropriate Government.
the rules of its 951 provident fund with respect to the rates of contribution are not less favourable than those specified in Section 6 and the employees are also in enjoyment of other provident fund benefits which on the whole are not less favourable to the employees than the benefits provided under this or any Scheme In relation to the employees in any other establishment of a similar character; or xx xx xx Section 17(4) provides for cancellation of such an exemption if any employer fails to comply with the conditions.
The relevant provision 17(14) (a) reads thus: " 17(4) Any exemption granted under this section may be cancelled by the authority which granted it, by order in writing, if an employer fails to comply, (a) in the case of an exemption granted under sub section (1), with any of the conditions imposed under that sub section or with any of the provisions of sub section xx xx xx xx xx xx Section 17(5) deals with transfer of provident fund so far contributed after such cancellation and it reads as under: 17(5) Where any exemption granted under sub section (1), sub section (IA), sub section (2), sub section (2A) or sub section (2B) is cancelled, the amount of accumulations to the credit of every employee to whom such exemption applies, in the provident fund, the family pension fund or the insurance fund of the establishment in which he is employed shall be transferred within such time and in such manner as may be specified in the Scheme or the Family Pension Scheme or the insurance Scheme to the Credit of his account in the Fund or the Family Pension Fund or the Insurance Fund, as the case may be.
" The only other provision to be noted before we proceed further is paragraph 76 of the 1952 Scheme the contravention of which is also mentioned in the complaints.
It reads thus: 952 "76.
Punishment for failure to pay contributions etc.
If any person (a) deducts or attempts to deduct from the wages or other remuneration of a member the whole or any part of the employer 's contribution, or (b) fails or refuses to submit any return, statement or other document required by this Scheme or submit a false return, statement or other document, or makes a false declaration, or (c) obstructs any Inspector or other official appointed under the or this Scheme in the discharge of his duties or fails to produce any record for inspection by such Inspector or other official, or (d) is guilty of contravention of or non compliance with any other requirement of this Scheme, he shall be punishable with imprisonment which may extend to six months or with fine which may extend to one thousand rupees, or with both.
On a perusal of the above extracted provisions of the the following aspects to the extent relevant to the present case can be spelt out.
The Management of an establishment has to contribute to the provident fund and the Government under Section 5 can frame a scheme called Employees ' Provident Fund Scheme and such a scheme was framed in the year 1952.
The scheme provides for the establishment of provident fund under the for employees of the establishments specified therein.
Section 6 is the material provision and deals with contributions which may be provided under the Scheme and also prescribes the rate of contribution to the fund and that the employees ' contribution should be equal to the contribution payable by the employer.
Section 14 deals with the penalties and section 14(1A) lays down that an employer who contravenes, or makes default in complying with the provisions of Section 6 shall be punishable with imprisonment for a term which may extend to six months but shall not be less than three months in case of default in payment of the employees ' contribution which has been deducted by the employer from the employees 'wages.
But for adequate reasons it can be less.
Paragraph 76 of the Scheme also provides for punishment for failure to pay such contributions to 953 the fund.
Then we have Section 17 which provides for the exemption.
As per the said Section the appropriate Government may be notification and subject to such conditions, as may be specified in the notification, exempt from the operation of all or any of the provisions of any Scheme (in the present case 1952 scheme) if the appropriate Government is satisfied that the rules of the provident fund which a particular establishment is following in the matter of contribution to the provident fund are not less favourable than those specified in Section 6 and that the employees are also in enjoyment of other provident fund benefits.
In other words the exemption from the operation of the scheme is granted provided the particular establishment makes contribution as per its own rules governing the contribution to the fund, which in other words, can be called a provident fund scheme of its own are not less favourable than those specified in Section 6.
Accordingly the exempted establishment has to provide for its employees the benefits which are in no way less favourable than the ones provided under the and the Scheme.
Now the question is whether failure to make the contribution by the exempted establishment to the provident fund as per its one rules could attract the penal provisions of Section 14? The learned Additional Sessions Judge, however, as hereinbefore mentioned, held that Section 6 covers and attracts all be establishments including the exempted establishment.
Even otherwise according to him, Section 14(2A) which applies to an exempted establishment is clearly attracted inasmuch as the conditions subject to which exemption was granted under Section 17 have been violated in the instant case.
The learned Additional Sessions Judge also gave a finding that Section 14(IA) also is attracted as in his view even an exempted establishment is not absolved from the liability of employer 's contribution as also the employees ' contribution to the provident fund and therefore by necessary implication the employer and the employees of an exempted establishment have to make full contribution to the provident fund as required under Section 6 of the , and if its contribution remains unpaid it amounts to contravention of the provisions of Section 6 of the the thus attracts Section 14(1A).
We may point out at this stage that Section 14(2) and paragraph 76 of the Scheme are not attracted in the present case.
So far as Section 14(2) is concerned it can be seen that the provision deals with the family pension scheme or the insurance scheme etc.
We are not concerned, in the present case, with any such scheme.
We are only concerned with the provident fund as defined under Section 2(h) of the 954 .
Similarly paragraph 76 of the 1952 Scheme also is not attracted because the establishment herein is admittedly exempted from the operation of the scheme.
We may also mention here that similarly Sections 14A(1), 14A(2) and 14AA which are also mentioned in the complaints also are not attracted.
Shri S.K. Dolakia, learned counsel appearing for the respondents, could not dispute the same.
Then we are left with Sections 14(IA) and 14(2A).
While it was the submission of Mr. Chidambram, learned counsel for the appellants that even these two provisions are also not attracted, Shri Dholakia, on the other hand, submitted that both the provisions are attracted and at any rate Section 14(2A) is clearly attracted and therefore no interference is called for in these appeals.
We shall first take up the submissions in respect of Section 14( '2A).
This Section lays down that whoever contravenes or makes default in complying with any provisions of the or of any condition subject to which exemption was granted under Section 17 shall, if no other penalty is elsewhere provided by or under this for such contravention or non compliance, be punishable with imprisonment and also fine mentioned therein.
Firstly, it is submitted that the only contravention alleged against the appellants is that no contribution was made to the provident fund and since it is an exempted establishment, Section 6 is not attracted and therefore it must be held that there is no contravention or non compliance of any of the provisions of the .
In other words, the submission is that Section 6 of the applies only to the non exempted establishments and covered under the statutory exemption.
The learned Additional Sessions Judge, however, as already noted, has held that Section 6 applies to both exempted and non exempted establishments.
This aspect we will consider at a later stage while examining the applicability of Section 14(, IA).
So far Section 14(2A) is concerned, the later part of it specifically is made applicable to the exempted establishments and if there is contravention of any of the conditions subject to which exemption was granted under Section 17 and if no other penalty is elsewhere provided by or under the then such contravention or non compliance is punishable.
The essentials of these provisions are; (i) there should be a contravention or default in complying with the provisions of the , or ( 'ii) there should be a contravention or default in complying with any of the conditions subject to which exemption was granted under Section 17, and (iii) there should be no other penalty elsewhere provided by or under the for such contravention or non compliance.
Only when these essentials are satisfied, the Section is attracted.
The learned counsel for the appellants submitted that in the present case there is no such contra 955 vention or non compliance of any of the conditions subject to which exemption was granted.
His further submission in this context is that the cancellation of an exemption as provided under Section 17(4) is a penalty provided by or under the for such contravention and therefore Section 14(2A) is not attracted.
To appreciate these contentions it becomes necessary to refer to the conditions subject to which the exemption under Section 17 was granted in the present case.
The relevant conditions for our purposes are Conditions Nos. 1, 2(a),(b), 10 and 15 and they read as under: "SCHEDULE II (Conditions) 1.
Every factory shall have a provident fund scheme in force the rules of which with respect to the rates of contribution shall not be less favourable than those specified in Section 6 of the and the employees shall also be in enjoyment of other provident fund benefits which on the whole shall not be less favourable to the employees than the benefits provided under the or any Scheme in relation to the employees in any other factory of a similar character and these rules shall be followed in all respects.
The employer in relation to each factory (hereinafter referred to as the 'employer ') shall within three months of the date of publication of this notification, amend the constitution of the Provident Fund maintained in respect of the factory in regard to the following matters namely: (a) The Provident Fund shall vest in a Board of Trustees and there shall be a valid instrument in writing which adequately safeguards the interests of the employees and such instruments shall be duly registered under Section 5 of the ; (b) the Board of Trustees shall consist of an equal number of representatives of the employees and the employer and all questions before the Board shall be decided by a majority of votes; xx xx xx 10.
The employer shall accept the past provident fund accumulations or an exempted fund and who obtains employment in his factory.
Such an employee shall immediately 956 be admitted as a member of the factory 's Provident Fund.
His accumulations which shall be transferred within 3 months of his joining the factory shall be credited to his account.
xx xx xx 15.
Exemption granted by this notification is liable to be withdrawn by the Central Provident Fund Commissioner for breach of any of the aforesaid conditions or for any other sufficient cause which may be considered appropriate.
As per condition No. I the exempted factory should have a provident fund scheme in force the rules of which with respect to the rates of contribution shall not be less favourable than those specified in Section 6.
This part of the condition is in conformity with the requirement under Section 17(1).
The condition proceeds to lay down that these rules shall be followed in all respects.
There is no dispute that as per the rules governing the provident fund scheme of the exempted establishment in question, the contributions have to be made regularly and condition No. I lays down that these rules should be followed in all respects.
The default in making the contribution amounts to contravention of the rules and consequently the condition No. 1, subject to which the exemption was granted, is clearly violated.
That there was a violation of this condition is also made clear by the notice issued by the Regional Provident Fund Commissioner on 15.9.75.
The relevant portion of the notice reads thus: "And thus it has violated the conditions governing grant of exemption for contravention of which the offenders are liable for the cancellation of the exemption granted under Section 17 of the Employees ' Provident Fund Act, 1952.
" We are therefore satisfied that some of the conditions subject to which the exemption was granted have been violated.
So this part of Section 14(2A) is satisfied.
Now we shall see whether the cancellation under Section 17(4) is a penalty provided by or under the Act.
In the common parlance the word 'penalty ' is understood to mean; a legal or official punishment such as a term of imprisonment.
In some contexts it is also understood to mean some other form of punishment such as fine or forfeiture for not fulfilling a contract.
But 957 in gathering the meaning of this word, the context in which this is used is significant.
In the Act, as already noted, Section 14 deals with penalties and enumerates various contraventions or non compliances which are punishable with imprisonment.
Every contravention mentioned in each of the sub sections is punishable with imprisonment and for offences covered by Sections 14(1A), 14(1B) and 14(2A) minimum imprisonment is also made compulsory.
The imposition of fine also is prescribed.
The penalties mentioned in this connection would indicate that the Legislature envisaged that a penalty should necessarily mean imprisonment or atleast imposition of fine.
We find from the reports that the National Commission of Labour having found that tile working of the Employees ' Provident Fund and Family Pension Fund Act, 1952 are not effective and that in order to cheque the growth of arrears penalties for defaults in payment of provident fund dues should be made more stringent and the default should be made cognizable.
Accordingly it was proposed to amend the Act so as to render penal provisions more stringent and to make defaults cognizable offences and provisions were also made for compulsory imprisonment in case of non payment of contributions and administrative and inspection charges.
The provisions of the Act thereafter are suitably amended.
We must bear this object and reasons in mind in examining whether a mere cancellation of the exemption granted under Section 17(4) would amount to a penalty.
No doubt under Section 14(2A) one of the requirements is that "there should be no other penalty elsewhere provided by or under the Act for such contravention or non compliance," but we are not persuaded to hold that the mere cancellation of an exemption amounts to a penalty particularly expected to be stringent as contemplated under Section 14.
However, we shall proceed to consider some of the submissions made on this aspect.
The learned counsel referred to certain standard books on words and phrases.
In Butterworths ' Words and Phrases, legally defined Third Edition page 343 the meaning of the word 'Penalty ' is given as that the word penalty ' is large enough to mean, is intended to mean, and does mean, any punishment whether by imprisonment or otherwise.
Blackburn,J. in R. vs Smith, [ ; at 138, observed as under: "I consider that the word "penalty" falls to be read in a wide popular sense, .
and I select two definitions adequately conveying that sense.
The late Mr. Roberton Christie The Encyclopedia, Vol.
I 1, p 204) said:"Penalty in the broad sense may be defined as any suffering in person or property by way of forfeiture, deprivation or disability, imposed as a punishment by law or judicial 958 authority in respect of . an act prohibited by statute.
" The Oxford Dictionary echoes the same wide conception by referring to "a loss, disability or disadvantage of some kind . fixed by law for some offence.
The meaning of the word 'penalty ' as given in the Collins English Dictionary, is as under: "Penalty: 1.
a legal or official punishment, such as a term of imprisonment.
some other form of punishment, such as a fine or forfeit for not fulfilling a contract.
3. loss, suffering, or other unfortunate result of one 's own action, error, etc.
Sport, games etc.
a handicap awarded against a player or team for illegal play, such as a free shot at goal by the opposing team, loss of points, etc.
" In addition, the learned counsel also relied on some decisions of foreign courts where the meaning of the word 'penalty ' was considered.
In People ex rel Risso vs Randall, , 268 Misc.1057, it was held that: "A "penalty" may refer to both criminal and civil liability, being denied as penal retribution, punishment for crime of offense, the suffering in person, rights or property which is annexed by law or judicial decision to commission of a crime or public offense.
" In City of Fort Wayne vs Bishop, , 547, , it was observed as under: "The term "penalty" embraces all consequences visited by law on heads of those who violate police regulations and extends to all penalties whether exigible by state in interest of community or by private persons in their own interest, even when statute is remedial as well as penal." In City of Cincinnativ.
Wright, 67N.E.2d 358,361,77 Ohio App.261,it was noted that: "The word "penalty" is not confined to punishment or crime; it has a broader meaning in law of contracts; it is used as contradistinguished from liquidated damages.
It is also used to indicate the sum to be forfeited on breach of a 959 bond.
And in common parlance it expresses any disadvantage resulting from an act.
The learned counsel relying on the above meanings given to the word 'penalty ' submitted that a cancellation in other words a forfeiture of the right given amounts to punishment.
It is also his submission that this is a penalty provided by or under the Act inasmuch as such a cancellation is contemplated under Section 17(4) and that the word "under" cannot but be understood to mean that it covers the cancellation of the exemption also provided under Section 17(4).
In this context he relied on the meaning of the word "under" as given in Butterworths ' Words and Phrases, legally defined.
Third edition page 345:, which reads thus: "In one sense every act of a body which is the creature of statute may be said to be done "under" or by virtue of the statute creating it." The author has extracted the observations made by O ' Bryan, J. in R. D vs Clyne, ex p Harrap ( 194 1) VLR 200 at 20 1, as under: "In another sense the acts of such a body may be said to be done .under" or by virtue of some provision granting a general jurisdiction to act in relation to a variety of matters.
But the expression is also quite commonly used in relation to a particular act, when the general jurisdiction to act is assumed, to designate the more particular power to do that particular act.
It is rash to attempt to substitute a different expression for the more simple and usual one used, but in this connection "under" is perhaps more aptly translated by the expression "pursuant to" than by the phrase "by virtue of.
" It is necessary to have regard to the context to determine in which sense the word is used." (emphasis supplied) It therefore cannot be gainsaid that the context in which these words are used is significant.
At this juncture we may also note that the scheme or rules framed by a company in respect of the provident fund of the employees are meant to be duly complied with.
The exemption under Section 17 is incorporated in the Act for getting better benefits for the employees and the same is granted with a view to avoiding duplication that is to say for framing a scheme by the appropriate Government on the lines as framed by the establishment itself and 960 such an exemption is meant to ensure to the employees the continuance of the benefits and the purpose of the exemption is only to ensure such a scheme better than the one under Section 6 of the Act.
It must also be noted that notwithstanding the exemption granted under Section 17 of the Act the appropriate Government does not lose its hold over the scheme framed by the establishment and there are built in safeguards in Section 17 itself to protect the interests of the employees and Section 17(14) is one such safeguards.
In Mohmedalli and Others vs Union of India and another, [1963] Suppl.
I SCR 993; it is held that: "It would appear from the terms of the relevant portion of section 17 that the exemption to be granted by the appropriate Government is not in the nature of completely absolving the establishments from all liability to provide the facilities contemplated by the Act.
The exemptions are to be granted by the appropriate Government only if in its opinion the exempted establishment has provisions made for provident fund, in terms at least equal, if not more favourable, to its employees.
In other words the exemption is with a view to avoiding duplication and permitting the employees concerned the benefit of the preexisting scheme, which presumably has been working satisfactorily, so that the exemption is not meant to deprive the employees concerned of the benefit of a provident fund but to ensure to them the continuance of the benefit which at least is not in terms less favourable to them.
As the whole scheme of provident fund is intended for the benefit of employees, section 17 only saves pre existing schemes of provident fund pertaining to particular establishments.
" (emphasis supplied) Having examined the scope of Section 14( '2A) in this background, we find it difficult to agree with the learned counsel that the cancellation of the exemption granted under Section 17(4) amounts to a penalty under Act within the meaning of Section 14(12A).
We may also note that Section 14(2A) was introduced in the year 1953 by Act No. 37 of 1953 whereas sub section 4 of Section 17 was introduced in the year 1963 by the amendment Act No. 28 of 1963, nearly ten years later.
This only shows that the cancellation is not meant to be treated as one of the penalties and the reasonable inference is, particularly having regard to the object underlying the Act, that the expression 'penalty ' in the context in which it is used particu 961 larly in Section 14 including Section 14(2A) only connotes imposition of imprisonment or fine.
The cancellation as provided under Section 17(4) is only consequential and also rather procedural meant to be applied to the exemption granted under Section 17( 1) in case of noncompliance of the conditions subject to which such exemption was granted.
A close perusal of Section 17 and its various sub sections would clearly indicate that it is a self contained provision dealing with the power to grant exemption and the consequent obligations and the procedural aspects and Section 17(4) is a built in provision providing for cancellation of such exemption in case of contravention or noncompliance of the conditions.
By a cancellation of the exemption only the privilege granted is being withdrawn by an executive order.
Suffice it to say that such a cancellation does not penalise the management and consequently does not result in any punishment that is normally awarded in respect of an offence.
In State of Uttar Pradesh through the Provident Fund Inspector, U.P. vs Lala Ram Gopal Gupta and three Others, a Division Bench considered this very question and held that the cancellation of exemption in accordance with Section 17(4)(a) does not involve imposition of a penalty within the meaning of Section 14(12A) of the Act.
In our view the Division Bench of the Allahabad High Court rightly held that cancellation under Section 17(4)(a) is not an alternative penalty for failure to comply with the conditions subject to which the exemption was granted and if the Parliament had contemplated that the cancellation of the exemption amounted to penalty within the meaning of Section 14(2A) it was purposeless to provide for any similar penalty under Section 14(2A).
It is thus clear that if the contention of the learned counsel is to be accepted then Section 14(2A) would become otoise and redundant.
The learned counsel submitted that these being penal provisions should be interpreted strictly and if so interpreted the cancellation of exemption under Section 17(4) cannot but be a penalty under the Act.
The learned author Justice G.P. Singh in his book Principles of Statutory Interpretation Fourth Edition 1988, has stated the general principles regarding the construction of penal statutes as follows: "Clear language is now needed to create a crime . .
If there is a reasonable interpretation which will avoid the penalty in any particular case we must adopt that construction and if there are two reasonable constructions we must give the more lenient one.
" 962 In Tolaram vs State of Bombay, ; Mahajan, C.J. observed as under: "If two possible and reasonable constructions can be put upon a penal provision, the court must lean towards that construction which exempts the subject from penalty rather than the one which imposes penalty.
It is not competent to the court to stretch the meaning of an expression used by the legislature in order to carry out the intention of the legislature.
" The learned author Justice G.P. Singh after extracting the principles laid down by the Supreme Court as well as by the English courts summed up the principles in the following manner: "The content of the rule and its limits, in the sense now understood, may be summed up in the following propositions: (1) If the prohibitory words in their known signification cover only some class of persons or some well defined activity, their import cannot be extended to cover other persons or other activity on considerations of policy or object of the statute.
(2) If the prohibitory words are reasonably capable of having a wider as also a narrower meaning and if there is no clear indication in the statute or in its policy or object that the words were used in the wider sense, they would be given the narrower meaning.
(3) When the prohibitory words are equally open to two constructions, one of which covers the subject and the other does not, the benefit of construction will be given to the subject.
(4) If the prohibitory words in their known signification bear a wider meaning which also fits in with the object or policy of the statute, the words will receive that wider meaning and their import will not be restricted even if in some other context they can bear a narrower meaning.
(5) If the literal reading of the prohibitory words produces 963 an unintelligible or non sensual result.
but the statute read as a whole gives out its meaning clearly, effect will be given to that meaning by curing a mere defect in phraseology.
Relying on the aforesaid principles governing the construction of the penal statute Shri P. Chidambram, learned counsel for the appellants submitted that the provisions of Section 14(2A) and Section 17(4) should reasonably be construed and if so construed Section 14(2A) becomes inapplicable to the facts of the case on hand.
It is true that all the penal statutes should be construed strictly and the court must see that the thing charged as an offence is within the plain meaning of the words used but it must also be borne in mind that the context in which the words are used is important.
The legislative purpose must be noted and the statute must be read as a whole.
In our view taking into consideration the object underlying the Act and on reading Sections 14 and 17 in full, it becomes clear that cancellation of the exemption granted does not amount to a penalty within the meaning of Section 14(2A).
As already noted these provisions which form part of the Act, which is a welfare legislation are meant to ensure the employees the continuance of the benefits of the provident fund.
They should be interpreted in such a way so that the purpose of the legislation is allowed to be achieved (vide M/s International Ore and Fertilizers (India) Pvt. Ltd. vs Employees 'State Insurance Corporation, AIR 1988 SC 79.
In Seaford Court Estates Ltd. vs Asher, [ 19491 2 All E R 155, Lord Denning, L.J. observed: "The English language is not an instrument of mathematical precision.
Our literature would be much poorer if it were.
This is where the draftsmen of Acts of Parliament have often been unfairly criticised.
A judge, believing himself to be fettered by the supposed rule that he must look to the language and nothing else, laments that the draftsmen have not provided for this or that, or have been guilty of some or other ambiguity.
It would certainly save the judges trouble if the Acts of Parliament were drafted with divine prescience and perfect clarity.
In the absence of it, when a defect appears, a Judge cannot simply fold his hands and blame the draftsman.
He must set to work on the constructive task of finding the intention of Parliament, and he must do this not only from the language of the statute, but also from a consideration of the social conditions which gave rise to it and of the mischief which it was passed to remedy, and then he must supplement the written word so as to give 'force 964 and life ' to the intention of legislature.
A Judge should ask himself the question how, if the makers of the Act had themselves come across this ruck in the texture of it, they would have straightened it out? He must then do so as they would have done.
A judge must not alter the material of which the Act is woven, but he can and should iron out the creases.
(emphasis supplied) Therefore in a case of this nature, a purposive approach is necessary, However, in our view the interpretation of the word 'penalty ' used in Section 14(2A) does not present any difficulty and cancellation is not a punishment amounting to penalty within the meaning of this Section.
Shri P. Chidambram, however, submitted that unless the context otherwise requires, such a purposive or liberal approach need not be resorted to.
He invited our attention to the opening words "unless the context otherwise requires" occurring in Section 2 which contains definitions.
We may at this juncture point out that these words strictly apply to definitions and while considering the scope of Section 14(2A) we have proceeded adhering to the language of the Section.
However, we shall consider the effect of these opening words in Section 2A, at a later stage while considering the submissions of Shri Dholakia regarding the applicability of Section 14(1A).
Shri P. Chidambaram, learned counsel for the appellants, however, contended that the failure to contribute to the fund under the 1952 Scheme only is punishable as it amounts to "contravention" and that in the instant case the complaint is that the management failed to contribute to the fund maintained by the establishment itself and such a failure is not punishable and the word "contribution" must be construed strictly as defined under Section 2 and not otherwise as the context does not otherwise require.
Similar words occur in Section 2 of the Companies Act and in section K. Gupta and Another vs K. P. Jain and Another, ; wherein it is held as under: "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 definitions 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.
965 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.
" In State Bank of India etc.
vs Yogendera Kumar Srivastava and Others etc.
; , it is observed: "Repugnancy of the definition of any term may arise only if such definition does not agree with the subject or context of a particular provision.
But, surely, any action not in conformity ' with the provision of the definition clause will not render the definition of a term repugnant to the subject or context of any provision of the statute containing the term.
Relying on the above, passages, the learned counsel for the appellants further submitted that the context in which the word 'penalty ' is used would show that Section 14(2A) does not necessarily require that there should be a punishment of either imprisonment or fine inasmuch as the "cancellation" also can be a penalty within the meaning of Section 14(2A).
At any rate according to the learned counsel for the appellants there is an ambiguity and that this being a penal law, the provisions should be construed strictly and necessarily the benefit of doubt, if any, should go to the accused.
In view of the discussion already made by us on this aspect, this contention does not merit acceptance.
In our view, there is no ambiguity as suggested by the learned counsel for the appellants.
Even assuming so, in view of the object underlying the Act the context does definitely require a reasonable interpretation of Section 14(2A) so as to make it applicable also to a case of failure to contribute to the fund as per the conditions under which the exemption was granted.
Like wise it must also be interpreted to mean that cancellation does not amount to a penalty.
Therefore the submission that Section 14(2A) is not attracted does not merit acceptance.
Shri Dholakia, learned counsel for the respondents, as already noted, submitted that in addition to Section 14(2A), Section 14(A) is also attracted and the appellants are punishable under that provision for the contravention and non compliance of Section 6 of the Act.
In his submission, the words "fund" and "scheme" should be given a wider meaning and cannot be restricted merely because of their definitions as contained in Section 2.
According to the learned counsel, the opening words of Section 2 namely "Unless the context otherwise 966 requires" give a scope for a wider interpretation and they cannot be narrowly understood to mean only "fund" and "scheme" as mentioned therein.
As this point has been argued in support of the applicability of Section 14(1A) we shall consider the same from that perspective.
Section 2 begins with the words "In this Act, unless the context otherwise requires.".
Section 2(c) defines "contribution" to mean a contribution payable in respect of a member under a Scheme Section 2(h) defines "fund" to mean the provident fund established under a Scheme and Section 2(1) defines "Scheme" to mean the Employees ' Provident Fund Scheme, framed under Section 5.
Section 5 empowers the Central Government by a notification to frame a scheme and such a scheme was framed in 1952 called the Employees ' Provident Fund Scheme of 1952.
Section 6, as already noted, lays down that the "contribution" which shall be paid by the employer to the "Fund" shall be of the percentage mentioned therein.
We shall now examine Section 14(1A).
This provision was introduced in the year 1973 and specifies a penalty laying down that if an employer who contravenes or makes default in complying with the provisions of Section 6 or clause (a) of sub section (3) of Section 18, shall be punishable with imprisonment mentioned therein.
For the purpose of this case we have to see whether there is a contravention or non compliance with the provisions of Section 6.
According to Shri Dholakia the "scheme" should be interpreted liberally as to mean a scheme framed and followed by the employer himself and "fund" in that context should be taken to mean a provident fund established under such a scheme by the employer and the "contribution" should consequently mean a contribution payable by him under such a private scheme and consequently if there is a default in payment of the contribution to such a scheme it amounts to contravention of Section 6 punishable under Section 14(1A).
Learned counsel for the respondents very much relied on the opening words of Section 2 namely "In this Act, unless the context otherwise requires," and urged that these words can otherwise, than as mentioned in the definitions, also be interpreted keeping in view the object of the Act.
He further urged that the duties under the scheme framed under Section 5 i.e. 1952 scheme and the private scheme followed by an employer because of an exemption granted are one and the same and that if viewed from this angle, the expressions "contribution", "fund" and "scheme" can be understood to be wide enough to carry the same meanings in respect of the private scheme also and consequently failure to contribute to the fund under a private, scheme framed and operated by the employer attracts Section 14(IA).
After a careful consideration we are inclined to agree with the 967 learned counsel fOr the respondents.
In this context we may note a passage in Knightsbridge Estates Trust Ltd. vs Byrne and Others, which reads thus: "It is perhaps worth pointing out that the words "unless the context otherwise requires" which we find in the consolidating Act of 1929 are not to be found in the amending Act of 1928.
I attribute little weight to this fact, for, in my opinion, some such words are to be implied in all statutes where the expressions which are interpreted by a definition clause are used in a number of sections with meanings sometimes of a wide, and sometimes of an obviously limited, character.
On the other hand, I think due weight ought to be attributed to the words "otherwise requires" in the Companies Act, 1929, and it is incumbent on those who contend that the definition does not apply to sect.
74 to show with reasonable clearness that the context does in fact require a more limited interpretation of the word "debenture" then Sect.
380 has assigned to it." In National Buildings Construction Corporation vs Pritam Singh Gill and Others, [ ; this Court observed as under: "as is usual with most of the definition sections, with the clause, "unless there is anything repugnant in the subject or context.
" This clearly indicates that it is always a matter for argument whether or not this statutory definition is to apply to the word "workman" as used in the particular clause of the Act which is under consideration, for this word may both be restricted or expanded by its subject matter.
The context and the subject matter in connection with which the word "workman" is used are accordingly important factors having a bearing on the question.
The propriety or necessity of thus construing the word "workman" is obvious because all parts of the Act have to be in harmony with the statutory intent." (emphasis supplied) In Commissioner of Expenditure Tax, Gujarat, Ahmedabad vs Darshan Surendra Parekh; , it was observed as under: "Undoubtedly the definitions in section 2 of words and expressions used in the Act apply unless the context otherwise 968 requires, and if the context in section 4 requires that the expression "dependent" should not be given the meaning which is assigned thereto by the definition in cl.
(g) of section 2, the Court would be justified in discarding that definition.
It is a settled rule of interpretation that in arriving at the true meaning which is assigned thereto by the definition in cl.
(g) to be viewed isolated from its context; it must be viewed in its whole context, the title, the preamble and all the other enacting parts of the statute.
It follows there from that all statutory definitions must be read subject to the qualifications expressed in the definition clauses which create them, such as "unless the context otherwise requires"; or "unless a contrary intention appears" or "if not inconsistent with the context or subject matter.
(emphasis supplied) In Bennett Coleman & Co. (P) Ltd. vs Punya Priya Das Gupta, [1970]I SCR 181 this Court observed thus: "But assuming that there is such a conflict as contended, we do not have to resolve that conflict for the purposes of the problem before us.
The definition of section 2 of the present Act commences with the words "In this Act unless the context otherwise requires" and provides that the definitions of the various expressions will be those that are given there.
Similar qualifying expressions are also to be found in the , the , the C.P. & Berar Industrial Disputes Settlement Act, 1947 and certain other statutes dealing with industrial questions.
It is, therefore, clear that the definitions of "a newspaper employee" and "a working journalist" have to be construed in the light of and subject to the context requiring otherwise.
" The above passages throw a flood of light on the scope of interpretation of these opening words of Section 2 and it is clear that they must be examined in the light of the context, the title, the preamble and all the other enacting parts of the statute.
Due weight ought to be given to the words "unless the context otherwise requires".
The subject matter and the context in which a particular word is used are of great importance and it is axiomatic that the object underlying the Act must 969 always be kept in view in construing the context in which a particular word is used.
In the Statement of Object and Reasons of Act No. 40 of 1973 by which Section 14(IA) was introduced, it is clearly mentioned that National Commission of Labour has recommended that in order to check the growth of arrears, penalties for defaults in payment of provident fund dues should be more stringent and the default should be made cognizable.
The concept which prompted the Legislature to enact this welfare law should also be borne in mind in interpretation of the provisions.
Chagla, C.J. in Prakash Cotton Mill.
(P) Ltd. vs State of Bombay, [1957]2 LLJ 490 observed as under: "no Labour legislation, no special legislation, no economic, legislation, can be considered by a court without applying the principles of social justice in interpreting the provisions of these laws.
Social justice is an objective which is embodied and enshrined in our Constitution . . it would indeed be startling for anyone to suggest that the court should shut its eyes to social justice and consider and interpret a law as if our country had not pledged itself to bringing about social justice." In Organo Chemical Industries and Another vs Union of India and Others, [ 19791 4 SCC 573 it was observed that: "A policy oriented interpretation.
when a welfare legislation falls for determination, especially in the context of a developing country, is sanctioned by principle and precedent and is implicit in Article 37 of the Constitution since the judicial branch is, in a sense, part of the State.
So it is reasonable to assign to 'damages ' a larger, fulfilling meaning.
In Kanwar Singh vs Delhi Administration, ; it was observed as under: "It is the duty of the court in construing a statute to give effect to the intention of the legislature.
If, therefore, giving a literal meaning to a word used by the draftsman, particularly in a penal statute, would defeat the object of the legislature, which is to suppress a mischief, the court can depart from the dictionary meaning or even the popular meaning of the word and instead give it a meaning which will advance the remedy and suppress the mischief.
" 970 In State of Gujarat vs Chaturbhuj Maganlal and Another, ; it was observed as under: "It is well recognised that where the language of a statutory provision is susceptible of two interpretations, the one which promotes the object of the provision, comports best with its purpose and preserves its smooth working, should be chosen in preference to the other which introduces inconvenience and uncertainty in the working of the system.
This rule will apply in full force where the provision confers ample discretion on the Government for a specific purpose to enable it to bring about an effective result." In Vanguard Fire & Gen. Ins. Co. vs Fraser & Ross, AIR 1960 SC 1971 it was held that "the Court has not only to look at the words but also at the context, the collocation and the object of such words and interpret the meaning intended to be conveyed by the use of the words under the circumstances" We feel it may not be necessary to multiply the authorities on this aspect.
In this background if we examine the opening words of Section 2 namely "In this Act, unless the context otherwise, requires," then we necessarily feel that there is much in the context to show that the restricted meaning in the definitions should not be applied.
So much is about the opening words to Section 2 and it, therefore, follows that the words 'contribution ', 'Scheme ', 'fund ' occurring in the said section should in the "context" be otherwise interpreted as to apply to a private scheme also and if there is a default in "contribution" by the exempted establishment, the same amounts to contravention of Section 6 punishable under Section 14(1A).
Before we conclude we shall however refer to one general submission of Sri Chidambaram.
He submitted that the fact that Section 17(1A) was introduced in 1988 prescribing a penalty in respect of contraventions or non compliances committed by an exempted establishment, would go to show that Sections 14(1a) and 14(2A) were not intended to be made applicable to an exempted establishment and that cancellation of the exemption under Section 17(4) was the only prescribed penalty.
He also invited our attention to the Statement of Objects and Reasons of Amendment Act No. 33 of 1988.
We see no force in this submission.
The mere fact that Section 17(1A) was intro 971 duced in the year 1988 does not necessarily lead to an inference that Sections 14(IA) and 14(2A) were not intended to be made applicable to an exempted establishment.
As stated in the foregoing paragraphs the object underlying every amendment was mainly intended to render the penal provisions more stringent in order to check the growth of arrears and to punish the defaulters.
Likewise in the Amendment Act No. 33 of 1988 also it was intended to make the existing penal provisions more stringent.
This Amendment Act was passed on the recommendations of a high level committee set up to review the working of the employees provident fund organisation and to suggest improvements.
One of the recommendations was to make the existing penal provisions more stringent and also make the existing legal and penal provisions as applicable to unexempted establishments being made applicable to exempted establishments so as to check the defaults on their part.
The learned counsel for the appellants very much relied on this part of Objects and Reasons and submitted that it is only by the introduction of Section 17(1A) that the exempted establishments also are brought within the purview of the penal provisions which hitherto were applicable to unexempted establishments, and therefore Sections 14(1a) and 14(2A) were hitherto inapplicable to exempted establishments.
We are unable to agree that this part of the Statement of Objects and Reasons would necessarily lead to such an inference.
As already discussed many aspects are common to both the types of provident fund.
So far as unexempted establishments are concerned there are several other penal provisions like Sections 14(1), 14(2) and 14AA and also in particular Paragraph 76 of the 1952 Scheme.
There are other legal provisions also which apply to unexempted establishments.
Therefore under the Amendment Act No. 33 of 1988 the Legislature wanted to make as far as possible these existing legal and penal provisions which are applicable to unexempted establishments, applicable also to exempted establishments.
That does not mean that there were no penal provisions earlier applicable to exempted establishments.
Section 17(1A) is in the following terms: " 17(1 A) Where an exemption has been granted to an establishment under clause (a) of sub section (1), (a) the provisions of Sections 6, 7 A, 8 and 14 B shall, so far as may be, apply to the employer of the exempted establishment in addition to such other conditions as may be specified in the notification granting such exemption, and where such employer contravenes, or makes default in complying with any of the said provisions or conditions or 972 any other provision of this Act, he shall be punishable under Section 14 as if the said establishment had not been exempted under the said clause (a); (b) the employer shall establish a Board of Trustees for the administration of the provident fund consisting of such number of members as may be specified in the Scheme; (c) the terms and conditions of service of members of the Board of Trustees shall be such as may be specified in the Scheme; (d) the Board of Trustees constituted under clause (b)shall (i) maintain detailed accounts to show the contributions credited, withdrawals made and interest accrued in respect of each employee; (ii) submit such returns to the Regional Provident Fund Commissioner or any other officer as the Central Government may direct from time to time; (iii) invest the provident fund moneys in accordance with the directions issued by the Central Government from time to time; (iv) transfer, where necessary, the provident fund account of any employee; and (v) perform such other duties as may be specified in the Scheme.
A perusal of this Section would only go to show that some more provisions, legal and penal, are also made applicable to the exempted establishments with a view to make the penal provisions more stringent with a view to check the growth of arrears.
Therefore we are unable to agree with the learned counsel that Sections 14(IA) and 14(2A) are inapplicable to exempted establishments.
From the above discussion, it emerges that atleast Sections 14(IA) and 14(2A) are attracted to the facts in the present case and therefore it cannot be said that there is no prima facie case and conse 973 quently the accused cannot claim any acquittal, even before the conclusion of the trial under Chapter XX Cr P.C. dealing with trial of summons cases.
Other Sections like 14(2), 14A(l) and 14A(2) and paragraph 76 of the Employees Provident Fund Scheme 1952 will not apply to the facts of the present case.
Therefore the trial court may proceed with the trial for the offences punishable under Sections 14(IA) and 14(2A) against the appellants and dispose of the matter in accordance with law.
Subject to the above directions, these appeals are disposed of.
| IN-Abs | was enacted with a view to provide for institution of provident fund for employees in factories and other establishments and was made applicable to every establishment which came within the meaning of 939 'factory '.
The Central Government under section 5 of the Act, framed the Employees ' Provident Fund Scheme in 1952 for establishment of provident funds for the employees of the establishments governed by the Act.
Management of such establishments had to contribute to the provident fund of its employees in accordance with section 6.
Contravention or default in complying with section 6.
was punishable under s 14.
Under section 17 the appropriate government was empowered to grant exemption from the operation of the 1952 Scheme provided the concerned establishment had Instituted its own provident fund scheme and the rules in this respect were not less favourable than those specified in section 6 and the employees were also in the enjoyment of other provident fund benefits.
The Act underwent major amendments in 1971 and thereafter.
The appellants were in the management of an establishment governed by the Act.
By a notification dated 17.10.1957 the Central Government granted exemption under section 17 to,the said establishment subject to the conditions specified in Schedule II, to the notification.
Condition No. 1 was to the effect that the factory was to have a provident fund scheme in force, the rules of which with respect to the rates of contribution should not be less favourable than those specified in section 6 of the Act and the employees should also be in the enjoyment of other provident fund benefits provided under the Act.
Consequently the 1952 Scheme did not apply to the company as it created a trust and the management was making contributions of provident fund to the said trust.
In September/October, 1975, the Inspector Provident Fund filed complaints that the appellants being incharge of the management of the establishment failed to pay contributions to the provident fund trust in 1974 and thereby committed offences punishable under sections 14(1A), 14(2), 14(2A), 14A(l), 14A(2), of the Act and Paragraph 76 of the 1952 Scheme, the appellants also received notice dated 15.9.1975 threatening to cancel the exemption granted under section 17.
In September 1975 the company was closed and liquidation proceedings were initiated.
The appellant filed applications before the Metropolitan Magistrate, before whom the complaints were pending, contending that section 6 of the Act was not applicable to establishments exempted under section 17, and no proceedings under section 14 could be initiated against them; and prayed for their acquittal and for dropping of the proceedings.
The application were rejected.
The appellants thereupon filed revision applications which were dismissed by the Addl.
Sessions Judge, holding that section 6 covered all the establishments Including the exempted one; that even an exempted 940 establishment was required to make full contribution to the provident fund as provided by section 6 and failure to pay contributions amounted to contravention of section 6 and attracted section 14(1A); and that since the conditions, subject to which exemption was granted under s.17, were violated, section 14(2A) was also attracted.
In appeal to this Court, it was contended by the appellants that since the establishment was exempted under section 17, it was governed neither by the 1952 Scheme nor by section 6 of the Act; that cancellation of exemption under section 17(4) was a penalty provided by or under the Act; that if the word 'contribution ' was construed strictly as defined in section 2, failure by an exempted establishment in not paying provident fund contributions to the trust was not a contravention of s.6; and that before the introduction of s.17(1A) by the Amendment Act 33 of 1988 the penal provisions including section 14(1A), and 14(2A) were not applicable to establishment exempted under section 17.
On the questions whether: (1) for contravention of the provisions of the , criminal proceedings could be instituted under section 14 of the Act against an establishment exempted under section 17; and (2) failure by the establishment in question to pay the provident fund contributions to the trust attracted the prosecution or only warranted cancellation of the exemption under section 17(4).
Disposing of the appeals, this Court, HELD: 1.1 An exempted establishment has to provide for its employees the benefits which are in no way less favourable than those provided under the and the Employees ' Provident Fund Scheme 1952.
Under section 17 the appropriate government may by notification and subject to such conditions as may be specified in the said notification, exempt an establishment from operation of the 1952 Scheme if it is satisfied that the establishment makes contribution to the provident fund, which can be called a provident fund scheme of its own, and the rules governing such scheme are not less favourable than those specified in section 6.
[953A c] 1.2 Contravention or non compliance of any of the conditions, subject to which exemption was granted under section 17 is punishable under section 14(2A) if no other penalty is elsewhere provided by or under the Act.
The essentials of the provisions are that there should be a contravention 941 or default in complying with the provisions of the Act or any of the conditions subject to which exemption was granted under section 17; and that there should be no other penalty elsewhere provided by or under the Act for such contravention or non compliance.
[954F G] 1.3 In the instant case, the default in making the provident fund contributions to the trust by the company amounted to contravention of the rules; and consequently condition no.1 mentioned in Schedule II to the notification dated 17.10.1957, subject to which the exemption was granted, was clearly violated.
[956D E] 2.1 In common parlance the word 'penalty ' is understood to mean: a legal or official punishment such as a term of imprisonment.
In some contexts it is also understood to mean some other form of punishment such as fine or forfeiture for not fulfilling a contract.
But in gathering the meaning of this word, the context in which it is used is significant.
[956G H; 957A] 2.2 Section 14 of the Act dealing with penalties shows that every contravention or non compliance mentioned in each of the sub sections is punishable with imprisonment and/or fine; and for some offences minimum punishment is also made compulsory.
The penalties mentioned in this connection would indicate that the Legislature envisaged that a penalty should necessarily mean imprisonment or at least imposition of fine.
Having regard to the object underlying the Act, the expression 'penalty ' in the context in which it is used in s.14 including section 14(2A), only connotes imposition of imprisonment or fine.
[957A B] 3.1 It is true that all the penal statutes should be construed strictly and the court must see that the thing charged as an offence is within the plain meaning of the words used, but it must also be borne in mind that the context in which the words are used is important.
The legislative purpose must be noted and the statute must be read as a whole.
The is a welfare legislation and section 14 including sections 14(2A) and 17 are part of it: and they should be interpreted in such a way so that the purpose of the legislation is allowed to be achieved.
[963B D] M/S International Ore and Fertilizers (India) Pvt. Ltd. vs Employees ' State Insurance Corporation; , , relied on.
Seaford Court Estates Ltd. vs Asher, [1949] 2 All E.R. 155, referred to.
942 3.2 Taking into consideration the object underlying the Act and on reading sections 14 and 17 In full, it becomes clear that cancellation of exemption does not amount to a penalty within the meaning of section 14(2A).
It cannot be said that mere cancellation of an exemption granted under s.17 amounts to a penalty particularly expected to be stringent as contemplated under section 14.
[963C; 957E] State of Uttar Pradesh through the Provident Fund Inspector, U.P. vs Lala Ram Gopal Gupta and three Others, [1973] Allahabad Law journal 355, approved.
Notwithstanding the exemption granted, the appropriate government does not lose its hold over the scheme framed by the establishment, and there are built in safeguards like section 17(4) to protect the interests of the employees.
Section 17 is a self contained provision dealing with the power to grant exemption and the consequent obligation.
The exemption is granted for getting better benefits and to ensure their continuance for the employees with a view to avoiding duplication in framing a scheme by the appropriate government on the lines as framed by the establishment itself and the purpose of the exemption is only to ensure such a scheme better than the one under section 6.The procedural aspect of section 17(4) provides for cancellation of such exemption by which only the privilege granted is being withdrawn by an executive order.
Such a cancellation does not penalise the management and consequently does not result in any punishment that is normally allowed in respect of an offence.
[960A B; 961B C] Mohmedalli and Others vs Union of India and Another, [1963] Suppl.
1 SCR 993, relied on.
3.4 So far as unexempted establishments are concerned, there are several other penal provisions like sections 14(1), 14(2) and 14AA and also in particular Paragraph 76 of the 1952 Scheme.
There are other legal provisions also which apply to unexempted establishments.
Therefore under the Amendment Act No. 33 of 1988 the Legislature wanted to make as far as possible these existing legal and penal provisions which are applicable to unexempted establishments, applicable also to exempted establishments.
That does not mean that there were no penal provisions earlier applicable to exempted establishments.
[971E F] 4.
The subject matter and the context in which a particular word is used are of great importance and it is axiomatic that the object underlying the Act must always be kept in view in construing the con 943 text in which a particular word is used.
The concept which prompted the legislature to enact this welfare law should also be borne in mind in interpreting the provisions ' Due weight ought to be given to the words "unless the context otherwise requires" occurring in section 2, which show that restricted meaning in the definitions should not be applied; and the words 'contribution ', 'scheme ', 'fund ' occurring in the said section should in the "context" be otherwise interpreted as to apply to a private scheme also and if there is a default in "contribution" by the exempted establishment, the same amounts to contravention of section 6 punishable under section 14(1a).
[968G H; 969A; 970D F] Commissioner of Expenditure Tax, Gujarat, Ahmedabad vs Darshan Surendra Parekh; , ; Bennet Coleman & Co. (P) Ltd. vs Punya Priya Das Gupta, ; ; Organo Chemical Industries and Another vs Union of India and Others, ; ; Kanwar Singh vs Delhi Administration, ; ; State of Gujarat vs Chaturbhuj Maganlal and Another, ; and Vanguard Fire & Gen. Ins Co. vs Fraser & Ross, ; , relied on.
Parekh cotton Mills (P) Ltd. vs State of Bombay, , referred to.
Sections 14(1A) and 14(2A) of the Act are attracted to the facts in the instant case and it cannot be said that there is no prima facie case; and consequently the accused cannot claim acquittal even before the conclusion of the trial under Chapter XX Cr.
P.C. dealing with trial of summons cases.
[972G H; 973A] Besides sections 14A(l) and 14A(2) of the Act, not being applicable, section 14(2) dealing with family pension scheme and insurance scheme is not relevant in the instant case.
Similarly Paragraph 76 of the 1952 Scheme is also not attracted as the establishment in question is exempted from operation of the said scheme.
[953G H; 954A; 973A] R. vs Smith, ; ; People ex rel Risso vs Randall, , ; City of Fort Wayne vs Bishop, , 547, ; City of Cincinnati vs Wright, 361, 77 Ohio App. 261; R. vs Clyne, ex p. Harrap ; at 201; Tolaram vs State of Bombay, ; ; S.K. Gupta and Another vs K.P. Jain and Another, [19791 3 SCC 54; State Bank of India etc.
vs Yogendra Kumar Srivastava and Others etc. ; ; Knightbridge Estates Trust Ltd. vs Byrne and Others, [1940] 2 All and National Buildings Construction Corporation vs Pritam Singh Gill and Others, ; , referred to.
Collins English Dictionary, Butterworths ' Words and Phrases, Legally defined 3rd Edn.
page 345, Principles of Statutory Interpretation by G.P. Singh Fourth Edition,1988, referred to.
|
tion No. 320 of 1987.
(Under Article 32 of the Constitution of India.) Jitender Sharma for the Petitioners.
Kepil Sibal, Ms. Tamali Das Gupta, Ms. J. Wad and Mr. R.Venkataramani (NP) for the Respondent.
The Judgement of the Court was delivered by THOMMEN,J.
This petition has been filed by the D.T.C. Workers ' Union and some its members.
The main relief sought by them, as contained in prayer (a), reads: "Issue a Writ of Mandamus or Direction to the respondent the Delhi Transport Corporation to implement w.e.f. 1.1.86 the recommendations of the Fourth Pay Commission as approved by the Government of India to the Central Government employees as per the undertakings gives to its employees vide Office Order NO.PLD IX(465)/83/10589 dated 15.9.1983 and DGM(IR)/84/93 dated 7.2.1984." The petitioners as well as the respondent, the Delhi Transport Corporation, rely heavily upon the Office Order No. DGM(IR)/84/90 dated 7.2.1984 issued by the Deputy General Manager of the respondent Corporation, although they differ in their construction of what it contains.
We shall, therefore, read the whole Order; 986 ". .
Before Interim Relief was announced by the Central Government for its employees to be paid w.e.f. 1.6.83, the Wage Group constituted by the Government of India for considering the demand regarding revision of pay scales of the employees of the Delhi Transport Corporation gave its report recommending revision of pay scales of all the Class III & IV employees as an interim measure pending receipt of Fourth Pay Commission report.
Thus the revised scales themselves were in the shape of an interim relief.
As interim relief was announced by the Government for its employees almost simultaneously some unions approached the Management opposing the introduction of new scales and asking for the interim relief as at the Government rates.
It was explained to them that the revised scales have a greater in built advantage as the benefit in some cases go even over hundred rupees while interim relief for workers was fifty to seventy rupees.
However, an option was given vide circular No.
PLD IX(465)/83/10589 dated 15.9.83 to the employees of the Corporation either to avail the benefit of interim relief and retain the old pay scales or to avail the benefit of the revised pay scales.
In reference to the clarification sought by the Unions, it was made absolutely clear beyond any ambiguity to the employees that (1) there is absolutely no intention to de link the DTC from the Central Government pay structure and DA pattern arbitrarily or unilaterally; (ii) if the Fourth Pay Commission granted any further interim relief or benefit before the final report, such benefit will be available to the DTC employees; (iii) the differential in the head start now given in the pay scales will be maintained even while implementing the scales recommended by the Fourth Pay Commission and (iv) the payscales recommended by the Working Group would be enforceable for a period of four year or the receipt of report of the Commission whichever is earlier.
It has already been made amply clear that differential in "head start" given in the revised pay scales will be maintained even while implementing the scales recommended by the Fourth Pay Commission.
In fixation of pay in the scales to be recommended by the Foruth Pay Commission, the employees coming over to the revised scales of pay will be given due benefit of Central Government Interim Relief so as to ensure that they are not at any disadvantage because of having opted for the revised scales now.
For instance, if the 987 pay of an individual in the pay scale of Rs.260 400 drawing a basic pay of Rs.260 per month who had opted for interim Relief at Central Government rates is fixed at Rs.310 p.m. by adding Rs.50 as Interim Relief a Basic Pay of Rs.260 whereas the pay of an employee who has opted for corresponding revised pay scale of Rs.284 440 and is drawing Basic pay of Rs.284 p.m. will be fixed at Rs.334 p.m. by adding Rs.50 to his Basic Pay of Rs.284.
In this connection our circular NoPLD IX(465) 83 dated 20.9.93 referees.
It has been clearly shown in the above illustrations as to how the revised pay scales will be beneficial to the employees.
It is opted that the employees will not be mislead now by any such interpretation which is being placed on the Ministry of Finance 's O.M. of 28th November ,1983.
" Referring to the concept of "head start" mentioned in the Order, Mr. Jitender Sharma, appearing for the petitioners, submits that it being the intention of the Corporation to protect the interim relief granted to the employees, not withstanding the recommendations of the Fourth Pay Commission, the employees are entitled to the interim relief, referred to as the "head start", in addition to the pay scale recommended by the Fourth Pay Commission, In other words, according to Mr.Sharma, the employees will be entitled not only to the new pay scale recommended by the Fourth Pay Commission, but more in the shape of interim reliefs which they had enjoyed during the period of the interregnum between their original pay scale and the new payscale.
Mr. Kapil Sibal, appearing for the respondent Corporation, submits that all that the Order dated 7.2.1984 has intended to state is that the "head start" in the form of interim relief will not deprive the employees of the full benefits of either the revised interim pay scale, i.e., the scale as revised during the interregnum, or the new pay scale subsequently introduced as per the recommendations of the Fourth Pay Commission.
The employees had the option either to accept the additional payment in the nature of an interim relief in the sum of Rs.50 or Rs.70 as the case may be, or the revised interim pay scale which was itself in the nature of an interim relief, pending adoption of the new scale recommended by the Fourth Pay Commission.
But once the employees are placed on the scale recommended by the Fourth Pay Commission, all the reliefs which they had earlier received would merge into the new scale and they would have no entitlement to any 988 additional payment.
Any payment in addition to what the Fourth Pay Commission recommended would place the employees of the Corporation at an undue advantage in comparison to the employees of the Government in Corresponding grades.
Any such deferential treatment, counsel points out, will be discriminatory and, therefore, unsustainable.
Mr. Sharma, however, refers to the scales of pay relating to the category of conductors, tailors,compositors etc.
Their scale of pay prior to June, 1983 was Rs.260 6 290 EB 6 326 EB 8 390 10 400.
A revised interim scale was introduced on 1.6.1983.
This scale was Rs.284 8 340 10 440.
On 1.1.86, a new scale was introduced on the basis of the recommendations of the Fourth Pay Commission.
That scale is Rs.950 20 1150 EB 25 1500.
This shows that, prior to 1.1.1986, an employee on the scale of Rs.260 400 as on 31.5.1983 had the option either to remain on that scale and draw an additional allowance or be placed on the revised interim scale of Rs.284 440 .
On 1.1.1986 all employees in the category of conductors etc., came on the scale of Rs.950 1500 whether or not, prior to that date, they had, in exercise of their option, remained on the original scale or Rs.260 400 with the additional allowances or been placed on the revised interim scale Rs.284 440.
According to Mr. Sharma, the "head start" promised by the Corporation means the additional allowances or revised scales recieved by the employees during the interregnum, and such benefits have to be super imposed over the new scale of Rs.950 1500.
He further submits, insofar as none of the employees of the Corporation had opted to remain on the original scale with the additional allowances, but had come on the revised interim pay scale, all the employees brought on the new pay scales on 1.1.86 are entitled to be fitted with reference to the total emoluments drawn on the revised interim scale.
A careful reading of the Order dated 7.2.1984 shows that certain interim benefits were granted to the employees preceding the introduction of the new pay scale on the basis of the recommendations of the Fourth Pay commission.
These benefits which were either in the nature of an additional payment or a revised interim pay scale were intended to cover the period preceding the introduction of the regular pay scale which came into effect on 1.1.86.
The Order further shows that the Corporation was to carry the same pay structure and DA pattern as in the case of the Government employees in the corresponding categories.
All benefits granted by the Fourth Pay Commission in the nature of interim reliefs were also to be made available to the 989 Corporation employees.
The interim reliefs granted by the Corporation in the nature of what is imprecisely referred to as "head start" were to be maintained in implementing the scales recommended by the Fourth Pay Commission.
The figures worked out in the penultimate paragraph of the Report indicate that whether the employees were retained on the original pay scale with the additional emoluments by way of interim relief or they had, as in the instant case, opted for the revised interim scale, they should suffer no loss by reason of the option they hadexercised.
But the overriding consideration behind the Other dated 7.2.1984 is that, as in the case of all Government employees, so in the case of the Corporation employees, the new scale recommended by the Fourth Pay Commission should be fully implemented.
What ever may be the amounts actually payable in terms of the interim reliefs, the employees of the Corporation should neither be paid less nor more than the Government employees in the corresponding categories.
This means that all employees, whether retained on the original pay scale or placed on the revised interim pay scale during the period preceding 1.1.86 will be placed on the pay scale adopted as per the recommendations of the Fourth Pay Commission in such a way that they will be fitted exactly in positions corresponding to their positions on the earlier pay scales.
But the corresponding positions in the new pay scales will naturally carry better emoluments, so as to maintain parity with the Government employees in like categories.
In the circumstances, we have no doubt that the recommendations of the Fourth Pay Commission will be fully implemendted in terms thereof.
Mr. Kapil Sibal, appearing for the Corporation, assures us that it will be so done.
Mr. Sibal 's submission is recorded.
In the circumstances, no further order is required.
The writ petition is accordingly disposed of.
No costs.
R.N.J. Pentition disposed of.
| IN-Abs | The D.T.C. Workers ' Union and some of its members have filed this Writ Petition under Article 32 of the Constitution praying, as the main relief, for issue of a Writ of Mandamus or Direction to the respondent Corporation to implement w.e.f. 1.1.86 the recommendations of the Fourth Pay Commission as approved by the Government of India to the Central Government employees as per the undertakings given to its employees vide Office Orders No.
PLD IX (465/83/10589 dated 15.9.1983 and DGM(IR)/84/90 dated 7.2.1984.
Relying on the undertakings given in the said Office Orders it has been contended on behalf of the petitioners that the D.T.C. employees will be entitled not only to new pay scales as recommended by the Fourth Pay Commission to the corresponding categories in the Central Government but more in the shape of interim reliefs which they has enjoyed during the period of interregnum between their original pay scale and the new pay scales.
On behalf of the Corporation it has been submitted that all the reliefs which its employees had earlier received, be it additional payment in the nature of interim relief in the sum of Rs.50 or Rs.70 as the case may be, or the revised interim pay scale, pending adoption of the new scale recommended by the Fourth Pay Commission, would merge into the new scale and they would have no entitlement to any additional payment as any such differential treatment will be discriminatory and, therefore, unsustainable.
Disposing of the Writ Petition, this Court, HELD: The overriding consideration behind the Order dated 7.2.1984 is that, as in the case of all Government employees, so in the case of the Corporation employees, the new scales recommended by the Fourth Pay Commission should be fully implemented.
Whatever may be the amounts actually payable in terms to the interim reliefs, the 985 employees of the Corporation should neither be paid less nor more than the Government employees in the corresponding categories.[989C] All employees, whether retained on the original pay scale or placed on the revised interim pay scale during the period preceding 1.1.86, will be placed on the pay scale adopted as per the recommendations of the Fourth Pay Commission in such a way that will be fitted exactly in positions corresponding to their positions on the earlier pay scales.
But the corresponding positions in the new pay scale will naturally carry better emoluments, so as to maintain parity with the Government employees in like categories.
We have no doubt that the recommendations of the Fourth Pay Commission will be fully implemented in terms thereof.
[989D E]
|
Civil Appeal No.4094 of 1984.
From the Judgment and order dated 9.7.1984 of the Punjab & Haryana High Court in Civil Writ Petition No.5371 of 1981.
P.P. Rao, Sr.
and Janendra lal for the appellants.
S.C. Gupta, Rajinder Sachhar, Sudarshan Goyal, Vivek Bhandari, S.C.Patel, mahabir Singh and C.M. Nayar (NP) for the Respondents.
The Judgment of the Court was delivered by K.RAMASWAMY, J.
The appellants and the proforma respondents, thirty in number are employed in the Punjab Service of Engineers, Class II.
The Governor, in exercise of the power under proviso to article 309 of the Constitution of India framed the Punjab Service of Engineers, Class I, P.W.D. (Road and Buildings) Rules.
1960 for short the Rules constituting the Punjab Service of 204 Engineers, Class I, P.W.D. (Roads and Buildings Branch), After the formation of State of Haryana w.e.f.
November 1, 1966, the rules are called Haryana Service of Engineers, Class I, P.W.D. (Roads and Buildings Branch).
The services consist of Asstt.
Executive Engineers, Executive Engineers, Superintending Engineers, and Chief Engineers, as may be specified by the Government of Haryana from time to time (Rule 3(1).
The recruitment to the service is made by the government as per Rule 5(1); (a) by direct recruitment; (b) by transfer from any other services of the State Govt.
or of the Union of India; and (c) by promotion from Haryana Engineers, Class II Service.
The appellants for short 'the promotees" from Class II Service were promoted as Executive Engineers by relaxing five years length of service as Class II Engineers in officiating capacity on various dates between January 6, 1969 to May 29, 1971, There of them, namely, A.N. Sehgal, Raj Kumar and H.C. Sethi were confirmed as Executive Engineers w.e.f. July 11, 1973, December 11, 1974 and December 9, 1975 respectively.
The rest are yet to be confirmed.
Raje Ram Sheoran was recruited and appointed directly as Asstt.
Executive Engineer w.e.f October 25, 1971.
He too was given relaxation of the length of service of five years as Asstt.
Executive Engineer and was promoted as Executive Engineer on October 8, 1973.
He was confirmed w.e.f. December 22, 1976.
All the appellants except M.R. Gupta were further promoted as Superintending Engineers on different dates between 1980 to 1984 and Mr. Sheoran was promoted as Superintending Engineer on March 4, 1987 A.N. Sehgal was further promoted as Chief Engineer, Equally Mr. Sheoran was also promoted as Chief Engineer but the validity was challenged and it is not necessary to refer any further as it is subject matter of proceedings in the High Court.
R.R. Sheoran who was shown junior to the appellants, field Writ Petition No. 5371/81 and sought a writ of mandamus directing the second respondent, State Government to consider his case for promotion as Superintending Engineer from the date on which the respondents were promoted; to quash the gradation list; to assign the seniority over the appellants and the consequential reliefs.
On reference, a Division Bench of the High Court by its judgement dated July 9, 1984 agreed with the ratio laid down in M.S. Mighlani vs State of haryana & Anr., [1983] 1 S.L.R. 421 and held that R.R. Sheoran was a member of the service from the date of his initial appointment as Asstt.
Executive Engineer and the appellants and the proforma respondents are not members of the service and directed the learned Single Judge to dispose of th matter on merit.
This appeal on leave arises against the judgement of the Division Bench.
205 The controversy centres round the inter se seniority of the appellants and R.R. Sheoran.
For its determination the Rules need interpretation.
The counsel for parties agreed that we should decide the principles on consideration of the Rules and leave the matter for the State Govt.
to determine the inter se seniority by applying the law, so for as the controversy relating to relaxation of the length of service is concerned it is set at rest by this Court in J.C. Yadav vs State of Haryana, and K.K. Khosla V. State of Haryana, [1990] 2 SCC 199 by a bench of three Judges to which one of us (K.N. Singh, J.) was a member.
The only question which survives is as to when `the appellants ' and `R.R. sheoran ' become members of the respective services.
Shri P.P.Rao, learned Senior Counsel for the appellants contends that the appellants were promoted as Executive Engineers against regular vacancies, which were neither a stop gap arrangement nor fortuitous, and they continued in service without any break from the respective dates of their promotion, therefore, they are members of the service in a substantive capacity as Executive Engineers from the respective dates of promotion.
He further argued that since Raje Ram Sheoran was recruited as Asstt.
Executive Engineer w.e.f. August 30, 1971 along after the promotion of the appellants upto B.L. Goyal, the appellants are senior to R.R. Sheoran as Executive Engineers.
Proviso to Rule 5(2) entitles them to remain in a substantive capacity as Executive Engineers since requisite number of qualified Asstt.
Executive Engineers were not available for promotion.
In view of their continous officiation as Executive Engineers in terms of Rule 2(12)(a) of the rules, they must be deemed to be the members of the service from the dates of promotion and, therefore, they are seniors to R.R.Sheoran .
M/s. Sachhar, learned counsel for the State and Gupta for R.R. Sheoran on the other hand contended that unless the appellants were appointed substantively to the cadre posts they could not be members of the service.
R.R. Sheoran became member of the service from the date of his initial appointment as Asstt.
Executive Engineer, therefore, he is senior to the appellants and proforma respondents and the High Court rightly interpreted rule 5(2).
Since the High Court did not enter into the merits of the respective claims of the appellants and Sheoran, we express no opinion on merits except, as agreed by the parties, we declare the law on the interpretation of the rules and leave it to the State Govt.
to decide the inter se seniority on merits.
It is necessary to have a look into the Rules regulating the 206 service.
Rule 3(1) postulates that the service shall comprise of Assistant Executive Engineers, Executive Engineers, Superintending Engineers and Chief Engineers.
Rule 3(2) read with appendix `A ' enjoins the State of Haryana to determine the cadre strength of service each year.
Appendix `A ' lays down procedure to determine the cadre strength of service.
The senior posts include Executive Engineers and above while junior scale posts include Asst.
Executive Engineers .
Ex cadre posts also are contemplated in the respective senior posts and junior scale posts.
Rule 5(1)(a) posits recruitment to the service: (a) by direct recruitment; (b) by transfer and (c) by promotion from Class II service.
Sub rule (4) of Rule 5 says that all direct appointments to the service shall be to the post of Asstt.
Executive Engineer.
Proviso therein gives power to the government to appoint by direct recruitment as Executive Engineers, in exceptional circumstances, for reasons to be recorded in writing.
Rules 6 and 7 prescribe qualifications and method of appointment by direct recruitment .
Subrule (3) of Rule 7 states that appointment to the service shall be made according to the number of vacancies to be filled by direct recruitment strictly in the order of merit as indicated by the Public Service Commission.
As per Rule 11(1) and direct recruit shall remain on probation for a period of two years or extended period upto maximum of three years.
On satisfactory completion of probation, the government may confirm under clause (a) of sub rule (3) of Rule 11 or to discharge him from service otherwise.
The post of Asstt.
Executive Engineer is a junior scale post.
Under rule 12(3), they year of allotment of an Asstt.
Executive Engineer shall be the calendar year in which the order of appointment is issued by the government.
Rule 2(1) defines appointment to the service which includes an appointment made according to the terms and provisions of the rules to an officiating vacancy or to an ex cadre post provided that an officer so appointed shall not be deemed to have become a member of the service as defined in Clause (12) of Rule 2.
The Asstt.
Executive Engineer means a member of the service in the junior scale of pay, (Rule 2(2)).
Cadre post means permanent post in the service as per Rule 2(3).
`Class II Service ' means the Punjab Service of Engineers, Class II, in the Buildings and Roads Branch and includes, for purposes of promotion to and fixation of seniority in the Class I Service, Temporary Asstt.
engineers when a suitable Class II Officer is not available vide Rule 2(5).
Direct appointment means an appointment by open competition but does not include (a) an appointment made by promotion; (b) an appointment by transfer of an officer from the service of the State Government or of the Union, (Rule 2(7).
Ex cadre 207 post means a temporary post of the same rank as a cadre post vide Rule 2(10).
A member of the service means an officer appointed sub stantively to a cadre post and includes (a) in the case of a direct appointment an officer on probation, or such an officer who, having successfully completed his probation, awaits appointment to a cadre post vide Rule 2(12)(a).
A reading of the rules clearly indicates that an Asstt.
Executive Engineer appointment by open competition to a substantive vacancy in a cadre post and put on probation is a member of the service.
Equally such Asstt.
Executive Engineer recruited by open competition and appointment to an ex cadre post and put on probation and who having successfully completed his probation and awaits appointment to a cadre post would also become a member of the service.
The contention of Shri P.P.Rao is that an officer appointed substantively to a cadre post is a direct recruit and the inclusive definition encompasses within its ambit the promotee and the phase ``such an officer who having successfully completed his probation and awaits appointment to the cadre post ' ' is only referable to a promotee.
So promotee is also a member of the service from the date of initial promotion.
We may make it clear at this juncture that in normal service jurisprudence a direct recruit would always be recruited and appointed to a substantive vacancy and from the date he starts discharging the duty attached to the post he is a member of the service subject to his successfully completing the probation and declaration thereof at a later date and his appointment relates back to the date of initial appointment, subject to his being discharge from service on failure to complete the probation within or extended period or termination of the service according to rules.
Equally it is settle law that a promotee would have initial officiating promotion to a temporary vacancy or substantive vacancy and on successful completion and declaration of the probation, unless reverted to lower posts, he awaits appointment to a substantive vacancy.
Only on appointment to a substantive vacancy he become a member of the service.
But confirmation and appointment to a substantive vacancy always an inglorious uncertainty and would take unduly long time.
Therefore, the confirmation or appointment to a substantive capacity would not normally be a condition precedent to reckon the continuous length of service for the purpose of seniority.
On the facts of the case and the settled legal position, at first blush the argument of Shri P.P.Rao carried weight that the appellants would get their seniority from the respective dates of the initial promotion as Executive Engineers.
But we find that in the instant case the rules have made departure from the normal service jurisprudence as would 208 appear from the scheme under the rules.
Para 11(b) of appendix `A ' read with Rule 3(2), while determining the cadre strength of the service, adumbrates creation and appointment of Asstt.
Executive Engineers (direct recruit) to an ex cadre junior scale post in each year.
Therefore in a given situation, a direct recruit appointed to an ex cadre post, cannot be kept in lurch until he is appointed to a cadre post so as to become a member of the service.
Obviously to avoid such a hiatus, Rule 2(12)(a) was introduced.
The main part o Rule 2(12)(a) declares that an appointee substantively to a cadre post i.e., permanent post is a member of the service.
The inclusive definition brings an officer `by direct appointment on probation ' who having successfully completed probation and awaits appointment to a cadre post is also a member of the service.
Take for instance if direct recruitment is made to fill in five posts of Asstt.
Executive Engineers of which four are cadre posts and one ex cadre post and four persons are appointed to cadre posts in the order of merit and the last one to the ex cadre post.
The first four officers appointed on probation to the substantive vacancies and they are covered by the main part of Rule 2(12)(a).
The fifth one intended to cover the field of operation of the inclusive definition which says that `and also includes an officer directly appointed on probation ' `and such an officer who having successfully completed his probation, awaits appointment to a cadre post '.
The words `and such an officer ' `directly appointed ' would obviously referable to an Asstt.
Executive Engineer directly appointed to an ex cadre post; who may be placed on probation and awaits appointment to a cadre post.
By operation of the definition clause he also becomes the member of the service from the date of initial appointment.
This view is further fortified by the definition the `appointment to the service ' in Rule 2(1) which says that appointment to the service includes an appointment made according to the terms and provisions of these rules to an officiating vacancy or to an ex cadre post.
Rule 2(7) says that direct appointment means appointment by open competition but excludes `promotee ' or `transferee '.
So a promotee promoted to an officiating vacancy or on ex cadre post does not become member of the service unless he is appointed substantively to a cadre post.
We, therefore, hold that a direct recruit appointed to an ex cadre post alone is a member of the service even while on probation and Rule 2(12)(a) applies to them and it does not apply to promotee from Class II service.
An Asstt.
Executive Engineer, on putting five years of service under rule 9(3)(a) and passing the department examination as 209 required under rule (15), (unless the qualifications are relaxed in exercise of the power under rule (22) of the rules) becomes eligible for promotion as Executive Engineer.
The State Govt.
had relaxed the required length of five years service of the promotees as well as direct recruits.
R.R.Sheoran therefor became eligible to be considered for promotion.
As per the procedure prescribed in this regard under rule 9(2), he was found fit and suitable and was promoted as an Executive Engineer w.e.f. October 8, 1973.
Though M/s. Sachhar and Gupta contended that the direct recruit need not undergo the required probation ad Executive Engineer, we find no force in the contention.
The normal channel of appointment to the post of Executive Engineer, a senior post, is by way of promotion to which a direct recruit Asstt.
Executive Engineer is entitled to be considered.
On promotion he shall be on probation for a period of one year as per Rule 11(1)(a), but the period spent on officiation as Executive Engineer shall be taken into account for purposes of completing the period of probation and on its successful completion, he shall remain in service As Executive Engineer.
On a conjoint reading of Rule 12(3) and 12(5) it is clear that the year of allotment of the Asstt.
Executive engineer in the post of Executive Engineer, shall be the calendar year in which th order of appointment as Asstt.
Executive Engineer had been made.
Thus his seniority as Executive engineer, by fiction of law, would relate back to his date of initial appointment as Asstt.
Executive Engineer and in Juxta position to Class II officers ' seniority as Executive Engineer is unalterable.
The date of the seniority of Mr. R.R.Sheoran 1971.
The question then is what is the date from which the seniority of a promotee as Executive Engineer shall be reckoned? The contention of Shri P.P. Rao is that Rule 5(2) reserve 50% of the posts to the direct recruits but the proviso thereto makes a built in relaxation, namely, so long as the required number of direct recruits are not available to occupy those posts, the promotees are entitled to hold those posts also.
Admittedly except R.R. Sheoran no other direct recruit was available.
The promotees are eligible to occupy all the cadre posts even in excess of their quota.
The seniority has to be determined from the respective dates of initial officiating promotion.
Shri Rao ' further contention that the phrase `such an officer appointed to an officiating post ' has reference only to promotees cannot be accepted for the reasons given earlier.
The officer appointed directly is referable only to Asstt.
Executive Engineer and a promotee by operation of Rules 2(7) stands excluded until he is appointed substantively to a cadre post.
210 When an officer is appointed substantively to a cadre post, is the next question.
It is settled law that all the rules should be harmoniously construed giving life, force and effect to every part of the rule of clause or word so that no part would be rendered redundant, ineffectual, nugatory or otiose.
Rule 5(1) regulates recruitment to the service from three sources, namely, direct recruitment; by transfer and by promotion from Class II service.
Sub rule (2) thereof prescribes the ratio between the promotees and others.
It says that, "recruitment to the service shall be so regulated that the number of posts so filled by promotion from Class II service shall not exceed 50%" of the number of posts in the service excluding the posts of Asstt.
Executive Engineers; provided that till such time the adequate number of Asstt.
Executive Engineers who ar eligible and considered fit for promotion are available, the actual percentage of officers promoted from Class II service `may be larger than 50%.
A reading thereof clearly manifests the legislative animation, namely, that the promotees from Class II service shall not exceed 50% of the posts in the service.
The word `shall ' indicates that it is mandatory that the remaining 50% shall be kept open only to the Asstt.
Executive Engineers who were directly recruited but later were found eligible and fit for promotion as Executive Engineers.
Therefore, unless the government resorts exceptionally with prior permission of Public Service Commission, vide Rule 10 to recruitment by transfer of an officer from other service of the State Govt.
or of the Union, the remaining 50% of the posts as Executive Engineers, Superintending Engineers and Chief Engineers shall be occupied only by the direct recruit Asstt.
Executive Engineers.
It is settled law that prescription of quota for recruitment from different sources is constitutionally a valid rule.
Rule 5(2) limits 50% posts to the promotees from Class II Service and no further, but the proviso to the Rule lays down that till adequate number of Asstt.
Executive Engineers are available, the rigour of 50% quota may be relaxed and Class II officers may be promoted in excess of their quota.
What is the intendment of the class `the actual percentage of officers promoted from Class II service may be larger than 50% is the question.
The mandate of Rule 5(2) is that the officers promoted from Class II service shall in no case exceed 50% of the number of posts in the service.
Unless it is relaxed, the appointment and occupation of the posts by promotee in excess thereof is irregular or illegal and the government have no power to promote persons from Class II service to fill in such posts of Executive Engineers Superintending Engineers and Chief Engineers.
It is common knowledge that direct recruitment as Asstt.
Executive Engineers 211 or Executive Engineer; in exceptional circumstances is a tardy process and even after appointment they have to put in five years service.
The balance 50% of the posts cannot be kept vacant.
With a view to allow the wheels of the administration moving, the proviso carves out an exception and allows the promotees to occupy temporarily the posts in excess of their quota.
In this view the contention of Shri Rao that the seniority as Executive Engineer is to be counted from the date of initial temporary promotion cannot be accepted as it would allow the promotees to occupy 100% posts of Executive Engineers, Superintending Engineers and Chief Engineers leaving little room for Rule 5(2) (a) to operate in full force.
The exception would eat away the flesh and blood of Rule 5(2)(a) freezing the channel of promotion to the direct recruits to senior posts for a very long time to come.
In the absence of rule of rotation there may be no chance to a direct recruits to occupy the senior posts.
That does not appear to be the intendment, scope and operation of the proviso.
The intendment appears to be that so long as the direct recruit Asstt.
Executive Engineer, eligible and considered fit for promotion is not available, the promotee from Class II service in excess of the quota is eligible to occupy on officiating capacity the senior posts, i.e., Executive Engineers and above.
The moment direct recruits are available, they alone are entitled to occupy 50% of their quota and the promotees shall give place to the direct recruits.
It is a cardinal rule of interpretation that a proviso to a particular provision of a statute only embraces the field which is covered by the main provision.
It carves out an exception to the main provision to which it has been enacted by the proviso and to no other.
The proper function of a proviso is to except and deal with a cause which would otherwise fall within the general language of the main enactment, and its effect is to confine to that case.
Where the language of the main enactment is explicit and unambiguous, the proviso can have no repercussion on the interpretation of the main enactment, so as to exclude from it, by implication what clearly falls within its express terms.
The scope of the proviso, therefore, is to carve out an exception to the main enactment and it excludes something which otherwise would have been within the rule.
It has to operate in the same field and if the language of the main enactment is clear, the proviso cannot be torn apart from the main enactment nor can it he used to nullify by implication what the enactment clearly says nor set at naught the real object of the main enactment, unless the words of the proviso are such 212 that it is its necessary effect.
In V.B. Badami, etc.
vs State of Mysore, [1976] 1SCR 815 dealing with the problem arising out of quota rule between promotees, this Court observed that: "In working out the quota rule, these principles are generally followed.
First, where rules prescribe quota between direct recruits and promotees, confirmation or substantive appointment can only be in respect of clear vacancies in the permanent strength of the cadre.
Second, confirmed persons are senior to those who are officiating.
Third, as between persons appointed in officiating capacity, seniority is to be counted on the length of continuous service.
Fourth, direct recruitment is possible only by competitive examination which is prescribed procedure under the rules.
In promotional vacancies, the promotion is either by selection or on the principle of seniority cum merit, a promotion could be made in respect of a temporary post or for a specified period but a direct recruitment has generally to be made only in respect of clear permanent vacancy either existing or anticipated to arise at or about the period of probation is expected to be completed.
Fifth, if promotions ar made to vacancies in excess of the promotional quota, the promotions may not be totally illegal but would be irregular.
The promotees cannot claim any right to hold the promotional posts unless the vacancies fall within their quota.
If the promotees occupy any vacancies which are within the quota of direct recruits, when direct recruitment takes place the direct recruits will occupy vacancies within their quota.
Promotees who were occupying the vacancies within the quota of direct recruits will either be reverted or they will be absorbed in the vacancies within their quota in the facts and circumstances of a case".
With a view to have efficient and dedicated services accountable to proper implementation of Govt.
policies, it is open, and is constitutionally permissible for the State, to infuse into the services, both talented fresh blood imbued with constitutional commitments, enthusiasm, drive and initiative by direct recruitment, blended with matured wealth of experience from the subordinate services.
It is permissible to constitute an integrated service of persons recruited from two or more sources, namely, direct recruitment, promotion from subordinate 213 service or transfer from other services, Promotee from subordinate generally would get few chances of promotion to higher echolans of services.
Avenues and facilities for promotion to the higher services to the less privileged members of the subordinate service would inculcate in them dedication to excel their latent capabilities to man the cadre posts.
Talent is not the privilege of few but equal avenues made available would explore common man 's capabilities overcoming environmental adversity and open up full opportunities to develop one 's capabilities to shoulder higher responsibilities without succumbing to despondence.
Equally talented young men/women of great promise would enter into service by direct recruitment when chances of promotions are attractive.
The aspiration to reach higher echolans of service would thus enthuse a member to dedicate honestly and diligently to exhibit competence, straightforwardness with missionary zeal exercising effective control and supervision in the implementation of the programmes.
The chances of promotion would also enable a promotee to imbue involvement in the performance of the duties; obviate frustration and eliminate proclivity to corrupt practices, lest one would tend to become corrupt, sloven and mediocre and a dead wood.
In other words, equal opportunity would harness the human resources to augment the efficiency of the service and under emphasis on either would upset the scales of equality germinating the seeds of degeneration.
With a view to achieve this objective, the rule making authority envisaged to appoint direct recruits as well as by promotion from Class II Service, otherwise by transfer from other services.
In interpreting the rules, effect must be given to allow everyone drawn from these sources to have their due share in the service and chances of involvement of effectively discharge the duties of the posts honestly and efficiently with dedication.
Any wanton or deliberate deviation in the implementation of the rules should be curbed and snubbed and the rules must be strictly implemented to achieve the above purpose.
If wanton deviations are allowed to be repeated, it would breed indiscipline among the service and amounts to undue favour to some and denial of equality for many for reasons known or unknown subverting the purpose of the rules.
It is settled law that appointment to a post in accordance with the rules is condition precedent and no one can claim appointment to a post or promotion, as of right, but has a right to be considered in accordance with the rules.
Appointment by promotion or direct recruitment, therefore, must be in accordance with the rules so as to 214 become a member of the service in a substantive capacity.
Seniority is to be fixed in accordance with the principles laid down in the rules.
Rule 8 prescribes procedure for appointment by promotion from Class II services.
Rule 9(2) states that promotion would be made by selection on the basis of merit and suitability in all respect and no member of the service shall have any claim, to such promotion as a matter of right by mere seniority.
The committee as constituted under Rule 8 shall prepare the list of officers considered fit for promotion in the order of merit and on approval by the public Service Commission, the State Govt.
shall appoint the persons from the list in the order in which the names have been placed by the Commission, Appointment by promotion may be made under Rule 8(12) to an excadre post or to any post in the cadre in an officiating capacity from the list prepared as aforesaid.
On promotion, as per Rule 11(1), officer shall be on probation for a period of one year, but if the officer had been officiating as an Executive Engineer the period of officiation would be counted towards probation.
Rule 11(4) provides the on satisfactory completion of the probationary period, the Govt.
confirms the officiating promotee and "appoint him in a substantive capacity on a cadre post provided the post is available to him".
If no cadre post is available, the officer has to wait for an appointment to the cadre post.
A promotee within quota under rule 5(2) gets his seniority from the initial date of his promotion and the year of allotment, as contemplated in Rule 12(6) shall be the next below "the junior most officer in the service whether officiating or confirmed as Executive Engineer before the former 's appointment ' counting the entire officiating period towards seniority, unless there is break in the service or from the date of later promotion.
Such promotee, by necessary implication, would normally become senior to the direct recruit promoted later.
Combined operation of sub rules (3) to (5) of Rule 12 makes the direct recruit a member of the service of Executive Engineer from the date of year of allotment as an Asstt.
Executive Engineer.
The result is that the promotee occupying the posts within 50% quota of the direct recruits, acquired no right to the post and should yield to direct recruit though promoted later to him, to the senior scale posts i.e., Executive Engineer, Superintending Engineer and Chief Engineer.
The promotee has right to confirmation in the cadre post as per Rule 11(4) if a post is available to him within his quota or at a later date under rule 5(2) read with 11(4) and gets appointment under section 8(11).
His seniority would be reckoned only from the date of the date of the availability of the post and the year of allotment, he shall be next below to his immediate 215 senior promotee of that year or the junior most of the previous year of allotment whether officiating or permanent occupying the post within 50% quota.
The officiating period of the promotee between the dates of initial promotion and the date of the availability of the cadre post would thus be rendered fortuitous and stands excluded.
A direct recruit on promotion within his quota, though later to the promotee is interposed in between the periods and interjects the promotee 's seniority; shaps the links in the chain of continuity and steals a march over the approved promotee probationer.
Harmonious construction of rule 2(1), 2(3), 2(7), 2(10), 2(12),(a) 5(2)(a), 8,9(2), 11, 12(3), 12(5) to 12(7) would yield to the above result, lest the legislative animation would be defeated and the rules would be rendered otiose and surpluses.
It would also adversely effect the morale and efficiency of the service.
Mere officiating appointment by promotion to a cadre post outside the quota; continuous officiation therein and declaration of probation would not clothe the promotee with any right to claim seniority over the direct recruits.
The necessary conclusion would, therefore, be that the direct recruit shall get his seniority with effect from the date of the year of the allotment as Asstt.
Executive Engineer which is not alterable.
Whereas the promotee would get his seniority w.e.f.
the date of the availability of the posts within 50% quota of the promotees.
The year of allotment is variable and the seniority shall be reckoned accordingly.
Appointment to the cadre post substantively and confirmation thereof shall be made under rule 8(11) read with Rule 11(4) of the rules.
A promotee Executive Engineer would only then become member of the service, `Appointed substantively ' within the meaning of Rule 2(12) (a) shall be construed accordingly.
We, further hold that the seniority of the promotee from Class II service as Executive Engineer shall be determined with effect from the date of which the cadre post was available to him and the seniority shall be determined accordingly.
In K.C.Joshi & Ors. etc.
vs Union of India & Ors., [1990]2 Scale 951 a Bench of three Judges to which one of us (K. Ramaswamy, J.) was a member, considered similar question.
In that case U.P. Forest Service Rules, 1952 provides, two sources of recruitment to the post of Asstt.
Conservators of Forest.
The petitioners therein were Forest Range Officers in U.P. Forest Subordinate Service.
The respondents were direct recruits as Asstt.
Conservators of Forest.
The rules prescribed ratio between direct recruits and promotees.
Due to delay in recruitment as Asstt.
Conservators of Forest, the Forest Rangers were promoted in excess of their quota as Asstt.
Conservators of Forest temporarily and continued in service without any break for 5 to 12 216 years.
The promotees claimed seniority from the date of their initial promotion.
Considering the scope of the rules and rights acquired by the petitioners therein and the direct recruits, the Court held that: "When promotion was outside the quota, the seniority would be reckoned from the date of the vacancy within the quota, rendering the pervious service fortuitous.
The previous promotion would be regular only from the date of the vacancy within the quota and seniority shall be counted from that date and not from the date of his earlier promotion or subsequent confirmation.
In order to do justice to the promotees it would not be proper to do injustice to the direct recruits.
The rule of quota being a statutory one must be strictly implemented and it is impermissible for the authorities concerned to deviate from the rule due to administrative exigencies of expediency.
The result of punishing down the promotees appointed in excess of the quota may work hardship but it is unavoidable and any construction otherwise would be illegal, nullifying the force of statutory rules and would offend articles 14 & 16(1).
Therefore, the rules must be carefully applied in such a manner as not to violate the rules or equality assured under article 14 of the Constitution.
This Court interpreted that equity is an integral part of article 14.
So every attempt would be made to minimise, as far as possible inequity.
Disparity is inherent in the system of working out integration of the employees drawn from different sources, who have legitimate aspiration to reach higher echolans of service.
A feeling of hardship to one, or heart burning to either would be avoided.
At the same time equality is accorded to all the employees".
Shri P.P. Rao urged that the cadre posts in Rule 2(12) must include not only the permanent posts but also temporary posts continued for more than three years and notional posts which may have existed for short spells during preceding three years taking into account the number of months and days for which each post had existed as per the formula prescribed in appendix `A ' read with Rule 3 of the rules.
He further urged that the promotees appointed to such posts should be treated to be `members of the service ' interms of Rule 2(12)(a) and that their promotion should be retrospectively declared to have been promoted w.e.f.
the dates on which the posts were created.
We are unable to accept this contention.
Rule 3 read with 217 appendix `A ' confers power and also imposes duty on the State Govt.
to determine the cadre posts from time to time and in the first five years on the first day of each year.
This exercise should be done in the light of the criteria prescribed in appendix `A '.
The present controversy does not concern itself with the method and manner of determination of th cadre posts, though determination of seniority hinge upon it.
Therefore, for determining seniority, the State Govt.
should undertake the exercise interms of Rule 3 read with appendix `A '.
The rules postulate that substantive appointment to a cadre post is a condition precedent to become a member of the service.
A class II officer shall be promoted to a temporary post or in an officiating capacity to a cadre post if vacancy exist ' when he occupies a vacancy in a substantive post and continued uninterruptedly it would be open to the appointing authority to put the promotee Executive Engineer on probation.
Though confirmation is an inglorious uncertainty depending neither on the efficiency of the officer nor generally on the availability of the post, the mandate of Quota of 50% in Rule 5(2) should be adhered to.
Declaration of probation and confirmation to a cadre post, if available, under Rule 11(4) shall be made.
Seniority of such approved or confirmed promotee should be counted from the date of either initial officiating promotion of continous later officiation from the date of availability of the cadre post, however, should be next below his senior promotee or the junior most of the preceding year of allotment within the quota.
If no post is available till such date of the availability, the entire period of continuous officiation would be rendered fortuitous.
The contention, therefore, that the promotion would relate back retrospectively to the date of creation of the post and the appointment to the vacancy shall be with reference to the date of the creation of the post, would result anomalies and render Rule 5(2) to the direct recruits surplusage.
Shri P.P. Rao 's further contention that the de facto promotion and the retrospective declaration of cadre post would make the Class II officers as de jure members of the service from the very date of temporary appointment w.e.f.
the date of initial appointment also lacks force for the same reasons.
The principles laid down in R.P. Khanna vs S.A.F. Abbas & Ors., [1973]3 SCR. 548 at 557 C J .
is not applicable to the facts of this case.
In that case the certain posts in State services were required to be declared as senior cadre posts in the All India Service, but before such declaration could be made some of the promotee officers officiated in the senior cadre post.
In that context the Court observed that 1the promotee could not get the benefit of officiation unless the post was declared a equivalent to a senior cadre 218 post before the promotee was appointed; to officiate him would defeat the policy of the government ' and held that they are entitled to the benefit of the retrospective declaration `in the absence of things practical as well as reasonable.
The scheme of the rules made a definite departure to the normal service jurisprudence and the operation of the scheme in the rules must be given full effect.
In the instant case under the Rules `determination of seniority would be ' made only after the promotee becomes a member of the service.
Therefore, the year of allotment must be determined having regard to (i) availability of the cadre post within quota; (ii) satisfactory completion of the probation; and (iii) appointment to the post in the substantive capacity in term of Rules 12(6) and (7) read with 11(4) and Rule 8(12).
Any other construction would be contrary to the avowed object of the rules as a whole.
The inclusive definition of Rule 2(12) (a) must be interpreted liberally and not restrictively.
Undoubtedly the inclusive definition always receives liberal interpretation to bring within its ambit cognate but unforeseen similes.
But the rules envisage only three sources of recruitment, namely, direct recruitment, appointment by promotion and in exceptional cases with prior approval of the Public Service Commission as per Rule 10, the appointment by transfer from other services of the State or Central Govt.
Until the ex cadre posts are declared to be cadre posts they remain ex cadre posts.
The promotion to the ex cadre post is temporary or to a cadre post could be only on officiating basis.
It may be open to the government to abolish at any time the ex cadre posts.
Determination of cadre strength is a condition precedent for Rule 5(2)(a) to operate.
Till a promotee is confirmed in a substantive capacity as Executive Engineer, he continues to retain line in Class II service.
The interpretation that the promotion to the temporary post or ex cadre post within the meaning of Rule 2(10) should also be deemed to be an appointment to a substantive post would do violence to the language of the relevant rules and the scheme.
It is true that this Court in Baleshwar Dass & Ors.
vs State of U.P. & Ors.
, [1981] 1 SCR 449 at 463 held that there cannot be probation for a government servant who is not to be absorbed substantively in the service on completion.
The ratio therein does not apply to the facts of this case for the reason that the Govt.
itself did not understand the scope and operation of the rules properly as is amply demonstrated from their mutually irreconcilable inconsistent stand taken in the counter affidavits filed by the State Govt.
in the High Court and in this Court.
That apart, it would appear that in the instant case after the formation of the State of Haryana, adequate number of officers were 219 not available to hold the posts.
The length of service and passing of prescribed tests were relaxed enmass.
In view of the above peculiar and special facts merely because the promotee Class II Officers were put on probation and the same was declared it does not clothe them with any right to deemed appointment to substantive vacancies in excess of their quota with retrospective effect from the date of initial promotion to the cadre posts.
The year of allotment of a direct recruit is always the year in which he is appointed to the junior scale post of Asstt.
Executive Engineer but the year of allotment to the promotee is variable depending on the availability of the cadre post within quota of 50% and subject to taking the seniority next below the junior most promotee of the preceding year of allotment or immediate senior of the same year.
If the contention of Shri P.P. Rao is accepted is accepted it would render Rule 8(11) mutually inconsistent with Rule 5(2w) read with Rules 2(7) and 2(12) and Rule 2(1).
No countenance could be given to the contention that the officers put on probation in terms of Rule 11(1) irrespective whether they occupied declared posts, but also posts which ought to have been declared as such from time to time and have continuously remained in service entitle them to become member of service and that, as and when the posts occupied by them are declared as cadre posts with retrospective effect, they are entitled to be treated as members of the service w.e.f.
the due dates.
In other words it amounts to put a premium on the inaction on the part of the State Govt.
to declare the cadre posts in terms of Rule 3(2) read with appendix `A ' defeating the scheme of the Rules.
The contention that our interpretation renders Rule 2(12) arbitrary and discriminatory violating articles 14 and 16 is also not tenable.
A direct recruit, by operation of Rule 2(12) (a) read with Rules 2(1) and 2(10), though appointed to an ex cadre post, by fiction of law, becomes a member of the service from the date of his initial appointment since being a fresh recruit.
On his satisfactory completion of the prohibition and on availability of the cadre post as Asstt.
Executive Engineer, he becomes a confirmed Asstt.
Executive Engineer.
While a promotee Executive Engineer continues to retain his line on the posts as Class II officers still he is appointed substantively to Class I service.
There is reasonable classification and discernable distinction drawn between the direct recruit and the promotee.
The nexus is to treat direct recruit Asstt.
Executive Engineer appointed to the cadre posts as well as ex cadre post at par as members of the service and the deeming clause is to serve this purpose.
Thus, there is nether invidious discrimination nor arbitrariness in Rule 2(12)(a) offending articles 12 & 16.
The differentiation drawn between direct recruit and the 220 promotee bears rational relation to the object of Rule 2(12), the ratio of the Constitution Bench in B.S. Yadav vs State of Haryana, and The Direct Recruit, Class II Engineering Officers ' Association vs State of Maharashtra & Ors., ; at 745 cannot be imported bodily and applies to the ficts of the case in the light of the operation of the rules in question.
The further contention that Rule 12 adumbrates that not only a member of the service, but even an officer officiating as an Executive Engineer before becoming a member of the service is entitled to an year of allotment because the rules nowhere say that only members of service are entitled to year of allotment is devoid of substance.
As already discussed a promotee cannot be given year of allotment, before he becomes a member of the service and his seniority cannot be fixed arbitrarily with reference to the date of his initial promotion to an ex cadre post or continuous officiating in a cadre post without break, as the case may be.
We accordingly, direct the Government of Haryana to determine the cadre posts, if not already done, regularly from time to time including the post created due to exigencies of service in terms of Rule 3(2) read with appendix `A ' and allot the posts ineach year of allotment as contemplated under rule 12 read with Rule 5(2)(a) and issue orders appointing substantively to the respective posts within the quota and determine the inter se seniority between the appellants promotees and R.R. Sheoran, direct recruits in the respective quota cadre posts of Executive Engineers etc.
within four months from the date of receipt of this judgment.
The inter se seniority of promotees and direct recruits shall be determined accordingly.
All the inpugned promotions or those pending proceedings in the High Court or in this Court shall be subject to the above determination and the status quo would continue till the appointments according to the rules are made and seniority is determined in the light of the law declared inthis judgment.
The appeals is disposed of accordingly.
In the circumstances parties are directed to bear their respective costs.
| IN-Abs | The appellants, `the promotees ' from Class II service were promoted as Executive Engineers by relaxing five years length of service as Class II Engineers in officiating capacity on various dates between January 6, 1969 to May 29, 1971.
Only the appellant No. 1 and two other were confirmed as Executive Engineers w.e.f. July 11, 1973, December 11, 1974 and December 9, 1975 respectively.
The respondent No.1 was recruited and appointed directly as Asstt.
Executive Engineer w.e.f. October 25,1971.
he was also given relaxation of the length of service of five years as Asstt.
Executive Engineer and was promoted as Executive Engineer on October 8, 1973 and was confirmed w.e.f. December 22, 1976.
199 All the appellants except one M.R. Gupta were further promoted as Superintending Engineers on different dates between 1980 to 1984 whereas the respondent No. 1 was promoted as Superintending Engineer on March 4, 1987.
The applicant No. 1 was further promoted as Chief Engineer The validity of the promotion of respondent No. 1 to the post of Chief Engineer was challenged.
The respondent No. 1 who was shown junior to the appellants, field Writ Petition seeking a writ of mandamus directing the second respondent, State Government to consider his case for promotion as Superintending Engineer from the date on which the respondents were promoted assigning the seniority over the appellants and the consequential reliefs.
On reference, a Division Bench of the High Court held that respondent No. 1 was a member of the service from the date of his initial appointment as Asstt.
Executive Engineer and the appellants and the proforma respondents were not members of the service and directed the Single Judge to dispose of the matter on merit, against which, this appeal on leave was filed.
The appellants contended that the appellants being promoted as Executive Engineers against regular vacancies, which were neither a stop gap arrangement nor fortuitous, and being continued in service without any break from the respective dates o their promotion, they were members of the service in a substantive capacity as Executive Engineers from the respective dates of promotion; that since the respondent No. 1 was recruited as Asstt.
Executive Engineer w.e.f. August 30, 1971 long after the promotion of the appellants, the appellants were seniors to the respondent No. 1 as Executive Engineers, as Proviso to Rule (5)2 entitles them to remain in a substantive capacity as Executive Engineer since requisite number of qualified Asst.
Executive Engineers were not available for promotion; that in view of their continous officiation as Executive Engineers in terms of Rule 2(12)(a) of the rules, they must be deemed to be the members of the service from the dates of promotion and, therefore, they were seniors to the respondent no.1.
The respondents contended that unless the appellants were appointed substantively to the cadre posts they could not be members of the service.
The respondent No. 1 became a member of the service 200 from the date of his initial appointment as Asstt.
Executive Engineer, therefore, he was senior to the appellants and proforma respondents.
As agreed by the parties, this Court declare the law on the interpretation of the rules and leave the matter for the State Govt.
to decide the inter seniority on merits.
Disposing the appeal, it is.
HELD: 1.
Appointment to a post in accordance with the rules is a condition precedent and no one can claim appointment to a post or promotion, as of right, but has a right to be considered in accordance with the rules, Appointment by promotion or direct recruitment, therefore, must be in accordance with the rules so as to become a member of the service in a substantive capacity.
Seniority is to be fixed in accordance with the principle laid down in the rules.
[213G 214A] 2.
The promotee has right to confirmation in the cadre post as per Rule 11(4) if a post is available to him within his quota or at a later date under rule 5(2) read with rule 11(4) and gets appointment under rule 8(11).
His seniority would be reckoned only from the date of the availability of the post and the year of allotment, he shall be next below to his immediate senior promotee of that year or the junior most of the previous year of allotment whether officiating or permanent occupying the post within 50% quota.
[214G 215A] 3.
A direct recruit on promotion within his quota, though later to the promotee is interposed in between the periods and interject the promotee 's seniority; snaps the links in the chain of continuity and steals a march over the approved promotee probationer.[215B] 4.
Mere officiating appointment by promotion to a cadre post outside the quota; continuous efficiation therein and declaration of probation would not clothe the promotee with any right to claim seniority over the direct recruits.
The necessary conclusion would, therefore, be that the direct recruit shall get his seniority with effect from the date of the year of the allotment as Asstt.
Executive Engineer which is not alterable.
Where the promotee would get his seniority w.e.f.
the date of the availability of the posts within 50% quota of the promotees.
[215D] 5.
The seniority of the promotee from Class II service Executive Engineer shall be determined with effect from the date on which the cadre post was available to him and the seniority shall be determined accordingly.[215F] 201 6.
Under the Rules `determination of seniority would be made only after the promotee becomes a member of the service '.
Therefore the year of allotment must be determined having regard to (i) availability of the cadre post within quota; (ii) satisfactory completion of the probation, and (iii) appointment to the post in the substantive capacity in term of Rules 12(6) and (7) read with Rule 11(4) and Rule 8(12).
Any other construction would be contrary to the avowed object of the rules as a whole.[218B C] 7.
There is neither invidious discrimination nor arbitrariness in Rule 2(12)(a) offending articles 14 & 16.
The differentiation drawn between direct recruit and the promotee bears rational relation to the object of Rule 2(12).
[219H] 8.
The Government of Haryana to determine the cadre posts, if not already done, regularly from time to time including the post created due to exigencies of service in terms of Rule 3(2) read with appendix `A ' and allot the post in each year of allotment as contemplated under rule 12 read with Rule 5(2)(a) and issue orders appointing substantively to the respective posts within the quota and determine the inter se seniority between the appellants promotees and the direct recruit in the respective quota cadre posts of Executive Engineers etc.
within four months from the date of receipt of this judgment.
The inter se seniority of promotees and direct recruits shall be determined accordingly.
[220D E] M.S. Mighlani vs State of Haryana & Anr. ; J.C. Yadav vs State of Haryana, ; K.K. Khosla vs State of haryana, [1990] 2 SCC 199; V.B. Badami, etc.
vs Stat of Mysore [1976] 1 SCR 815; K.C. Joshi & Ors.
vs Union of India & Ors., to.
R.P. Khanna vs S.A.F. Abbas & Ors, at 557 C J; Baleshwar Dass & Ors.
vs State of U.P. & Ors.
, [1981] 1 SCR 449 at 463; B.S. Yadav vs State of Haryana, ; The Direct Recruit, Clall II Engineering Officers ' Association vs State of Maharasthra & Ors., ; at 745 Distinguished. 9.
It is a cardinal rule of interpretation that a proviso to a particular provision of a stature only embraces the field which is covered by the main provision.
It carves out an exception to the main provision to which it has been enacted by the proviso and to no other.
The proper function of proviso is to except and deal with a case which would otherwise fall within the general language o the main enactment, 202 and its effect to confine to that case.
Where the language of the main enactment is explicit and unambiguous, the proviso can have no repercussion on the interpretation of the main enactment, so as to exclude from it, by implication what clearly falls within its express terms.
[211E F] 10.
The scope of the proviso is to carve out an exception to the main enactment and it excludes something which otherwise would have been within the rule.
It has to operate in the same field and if the language of the main enactment is clear, the proviso cannot be torn apart from the main enactment nor can it be used to nullify by implication what the enactment clearly says nor set a naught the real object of the main enactment, unless the words of the proviso are such that it is its necessary effect [211G H] 11.
In interpreting the rule, effect must be given to allow everyone drawn from the sources to have their due share in the service and chances of involvement to effectively discharge the duties of the posts honestly and efficiently with dedication.
Any wanton or deliberate deviation in the implementation of the rules should be curbed and snubbed and the rules must be strictly implemented to achieve the above purpose.
If wanton doviations are allowed to be repeated, it would breed indiscipline among the services and amounts to undue favour to some and denial of equity for many for reasons known or unknown subverting the purpose of the rules.{213F] 12.
Rules 2(1), 2(3), 2(7), 2(10), 2(12)(a) 5(2)(a) 8, 9(2) 11, 12(3) 12(5) to 12(7) to be construed harmoniously.
lest the legislative animation would be defeated and the rules would be rendered otiose and surpluses.
It would also adversely effect the morale and efficiency of the service.[215C] 13.
With a view to have efficient and dedicated services accountable to proper implementation of Govt.
policies, it is open and is constitutionally permissible for the State, to infuse into the services, both talented fresh blood imbued with constitutional commitments, enthusiasm,drive and initiative by direct recuritment, blended with matured wealth of experience from the subordinate services.[212G] 14.
It is permissible to constitute an integrated service of persons recruited from two or more sources, namely, direct recruitment, promotion from subordinate service or transfer from other services.
Promotee from subordinate service generally would get few chances of 203 promotion to higher echolans of services.
[212H] 15.
Avenues and facilities for promotion to the higher services to the less privileged member of the subordinate service would inculcate in them dedication to excel their latent capabilities to man to cadre posts {213A] 16.
Talent is not the privilege of few but equal avenues made available would explore common man 's capabilities overcoming environmental adversity and open up full opportunities to develop one 's capabilities to shoulder higher responsibilities without succumbing to despondence.
Equity talented young men/women of great promise would enter into service by direct recruitment when chances of promotions are attractive.
[213B] 17.
The chance of promotion would also enable a promotee to imbue involvement in the performance of the duties, obviate frustration and eliminate proclivity to corrupt practices, lest one would tend to become corrupt, sloven and mediocre and a dead wood.
In other words, equal opportunity would harness the human resources to augment the efficiency of the service and undue emphasis on either would upset the scale of equality germinating the seeds of degeneration. {213D]
|
ivil Appeal Nos.1761 62 of 1991 From the Judgment and Order dated 13.8.90 of the Madras High Court in C.M.P. No. 10274 and 10275 of 90. 233 WITH C.A. No. 1763 18 of 1991.
V. Krishnamurthy for the Appellants.
Mrs. N. Chidambaram, K.Parasaran, M.N. Krishnamani, G. Srinivasan, B.Rabu Manohar G.Vijay Anand, V. Balachandran and Ajit K. Sinha for the Respondents.
The following Order of the Court was delivered: Leave granted.
In the State of Tamil Nadu a number of educational institutions were set up for running courses for teachers training.
The respondent Institutions and certain other institutions sought recognition from the Director and the Joint Director of Education of the State of Tamil Nadu for running the teachers training courses.
In some cases the recognition was not a corded as the institutions did not fulfill the conditions required for setting up the Teachers Training Institution while in other cases the application for recognition was pending consideration.
Indisputably none of the respondent Institutions had been accorded recognition but they admitted students to the course of study for conferring the Diploma in Teachers sTraining.
Since, the Education Department of the State Government was not willing to allow the students of such Institutions to appear at the public examination held by the Government, the affected institutions filed writ petitions before the High Court claiming relief for issuance of mandamus directing the Government to recognise the Institutions and also for a direction permitting the students to appear at the public examination with a further direction for declaring the result of the examination.
A learned Single Judge of the High Court referred the matter to Full Bench.
The Full Bench considered the question: "Whether the students of unrecognized Educational Institutions can be permitted to write the public examinations held by the Government." The Full Bench on an elaborate discussion held that in the absence of recognition accorded to an Educational Institution, the students of such Institutions were not entitled to appear at the public examination held by the Government.
In this view of the Full Bench the students were not entitled to any relief but the Full Bench adopted a peculiar course to grant relief.
The Full Bench on account of the "persistent and persuasive stand of the 234 petitioners" issued directions to the State Government and the Education Department on humanitarian ground directing them to hold supplementary examination for enabling the student of the concerned unrecognized Institution to appear at the examination with a condition that the declaration of their result will be subject to the ultimate settlement of the question of recognition.
With these directions the Full Bench disposed of the writ petitions before it by its order dated 24.7.1990.
The writ petitions out of which the present appeals have arisen were filed by the unrecognized Educational Institutions.
These petitions were heard by a Division Bench of the High Court.
The Division Bench following the decision of the Full Bench in Writ Petition No. 2712 of 1990 and other connected matters (fathima Secondary Grade Teachers Training Institute vs Commissioner and Secretary to Government, Education Department), issued similar directions permitting the student to appear at the examination and directing the State Government to arrange for supplementary examination to enable the students to appear at that examination.
These appeals are directed against the order of the Division Bench.
After hearing learned counsel for the parties were are of the opinion that these appeals must succeed.
There is no dispute that the respondent educational Institutions were established for imparting education in Teachers Training Course without obtaining recognition from the Education Department of the State Government.
In the absence of recognition from the Education Department the students pursuing their studies in these Institutions could not appear at the public examination held by the Education Department The Full Bench rightly held that students of unrecognized educational institutions could not be permitted to appear at the public examination held by the Government.
On its own finding, the Full Bench should have refused relief in the petitioners, but it was persuaded to issue directions on humanitarian ground which were in effect destructive of its own findings, and the law laid down by it.
The Full Bench issued directions permitting the students to appear at the examination and directing the appellant authorities to make a special provision for supplementary examination.
These directions in our opinion were unauthorised and wholly unjustified.
The practice of admitting students by unauthorised educational Institutions and then seeking permission for permitting the students to appear at the examination has been looked with disfavour by this Court.
235 In Nageshwaramma vs State of Andhra Pradesh, [1986] Supl.
SCC 166 this Court observed that if permission was granted to the student of an unrecognised Institution to appear at the examination, it would amount, to encouraging and condoning the establishment of unauthorised institutions.
The Court declared that the Jurisdiction of this Court under Article 32 or of the High Court under Article 226 of the Constitution should not be frittered away for such of purpose.
In A.P. Christains Medical Educational Society vs Government of Andhra Pradesh & Anr., ; a similar request made on behalf of the institution and the student for permitting them to appear at the examination even though affiliation had not been granted, was rejected by this court.
The court observed that any direction of the nature sought for permitting the students to appear at the examination without the institution being affiliated or recognised would be in clear transgression of the provision of the Act and the regulations.
The Court cannot be a party to direct the students to disobey the statute as that would be destructive of the rule of law.
The full Bench noted these decisions and observations and yet is granted relief to the students on humanitarian ground Courts can not grant relief to a party on humanitarian grounds contrary to law.
Since the students of unrecognised institutions were legally not entitled to appear at the examination held by the Education Department of the Government, the High Court acted in violation of law in granting permission to such students for appearing at the public examination.
The directions issued by the full Bench are destructive of the rule of law.
Since the Division Bench,issued the impugned orders following the judgment of the Full Bench, the impugned orders are not sustainable in law.
Nalini Chidambaram contended that under Section 9 of the Tamil Nadu Act a minority community is entitled to establish an educational institution without obtaining permission from the Government and the students of such institution are entitled to appear at the public examinations.
We find no merit in the submission.
Under Article 30 of the Constitution minorities based on religion or language, have fundamental freedom to establish educational institutions their own choice, but the State has right to prescribe regulatory provisions for ensuring educational excellence.
Minority institutions which do not seek recognition are free to function according to their own choice, but if such an institution seeks recognition from the State, it has to comply with prescribed conditions for granting recognition, and in that event the minority institution has to follow prescribed syllabus for examination, courses of study and other allied matters.
These conditions are necessary to be followed to ensure efficiency and educational standard in 236 minority institutions.
See: All Bihar Christian Schools Association & Anr.
vs State of Bihar & Ors.
, [1988] 1 S.C.C. 206.
We are, therefore, of the opinion that even if a minority community has fundamental right to establish and administer educational institution, it has no right to insist upon the State to allow students to appear at the public examinations without recognition or without complying with the conditions prescribed for such recognition.
We, accordingly, allow the appeals and set aside the order of the High Court and dismiss the writ petitions filed by the respondents.
There will be no order as to costs.
G.N. Appeals allowed.
| IN-Abs | In the appellant State, there were number of educational institutions running teachers straining course.
Recognition was not accorded to some institutions as they did not fulfill the conditions.
In other cases, the recognition was under consideration.
Admittedly, none of the respondent institutions was accorded recognition.
Since the Education Department did not permit their students to appear at the Public Examination, the respondent institutions filed a Writ Petition before the High Court praying for direction to the appellant State to recognise the institutions and also for a direction permitting their students to appear at the Public Examination.
Following the decision of the Full Bench in similar cases, the Division Bench directed the appellant State to arrange for supplementary examination in respect of the students of the respondent institutions.
Against the said Judgment the State has preferred these appeals, by special leave.
Allowing the appeals, this court, HELD: 1.1.
In the absence of recognition from the Education Department the students pursuing their studies in such Institution could not appear at the public examination held by the Education Department.
The Full Bench rightly held that students of unrecognized educational 232 institutions could not be permitted to appear at the public examination held by the Government.
On its own findings,s the Full Bench should have refused relief to the petitioners.
The Full Bench 's directions permitting the student to appear at the examination and directing the appellant authorities to make a special provision for supplementary examination were unauthorized and wholly unjustified.
[234E G] 1.2.
The Court cannot be a party to direct the students in disobey the statue as that would be destructive of the rule of law.
Courts cannot grant relief to a party on humanitarian ground contrary to law.
Since the Division Bench issued the said orders following the Judgment of the Full Bench, the orders are not sustainable in law.
Nageshwaramma vs State of Andhra Pradesh, [1986](Suppl.) SCC 166 and A.P. Christians Medical Educational Society vs Government of Andhra Pradesh & Anr., ; , relied on.
2.1 Under Article 30 of the Constitution minorities based on religion or language, have fundamental freedom to establish educational institutions of their own choice, but the State has the right to prescribe regulatory provisions for ensuring educational excellence.
Minority institutions which do not seek recognition are free to function according to their own choice, but if such an institution seeks recognition from the State it has to comply with the prescribed conditions for granting recognition and in that event the minority institution has to follow the prescribed syllabus for examination, courses of study and other allied matters.
These conditions are necessary to be followed to ensure efficiency and educational standard in minority institutions.
[235C F] 2.2.
Even if a minority community has fundamental right to establish and administer educational institution, it has no right to insist upon the State to allow its students to appear at the public examination without recognition or without complying with the conditions prescribed for such recognition.
[236A B] All Bihar Christian Schools Association & Anr.
vs State of Bihar & Ors.
, ; , relied on.
|
ivil Appeal Nos.1426 to 1428 (NT) of 1975.
From the judgment and Orders dated 24.2.1972 & 23.4.1974 of the Allahabad High Court in Income Tax Reference Nos.456/68 & 47 of 1973.
WITH Civil Appeal No.1653 (NT) of 1991.
Raja Ram Aggarwal and E.C.Aggarwal for the Appellant.
V.Gauri Shankar, B.B.Ahuja, S.Rajappa and Ms.
A.Subhashini for the Respondents.
The Judgment of the Court was delivered by RANGANATHAN,J.
These four matters arise out of income tax assessments of the same assessee and involve the same questions.
We grant leave in the Special Leave Petition after condoning the delay of 141 days in the circumstances set out in the application for condonation 240 of delay and proceed to dispose of all the four appeals by this common judgment.
The assessee appellant in all these cases is a Hindu Undivided Family (HUF) known as M/s Moti Lal Chhadami Lal Jain carrying on business at Ferozabad.
The HUF consisted of the karta, Chhadamilal Jain, and his son Bimal Kumar Jain.
Appeal No.1426 of 1975 relates to the assessment year 1962 63, Civil Appeal Nos.1427 and 1428 relate to assessment years 1968 69 and 1969 70 and the other remaining Civil Appeal relates to the assessment year 1973 74.
The facts relevant for the assessment year 1962 63 may now be set out: For the assessment year in question (the previous year for which ended on 12.7.1961), the assessee HUF derived income from property as well as hire, rent and commission from Jain Glass Works(P) Ltd. (hereinafter referred to as `the company ').
On 3.5.1960, the assessee family had granted a perpetual lease of certain buildings, furnaces and lands owned by it to the company.
It appears that a firm known as Jain Glass Works P.Ltd.
had taken on lease the above assets of the HUF at an annual rent of Rs.62,000 for running its business in the manufacture of glassware.
The lease deed recited that the company which had taken over the running business of the firm was to continue to have its factory for manufacture of glassware on the land belonging to the joint family and continue to use and enjoy all the facilities for the manufacture of glassware on the bhatties belonging to the family.
In consideration of the use of all the above premises, the company was to pay the HUF an annual rent of Rs.21,000 for the period during which the company continued to have its factory in the premises of the lessor and also to pay the HUF a commission at one per cent of the total turnover of the company for financial year.
Under clause 3 of the lease deed, the company was to pay the annual rent of Rs.21,000 in the following manner: (a) Rs.10,000 to Shri Chhadami Lal Jain Trust Degree College, Ferozabad.
(b) Rs.11,000 direct to the lessor M/s.
Moti Lal Chhadami Lal, HUF.
On 5.5.1962, another agreement was entered into between four parties the two male members of the assessee HUF, the company, the 241 Chhadami Lal Jain Trust (hereinafter referred to as `the Trust ') and the Chhadami Lal Jain Degree College (hereinafter referred to as `the College) which is an educational institution run by the Trust.
This document referred to the earlier lease agreement between the family and the company and its terms.
The agreement recorded, inter alia that out of the total rent of Rs.21,000 payable by the company, a sum of Rs.10,000 would be paid to the college and the balance to the HUF in four equal quarterly installments.
Clause 7 of the deed reads as follows: "That in the event of the `second party ' failing to pay the rent every quarter in accordance with the above mentioned conditions or violates the terms of this agreement, then, in the first place, the `fourth party ' shall have full rights to recover Rs.10,000 (ten thousand rupees) per year as rent by recourse to the Court in whatsoever manner it deems fit and shall have first charge on the full property mentioned below.
Subsequently, the `first party ' shall recover the balance of Rs.11,000 per year rent alongwith the interest costs and expenses from the `second party ' and such recovery will not be objected to by the `second party ' or its successors.
" For the assessment year 1962 63 the assessee family returned Rs.11,000 as lease rent received from the company.
It was claimed that the balance of Rs.10,000 was the income of the trust and hence not part of the income of the assessee.
It was explained that the University, while granting affiliation to the college had imposed a condition that security should be given for the running expenses of the college and as such a security was given by creating a charge of Rs.10,000 in favour of the college on the immovable property of the joint family.
The contention was that the sum of Rs.10,000 out of the rent payable by the lessee for the property got diverted by overriding title to the college and ceased to be the income of the assessee.
This contention was negatived by the Income Tax Officer (I.T.O.), the Appellate Assistant Commissioner (A.A.C.) and the Income tax Appellate Tribunal (the Tribunal).
The Tribunal, however, directed the I.T.O. to give appropriate relief u/s 88 in respect of this amount.
Another bone of contention between the parties related to the income from certain properties claimed to have been transferred by the assessee family to the Trust on 14.11.1947.
On that date, the assessee executed a Trust Deed which was also registered at Ferozabad.
By this deed, Chhadami Lal, the karta of the assessee family, 242 expressed his desire to create a charitable trust which would fulfill the needs of education, religion and medical facilities in the town of Ferozabad.
He, therefore, proceeded to create a trust which would run a boarding house, a dharamshala with a temple, a commercial and industrial Institute, a Jain Dharam School, a Jain Aushadhalya, a students ' scholarship fund and a public library and reading room.
Clause 3 of the deed provided.
"That the expenditure of the trust and expenses for the above mentioned objects will be made from the income of the following properties which income will be of the trust.
I will have no personal concern with this income nor will be used for my personal benefit but will be spent on the aims of the trust.
" Chhadami Lal constituted himself the trustee to look after the trust as long as he lived and manage its affairs.
The deed then proceeded to set out the details of "the property the income from which will be used for the purpose of the trust".
The properties were said to be of the value of Rs.6,12,000 and to yield an income of about Rs.18,000 per annum.
On the strength of the above document, the assessee HUF was not assessed on the income from the properties for the assessment year 1949 50.
However, while scrutinizing the accounts for the assessment years 1951 52 to 1959 60, the I.T.O. assessed the income from the properties in the hands of the family, as he was of opinion that the Trust Deed only purported to transfer the income from the properties to the Trust but not the corpus thereof and that, therefore, the income was not eligible for exemption under s.4(3)(i) of the Indian Income Tax Act, 1922.
Appeals by the assessee to the A.A.C. and the Tribunal were unsuccessful.
It was be mentioned here that, on 9th August, 1960, Shri Chhadami Lal and his son had executed another registered document.
This document referred to the creation of the Trust in 1947 which, it was stated, had been running several educational and charitable institutions regularly and successfully.
The document proceeded to say: "Thus there has been a great progress in the working of the above mentioned institutions and the property above mentioned was felt to be insufficient in the year 1957; therefore, both of us thought it proper that in order to run 243 the trust successfully, the properties mentioned below should also be invested in the trust and to be under the same so that Shri Chhadami Lal Jain Trust should always run properly and the public good that has been done upto now, as stated above, should continue to be so done in the same rather better way.
Public good should continue to be done.
Therefore, we executants had given to the trust on the Ist July, 1957 the following property the value of which was Rs.25,000 [by] canceling mutation thereof in respect thereof in our name and giving up possession of the below mentioned property, at the same time, had transferred it to the Trust.
Since the Ist of July, 1957, we have had no connection with the property mentioned below nor shall we have any concern with it is the future.
" The deed then proceeded to mention the details of the property "which has been in the use of the trust above mentioned since 1957 and will continue likewise to be in the use of the trust always".
It then proceeded to appoint eleven persons who were to be trustees to continue to run the Trust and the institutions.
Chhadami Lal, Bimal Kumar and his wife were three of the trustees, the others being outsiders.
Then followed several clauses.
Clause 3 referred to "the properties which has been given to the trust before and now" and empowered the trustees to sell or lease out the land to construct a building for the trust if it was found necessary.
Clause 5, however, prohibited the trustees from "putting the property of the trust to personal use, wasting it or from mortgaging and selling it except in accordance with clause 3." Despite this document, the I.T.O. assessed the family on the income from the above properties.
Appeals to the A.A.C. failed but the Tribunal allowed the appeals of the assessee.
For the assessment year 1962 63, the Tribunal, following its earlier orders in the case of the Trust viz. I.T.A. No.17157 of 1963 64 and I.T.A. No.11774 of 1964 65, allowed the assessee 's appeal.
The assessee, aggrieved by the Tribunal 's decision on the first contention and the department, aggrieved by the decision on the second contention, sought references to the High Court.
Thus, two questions were referred to the High Court in relation to the assessment year 1962 63 (I.T.Ref.456/1968).
These questions were: (1) Whether on a proper construction of the lease deeds dated 244 3.5.1960 and 5.5.1962 and the accompanying facts and circumstances of the case, the sum of Rs.10,000 is the income of the assessee and not that of Chhadami Lal Jain Degree College? (2) Whether, on the facts and circumstances of the case, the income of Rs.14,000 from properties purported to have been transferred to Seth Chhadami Lal Jain Trust was not assessable in the hands of the assessee family? I.T.R.47 of 1973 related to assessment years 1968 69 and 1969 70 for which the relevant previous years ended on 1.9.67 and 1.9.68.
For these assessment years also, the inclusion of the income of Rs.13,920 from the properties claimed to have been transferred to the Trust in the assessments of the HUF having been deleted by the Tribunal following its orders in the appeals relating to 1964 65 to 1967 68, the following question was referred to the High Court (in R.A.Nos.88 and 89 of 1972 73 dated 8.12.72): "Whether on the facts and in the circumstances of the case, income of Rs.13,920 from properties purported to have been transferred to the trust was not assessable in the hands of assessee family?" It may be mentioned that though a reference was also made by the Tribunal on the other question regarding income from the property (in R.A.No.90 and 91 of 1972 73 dated 7.3.72), that was not the subject matter of I.T.R. 47/73 and hence we are not concerned with that here.
In I.T.R.168/79 which relates to the assessment year 1973 74, three questions were referred to the High Court, of which we are concerned with only two here.
These are: "(2) Whether on the facts and in the circumstances of the case, income of Rs.6,329 from properties purported to have been transferred to the Trust was not assessable in the hands of the assessee family? (3) Whether on a proper construction of the lease deeds dated 3.5.1960 and 5.5.1962 and accompanying facts and circumstances of the case, the sum of Rs.10,000 is the income of the assessee and not that of Chhadami Lal Jain Degree College?" 245 The questions referred were answered by the High Court against the assessee and in favour of the Department.
The judgment of the High Court in I.T.R.456/68 is reported in (1977) 106 I.T.R.909 (All).
This judgment contains the reasons for the conclusion on the question relating to the rental income is concerned.
But so far as the other question is concerned, the High Court answered it following its earlier decision in I.T.R.72 of 1969 arising out of the Tribunal 's orders in the case of the trust in I.T.A.Nos.17157 of 1963 64 and I.T.A.No.11774 of 1964 65 referred to earlier and reported in The judgment in I.T.R. 47/73 follows the decision in I.T.R. 456/68.
In I.T.R. 168/79, again, the ruling in has been followed and the decision given against the assessee.
These are the three judgments in appeal before us.
Before considering the questions arising in these appeals we would like to point out that there is no information before us as to what has happened (a) in the assessment years 1950 51 to 1959 60; (b) in the intervening assessment years 1963 64 to 1967 68 and, again, from 1970 71 to 1972 73; (c) in the assessment years subsequent thereto; and (d) for assessment years 1968 69 and (1969 70 so far as the issue regarding the rental income is concerned.
We are indeed surprised that even the assessee who, in all probability, must have been affected by the assessments for those years, should not have cared to place the relevant information before us.
It is regrettable that neither party has cared to verify whether any appeals before the authorities or references in the High Court or appeals or special leave petitions are pending for those years.
It would have been helpful to both sides if an attempt had been made to find out all the information so that all the connected matters could have been consolidated and heard together.
So far as the question of rental income is concerned, we agree with the view taken by the High Court.
The assessee is the owner of the properties in question and has leased out the properties in question to the company for an annual rent of Rs.21,000.
This is the income of the family.
The assessee 's agreement with the company is only that Rs.10,000, out of the rent due to it, should be paid directly to the College.
This is only a mode of application of the income by the family which will make no difference in its liability to tax on the entire rent of Rs.21,000.
Nor does the fact that the College has been given a right, by the four party agreement, to sue for and recover the sum of Rs.10,000 directly from the company in case of default alter this position.
That is only a mode of recourse provided to the College for the enforcement of the promise made to it by the assessee.
The payment to, or recovery 246 of, Rs.10,000 by the College will only discharge in part the liability of the company to pay a rent of Rs.21,000 to the assessee under the lease deed.
It is contended on behalf of the assessee that it would not be correct to treat this a case of a mere application, by the assessee, of a part of the rental income due to, and receivable by, it.
The right given to the College to sue the company, directly coupled with the creation of a charge in its favour on the property yielding the rent for such payment, has the result of diverting that part of the rental income at the very source or inception.
Under the second agreement, it is urged, not merely an amount of Rs.10,000 per annum but the very right to receive, and enforce the payment of, that part of the rent is assigned to the College by the assessee.
Its effect is that the income from the property thereafter accrues partly to the assessee and partly to the College with the result that the assessee is left only with the right to receive Rs.11,000 from the company every year.
Reliance is placed, in this context, on the decisions in C.I.T. vs Sitaldas Tirathdas, , S.C. and Murlidhar Himmatsingka vs I.T.O., , S.C. We are of opinion that this contention cannot be accepted.
As we have pointed out earlier, the right given to the College to sue the company is only the right to recover part of amount which has already accrued to the assessee.
The creation of a charge in favour of the College does not make any difference.
It only obliges the company to pay a part of the rent to the College on behalf of the assessee but the existence of a mere obligation is not sufficient to constitute diversion of income.
The classic statement of the true principle is set out in C.I.T. vs Sitaldas Tirathdas, (supra): "Obligation, no doubt, there are in every case, but it is the nature of the obligation which is the decisive factor.
There is a difference between an amount which a person is obliged to apply out of his income and an amount which by the nature of the obligation cannot be said to be a part of the income of the assessee.
Where by the obligation, income is diverted before it reaches the assessee, it is deductible.
But where the income is required to be applied to discharge an obligation (self imposed and gratuitous) after such income reaches the assessee, the same consequence in law does not follow.
It is the first kind of payment which can truly be excused and not the second.
The second payment is merely 247 an obligation to pay another a portion of one 's own income which has been received and is since applied.
The first is a case in which the income never reaches the assessee who, even if he was to collect it, does so, not as part of his income but for and on behalf of the persons to whom it is payable.
" In the above passage, it is clear, the expressions "reaches the assessee" and "has been received" have been used not in the sense of the income being received in cash by one person or another.
What the passage emphasises is the nature of the obligation by reason of which the income becomes payable to a person other than the one entitled to it.
Where the obligation flows out of an antecedent and independent title in the former (such as, for example, the rights of dependents to maintenance or of coparceners on partition, or rights under a statutory provision or an obligation imposed by a third party and the like), it effectively slices away a part of the corpus of the right of the latter to receive the entire income and so it would be a case of diversion.
On the other hand, where the obligation is self imposed or gratuitous (as here) it is only a case of an application of income.
The case of a sub partnership, referred to on behalf of the assessee, is really a case on the borderline.
It is possible to take a view that it is nothing more than a case of one partner agreeing to divide his share of profits from a firm with others and, indeed, this was the view taken earlier: see, Mahaliram Santhalia vs C.I.T., But, apparently in view of the commercial necessities which compel the formation of sub partnerships, a series of judicial decisions, approved in Murlidhar Himmatsingka vs I.T.O., (supra) have held that they represent cases of diversion.
That analogy cannot be extended to cases such as the present.
We would also like in this context to refer to S.24(1)(iv) of the Income tax Act, 1961.
It provides for a deduction, in the computation of income from house property, in respect of the amount of an annual charge on the property.
The statutory provision was initially wide enough to rope in cases of such charges irrespective of the purpose for which they were created and even where they were voluntarily created by an assessee.
But the provision has been amended w.e.f.1.4.1969 to exclude deduction of an annual charge voluntarily by the assessee.
The case before us is not one of income from house property computed under Ss.22 24 and we are referring to this only as a matter of interest.
This amendment also indicates that a charge voluntarily created would 248 stand on an different footing from super imposed charges.
For these reasons, we agree with the view taken by the High Court and hold that the assessee is liable to tax on the entire rental income of Rs.21,000.
Turning now to the second question before us, it talks of the income from the properties "purported to have been transferred to the Trust" and in the words in quotation lies the crucial issue in the case.
There is no dispute that the income from the property is applied wholly for religious and charitable purposes.
S.4(3)(i) of the Indian Income tax Act, 1922 and its successor section 11(1)(a) of the Income tax Act, 1961 (insofar as they were applicable to the assessment years before us) exempt the income derived by an assessee from "property held in trust or other legal obligation" for such purposes.
This exemption has been denied to the assessee on the short ground that the properties (with the income from which we are concerned) continue to vest in the assessee and have not been effectively transferred to the Trust.
This is said to be so far two reasons.
The first is that the trust has been created in respect of immovable properties of the value of more then Rs.100 and this is possible only if the properties had been duly conveyed to the trustees by a deed duly stamped and registered.
The second is that the deeds of trust themselves do not speak of the corpus of the properties being held in trust.
Clause 3 of the 1947 deed only stipulates that the income from the properties will be the income of the trust.
A little later also the deed proceeds to set out the "properties the income from which will be used for the purposes of the trust".
In other words, the deed only records the assessee 's desire to utilise the income for the objects mentioned in the deed and not for his personal benefit.
The document of 1960 does not improve matters any further.
So, it is said no valid trust has been created by the assessee to merit the claim for exemption.
We are of the opinion that the view of the High Court proceeds on an unduly narrow construction of the deeds of 1947, and 1960.
We have pointed out that, under the deed of 1947 the karta of the assessee family is the sole trustee to execute the objects of the trust.
It appears to have been overlooked that while a registered conveyance to the trustees by the owner of immovable property is necessary where the trustees are persons other than the author, this requirement does not arise where the author of the trust is to be the sole trustee.
While a trust is not complete until the trust property is vested in trustees for the benefit of the cestui que trust, this can be done by the settlor, where he is 249 himself the trustee, by a declaration of trust, using language which, taken in connection with his acts, shows a clear intention on his part to divest himself of all beneficial interest in it and to exercise dominion and control over it exclusively in the character of a trustee.
Sec.6 of the Indian Trusts Act, makes this clear beyond all doubt.
In the present case there is a deed which makes clear the unequivocal intention to utilise the income from the properties in the manner set out in the deed of trust.
It is in the context of the above legal position that one has to understand the references in the trust deed to the income of the properties belonging to the trust.
Indeed, this is made clear by the conduct of the party all through and the language of the second deed.
The assessee 's full ownership of, and unqualified right to enjoy, the properties gets restricted and qualified on the execution of such a trust deed by the various conditions set out and imposed by the trust deed.
The execution of the trust deed creates an overriding title in the beneficiaries thereunder (viz. the various cross sections of the public covered by it) to require that the income from the properties, which are made the subject matter of the trust, be utilised in the manner set out therein and no other.
Indeed, after the execution of the trust deed, the properties are no longer held by the assessee as the absolute owner thereof; they are held by the assessee under trust and legal obligation to apply the income exclusively for charitable purposes, thus attracting the provisions for exemption contained in the Act.
For the reasons discussed above, we are inclined to take the view that the deed of 1947 should be construed as a valid trust which has the effect of diverting the income at the source and that the income thereafter has ceased to be the income of the assessee family.
We therefore answer the question referred to the High Court on this issue in favour of the assessee.
In the result of C.A. 1427/ 8/75 are allowed and the other two civil appeals are allowed in part.
There will, however, be no order regarding costs.
R.N.J. C.A.1427 28/75 allowed.
C.A.1426/75 & 1653/91.
partly allowed.
| IN-Abs | For the assessment year 1962 63 the Assessee family returned Rs.11,000 as the rent received from the lessee Company.
Regarding the balance of Rs.10,000,it was contended on behalf of the assessee that this amount being directly payable by the lessee company under the lease deed dated 5.5.62 to the Trust College, this ceased to be the income of the assessee.
This contention was negatived by the Department right upto the Income Tax Appellate Tribunal.
The other point of dispute concerned the income accruing from certain properties claimed to have been transferred by the family to a charitable Trust created under a Trust Deed dated 14.11.1947.
The I.T.O. assessed the income from these properties in the hands of the family taking the view that the Trust deed only purported to transfer income from the properties and not the corpus and therefore, this income was not eligible for exemption under section 4 (3) (i) of the Indian Income Tax Act 1922.
Assessee 's appeal to the Appellate Assistant Commissioner failed but further appeal to the Tribunal succeeded.
238 Thus the assessee aggrieved on the first contention and the department on the second contention sought references to the High Court.
In respect of assessment year 1962 63 two questions were referred to the High Court on the above two points.
A question in respect of the first point was also referred for the assessment years 1968 69 and 1969 70 and two questions on the two points mentioned above were referred to the High Court in respect of assessment Year 1972 73.
As the High Court answered these questions against the assessee, it preferred four appeals covering the four assessment year in question.
Allowing the appeals in respect of assessment years 1968 69 and 1969 70 and party allowing the other two appeals in respect of assessment years 1962 63 and 1973 74, this Court, HELD:(1) The assessee is the owner of the properties in question leased out to the company on an annual rent of Rs.21,000.
This is income of the family.
The Assessee 's agreement with the company that Rs.10,000 out of the rent due to it should be paid directly to the College is only a mode of application of the income by the family which makes no difference in its liability to tax on the entire rent of Rs.21,000 nor does the fact that the college has been given a right to sue for and recover this sum directly from the company in case of default, alter this position.
The payment to, or recovery of, Rs.10,000 by the college will only discharge, in part, the liability of the company to pay a rent of Rs.21,000 to the assessee under the lease deed.
The creation of a charge in favour of the college does not make any difference.
It only obliges the company to pay a part of the rent to the college on behalf of the assessee but the existence of a mere obligation is not sufficient to constitute diversion of income.
Where the obligation flows out of an antecedent and independent title in the former, it effectively slices away a part of the corpus of the right of the latter to receive the entire income and so it would be a case of diversion.
On the other hand, where the obligation is self imposed or gratuitous it is only a case of an application of income.
We, therefore, agree with the High Court that the assessee is liable to tax on the entire rental income of Rs.21,000.
[245F 246A, E;247C D,248B] (2) A registered conveyance of immovable property to the trustees is necessary where the trustees are persons other than the author.
But this requirement does not arise where the author is himself to be the trustee.
While a trust is not complete until the trust property is vested in trustees for the benefit of the cestui que trust, this can be 239 done by the settlor, where he is himself the trustee, by a declaration of trust, using language which, taken in connection with his acts, shows a clear intention on his part to divest himself of all beneficial interest in it and to exercise dominion and control over it exclusively as a trustee.
Section 6 of the Indian Trusts Act, makes this clear beyond all doubt.
The assessee 's full ownership of an unqualified right to enjoy the properties gets restricted by the trust deed, which creates an overriding title in the beneficiaries regarding the use of the income from such properties in the manner set out therein and no other.
In fact after the execution of such a trust deed, the properties are no longer held by the assessee as the absolute owner thereof but as a trustee with a legal obligation to apply the income exclusively for charitable purposes, thus attracting the provisions for exemption contained in the Act.
We are inclined to take the view that the Trust deed of 1947 should be construed as a valid trust which has the effect of diverting the income at the source and that the income thereafter ceased to be the income of the assessee family.[248G 249B, C D; E F] C.I.T. vs Sitaldas Tirathdas, [1961] 41 I.T.R.367, S.C.Murlidhar Himmatsingka vs I.T.O., [1961] 62 I.T.R.323, S.C.Mahaliram Santhalia vs C.I.T., [1958] 33 I.T.R.261, referred to.
|
ivil Appeal Nos.1756 59 of 1991.
From the Judgment and Order dated 17.1.1990 of the Allahabad High Court in C.M.W.P. Nos.10962,10901, 10902 and 10903 of 1987.
Raju Rama Chandran for the Appellants.
Prem Malhotra for the Respondents.
The Judgment of the Court was delivered by K.JAGANNATHA SHETTY,J.
We grant Special Leave and proceed to dispose of these appeals.
These appeals preferred against the decision of the Allahabad High Court raise common questions as to the scope of Regulations 17(2) and 17(3) of the U.P. State Road Transport Corporation Employees (Other than officers) Service Regulations, 1981 (`the Regulations ').
277 The respondents were appointed as drivers in the erstwhile U.P. Government Roadways.
Upon the formation of the U.P.State Road Transport Corporation (`Corporation ') they were absorbed in the services of the Corporation.
The Corporation has framed the Regulations inter alia prescribing medical test to drivers every year for the purpose of assessing their suitability for the job.
Pursuant to these Regulations, the Managing Director of the Corporation issued a circular dated December 19,1986 stating that all drivers should be medically examined and those found unsuitable either because of ill health or poor eye sight, be not given duty and their services be dispensed with.
This was followed by another circular dated March 12, 1987 by which the Managing Director directed the Regional Managers to terminate the services of the drivers who are medically found unfit to drive the vehicles.
It was also directed in the circular that such employees whose services are dispensed with should be paid benefits like retrenchment compensation under Section 6(N) of the U.P. Industrial Act.
In the beginning of 1987, all the respondents were subjected to medical examination and it was found that their eye sights were defective.
In view of the medical report, the Corporation discharged them with immediate effect by paying them one month salary in lieu of notice and also retrenchment compensation under the Industrial Disputes Act.
The respondents challenged their retrenchment by means of writ petitions before the Allahabad High Court.
The High Court has allowed the writ petitions directing the Corporation to offer alternative jobs to the respondents.
The Corporation being aggrieved by the decision of the High Court has appealed to this Court.
Regulations 17(2) and 17(3) read as follows: "17(2) A person, appointed to the post of driver, will be required to undergo medical test, particularly vision test, every year or at such intervals as may be prescribed by the General Manager from time to time.
17(3) The service of a person who fails to pass the fitness test, referred to in the sub regulation (2), may be dispensed with: 278 Provided that the persons, whose services are so dispensed with may, in the discretion of the Corporation, be offered alternative job.
" Regulation 17(2) requires that the drivers have to undergo medical test particularly vision test every year, or at such intervals as may be prescribed by the General Manager of the Corporation.
Regulation 17(3) has two branches.
The first branch provides power to the Corporation to remove the driver from the service who fails to pass the medical test.
The second branch of Regulation 17(3) though styled as proviso also appears to be an independent branch.
It is not proviso.
The proviso ordinarily carves out an exception from the general rule enacted in the main provision.
However, sometimes the insertion of a proviso by the draftsman is not strictly adhered to its legitimate use and it may be in substance a substantive provision adding to and not merely excepting something out of or qualifying what goes before it.
The proviso with which we are concerned in Regulation 17(3) does not carve out an exception from the general rule contained in the first branch.
It is an independent and substantive provision providing discretion to the Corporation to offer an alternative job to the retrenched driver.
This offer is to be made after the exercise of power under the first branch of Regulation 17(3).
There is therefore, no doubt that the second branch of Regulation 17(3) is a substantive provision and not in the nature of a proviso to first branch thereof.
The first branch of Regulation 17(3) appears to be in the public interest.
The driver who is found medically unfit to drive the vehicle on the public road certainly cannot be permitted to continue as a driver.
His driving licence is liable to be revoked.
His continuance as driver would, perhaps be perilous to the interests of passengers and pedestrians.
The Corporation therefore, has been empowered to remove him from service as driver.
At the same time, the second branch to Regulation 17(3) shows concern for the person who has been removed from service for want of medical fitness.
It confers discretion on the Corporation to offer him an alternative job.
What does this mean in practical terms? Does it mean that the retrenched driver has a statutory right to get an alternative job? Is it obligatory for the Corporation to offer an alternative job to the driver who is certified to be medically unfit for the driver 's job? The High Court has expressed the view that the Corporation before terminating the service of a driver who fails to satisfy the medical test, is obliged to offer him an alternative job and that offer shall be in writing.
In other 279 words, the High Court seems to be of the opinion that the proviso to Regulation 17(3) imposes an obligation on the Corporation to offer an alternative job to all those who are found medically unfit to carry on their duties in the existing jobs.
The view taken by the High Court appears to be fallacious.
The discretion conferred by Regulation 17(3) confers no vested right on the retrenched workmen to get an alternative job in the Corporation.
Like all other statutory discretion in the administrative law, Regulation 17(3) creates no legal right in favour of a person in respect of whom the discretion is required to be exercised other than a right to have his case honestly considered for an alternative job by the Corporation.
The High Court was equally in error in directing the Corporation to offer alternative job to drivers who are found to be medically unfit before dispensing with their services.
The Court cannot dictate the decision of the statutory authority that ought to be made in the exercise of discretion in a given case.
The Court cannot direct the statutory authority to exercise the discretion in a particular manner not expressly required by law.
The Court could only command the statutory authority by a writ of mandamus to perform its duty by exercising the discretion according to law.
Whether alternative job is to be offered or not is a matter left to the discretion of the competent authority of the Corporation and the Corporation has to exercise the discretion in individual cases.
The Court cannot command the Corporation to exercise discretion in a particular manner and in favour of a particular person.
That would be beyond the jurisdiction of the Court.
In the instant case, the Corporation has denied itself the discretion to offer an alternative job which the regulation requires it to exercise in individual cases of retrenchment.
As earlier stated, the Managing Director has issued two circulars: (i) dated December 19, 1986 and (ii) dated March 12 1987 directing the Regional Managers to dispense with the services of the drivers who are found to be medically unfit to drive the vehicles.
It is directed in the circulars that such drivers should be paid benefits like retrenchment compensation which they are entitled to under the U.P.Industrial Disputes Act.
The circulars thus leave no scope for exercising discretion to consider the individual cases of retrenched drivers for any alternative job.
It may be stated that the statutory discretion cannot be fettered by self created rules or policy.
Although it is open to an authority to which discretion has been entrusted to lay down the norms or rules to regulate exercise 280 of discretion it cannot, however, deny itself the discretion which the statute requires it to exercise in individual cases.
The concerned authority of the Corporation therefore, notwithstanding the said circulars are required to consider the cases of retrenched drivers for alternative jobs.
Counsel for the respondents argued that the object of Regulation 17(3) was to rehabilitate the drivers who are found to be medically unfit to drive vehicles and it is therefore, obligatory for the authority or Officer of the Corporation to exercise discretion in favour of such drivers by offering them alternative jobs.
But counsel for the Corporation considers that it is an absolute discretion of the Corporation to offer or not to offer an alternative job to such drivers and there is no compulsion in the matter.
These are, in our opinion, extreme contentions which are not sustainable under law.
There are two aspects to be borne in mind in exercising the discretion.
Firstly, there are constraints within which the Corporation has to exercise its discretion.
The Corporation is a public utility organisation where medicating motion is efficiency and effectiveness of public service.
Efficiency and effectiveness of public service are the basic concepts which cannot be sacrificed in public administration by any statutory corporation.
The Corporation has to render this public service within the resource use and allocation.
It is within these constraints the Corporation has to exercise its discretion and perform its task.
The second aspect relates to the manner in which the statutory discretion is to be exercised.
The discretion allowed by the statute to the holder of an office, as Lord Halsbury observed in Sharp vs Wakefield, at 179 is intended to be exercised "according to the rules of reason and justice, not according to private opinion; according to law and not humor.
It is to be, no arbitrary, vague and fanciful but legal and regular.
And it must be exercised within the limits to which an honest man competent to the discharge of his office ought to confine himself." Every discretion conferred by statute on a holder of public office must be exercised in furtherance of accomplishment of purpose of the power.
The purpose of discretionary decision making under Regulation 17(3) was intended to rehabilitate the disabled drivers to the extent possible and within the above said constraints.
The Corporation therefore, cannot act mechanically.
The discretion should not be exercised according to whim, caprice or ritual.
The discretion should be exercised reasonably and rationally.
It should be exercised faithfully and impartially.
There should be proper value judgment with fairness and equity.
Those drivers would have served 281 the Corporation till their superannuation but for their unfortunate medical unfitness to carry on the driver 's job.
Therefore, it would not be improper if the discretion is exercised with greater concern for and sympathetic outlook to the disabled drivers subject of course to the paramount consideration of good and efficient administration.
These are some of the relevant factors to be borne in mind in exercising the discretion vested in the Corporation under Regulation 17(3).
In the result we allow these appeals.
In reversal of the judgment of the High Court, we direct the Corporation to consider the cases of respondents in the light of the observations made.
In the circumstances of the case, however, we make no order as to costs.
D.R.L. Appeals allowed.
| IN-Abs | The respondents were employed as drivers in the U.P.State Road Transport Corporation.
The Corporation has framed the U.P.State Road Transport Corporation Employees (other than Officers) Service Regulations, 1981, Regulations 17(2) inter alia requires the drivers to undergo medical test particularly vision test every year and under Regulation 17(3) services of those drivers who fail to pass the fitness test are to be dispensed with, with the proviso that such drivers may, in the discretion of the Corporation, be offered alternative jobs.
Pursuant to these Regulations, the Managing Director of the Corporation issued two circulars dated December 19, 1986 and March 12, 1987 directing the Regional Managers to terminate the Services of the drivers who are medically found unfit to drive the vehicles with the further direction that such drivers should be paid benefits like retrenchment compensation under Section 6(N) of the U.P.Industrial Disputes Act.
The respondents were subjected to medical examination and it was found that their eye sights were defective.
Consequently, the Corporation discharged the respondents with immediate effect by paying them one month salary in lieu of notice and also retrenchment compensation under the U.P. Industrial Disputes Act.
The respondents challenged their retrenchment by means of writ petitions before the High Court.
The High Court allowed the writ petitions directing the Corporation to offer alternative jobs to the respondents.
Being aggrieved, the Corporation has preferred these appeals to this Court.
Allowing the appeals, the Court, 275 HELD: 1.
Regulation 17(2) requires that the drivers have to undergo medical test particularly vision test every year, or at such intervals as may be prescribed by the General Manager of the Corporation.
Regulation 17(3) has two branches.
The first branch provides power to the Corporation to remove the driver from the service who fails to pass the medical test.
The second branch of Regulation 17(3) though styled as proviso is an independent and substantive provision providing discretion to the Corporation to offer an alternative job to the retrenched driver.
[278B D] 2.
The discretion conferred by Regulation 17(3) confers no vested right on the retrenched workmen to get an alternative job in the Corporation.
Like all other statutory discretion in the administrative law, Regulation 17(3) creates no legal right in favour of a person in respect of whom the discretion is required to be exercised other than a right to have his case honestly considered for an alternative job by the Corporation.
[279B] 3.
The High Court was in error in directing the Corporation to offer alternative jobs to the respondents because the Court cannot direct the statutory authority to exercise the discretion in a particular manner not expressly required by law and that it could only command the statutory authority by a writ of mandamus to perform its duty by exercising the discretion according to law.
The Court cannot command the Corporation to exercise discretion in a particular manner and in favour of a particular person.
That would be beyond the jurisdiction of the Court.
[279E] In the instant case, the Corporation has denied itself the discretion to offer an alternative job which the regulation requires it to exercise in individual cases of retrenchment.
Although it is open to an authority to which discretion has been entrusted to lay down the norms or rules to regulate exercise of discretion, it cannot however deny itself the discretion which the statute requires it to exercise in individual cases.
The concerned authority of the Corporation therefore are required to consider the cases of retrenched drivers for alternative jobs.[279F G;280A] 4.1 There are two aspects to be borne in mind in exercising the discretion.
Firstly, there are constraints with which the Corporation has to exercise its discretion and perform its task.
The Corporation is a public utility organisation where mediating motion is efficiency and effectiveness of public service.
Efficiency and effectiveness of public 276 service are the basic concepts which cannot be sacrificed in public administration by any statutory corporation.
The Corporation has to render this public service within the resource use and allocation.[280D] 4.2 The second aspect relates to the manner in which the statutory discretion is to be exercised.
Every discretion conferred by statute on a holder of public office must be exercised in furtherance of accomplishment of purpose of the power.
[280E G] Sharp vs Wakefield, at 179, referred to.
The Corporation therefore cannot act mechanically.
The discretion should not be exercised according to him, caprice and ritual.
The discretion should be exercised reasonably and rationally.
It should be exercised faithfully and impartially.
There should be proper value judgment with fairness and equity.
[280H] Therefore, it would not be improper if the discretion is exercised with greater concern for and sympathetic outlook to the disabled drivers subject of course to the paramount consideration of good and efficient administration.
[281A B]
|
Civil Appeal Nos.4353 54 of 1983 etc.
From the Judgment and Order dated 7.3.1983 of the Orissa High Court in O.J.C. No. 1517 of 1978.
A.K. Ganguli, G. Ramaswamy, T.S. Krishnamurthy Iyer, Dr. 114 L.M. Singhvi, Shanti Bhushan, P. Chidambram, R.B. Datar, T.V. S.K. Iyer, V.A. Bobde B.Sen, M.S. Gujral, R.F. Narinan, P.H. Parekh Ms. Shalini, Soni, K.K. Lahiri, J.B.Dadachanji, S.Sukumaran, P.N.Gupta, R.K. Mehta, A.K.Panda, Sakes Kumar, Ashok Singh, Satish Agnihotri, D. Goburdhan, D.N. Mishra, Shri Narain, Abhey Sapra, Sandep Narain, Mrs. Kirti Misra, Harish N.Salve, S.R. Grover, K.J.John, M.P. Sharma, Ms. Deepa Dixit, Sanjay Parekh, Praveen Kumar, Darshan Singh, K.V. Srekumar, T.G.N.Nair, B.R.Agrawal, S.K. Bagga, Mrs. S.K.Bagga, Rameshwar Nath and A.M. Dittia for the appearing parties.
The Judgment of the Court was delivered by RANGANATHAN, J.
These are connected batches of Civil Appeals and Special Leave Petitions.
We grant special leave to appeal in all the petitions (condoning the delay in the filing of the unnumbered one referred to below) and proceed to dispose of all the appeals by this common judgment.
The details of the appeals and petition are, for sake of convenient reference, tabulated below: High Court Date of Civil Appeal/ Name of Judgment SLP Nos.
Appellant 1.
Orissa 17.4.1980 C.A.2053 2080/80 Tata Iron & Steel Co. Ltd. 7.3.1983 C.A.4353 4354/83 Orissa Cement Ltd. 22.12.1989 S.L.P. 1479/90 State of Orissa 22.12.1989 S.L.P. /90 Orient Paper & Industries Ltd. & Anr.
13.7.1990 S.L.P.11939/90 do 2.
Bihar 10.2.1986 C.A. 592/86 Tata Iron & Steel Co. Ltd. 3.
Madhya 28.3.1986 C.A. 1641 1662/86 State of M.P. Pradesh We shall discuss later the manner in which these appeals and petitions have arisen.
115 THE ISSUE The validity of the levy of a "cess", based on the royalty derived from mining lands, by the States of Bihar, Orissa and Madhya Pradesh is challenged in these petitions and appeals.
A seven Judge Bench of this Court in India Cement, struck down a similar levy under a Tamil Nadu Act as beyond the legislative competence of the State Legislature.
The assessees, in the matters now before us, claim that the issue here is directly and squarely governed by the above decision.
The State, on the other hand, claim that the nature and character of the levies imposed by them is totally different from that of the Tamil Nadu levy and that they are entirely within the scope of the States ' Legislative powers under the Constitution.
This is the issue to be decided in these matters.
As the impugned enactments of Bihar, Orissa and Madhya Pradesh mutually differ from one another in some respects, they will need separate consideration.
However, the basic issue being the same, all these matters have been heard together and it is found convenient to dispose of them all by this common judgment.
We may mention in passing that, initially, these matters were listed before a Bench of two Judges of this court.
It referred the matters on 17.8.1990 to the learned Chief Justice for the constitution of a larger Bench.
The matters have come up before us in pursuance of the directions of the Hon 'ble Chief Justice.
THE LEGISLATIVE ENTRIES It will be convenient, at the outset, to refer to the various entries of the Union and the State Lists in the Seventh Schedule to the constitution which have a bearing on the issues to be discussed.
These are: List I (Union List) Entry 52: Industries, the control of which by the Union declared by Parliament by law to be expedient in the public interest.
Entry 54: Regulation of mines and mineral development to the extent to which such regulation and development under the control of Union is declared by Parliament by law to be expedient in the public interest.
116 List II (State List) Entry 18: Land, that is to say, rights in or over land, land tenures including the relation of landlord and tenant, and the collection of rents; transfer and alienation of agricultural land; improvement and agricultural land; colonization.
Entry 23: Regulation of mines and mineral development subject to the provisions of List I with respect to regulation and development under the control of the Union.
Entry 45: Land revenue, including the assessment and collection of revenue, the maintenance of land records, survey for revenue purposes and records of rights, and alienation of revenues.
Entry 49: Taxes on lands and buildings.
Entry 50: Taxes on mineral rights subject to nay limitations imposed by Parliament by law relating to mineral development.
Entry 66: Fees in respect of any of the matters in this List, but not including fees taken in any court.
EARLIER HISTORY Before proceeding to consider the provisions of the enactments impugned, and the issues debated, before us, it is necessary to set out certain earlier controversies that led to India Cement.
Hingir Rampur Case As early as in 1960, this Court had to consider the constitutional validity of the Orissa Mining Areas Development Fund Act, 1952 (Orissa Act XXVII of 1952).
section 3 of the Act empowered the State Government to constitute mining areas whenever it appeared to the Government that it was necessary and expedient to provide amenities 117 life communications, water supply and electricity for the better development of such areas or to provide for the welfare of the residents or workers in areas within which persons employed in a mine or a group of mines reside or work.
S.4 empowered the State Government to impose and collect a cess or fee on the minerals extracted the rate of which was not to exceed 5% of the valuation of the minerals at the pit 'smouth.
S.5 provided for the constitution of the Orissa Mining Areas Development Fund.
The proceeds of the cess recovered in pursuance of S.4 along with other subsidies from Government, local authorities and other public subscriptions were credited to the fund and the expenses for such collection debited thereto.
The fund has to be utilised to meet expenditure incurred in connection with such development measures as the State Government might draw up for the purposes above mentioned as well as for the purposes specified in clauses (a) to (e) of S.5(5).
The validity of this levy of cess was challenged by the petitioner coal company in the Hingir Rampur case as ultra vires the powers of the State Legislature because (a) the cess was not a fee but a duty of excise on coal which was a field covered by Entry 84 of List I in the Seventh Schedule and repugnant to the Local Mines Labour Welfare Fund Act, 1947 (Central Act XXXII of 1947); and (b) even if it was treated as a fee relatable to Entries 23 and 66 of List II in the Seventh Schedule, it was hit by Entry 54 of List I read with the Mines and Minerals (Development & Regulation) Act, (Central Act LIII of 1948) (`the MMRD Act ' for short) or by Entry 52 of List I read with the Industries (Development and Regulation) Act (`the IDR Act ' for short), 1951 (Central ACt LXV of 1951).
The first of the above arguments was based on the fact that the cess was fixed at a percentage of the valuation of the mineral concerned at pit 's mouth.
This argument was based on two considerations.
The first related to the form and the second to the extent of the levy.
Repelling the argument, it was held that the extent of levy of a fee would always depend upon the nature of the services intended to be rendered and the financial obligations incurred thereby and cannot by itself alter the character of the levy from a fee into the of a duty of excise except where the correlation between the levy and services is not genuine or real or where the levy is disproportionately higher than the requirements of the services intended to be rendered.
So far as the first consideration was concerned, it was observed that the method in which the fee is recovered is a matter of convenience and by itself it cannot fix upon the levy the character of a duty of excise.
Though the method in which an impost is levied may be relevant in determining its character its significance and effect cannot be exaggerated.
The court, therefore, came to the conclusion that the cess levied by the impugned act was 118 neither a tax nor a duty of excise but a fee.
The second argument turned on the impact of the MMRD Act on the State 's power to levy a fee under Entry 66 read with Entry 23 of List II as a consequence of the declaration contained in S.2 of the Central Act.
The Court agreed that a declaration by Parliament in terms of Entry 54 of List I operated as a limitation on the legislative competence of the State Legislature itself and observed: "if Parliament by its law has declared that regulation and development of mines should in public interest be under the control of the Union, to the extent of such declaration the jurisdiction of the State Legislature is excluded.
In other words, if a Central Act has been passed which contains a declaration by Parliament as required by Entry 54, and if the said declaration covers the field occupied by the impugned Act, the impugned Act would be ultra vires not because of any repugnance between the two statutes but because the State Legislature had no jurisdiction to pass the law." (underlining ours) However, the answer to the argument was easily found by the Court inasmuch as the declaration on the terms of Entry 54 of List I relied on for the coal company was founded on Act LIII of 1948 which was an Act of the Dominion Legislature and not an Act of Parliament.
However, the Court did not stop here.
It proceeded to review the provisions of Central ACt LIII of 1948 and concluded that, if this Act were held to contain the declaration referred to in Entry 23, there would be no difficulty in holding that the declaration covered the field of conservation and development of minerals, and that the said field was indistinguishable from the field covered by the impugned Act.
In coming to this conclusion the Court pointed out that the rule making powers conferred on the Central Government under Section 6(2) of the Act included the levy and collection of royalties, fees and taxes in respect of minerals, mines, quarried excavated or collected.
The circumstance that no rules had in fact been framed by the Central Government in regard to the levy and collection of any fees, it was held, would not make any difference, The Court observed: "What Entry 23 provides is that the legislative competence of the State Legislature is subject to the provisions of List I with respect to regulation and development under the con 119 trol of the Union, and Entry 54 in List I requires a declaration by Parliament by law that regulation and development of mines should be under the control of the Union in public interest.
Therefore, if a Central Act has been passed for the purpose of providing for the conservation and development of minerals, and if it contains the requisite declaration, then it would not be competent to the State Legislature to pass an Act in respect of the subject matter covered by the said declaration.
In order that the declaration should be effective it is not necessary that rules should be made or enforced; all that this required is a declaration by Parliament that it is expedient in the public interest to take the regulation and development of mines under the control of the Union.
In such a case the test must be whether the legislative declaration covers the field or not.
Judged by this test there can be no doubt that the field covered by the impugned Act is covered by the Central Act LIII of 1948.
" The Court then considered the argument based on Entry 52 of List I and the provisions of the IDR Act but came to the conclusion that the vires of the impugned Act could not be successfully challenged on this ground.
Wanchoo J., delivered a separate dissenting judgment.
He held that the levy was not a fee or a land cess but a duty of excise.
He pointed out (at p 579 80) how taxes could be turned into fees on the so called basis of quantification with the help of the device of creating a fund and attaching certain services to be rendered out of monies in the fund.
In this view, he did not consider the question how far the Central Acts of 1948 and 1951 impaired the State 's competence to levy the fees in question.
He negatived the State 's attempt to bring the levy in question (treating it as a tax) within the scope of Entry 50 of List II.
He was of opinion that the expressions "taxes on mineral rights" referred to taxes on the right to extract minerals and not taxes on the minerals actually extracted.
He held that the cess in the present case was not a tax on mineral rights but a tax on the minerals actually produced.
It was no different in pith and substance from a a tax on goods produced which comes under Item 84 of List I as duty of excise.
Tulloch case ; The same issue regarding the competence of the Orissa State Legislature to levy the very same cess came up for consideration again 120 in the Tulloch case.
The scenario had changed because the levy now challenged was in respect of the period July 1957 to March, 1958 by which time the MMRD Act, 1957 (Central Act (Central Act LIII of 1948).
The 1948 Act, which had earlier provided for the regulation of mines and oil fields and for the development of minerals, was now limited only to oil fields and the 1957 Act provided for the regulation of mines and mineral development.
S.2 of the 1957 Act, like the predecessor 1948 Act, contained the following declaration in terms of Entry 54 of List I.
It read: "It is hereby declared that it is expedient in the public interest that the Union should take under its control the regulation of mines and the development of minerals to the extent hereinafter provided".
but unlike the earlier one this was a declaration contained in an Act of Parliament which had the effect of impairing the legislative competence of the State under Entry 23 read with Entry 66 of the State List.
The hurdle which prevented the Supreme Court from considering the provisions of the 1948 Act as a bar to the levy of the cess was therefore out of the way.
The Court analysed in detail the provisions of the impugned State Act as well as the two Central Acts.
It referred to its conclusion in the Hingir Rampur case that the field covered by the impugned State Act was covered by the 1948 Act and observed that this fully applied to the State Act vis a vis the 1957 Act also, particularly as Ss.
18(1) and (2) of the 1957 Act were wider in scope and amplitude and conferred larger powers on the Central Government than the corresponding provisions of the 1948 Act.
Counsel for the State attempted to distinguish the ambit of the 1957 Act from that of the 1948 Act.
But the Court pointed out that the argument could not prevail.
section 13 of the 1957 Act contained an express provision for the levy of a fee.
section 25 though not as categorically as section 6 of the 1948 Act clearly implied a power to levy "rent, royalty, tax, fee and other sums" a nd, besides, section 18 of the Central Act of 1957 were wider in scope and amplitude and conferred larger powers on the Central Government than the corresponding provisions of the Act of 1948.
It was reiterated, referring to Hingir Rampur and distinguishing Ch.
Tika Ramji & Ors.
vs The State of Uttar Pradesh & Ors., ; that it was incorrect to think that, until rules were made under section 13 or steps taken under S.25 to collect fees etc., the Central Act would not cover the field.
The Court observed, further: 121 "But even if the matter was res integra the argument cannot be accepted.
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, 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 present case, having regard to the terms of section 18(1) it appears clear to us that the intention of Parliament was to cover the entire field and thus to leave no scope for the argument that until rules were framed, there was no inconsistency and no supersession of the State Act".
Meeting the argument that the power to levy a fee was an independent head of legislative power under each of the three legislative lists and that the levy of tax undue the State Act could be traced to this entry, the Court pointed out the fallacy underlying the argument in the following words: "The materials words of the Entries are: "Fees in respect of any of the matters in this List".
It is, therefore, a prerequisite for the valid imposition of a fee that it is in respect of a "matter in the list".
If by reason of the declaration by Parliament the entire subject matter of "conservation and development of minerals" has been taken over, for being dealt with by Parliament, thus depriving the State of the power which it theretofore possessed, it would follow that the "matter" in the State List is, to the extent of the declaration, subtracted from the scope and ambit of Entry 23 of the State List.
There would, therefore, after the Central Act of 1957, be "no matter in the List" to which the fee 122 could be related in order to render it valid.
" The result was that Tulloch declared the levy of the cess to be invalid and it was held that, as and from 1.6.1958, the date on which the 1957 Act came into force, the Orissa Act should be deemed to be non existent for every purpose.
Murthy case We now come to the third important case on the topic, Murthy vs Collector of Chittoor, which seems to strike a somewhat different note although in both Tulloch and Murthy the judgments were delivered within a few month of each other by Rajagopala Ayyangar J. on behalf of 5 Judge Benches which were constituted differently.
The erstwhile Province of Madras (later State of Tamil Nadu) had been levying, since long, a cess on land revenue under the Madras District Boards Act (Madras Act XIV) of 1920.
Under S.78 of the Act, a cess was levied on the annual rent value of all occupied lands on whatever tenure held.
It was a tax at two annas in the rupee of the annual rent value of all lands ins the district.
The annual rent value of the land was to be calculated in the manner prescribed in S.79 of the Act.
The appellant held certain lands under a mining lease (for extraction of iron ore) from the Government which stipulated for the payment of a stipulated amount of dead rent, a royalty on the basis of every ton of ore mined as well as a surface rent per acre of the surface area occupied or used.
In the case of such lands, S.79(i) provided that "the lease amount, royalty or other sum payable to the Government for the lands" shall be taken to be the such lands, annual rent value.
The appellant was, therefore, called upon to pay a cess based on the royalty paid by him to the State Government (of Andhra Pradesh, which had succeeded to the State of Madras in respect of the territories in question) and it was the validity of this levy which was upheld by the High Court that came up for the consideration of this Court.
It was contended, on behalf of the appellant, relying on Hingir Rampur and Tulloch, that the provision imposing land cess quoad royalty must be held to be repealed by MMRD Act of 1948 or, in any event, by the MMRD Act, 1957 (Central Act LXVII of 1957) and that, after the date when these enactments came into force, the land cess that could be levied must be exclusive of royalty under a mining lease.
Distinguishing the decisions cited, this Court rejected the contention.
It observed: 123 "It will be seen that there is no resemblance, whatever, between the provision of the Orissa Act considered in the two decisions and the provision for the levy of the land cess under sections 78 and 79 of the Act with which we are concerned.
Sections 78 and 79 have nothing to do and are not concerned with the development of mines and minerals or their regulation.
The proceeds of the land cess are, under s.92 of the Act, to be credited to the District fund, into which, under the terms of the Finance Rules in section V to the Act, the land cess as well as several other taxes, fees and receipts are directed to be credited.
This fund is to be used under Ch.
VII of the Act with which s.112 starts "for everything necessary for or conducive to the safety, health, convenience or education of the inhabitants or the amenities of the local area concerned and everything incidental to the administration" and include in particular the several matters which are mentioned in those sections.
It will thus be seen that there is no connection between the regulation and development of mines and collection of land cess for which provision is made by ss.78 and 79 of the Act.
There is therefore no scope at all for the argument that there is anything in common between the Act and the Central Acts of 1948 and 1957 so as to require any detailed examination of these enactments for discovering whether there is any over lapping" A second contention raised before the Court was that, as the impugned land cess was payable only in the event of the lessee winning the mineral and not when no minerals were extracted, it was in effect a tax on the minerals won and, therefore, on mineral rights.
Rejecting this contention, the Court observed: "We are unable to accept this argument.
When a question arises as to the precise head of legislative power under which a taxing statue has been passed, the subject for enquiry is what in truth and substance is the nature of the tax.
No doubt, in a sense, but in a very remote sense, it has relationship to mining as also to the mineral won from the mine under a contract by which royally is payable on the quantity of mineral extracted.
But that does not stamp it as a tax on either the extraction of the mineral or on the mineral right.
It is unnecessary for the purpose of this case 124 to examine the question as to what exactly is a tax on mineral rights seeing that such a tax is not leviable by Parliament but only by the State and the sole limitation on the State 's power to levy the tax is that it must not interfere with a law made by Parliament as regards mineral development.
Our attention was not invited to the provision of any such law enacted by Parliament.
In the context of ss.78 and 79 and the scheme of those provisions it is clear that the land cess is in truth a "tax on land" within Entry 49 of the State List".
(emphasis added) The Court proceeded to explain why the land cess before it was nothing else except a land tax falling within Entry 49.
"Under section 78 of the Act the cess is levied on occupied land on whatever tenure held.
The basis of the levy is the "annual rent value" i.e., the value of the beneficial enjoyment of the property.
This being the basis of the Tax and disclosing its true nature, s.79 provides for the manner in which the "annual rent value" is determined i.e., what is the amount for which the land could reasonably be let, the benefit to the lessor representing the rateable value "or the annual rent value".
In the case of ryotwari lands it is the assessment which is payable to the Government that is taken as the rental value being the benefit that accrues to the Government.
Where the land is held under lease it is the lease amount that forms the basis.
Where land is held under a mining lease, that which the occupier is willing to pay is accordingly treated as the "annual rent value" of the property.
Such a rent value would, therefore, necessarily include not merely the surface rent, but the dead rent, as well as the royalty payable by the licensee, lessee or occupier for the user of the property.
The position then is that the rent which a tenant might be expected to pay for the property is, in the case of lease hold interests, treated as the statutory "annual rent value".
It is therefore not possible to accept the contention, that the fact that the lessee or licensee pays a royalty on the mineral won, which extended only to the mere use of the surface land, places it in a category different from other types where the lessee uses the surface of the land alone.
In each case the rent 125 which a lessee or licensee actually pays for the land being the test, it is manifest that the land cess is nothing else except a land tax.
" The judgment of the Supreme Court in the Murthy case (supra) held the field from 1964 to 1990.
Murthy followed: The above type of levy was not peculiar to the State of Tamil Nadu.
In fact, a cess on royalty was bound to be very remunerative to States having a wealth of mineral resources.
We are informed that similar cess is being levied in several States.
We have already referred to the cess levied in Orissa which came to be considered by this Court as early as 1961 and 1964 in the Hingir Rampur and Tulloch cases.
Further cases came up for consideration, on the same lines; in Bihar, Associated Cement Co. Ltd. vState of Bihar, and Tata Iron & Steel Co. vs State, (C.W.J.C. 30/1978 decided on 15.5.84 , the subject matter of C.A. 592/86 before us); in Orissa, Laxmi Narayan Agarwala vs State, A.I.R. 1983 Ori.
210; in Rajasthan, Bherulal vs State, A.I.R. 1965 Raj. 161; in Punjab, Sharma vs State, A.I.R, ; in Gujarat, Saurashtra Cement & Chemical Industries Ltd. vs Union, ; and Madhya Pradesh, Hiralal Rameshwar Prasad vs State, (m.P. 410/83 decided on 28.3.1986) and M.P. Lime Manufactures ' Association vs State of M.P., A.I.R. 1989 M.P. 264 F.B. and, except for the last two cases from Madhya Pradesh, the others upheld the levy of a cess which depended on royalties, following Murthy.
India Cement case The correctness of the above line of decisions came to be tested in India Cement Ltd. vs State.
The Government of Tamil Nadu and granted a mining lease on 19.7.1963 to the appellant for extraction of limestone and kankar for a period of twenty years.
The lease deed, which was in accordance with the Mineral Concession Rules, stipulated for the payment of royalty, dead rent and surface rent and also provided that the lessee was bound to pay all Central and State Government dues except land revenue.
At the time the lease was obtained, S.115(1) of the Madras Panchayats Act.
1958 provided for the levy, in each panchayat development block, of a local cess at the rate of 45 paise on every ruupee of land revenue payable to the Government in respect of any land for every fasli.
section 115(2) provided that the 126 local cess will be deemed to be public revenue and all the lands and buildings thereon shall be regarded as security therefore.
S 115(3) and (4) set out the various purposes for which the cess levied and collected under section 115 could be utilised.
S116 provided for the levy of a local cess surcharge.
The maximum amount of such surcharge was originally left to be prescribed by the Government and was in 1970 limited to Rs.1.50 on every rupee of land revenue and in 1972 to Rs.2.50 on every rupee of land revenue.
Apparently inspired by the decision in Murthy, the Tamil Nadu Panchayats (Amendment and Miscellaneous Provisions) Act (Tamil Nadu Act 18 of 1964) added, with full retrospective effect, the following Explanation to S.115(1): "Explanation: In this section and in Section 116, `land revenue ' means public revenue due on land and includes water cess payable to the government for water supplied or used for the irrigation of land, royalty, lease amount or other sums payable to the government in respect of land held direct from the government on lease or licence, but does not include any other cess or the surcharge payable under Section 116, provided that lands revenue remitted shall not be deemed to be land revenue payable for the purpose of this section".
The appellants ' challenge in the High Court to this levy which was consequent on the 1964 amendment was unsuccessful.
The High Court upheld it as a "tax on land" measured with reference to land revenue, royalty or lease or other amount as mentioned in the Explanation.
The challenge based on Entry 54 of List I read with Entry 23 of List II and the provisions of the MMRD Act, 1957 was also repelled, applying the decision in Murthy.
The appeal to this Court was referred to a Bench of seven Judges who came to the conclusion that Murthy dity of the levy of the cess.
It may be necessary to refer, in greater detail, to some passages in the judgment later but it will be convenient,.
for the present, to summarise the salient conclusions of the Court.
These were: 1.
The levy could not be supported under: (a) Entry 45 of List II: as it is not a tax on land revenue, an expression which has a well defined connotation.
`Land revenue ' is separate and distinct from `royalty.
The Explanation to S.115(1) itself proceeds on the basis that royalty cannot be land revenue 127 properly so called or conventionally so known.
(b) Entry 49 of List II: as it is not a tax on land.
A tax on land can only be levied on tax as a unit, must be imposed directly on land and must bear a definite relationship to it.
There is a clear distinction between a tax directly on land and a tax on income arising from land.
The cess is not a tax directly on land as a unit but only a tax on royalty which is indirectly connected with land.
In the words of Oza.
J. it is a tax not only on land but on labour and capital as well.
It could have been treated as a tax on land if it had been confined to `surface rent ' instead of `royalty.
(c) Entry 50 of List II: as a tax on royalty as it is not a tax on mineral rights and so is outside the purview of Entry 50.
Even otherwise, Entry 50 is subject to the provisions of List I and is, therefore, subject to the declaration contained in, and the purview of, the MMRD Act 1957.
Even if the cess is regarded as a fee, the State 's competence to levy the same can, if at all, only be justified with reference to Entry 23 and Entry 50 of List II but this recourse is not available as the field is already covered by Central Legislation referable to Entry 54 of List I. 3.
Murthy was not rightly decided.
The view of the Rajasthan, Punjab, Gujarat and Orissa decisions was overruled.
In the view taken by the Court, i.e. Madhya Pradesh ruling was not examined n detail, particularly as it was said to be pending in appeal before the Supreme Court.
In issue before us now are the levies of cesses based on royalty from lands containing minerals by the States of Orissa, Bihar and Madhya Pradesh.
Since the relevant statutes vary in detail and the parties concerned have also taken different stands, emphasising different aspects, the arguments have to be considered and dealt with separately, We may, however, mention that the appeals before us include those in the cases of Laxmi Narayan Agarwalla (Orissa).
land Harilal Rameshwar Prasad (Madhya Pradesh) noticed earlier.
THE VARIOUS ENACTMENTS ORISSA The invalidation in 1961 of Orissa Act XXVII of 1952 in Hingir Rampur apparently rendered it necessary for the State to bring in fresh 128 legislation.
The Orissa enactment with which we are now concerned is the Orissa Cess Act (Orissa Act IIof 1962) as amended by Act 42 of 1976.
According to the Statement of Objects and Reasons accompanying the bill, the primary objective of the legislation is to condense and simplify the existing law on the subject by consolidating the different enactments, customs and usages relating to the levy of cess in the State, to cure defects and deficiencies therein and to introduce uniformity in the levy of cess throughout the State.
The Act proposed to adopt a uniform rate of 25 paise in the rupee of the annual rental value and distribute the entire gross collection among the zilla parishads, panchayat samithis (referred to as `samithis ' in the Act) and grama panchayats in the ratio 5:8:12 respectively thus providing them with enhanced revenues to enable them to discharge their statutory responsibilities more efficiently by taking up development works and providing better amenities to the people of the State.
Its principal provisions are as follows: (i) Under Section 4, from and after the commencement of the Act, all lands (other than lands which were not liable to payment of rent or revenue before 1.4.77 and lands which were subject to a tax on land holdings sunder a 1950 Municipal Act) are made liable to the payment of cess (in addition to any land revenue, tax, cess rate or fee otherwise payable in respect thereof) determined and payable "as herein provided".
A 1976 amendment makes it clear that `lands held for carrying on mining operations" ar not exempt from the cess.
(ii) The "rate of cess, assessment [and] fixation of cess year" are dealt with by S.5 which originally read thus: "5.(1) The cess shall be assessed on the annual value of all lands on whatever tenure held calculated in the manner hereinafter appearing.
(2) The rate per year at which such cess shall be levied shall be twenty five percentum of the annual value of the land.
(3) x x x" Sub section(2) was amended by Act 13 of 1970 by substituting of 50% in place of 25% but a 1982 amendment inserted S.5A to provide that for a period 1.4.1977 to 31.3.1980, the cess would be levied at 25% of the annual value in respect of lands held for carrying on mining 129 operations.
section 5 was again amended by Act 15 of 1988 w.e.f. 26.10.1988 to read thus: "(2) The rate at which such cess shall be levied shall be.
a) in case of lands held for carrying on mining operations in relation to any mineral, on such percentum of the annual value of the said lands as specified against that mineral in Schedule II; and b) in case of other lands fifty percentum of the annual value.
Clause (a) was again amended by Act 17 of 1989 to read thus: "(a) in the case of land held for carrying on mining operations in relation to any mineral, such percentum of the annual value as the State Government may, by notification, specify from time to time in relation to such mineral".
It will thus be seen that, in place of a fixed rate, an elasticity was provided for, initially, by requiring the rates to be specified in the Schedule differently for different minerals.
Schedule II prescribed the percentage which the cess was to bear to the annual value; the percentages varied from 650% in the case of sand, to 300% in the case of coal, 200% in respect of certain minerals such as iron ore, limestone, manganese ore (except those meant for export or cement manufacture), 150% in the case of certain other minerals and 100% in respect of the rest.
Further elasticity was provided for in 1989 by leaving it to the Government to vary the rates by a simple notification.
In consequence of this amendment, Schedule has been omitted and a notification has been issued prescribing the percentage of the royalty or the dead rent (as the case may be) that is to be levied as the cess in respect of various items of specified minerals.
The rates specified are 650%, 400%, 300%, 200% and 150%.
In respect of all minerals not specified in the notification, the rate of cess is to be 100% of the royalty or dead rent.
(iii) S.6 specifies the person by whom the cess is payable.
In so far as is material for our present purposes, it directs that the cess is payable "(c) by a person for the lands he holds for carrying on mining operations and shall be paid by him to the Government".
This clause was inserted in S.6 simultaneously with the amendment of S.5 by Act 42 of 1976.
130 (iv) "Annual value" is defined in S.7 thus: "7.
Annual Value (1) The annual value of lands held by a raiyat shall be the rent payable by such raiyat to the land lord immediately under whom he holds the land: x x x x x x (2) In the case of lands held as an estate the annual value shall be the aggregate of (a) the amount which the intermediary is entitled to receive on account of revenue or rent less the amount payable by such intermediary as revenue to the intermediary immediately superior to him or to the Government, as the case may be; and (b) the rent, if any, payable held for carrying on mining operations, the annual value shall be the royalty or, as the case may be, the dead rent payable by the person carrying or mining operations(s) to the Government.
" The Explanation to the section defines "dead rent" and "royalty" in terms of their definitions in the MMRD Act,1957.
It also states the "royalty" would include "any payments made or likely to be make to the Government for the right of raising minerals from the land which shall be calculated on every tone of such minerals despatched from the land at the same rate as prescribed under the said Act or such other rate as may be fixed by the Government but not exceeding the amount which would have been otherwise payable as royalty under the said Act".
Act 17 of 1989 also amended S.7(3) to red thus: "(3) In the case of lands held for carrying on mining operations, the annual value shall be the royalty or, as the case may be, the dead rent payable by the person carrying on mining operations(s) to the Government or the pit 's mouth value wherever it has determined".
This was apparently intended to regulate the cess on coal in respect of which the pit 's mouth value had been determined.
So a notification 131 dated 14.8.89 was issued to provide that the cess in respect of coal bearing lands would be 30% of the pit 's mouth value of the said mineral.
(v) Sections 8 to 9B provide for the assessment of the cess in respect of various cases.
S.9B, inserted by the 1976 amendment, provided: "9B Assessment of cess on lands held for mining operations: (1) The cess payable in respect of lands held for carrying on mining operations shall be assessed in the prescribed manner.
(2) Nothing contained in Sections 8,9 and 9A shall apply in relation to the assessment of cess in respect of the aforesaid lands: The prescribed manner of such assessment had been already set out in the Orissa Cess Rules, 1963.
Rule 6A, inserted in 1977, deals with this but it is unnecessary for us to consider the details except to mention that it is assessed and collected, along with the amount of royalty or dead rent, by the Mining Officer concerned.
(vi) S.10 also needs to be referred to.
It originally read thus: "10.
Application of proceeds of the cess: (1) Notwithstanding anything contained in any other law the amount collected as cess shall be credited to the Consolidated Fund of the State and shall be utilised in the following manner, namely: (a) amounts collected in respect of lands within the local limits of any Municipality or Notified Area constituted under the Orissa.
Municipal Act, 1950 shall be paid to the concerned Municipal Council or Notified Area Council, as the case may be; and (b) amounts other than those referred to in clause (a) shall be distributed in the prescribed manner among the Grama Panchayats, Samitis and Parishads in the ratio of twelve is to eight is to five.
132 Explanation In this section "Grama Panchayat" mean a Grama panchayat constituted under the Orissa Grama Panchayats Act, 1948 and "Samiti" and "Parishad" respectively mean the Samiti and Parishad constituted under the Orissa Panchayat Samiti and Zila Parishad Act, 1964 and "Samiti" means a panchayat samiti constituted under the Orissa Panchayat Samitis Act 1959.
Orissa Act 13 of 1970 substituted the following section for the above: "10 Application of proceeds of the cess.
(1) Notwithstanding anything contained in any other law, the amount collected as cess shall be credited to the Consolidated Fund of the State and shell be utilised for the following purposes, namely: (a) primary education; (b) contribution to Grama Panchayats; and (c) contribution to Samitis.
Explanation In this section"Grama Panchayat" means & Grama Panchayat constituted under the Orissa Panchayat Samitis Act, 1959.
(2) The proportion in which the amount collected as cess is to be allotted for the said purpose shall be as may be prescribed.
As substituted by Act 42 of 1976, it reads: "10.
Application of proceeds of the cess: (1) Notwithstanding anything contained in any other law, all amounts collected as cess shall be credited fifty percentum of those which represent cess collected in respect of lands, other than lands held by carrying on mining operations, shall be utilised for the following purposes, namely: (a) primary education; (b) contribution to Grama Panchayats: and (c) contribution to Samitis.
(2) The allotment of amounts to be utilised for the pur 133 poses mentioned in clause (a) , (b) and (c) of sub section(1) shall be made in such proportion as may be prescribed" BIHAR We shall now turn to the relevant provisions of the Bihar Act.
Bihar is governed in this respect by the provisions of the Bengal Cess Act (Act IX of 1880).
It is sufficient to refer to the provisions of Sections 4 to 6,9 and to certain notifications.
(i) A definition of `royalty ' was introduced in S.4 of the Act by an ordinance of 1975.
It was amended by the Bihar Finance Act, 1981 and then by the Bihar Finance Act, 1982.
The definition as amended, w.e.f.
1.4.1982, by the latter reads as follows: "royalty for the purpose of this Act in respect of mines and quarries means payment (which includes dead rent) made or likely to be made to the owner of mines and minerals for the right of working the same on the quantity or value of such produce by a lessee if the land had been under a lease granted under MMRD Act, 1957, and rules made thereunder and includes any amount which Government may demand from the appropriation of mines and minerals belonging to the Government and any amount that may be paid as or in lieu of royalty for the right of working mines and quarries in areas held or acquired under any Act or agreement".
At the end of the section it added the following `interpretation clause ': "Valuation of mineral bearing land" means with reference to assessment of local cess in any year on land held for working mines and quarries the value at pit 's mouth of all the mineral extracted form the land in that year and the Explanation, which defines the value at pit 's mouth of a mineral; (ii) S.5 provided that, from and after the commencement of this Act, in any district or part of a district, all immovable property situate therein except otherwise in Section2 provided shall be liable to the payment of a local cess.
134 (iii) Section 6, again, is a much amended section, As substituted by Ordinance No.209 of 1975 dated 2.12.75, it read: "6.
Cess has to be assessed: The local cess shall be assessed on the annual value of lands and until provision to the contrary is made by the Parliament on the royalty of mines and quarries, sale value of the other immovable properties including forest produce and annual net profits from tramways and railways as contained respectively as prescribed in this Act and the rate at which the local cess shall be levied for each other shall be (a) in the case of royalty, the rate will be determined by the government from time to time but it will not exceed the amount of royalty; (b) in the case such annual net profits, fifteen paise on each rupee of such profits; (c) in the case of annual value of lands, twenty paise per rupee of the annual value; and (d) in the case of sale value of immovable properties including first produce, the rate will not exceed 10% and the State Government may, by notification, prescribe from time to time the commodities on the sale of which cess would be levied along with the rate at which it would be levied".
It was amended by a series of Bihar Cess (Amendment) ordinances between 1975 and 1982 .
It was further amended by the Finance Act, 1982 (w.e.f. 1.4.82), the Finance Act, 1984, the Finance Act, 1985 (w.e.f. 1.8.1985) and the Bihar Cess (Amendment) Ordinance, 1985, After the last of these amendments, the section stood thus: "S.6.
Cess how to be assessed: The local cess shall be assessed on the annual value of the lands and, until provision to the contrary is made by the Parliament, on the royalty of mines and quarries or on value of mineral bearing land as the case may be, sale value of other immovable properties including forest produce and annual net profits from tramways and railways ascertained respectively as prescribed in the Act and the rate at which the local cess 135 shall be levied for each year shall be (a) in the case of royalty, the rate will be determined by the Government from time to time but it will not exceed five times the amount of royalty, provided that the local cess payable in any one year shall not be less than the amount arrived at by multiplying the dead rent with the rate of cess determined undo clause (a); (aa) in the case of value of mineral bearing land, where the local cess payable in any year in respect of any mineral bearing land as assessed in clause (a) is less than 30 per cent of the value of mineral bearing land in that year, then, notwithstanding anything hereinbefore contained, the State Government may assess the local cess at such percentage of the value of the mineral bearing land, not exceeding [of] 30 per cent, as may be notified in the Official Gazette from time to time although the cess so assessed may exceed five times the amounts of royalty; (b) in the case of annual net profit, fifteen paise on each rupee of such profits; (c) in the case of annual value of land, twenty five paise per rupee of the annual value; and (d) in the case of sale value of immovable properties including first produce, the rate will not exceed 30 per cent and the State Government may , be notification prescribe from time to time the commodities on the sale of which cess would be levied along with the rates at which it would be levied".
The Bihar Cess (Amendment) Ordinance, 1987 (replaced by Act 3 of 1988) substituted 40% for 30% in clause (aa).
(iv) S.9 of the Act deals with the application of the proceeds of cess.
It has been amended from time to time, inter alia in 1976, 1977, 1978, 1979, 1980, 1981 and 1982.
After all these amendments, the section stood thus: "9.
Application of the proceeds of cess: The proceeds of local cess and all sums levied or recovered as interest or 136 otherwise shall in each district be paid in the district fund (i) at such rate as may, from time to time, be determined by the State Government in the case of local cess on annual value of land; and (ii) at such rate as may, from time to time, be determined by the State Government, subject to a maximum of twenty per cent in case of local cess on royalty of mines and quarries, or value of mineral bearing land, sale value of other immovable properties, forest produce and annual net profit from tramways and railways and the remaining amount shall be deposited in the consolidated fund of the State for the construction and maintenance of other works of public utility; xxx xxx xxx xxx xxx Provided further that out of the remaining amount not less than ten percent of the amount of the local cess collected under clause (a) or clause (aa) of Section 6 shall be spent for purposes relating to mineral development ' '.
(v) In exercise of the powers conferred by section 6 above, the State Government issued a notification on 20.11.80 determining the rate of cess on the amount of royalty of all minerals of the State at 100% w.e.f. 1.2.1980.
Our attention has also been drawn to, and some print made of, a notification dated 20.4.85 by which the State Government, modifying the earlier notification of 1.10.1981, determined the rate of cess ``on the amount of royalty of iron ore which is extracted from manually operated iron ore mines ' ' at 100% w.e.f. 1.10.84 which was followed up by a notification dated 20.11.85 enhancing the rate at 300% on the amount of royalty of iron ore w.e.f.21.6.85 in respect of mines other than those in which the ore is extracted manually.
Other notifications were also issued determining the rate of cess in respect of other minerals as indicated below : Date of Effective Mineral Rate Notification Date 20.11.85 21.6.85 Bauxite Ore, sand 500% for stowing 20.11.85 21.6.85 Copper Ore and 300% uranium 20.11.85 21.6.85 Lime stone and kynite 200% 20.11.85 21.6.85 Coal 30% of pit 's mouth value or 500% on the amount of royalty whichever is greater 137 Madhya Pradesh: In Madhya Pradesh, two statutes have to be considered: The first is the Madhya Pradesh Upkar Adhiniyam, 1981 (Act 1 of 1982).
It provides for the levy of an energy development cess (Part I), an urban development cess (Part II), a cess on transfer of vacant land (Part III), and a cess on storage of coal (Part IV).
The Act provided that the cesses levied under Parts I and IV should first be credited to the Consolidated Fund of the State but subsequently withdrawn and credited to a separate Electrical Development Fund [Ss.3(2)] and Coal bearing Area Development Fund [section 12(1)] and that the amounts to the credit of the funds as well as the cesses collected under Parts II and III should be utilised for special purposes connected respectively with energy development [S.3(3)] development of coal bearing areas [S.12(2)] urban development [section 7(2)] and rural development [section 9(5)].
Act 21 of 1987 changed Part IV into a part dealing with ``cess on land held in connection with mineral rights ' ' with full retrospective effect.
Part IV, as now substituted, deals only with ``land situate in the State and held under a mining lease for undertaking mining operations in relation to major mineral including operations for raising, winning or extracting coal ' '.
Section 11 and 12 read thus: ``Section 11: There shall be levied and collected a cess on land held in connection with mineral rights at such rate as may be notified by the State Government per ton of major mineral raised and the rate of cess prevailing in respect of coal during the period commencing from the date of commencement of the Principal Act and ending on the date of commencement of the Madhya Pradesh Upkar (Sanshodhan) Adhiniyam, 1987, shall be deemed to be the rate of cess notified under this sub section in respect of coal: Provided the subject to the limitation mentioned above the State Government may, by notification, increase or 138 reduce the rate of cess at an interval of not less than one year, where the rate is increased it shall not be in excess of fifty per cent of the rate for the time being in force; Provided further that every notification under the above proviso shall be laid on the table of the Legislative Assembly and the provisions of Section 24 A of the Madhya Pradesh General Clauses Act, 1957 (No. 3 of 1958) shall apply thereto as they apply to rule.
(2) The rate of cess to be notified for the first time in exercise of the powers conferred by Sub section (1) shall be effective from the [first of] April, 1987.
(3) The cess levied under sub section (1) shall, subject to and in accordance with the rules made in this behalf, be assessed and collected by such agencies and in such manner as may be prescribed.
(4) The agencies prescribed under sub section (3) shall for the purpose of assessment, collection and recovery of cess and all matters connected therewith, exercise such of the powers conferred upon the authorities specified in section 3 of the Madhya Pradesh General Sales Tax Act, 1958 (No. 2 of 1959) for the purpose aforesaid in respect of sales tax under said Act and the rules made thereunder, as may be prescribed as if such agencies were the authorities specified in the section 3 and the cess on land held in connection with mineral rights were the tax levied under the said Act.
Section 12 : The proceeds of the cess on land held in connection with the mineral rights may be utilised by the State Government for the general development of the mineral bearing areas. ' ' Section 12 has, however been omitted by an Amending Act of 1989, again, with full retrospective effect i.e. from 1.10.1982.
It appears, however, that there was in force in Madhya Pradesh w.e.f. 1.11.1982 another statute levying mineral development cess.
It was the M.P. Karadhan Adhiniyam, 1982 (Act 15 of 1982) as amended by M.P. Acts 1983 and 13 of 1985 which was challenged before the 139 M.P. High Court in Hiralal Rameshwar Prasad vs State and other connected cases.
The Madhya Pradesh Karadhan Adhiniyam, 1982, was enacted by State Legislature ``to provide for levy of school building cess, forest development cess and mineral areas development cess and matters incidental thereto ' '.
Part II of the Act deals with the school building cess.
Section 5 therein requires the holder of every holding of six hectares and above to pay the school building cess as provided therein.
The proceeds of the school building cess are required by S.4 to be credited to a separate Fund supplemented by a State contribution equal to 50% thereof and utilised for construction and furnishing of primary school buildings in non urban areas.
Part III of the Act deals with the forest development cess.
Section 7 imposes forest development cess on every sale or supply for forest produce by the Forest Department.
The proceeds thereof are to be credited to a separate Fund and utilised for social forestry, afforestation, reforestation, forest rehabilitation and other purposes connected with forest development.
Then comes Part IV dealing with the mineral areas development cess, the provisions of which are relevant for the purpose of these appeals and it is the charging provision therefor contained in Section 9 which has been attacked as constitutionally invalid.
The Section read thus: ``9. Levy of mineral areas development cess on land under mining lease ' '.
(1) There shall be levied and collected on the land held under a mining lease for undertaking mining operation a mineral areas development cess at the rate of twenty five percent of the rental value thereof.
(2) For the purpose of sub section (1), rental value shall be equal to the royalty or dead rent, as the case may be, whichever is higher.
(3) The mineral areas development cess shall be payable by person to whom the mining lease is granted.
(4) The mineral areas development cess shall, subject to and in accordance with the rules made in this behalf, be collected by such agencies and in such manner as may be prescribed and shall be applied towards development of mineral bearing areas ' '.
140 The 1983 amendment substituted the following sub section (1) in Section 9: ``(1) There shall be levied and collected on the land held under a mining lease for undertaking minor operations for a major mineral, a mineral areas development cess at the rate of one hundred percentum o the rental value thereof ' '.
The 1985 amendment substituted the following sub section in place of the above w.e.f.
1.8.1985: ``(1) There shall be levied and collected (a) on the land held under mining lease for undertaking mining operations for a major mineral other than coal a mineral areas development cess at the rate of one hundred percentum of the rental value thereof; (b) on the land held under mining lease for undertaking mining operations for coal, a mineral area development cess at the rate of the hundred twenty five percentum of the rental value thereof ' '.
and also made a provision for payment of interest on arrears of cess.
Rules have been framed under this Act called ``The Madhya Pradesh Mineral Areas Development Cess Rules, 1982 ' '.
Rule 3 provided for the collection of the cess every month along with the royalty or dividend.
Rule 10 thereof is alone relevant for the purpose of these partitions and read as under: ``10.
Application of cess: The State Government shall decide from time to time the manner in which the amount collected from cess shall be utilized for the development of mining lease areas ' '.
In 1985, an amendment substituted the words ``mineral bearing ' ' for the words ``mining lease ' ' in this rule.
It will be seen that, unlike the cesses referred to in Part I and III, the Act did not provide for the creation of a separate Fund for the mineral areas development cess.
The manner of utilisation thereof was also left to the discretion of the State Government though it had to be spent for development of mineral bearing areas.
141 THE CONTENTIONS ORISSA In the historical and statutory context set out above, the attempt of Sri T.S. Krishnamurthy Iyer, learned counsel for the State of Orissa to save the impugned legislation of the State is two fold.
First, he points out that in India Cement the statute, by Ss. 115 and 116, imposed a cess and surcharge on `land revenue ' and the explanation to section 115 defined `land revenue ' to mean `royalties '.
In other words that was a clear case of direct cess or Tax on royalties.
Here, on the other hand, s.5 makes it clear that what the legislature has provided for is a tax assessed on the annual value of all lands, on whatever tenure held, calculated at a percentage of the annual value of the land.
section 7, which defines `annual value ', provides for different measures for determining the annual value in respect of lands held under different kinds of tenures; and, in the case of lands held for mining operations, the measure of such annual value is the royalty or dead rent paid to the Government.
On a proper construction of the statute, he submits, the cess levied is a cess or tax on land and the `royalty ' is only taken as a measure for determining the quantum of tax.
He contends that India Cement only forbids a cess or tax on royalty as such and not a cess or tax on land, which may be measured by reference to the royalty derived from it.
He presses in aid of his argument the well marked distinction between the subject matter of a tax and its measure outlined, amongst others, in Ralla Ram 's case [1948] F.C.R.207 at pp.
218, 224 and Bombay Tyre International v Union, [1984] 1 S.C.C.487 at pp.
481 4.
This argument, Sri Iyer contended, is based on the statutory language used in the Orissa Cess Act, 1962 and should prevail independently of the correctness or otherwise of Murthy, Secondly, he submitted that `royalty ' is not a tax and the cess on royalty is also not a tax but only a fee.
This view is supported, he said, by the limitations imposed in the statute on the modes of its utilisation.
Being a fee, the State Legislature 's competence to impose it has to be determined with reference to Entry 23 read with Entry 66 of the State List.
So doing, the validity of the levy has to be upheld as, in counsel 's submission, the declaration contained in, and the provisions of, the MMRD Act, 1957 do not, in any way whittle down or impair this competence.
Basically, it will seen, two questions arise (1) Can the cess be considered as ``land revenue ' ' under Entry 45 or as a ``tax on land ' ' under Entry 49 or as a ``tax 142 on mineral rights ' ' under Entry 50 of the State List? (2) If the answer to question (1) is in the negative, can the cess be considered to be a fee pertaining to the field covered by Entry 23 of the State List or has the State been denuded of the legislative competence under this Entry because of Parliament having enacted the MMRD Act, 1957? Taking up the first question, the attempt to bring the levy under Entry 45 of the State List proceeds in two steps.
First, land revenue is the sovereign 's share of the proceeds of the land belonging to the sovereign and is represented, in the case of land containing minerals, by the payment of royalty to the Government.
Second, the cess, being an accretion to royalty, partakes of the same character.
This argument, however, must fail in view of the categorical observations of the Supreme Court in india Cement, (vide paras 20 and 21) as to the connection of the expression `land revenues '.
At least, in India Cement, the statute sought to include royalty within the meaning of `land revenue ' but there is no such provision in the Orissa Act and, this being so, royalty or the tax thereon cannot be equated to land revenue.
The cess here cannot be, therefore, brought under Entry 45.
Turning next to Entry 50, though Murthy left open the question how far a levy of this nature can be considered to be a tax on mineral rights (vide page 676), India Cement has chosen to approve the contrary view of Wanchoo J. in his dissenting judgment in Hingir Rampur (para 30).
Actually, it appears that the observations of Wanchoo J. have not been fully examined.
The learned Judge held that the tax in the case before him was not a tax on mineral rights because it was levied on the value of the minerals extracted.
If his observations in this context are read as a whole, it would seem that he also was of opinion that a tax on royalty would be a tax on mineral rights, for he observed (at pp.
582 3): `The next contention on behalf of the State of Orissa is that if the cess is not justified as a fee, it is a tax under item 50 of List II of the Seventy Schedule.
Item 50 provides for taxes on mineral rights subject to any limitations imposed by Parliament by law relating to mineral development.
This raises a question as to what are taxes on mineral rights.
Obviously, taxes on mineral rights must be different from taxes on goods produced in the nature of duties of excise.
If 143 taxes on mineral rights also include taxes on minerals produced, there would be no difference between taxes on mineral rights and duties of excise under item 84 of List I. A comparison of List I and II of the Seventh Schedule shows that the same tax is not put in both the Lists.
There fore, taxes on minerals rights must be different from duties of excise which are taxes on minerals produced.
The difference can be understood if one sees that before minerals are extracted and become liable to duties of excise somebody has got to work the mines.
The usual method of working them is for the owner of the mine to grant mining leases to those who have got the capital to work the mines.
There should therefore be no difficulty in holding that taxes on mineral rights are taxes on the right to extract minerals and not taxes on the minerals actually extracted.
Thus tax on mineral rights would be confined, for example, to taxes on leases of mineral rights and on premium or royalty for that.
Taxes on such premium and royalty would be taxes on mineral rights while taxes on the minerals actually extracted would be duties of excise.
It is said that there may be cases where the owner himself extracts minerals and does not give any right of extraction to somebody else and that in such cases in the absence of mining leases or sub leases there would be no way of leaving tax on mineral rights.
It is enough to say that these cases also, rare though they are, present no difficulty.
Take the case of taxes on annual value of buildings.
Where there is a lease of the building, the annual value is determined by the lease money; but there are many cases where owners themselves live in buildings.
In such cases also taxes on buildings are levied on the annual value worked out according to certain rules.
There would be no difficulty where an owner himself works the mine to value the mineral rights on the same principles on which leases of mineral rights are made and then to tax the royalty which, for example, the owner might have got if instead of working the mine himself he had leased it out to somebody else.
there can be no doubt therefore that taxes on mineral rights are taxes of this nature and not taxes on minerals actually produced.
Therefore the present cess is not a tax on mineral rights; it is a tax on the minerals actually produced.
Therefore the present cess is not a tax on mineral rights; it is a tax on the minerals actually produced and can be no different in pith and substance from a 144 tax on goods produced which comes under Item 84 of List I, as duty of excise.
The present levy therefore under section 4 of the Act cannot be justified as a tax on mineral rights.
However, the conclusion of India Cement is clear that a tax on royalties cannot be a tax on minerals and we are bound thereby.
This apart, we shall also advert, while discussing the second question, to another hurdle in the way of the State 's attempt to have recourse to Entry 50, which has also been touched upon by India Cement.
Can, then, the cess be described as a tax on land ' '? The Status considered in India Cement, as Sri Iyer correctly points out, was differently worded.
It purported to levy a cess on land revenue and `royalty ' was brought within the definition of that expression.
It was therefore, a case where they levy had no reference to land at all but only to the income from the land, in the case of Government lands, got by way of land revenue or otherwise.
Here the Statute is different.
The objective of the Cess Act as set out earlier, is to levy a cess on all land.
Indeed, originally the idea was to levy a uniform cess at 25% of the annual value of all land which was subsequently raised to 50%.
It is argued that the tax here is, therefore, a tax on land and it is immaterial that this tax is quantified with reference to the income yielded by the land.
A tax on land may be levied, inter alia with reference to its capital value or with reference to its annual value.
One realistic measure of such capital or annual value will be the income that the land will yield just as, for property tax purposes, the annual value is based on the amount for which the property can reasonably let from year to year.
The income from the land may be more or less due to a variety of reasons.
In the case of agricultural lands, it may depend on the fertility of the soil, the sources of irrigation available, the nature of crops grown and other such factors.
Likewise, where the land is one containing minerals, naturally the value (whether annual or capital value) will be more if it contains richer minerals and can be legitimately measured by reference to the royalties paid in respect thereof.
the mere fact, it is argued, that the annual value is measured with reference to the royalty, dead rent or pit 's mouth value of the mineral does not mean that it ceases to have the character of a tax on land.
In this context, Sri Iyer places strong reliance on the decision of a Constitution Bench of this Court in Ajay Kumar Mukherjea vs Local Board of Barpeta, [1965]3 S.C.R. 47.
There a local Board was authorised to ``grant. a license for the use of any land as a market and impose an annual tax thereon ' '.
The Court held, examining the Scheme and the language of the provision in question, that the tax imposed was a tax 145 on land under Entry 49.
The Court indicated the following approach to the issue before it: ``The first question which falls for consideration therefore is whether the impost in the present case is a tax on land within the meaning of Entry 49 of List II of the Seventh Schedule to the Constitution.
It is well settled that the entries in the three legislative lists have to be interpreted interpreted in their widest amplitude and therefore if a tax can reasonably be held to be a tax on land it will come within Entry 49.
Further it is equally well settled that tax on land may be based on the annual value of the land and would still be a tax on land and would not be beyond the competence of the State legislature on the ground that it is a tax on income: see Ralla Ram vs The Province of East Punjab, [1948] F.C.R.207.
it follows therefore that the use to which the land is put can be taken into account in imposing a tax on it within the meaning of entry 49 of List II, for the annual value of land which can certainly be taken into account in imposing a tax for the purpose of this entry would necessarily depend upon the use to which the land it put.
It is in the light of this settled proposition that we have to examine the scheme of section 62 of the Act which imposes a tax under challenge. ' ' On the other hand, it is contended for the respondents that, whatever may have been the original intention, the true and real impact of the cess is only on the royalties.
It is said that, at any rate, after the amendments of 1976, when lands held for mining operations were segregated for levy of separate and steep rates of cess based on royalty, the ostensible appearance of levying a tax on all land with reference to annual value has disappeared and a direct, undisguised tax on royalties from mining lands has taken its place.
it is urged that, for deciding whether the tax is really a tax on land as in Murthy or whether it is really a tax on royalties which has been struck down in India Cement, it is not the form or the statutory machinery that matters; one has to look at the real substance and true impact of the levy.
If this is done, it is said, there can be no doubt that the cess impugned here suffers from the same vice that vitiated the levy in India Cement.
The decision of this Court in Buxa Dooars Tea Co. vs State, was referred to by Sri G.Ramaswamy, learned 146 counsel for Orient Paper Mills, in support of this contention.
In that case, this Court was concerned with a cess levied annually.
Initially section 4(2) of the relevant statute levied the cess: ``(a) in respect of lands, at the rate of six paise on each rupee of development value thereof; (b) in respect of coal mines, at the rate of fifty paise on each tonne of coal on the annual dispatches therefrom; (c) in respect of mines other than coal mines and quarries, at the rate of six paise on each rupee of annual net profits thereof ' '.
With effect from 1.4.1981, clause (a) above was amended and clause (aa) inserted to provide for the levy of cess ``(a) in respect of land other than a tea estate, at the rate of six paise on each rupee of development value thereof; (aa) in respect of a tea estate at such rate, not exceeding rupees six on each kilogram of tea on the dispatches from such tea estate of tea grown therein, as the State Government may, by notification in the Official Gazette, fix in this behalf: Provided that in calculating the dispatches of tea for the purpose of levy of rural employment cess, such dispatches for sale made at such tea auction centres as may be recognised by the State Government by notification in the Official Gazette shall be excluded: Provided further that the State Government may fix different rates on dispatches of different kinds of tea ' '.
Sub section (4) was added in Section 4 to enable the State Government, if it considers necessary so to do, by notification in the Official Gazette, to exempt such categories of dispatches or such percentage of despatches from liability to pay the whole or any part of the rural employment cess or reduce the rate of rural employment cess payable thereon, under clause (aa) of sub section (2), on such terms and conditions as may be specified in the notification.
With effect from 1.10.1982, the first proviso to clause (aa) was omitted.
It was contended 147 for the tea estate, inter alia that the above levy violated the provisions of Article 301 of the Constitution and was also beyond the legislative competence of the State Government.
Upholding these contentions, the Court observed: ``The question then is whether the impugned levy impedes the free flow of trade and commerce throughout the territory of India and, if it does, whether it falls within the exception carved out in article 304(b).
If the levy imposes a cess in respect of tea estate, it may will be said that even though the free flow of trade is impeded in its Government throughout the territory of India, it is in consequence of an indirect or remote effect of the levy and that it cannot be said that article 301 is contravened.
The contention of the petitioners is, however, that it is ostensibly only in respect of tea estate but in fact it is a levy on despatches of tea.
If that contention is sound, there can be no doubt that it constitutes a violation of article 301 unless the legislation is brought within the scope of article 304(b).
To determine whether the levy is in respect of tea estates or is a levy on despatches of tea, the substance of the legislation must be ascertained from the relevant provisions of the statute.
It cannot be disputed that the subject of the levy, the nature of which defines the quality of the levy, must not be confused with the measure of liability, that is to say, the quantum of the tax.
There is a plenitude of case law supporting that principle, among the cases, being Union of India vs Bombay Tyre International, [1984] 1 S.C.R.347.
But what is the position here?. .
Now, for determining the true nature of the legislation, whether it is a legislation in respect of tea estate and therefore of land, or in respect of despatches of tea, we must, as we have said take all relevant provisions into account and ascertain the essential substance of it.
It seems to us that although the impugned provisions speak of a levy of cess in respect of tea estates, what is contemplated is a levy on despatches of tea instead.
The entire structure of the levy points to that conclusion.
If the levy is regarded as one in respect of tea estates and the measure of the liability is defined in terms of the weight of tea dispatched, there must be a nexus between the two indicating relationship between the levy, on the tea estate and the criteria for determining the 148 measure of liability.
If there is no nexus at all it can conceivably be inferred that the levy is not what it purports to be.
The statutory provisions for measuring the liability on account of the levy throws light on the general character of the tax as observed by the Privy Council in Re: A Reference under the Government of Ireland Act, 1920 and Section 3 of the Finance Act (Northern Ireland), 1934 [1963] 2 A.E.R. III.
In R.R. Engineering Co. vs Zilla Parishad, Barielly, ; this Court observed that the method of determining the rate of levy would be relevant in considering the character of the levy.
All these cases were referred to in Bombay Tyer International Ltd.; , where in the discussion on this point at page 367 this Court said: Any standard which maintains a nexus with the essential character of the levy can be regarded as a valid basis for assessing the measure of the levy ' '.
Applying the above tests to the case before it, the Court reached the conclusion that, in substance the impugned levy was a levy in respect of despatches of tea and not in respect of tea estates.
It was then pointed out that the question of legislative competence also turned on this issue: ``If this impugned legislation were to be regarded as a levy in respect of the estates, it would be referable to entry 49 in List II of the Seventh Schedule of the Constitution which speaks ``taxes on lands and buildings ' '.
But if the legislation is in substance legislation in respect of despatches of tea, legislative authority must be found for it with reference to some other entry ' ' Pointing out that no such entry in List II or III had been brought o its notice and further that, under S.2 of the Tea Ct, 1953, control over the tea industry has been assumed by Parliament within the meaning of Entry 54 of List I, the Court upheld the challenge to the competence of the State legislature to levy the impugned cess.
it is submitted that, likewise, here the levy is one in substance on royalties and not one on land.
There is force in the contention urged by Sri T.S.K. Iyer that there is a difference in principle between a tax on royalties derived 149 from land and a tax on land measured by reference to the income derived therefrom.
That a tax on building does not cease to be such merely because it is quantified on the basis of the income it fetches is nowhere better illustrated than by the form of the levy upheld in Ralla Ram, followed by Bhagwan Dass Jain; , which illustrates the converse situation.
Mukherjea (supra) also supports this line of reasoning.
But here the levy is not measured by the income derived by the assessee from the land, as is the case with lands other than mineral lands.
The measure of the levy is the royalty paid, in respect of the land, by the assessee to his lessor which is quite a different thing.
Moreover, interesting as the argument is, we are constrained to observe that it is only a reiteration of the ratio in Murthy which has been upset in India Cement.
We may point out that this is of significance because, unlike in India Cement, the statute considered in Murthy, as the one here, only purported to levy a cess on the annual value of all land.
India Cement draws a ``clear distinction between tax on land and tax on income arising from land ' '.
The former must be one directly imposed on land, levied on land as a unit and bearing a direct relationship to it.
In para 23 of the judgment, the Court has categorically stated that a tax on royalty cannot be said to be a tax directly on land as a unit.
Sri Iyer contended that all the observations and propositions in India Cement stem from the basic conclusion of the Court that the cess levied there was a cess on royalty in view of the Explanation to section 115.
He also submitted that the statue under consideration in India Cement did not provide for any cess in the case of land which did not yield any royalty; in other words, the Act did not use dead rent as a basis on which land was to be valued.
He drew attention to the observations of Oza, J.In para 42 of India Cement that if the Explanation to section 115 had used the words `surface rent ' in place of `royalty ' the position would have been different and that, if a cess on such `surface rent ' or `dead rent ' is charged, it could be justified as a tax on land falling within the purview of Entry 49, Here, however, the position is different and so, he urged, the nature of the levy is also different.
We may have considered these points as furnishing some ground to distinguish the present levy from that in india Cement but for the Court 's specific disapproval of Murthy.
We are unable to accept the plea of Sri Iyer that, in spite of Murthy, he can support the validity of the levy, as the statute considered in Murthy contained exactly the same features as are here emphasised by Shri Iyer and the validity of such Levy cannot be upheld after India Cement.
As to the second contention based on the observations in the judgment of Oza J., we may point out here the 150 levy is not one confined to dead rent or surface rent as suggested by Oza J. but one on royalty which even according to Oza J. cannot be described as a tax on land.
Sri Iyer contended that unless the case of the assessees is that the statute is a piece of colourable legislation, it is not possible to construe the levy on mineral lands differently.
He pointed out that section 4 of the Orissa Cess Act, 1962 levies a cess on all land and that, if Sc.
7(1) and (2) measuring the cess by reference to the income of other categories of land are valid, there is no reason why S.7(3) alone should be treated differently and objected to as imposing a tax on royalties particularly when the levy also extends to dead rent.
The answer to this contention appears to be that the plea of the assessee need not go to the extent of saying that the levy is a colourable piece of legislation.
it is sufficient to restrict oneself to the issue of a proper determination of the pith and substance of the legislation.
There is no doubt an apparent anomaly in considering section 7(1) and (2) as levying a tax on land but construing section 7(3) as imposing a tax on royalties and this anomaly has been noticed in India Cement (vide para 42).
But the question is, what is it that is really being taxed by the Legislature? So far as mineral bearing lands are concerned, is the impact of the tax on the land or on royalties? The change in the scheme of taxation under S.7 in 1976; the importance and magnitude of the revenue by way of royalties received by the State; the charge of the cess as a percentage and, indeed, as multiples of the amount of royalty; and the mode and collection of the cess amount along with the royalties and as part thereof are circumstances which go to show that the legislation in this regard is with respect to royalty rather than with respect to land.
Sri Iyer had invited our attention to the decision of this Court in R.R. Engineering Co. v Zila Parishad, ; which upheld the validity of a `circumstances and property tax ' levied by a Zila Parishad.
The High Court had held this levy could not be traced to any entry other than the residuary Entry 97 of List I. This Court, on appeal, pointed out the distinction between a tax of this type and a tax on income.
It held that the tax was a composite one referable to Entry 49 (tax on lands and buildings), Entry 58 (taxes on animals and boats) and Entry 60 (tax as on professions, trades, callings and employments) of List II.
While holding, therefore, that the ceiling of Rs.250 per annum referred to in Entry 60 would not be applicable to the tax, the Court uttered a ``word of caution ' '.
151 ``The fact that one of the components of the impugned tax, namely, the component of `circumstances ' is referable to other entries in addition to Entry 60, shall not be construed as conferring an unlimited charter on the local authorities to impose disproportionately excessive levies on the assessees who are subject to their jurisdiction.
An excessive levy on circumstances will tend to blue the distinction between a tax on income and a tax on circumstances.
income will then cease to be a mere measure or yardstick of the tax and will become the very subject matter of the tax.
Restraint in this behalf will be a prudent prescription for the local authorities to follow ' '.
While Sri Iyer sought to use this decision in support of his contention that a tax on property can be legitimately measured on the basis of the income therefrom, we think the observations extracted above are very apposite here.
The manner in which the levy, initially introduced a uniform cess on all land, was slowly converted, qua mining lands, into a levy computed at multiples of the royalty amounts paid by the lesses thereof seem to bear out the contention that it is being availed of as a tax on the royalties rather than one on the annual value of the land containing the minerals.
In the words of Chandrachud J. (as he then was) one can legitimately conclude that royalty has ceased to be a mere measure or yardstick of the tax and has become the very subject matter thereof.
For the reasons discussed above, we repel the contention of the State seeking to justify the levy under Entry 45, 49 and 50 of List II of the Seventh Schedule.
There has been considerable discussion before us as to whether `royalty ' itself is a tax or not.
The controversy before us centres round the discussion contained in paras 31 to 34 of the India Cement judgement.
Counsel for the assessees respondents invite attention to the opening sentence of para 34 which runs: ``In the aforesaid view of the matter, we are of the opinion that royalty is a tax ' ' and argue that this clinches the issue.
On the other hand, Sri Iyer submits that this purported conclusion does not follow from the earlier discussion and is also inconsistent with what follows.
He points out that though there is a reference in para 27 to the conclusion of Venkataramiah J. in a judgement of the Mysore High Court that royalty under S.9 of the MMRD Act is really a tax, and a reference in para 31 to the Rajasthan, Punjab, Gujarat and Orissa decisions to the effect that royalty is not a 152 tax, there is no discussion, criticism or approval of any of the decision on this point and that, therefore, the first sentence of para 34, relied upon for the respondents, is non sequitir.
He submits that, perhaps, there is a typographical error in the first sentence of para 34 and that the sentence should really read thus: ``In the aforesaid view of the matter, we are of opinion that cess is a tax, and as such a cess on royalty being a tax on royalty, is beyond the competence of the State Legislature. . ' ' He also points out that the last sentence of para 34 reads thus: ``Royalty on mineral right is not a tax on land but a payment for the use of land ' '.
He submits, therefore, that this issue has not been decided in India Cement.
He submits that, before we express any opinion on this issue, we should consider the matter afresh and places before us extracts from various lexicons and dictionaries to show that a royalty is nothing more than the rent or lease amount paid to a lessor in consideration for the grant of a lease to exploit minerals.
Reference may also be made to the discussion in this respect in paras 35 40 of Trivedi & Sons vs State of Gujarat, [1986] Supp.
S.C.C. 20.
It is therefore, neither a fee nor a tax but merely a price paid for the use of mineral bearing land.
We do not think that it is necessary for us to express an opinion either way on this controversy for, it seems to us, it is immaterial for the purposes of the present case.
If royalty itself were to be regarded as a tax, it can perhaps be described properly as a tax on mineral rights and has to conform to the requirements of section 50 which are discussed later.
We are, however, here concerned with the validity of the levy of not royalty but of cess.
If the cess is taken as a tax, then, unless it can be described as land revenue or a tax on land or a tax on mining rights, it cannot be upheld under Entry 45, 49 or 50.
On the contrary, if it is treated to Entry 23, a proposition the effect of which will be considered later.
the question whether royalty is a tax or not does not assist us much in furnishing an answer to the two questions posed in the present case and set out earlier.
We shall, therefore, leave this question to rest here.
This takes us to the second question posed by us initially and this 153 turns on the effect of M.M.R.D. Act, 1957 and the declaration contained in S.2 thereof which has been extracted earlier.
This will arise if we treat the levy as a tax falling under Entry 50 of List II or, alternatively, as a fee though it may not affect the State 's competence if it can be attributed to Entry 49 of List II.
To take up Entry 50 first, a perusal of entry 50 world show that the competence of the State Legislature with respect thereto is circumscribed by ``any limitations imposed by Parliament by law relating to mineral development ' '.
The M.M.R.D Act, 1957, is there can be no doubt about this a law of Parliament relating to mineral development.
S.9 of the said Act empowers the Central Government to fix, alter, enhance or reduce the rates of royalty payable in respect of minerals removed from the land or consumed by the lessee.
Sub section (3) of Section 9 in terms states that the royalties payable under the Second Schedule to the Act shall not be enhanced more than once during a period of three years.
India Cement has held that this is a clear bar on the State legislature taxing royalty so as, in effect, to amend the Second Schedule to the Central Act and that if the cess is taken as a tax falling under Entry 50 it will be ultra vires in view of the provisions of the Central Act.
It is possible, then, to treat the levy as a fee which the State legislature is competent to legislate for under Entry 66 of the State List? Sri Iyer contends for this position particularly on the strength of S.10 of the Orissa Cess Act, 1962.
There is one great difficulty in accepting this solution to the State 's problem.
S.10 as it stands now earmarks the purposes of utilisation of only fifty percent of the proceeds of the cess and that, too, is limited to the cess collected in respect of ``lands other than lands held for carrying on mining operations ' '.
In other words, the levy cannot be correlated to any services rendered or to be rendered by the State to the class of persons from whom the levy is collected.
Whether royalty is a tax or not, the cess is only a tax and cannot be properly described as a fee.
This consideration apart, even assuming it is a fee, the State legislature can impose a fee only in respect of any of the matters in the State List.
The entry in the State List that is relied upon for this purpose is Entry 23.
But Entry 23, it will be seen, is ``subject to the provisions of List I with respect to regulation and development ' ' of mines and minerals under the control of the Union.
Under Entry 54 of List I, regulation of mines and mineral development is in the field of Parliamentary legislation ``to the extent to which such regulation and 154 development under the control of the Union is declared by Parliament by law to be expedient in the public interest ' '.
Such a declaration is contained in section 2 of the M.M.R.D. Act, 1957, which has been set out earlier.
It, therefore, follow that any State legislation to the extent it encroaches on the field covered by the M.M.R.D. Act, 1957, will be ultra vires.
The assessees contend, in this case, that the legislation in question is beyond the purview of the State legislature by reason of the enactment of the M.M.R.D. Act.
It would appear, prima facie that the contention has to be upheld on the basis of the trilogy of decisions referred to at the outset viz. Hingir Rampur, Tulloch and India Cement.
They seem to provide a complete answer to this question.
The argument is, however, discussed at some length, because it has been put forward, mutatis mutandis, in support of the levy of cess by the other State as well.
Before dealing with the contentions of the counsel for the State in this behalf, a reference may be made to a difference in wording between Entry 52 and Entry 54 of List I. The languages of Entry 52 read with Entry 24 would suggest that, once it is declared by Parliament by law that the control of a particular industry by the Union is expedient in the public interest, the State legislatures completely lose all competence to legislate with respect to such an industry in any respect whatever, indian Tobacoo Co. Ltd. vs Union [1985] Supp. 1 S.C.R. 145.
But, even here, there are judicial decisions holding that such declaration does not divest the State legislature of the competence to make laws the pith and substance of which fall within the entries in List II, (see for e.g. Kannan Dewan Hills Co. vs State of Kerala; , and Ishwari Khetan Sugar Mills Ltd. vs State of U.P., ; to which reference will also be made later, merely on the ground that it has some effect on such industry.
Compared to that of Entry 52, the language of Entry 54 is very guarded.
It deprives the States of legislative competence only to the extent to which the law of Parliament considers the control of Union to be expedient in the matter of regulation of mines and mineral development.
Emphasising this difference, learned counsel for the State of Orissa submits that the intent, purpose and scope of the M.M.R.D. Act is totally different and does not cross the field covered by the impugned Act.
It is a law to provide for the proper exploitation and development of minerals and regulates the persons to whom, the manner in which and procedure according to which licenses for prospecting or leases for minerals should be granted.
The enactment is concerned with the need for a proper exploitation of minerals from lands.
The impugned Act, on the other hand, concentrates on the need 155 for development of mineral areas as such and provides for the collection of cess to cater to these needs.
The scope of the subject matter of legislation under the two Acts are entirely different and the M.M.R.D. Act cannot be considered to exclude State legislation of the nature presently under consideration.
Before considering the above contention, it will be useful to refer to certain earlier decisions of this Court which have a bearing on this issue.
State of West Bengal vs Union, [1964] 1 S.C.R. 371 concerned the validity of an Act of Parliament proposing to acquire certain coal bearing areas in the State qua certain areas vested in the State itself.
While upholding the general right of Parliament to legislate for the acquisition of even property vested in a State, the Court pointed out that this could be done only if there is some provision in the Central Act, expressly or necessarily implying that the property of the State is to be acquired by the Union.
However, the Court held, when the requisite declaration under Entry 54 is made, the power to legislate for regulation and development of mines and minerals under the control of the Union, would, by necessary implication, include the power to acquire mines and minerals.
Baijnath Kedia vs State of Bihar, ; was a case arising out of a 1964 amendment to the Bihar Land Reforms Act, 1950.
By section 10 of the 1950 Act, all the rights of former landlords or lessors under mining leases granted by them in their "estates" came to be vested in the State; but the terms and conditions of those leases were made binding upon the State Government.
Under a second proviso to this provision and a sub rule added by virtue of the 1964 amendment, additional demands were made to lessees, the validity of which was challenged successfully before this Court.
The Court, applying Hingir Rampur and Tulloch held that the whose whole of the legislative field in respect of minor minerals was covered by Parliamentary legislation and Entry 23 of List II was to the extent cut down by Entry 54 of List I.
The old leases could not be modified except by a legislative enactment by Parliament on the lines of S.16 of the M.M.R.D. Act, 1957.
In State of Haryana vs Chanan Mal, ; the State Government had declared saltpetre as a minor mineral and auctioned saltpetre mines in the State under the M.M.R.D. Act, 1957 read with the Punjab Minor Minerals Concession Rules, 1964.
In a writ petition filed by one of the owners, the High Court held, unless the mineral deposits were specifically mentioned in the wajib ul arz of the village 156 as having vested in the State, their ownership would continue to remain vested in the former proprietors according to the record of rights.
To meet this difficulty and the difficulties that had been created by haphazard leases created by the erstwhile proprietors, the State legislature passed the Haryana Minerals (Vesting of Rights) Act, 1973 and issued notifications thereunder again acquiring the rights to the saltpetre in the lands putting up certain saltpetre bearing lands to auction.
The High Court upheld the challenge to the validity of the notifications holding that, in view of the declaration contained in S.2 of the M.M.R.D. Act, the field covered by the impugned Act was already fully occupied by Central legislation and that, therefore, the State Act was void and imperative on grounds of repugnancy.
This Court, however, reversed the High Court 's decision.
It held that though the stated objects and reasons of the State Act showed that the acquisition was to be made to protect the mineral potentialities of the land and to ensure their proper development and exploitation on scientific lines and this did not materially differ from that which could be said to lie behind the Central Act the character of the State Act had to be judged by the substance and effect of its provisions and not merely by the purpose given in the Statement of Objects and Reasons.
Analysing the provisions of the Central Act, the Court pointed out that, subject to the overall supervision of the Central Government, the State Government had a sphere of its own powers and could take legally specified actions under the Central Act and rules.
In particular S.16(1)(b) of the Central Act showed that Parliament itself contemplated State legislation for vesting of lands containing minerals deposits in the State Government, a feature that could be explained only on the assumption that Parliament did not intend to touch upon the power of State legislatures under Entry 18 of List II read with Entry 42 of List III.S.17 also showed that there was no intention to interfere with vesting of lands in the States by the provisions of the Central Act.
The decision of Hingir Rampur, Tulloch and Baijnath Kedia were distinguished.
In Chanana Mal (Supra), the respondents relied upon certain observation in Hingir Rampur and State of West Bengal vs Union, (supra).
The Court, however, distinguished them saying: "In the two cases discussed above no provision of the Central Act 67 of 1957 was under consideration by this Court.
Moreover, power to acquire for purposes of development and regulation has not been exercised by Act 67 of 1957.
The existence of power of Parliament to legislate on this topic as an incident of exercise of legislative power on another subject is one thing.
Its actual exercise is another.
157 It is difficult to see how the field of acquisition could become occupied by a Central Act in the same way as it had been in the West Bengal 's case (supra) even before Parliament legislate to acquire land ina State.
At least untill Parliament has so legislated as it was shown to have done by the statute considered by this Court in the case from West Bengal, the field is free for State legislation falling under the express provisions of entry 42 of List III".
Tulloch and Baijnath Kedia were also considered no longer applicable as Ss.16 and 17 of the M.M.R.D. Act, 1957 had been amended to get over the need for a parliamentary legislation pointed out in Baijnath Kedia.
A similar question whether the State legislature was competent to acquire certain sugar undertakings, when the sugar industry had become a "declared: industry under the provisions of Entry 52 of List I read with S.2 of the I.D.R. Act, arose for consideration of Ishwari Khetan Sugar Mills (P) Ltd. vs State of U.P.,[1980] 3.
S.C.R. 331.
Answering this question in the affirmative, the Court observed : "The argument that the State legislature lacked competence to enact the impugned legislation is without force.
Legislative power of the State under Entry 24, List II is eroded only to the extent control is assumed by the Union pursuant to a declaration made by the Parliament in respect of a declared industry as spelt out by the legislative enactment and the field occupied by such enactment is measure of erosion.
Subject to such erosion, on the remainder the State legislature will have power to legislate in respect of a declared industry without in any way trenching upon the occupied field.
State legislature, which is otherwise competent to deal with industry under Entry 24, List II, can deal with that industry in exercise of other powers enabling it to legislate under different heads set out in Lists II and III and this power cannot be denied to the State.
The contention that the impugned Act is in violation of section 20 of the Central Act had no merit.
The impugned legislation was no enacted for taking over the management or control of nay industrial undertaken by the State undertakings.
If an attempt was made to take over the manage 158 ment or control of any industrial undertaking in a declared industry the bar of section 20 would inhibit exercise of such executive power.
The inhibition of section 20 is on the executive power which if as a sequel to an acquisition of an industrial undertaking the management or control of the industrial undertaking stands transferred to the acquiring authority section 20 is not attracted.
It does not preclude or forbid a State legislature exercising legislative power under an entry other than Entry 24 of List II and if in exercise of that legislative power the consequential transfer of management or control over the industry or undertaking follows as an incident of acquisition such taking over of management or control pursuant to an exercise of legislative power is not within the inhibition of section 20:.
The decisions in the above two case were, again, applied in Western Coalfields Ltd. vs Special Area Development Authority, ; Here the question was whether the enactment of the Coal Mines Nationalisation Act, 1973 and the M.M.R.D. Act 1957 precluded the State legislature from providing for the levy of a property tax by the Special Area Development Authority, constituted under a 1973 Act of the State legislature, in respect of lands and buildings used for the purposes of and covered by coal mines.
The plea on behalf of the appellant coalfields was that the State Act was invalid (a) as it encroached on the field vested in the Centre by reason of the declaration of S.2 of M.M.R.D. Act and (b) as it impeded the powers and functions of the union under the Coal Mines Nationalosation Act 1973 which had been enacted by Parliament "for acquisition of coal mines with a view to reorganising and restructuring such coal mines so to ensure the rational, coordinated and scientific development and utilisation of coal resources as best to subserve the common good".
Rejecting this contention the Court held : " Apart from the fact that there is no data before us showing that the property tax constitutes an impediment in the achievement of the goals of the Coal Mines Nationalisation Act, the provisions of the M.P. Act of 1973, under which Special Areas and Special Area Development Authorities are constituted afford an effective answer to the Attorney General 's contention.
Entry 23 of List II relates to "Regulation of mines and mineral development subject to the provisions of List I with respect to regulation and development under the control of the Union".
Entry 54 of List I 159 relates to "Regulation of mines and mineral development to the extent to which such regulation and development under control of the Union is declared by Parliament by law to be expedient in the public interest".
It is true that on account of declaration contained in S.2 of the Mines and Minerals (Development & Regulation) Act.
1957, the legislative field covered by Entry 23 of List II will pass on to Parliament by virtue of Entry 54, List I.
But in order to judge whether, on that account, the State legislature loses its competence to pass the Act of 1973, it is necessary to have regard to the object and purpose of that Act and to the relevant provisions thereof, under which Special Area development Authorities are given the power to tax lands and buildings within their jurisdiction.
We have set out the objects of the Act at the commencement of this judgement, one of which is to provide for the development and administration of Special Areas through Special Area Development Authorities.
Section 64 of the Act of 1973, which provides for the constitution of the special areas, lays down by sub section (4) that: Notwithstanding anything contained in the Madhya Pradesh Municipal Corporation Act, 1956, the Madhya Pradesh Panchayats Act, 1962 the Municipal Corporation, Municipal Council, Notified Area Committee or a Panchayat, as the case may be shall, in relation to the special area and as from the date of the Special Area Development Authority undertakes the function under clause (v) of clause (vi) of Section 68 ceases to exercise the powers and perform the function and duties which the Special Area Development Authority is competent to exercise and perform under the Act of 1973.
Section 68 defines the function of the Special Area Development Authority, one of which as prescribed by clause (v), is to provide the municipal services as specified in sections 123 and 124 of the Madhya Pradesh Municipalities Act, 1961.
Section 69, which defines the powers of the authority, shows that those powers are conferred, inter alia for the purpose of municipal adminstration.
Surely, the functions, powers and duties of Municipalities do not become an occupied filed by reason of the declaration contained in section 2 of the mines and Minerals (Development & Regulation) Act, 1957.
Though, therefore, on account of that declaration, the legislative field covered by Entry 23, List II may pass 160 on to the Parliament by virtue of Entry 54, List I, the competence of the State Government to enact laws for municipal adminstration will remain unaffected by our declaration.
Entry 5 of List II related to "Local Government, that is to say, the constitution and powers of municipal corporation and other local authorities for the purpose of local self Government".
It is in pursuance of this power that the State legislature enacted the Act of 1973.
The power to impose tax on lands and buildings is derived by the State Legislature from Entry 49 of List II: " Taxes on lands and buildings".
The power of the municipalities to levy tax on lands and buildings has been conferred by the State Legislature on the Sspecial Area Development Authorities.
Those authorities have the power to levy that tax in order effectively to discharge the municipal functions which are passed on them.
Entry 54 of List I does not contemplate the taking over of municipal functions.
" The Court pointed out that Murthy provided a complete answer to the above contention.
Chanan Mal and Ishwari Khetan, were referred to and Baijnath Kedia distinguished.
The decision of the Madhya Pradesh High Court in Central Coalfields vs State of M.P., A.I.R. 1986 M.P. 33 also arose out of similar facts: The question for consideration was whether the functions, powers and duties of Municipalities and Special Area Development Authority (SADA) become an occupied field by virtue of S.2 of the MMRD Act, 1957 and the powers vested in them to regulate construction activities relating to mining areas was ultra vires.
It was found that SADA had become the local authority to discharge the functions of a municipal adminstration under a State Act and that the regulation of construction activities was one of the aspects of municipal adminstration and management.
In this situation, the question posed was answered in the negative following Ishwari Khetan, Western Coalfields and Chanan Mal.
Placing considerable reliance on the decisions in Chanan Mal, Ishwari Khetan and Western Coalfields, Sri Iyer contended that the State legislation in the present case is not vitiated by reason of M.M.R.D. Act, 1957.
He also pointed out that India Cement also dies not consider in detail the reasoning in Hingir Rampur and Tulloch but only reefers to certain observations in the dissenting judgement of Wanchoo J ( as His Lordship then was) in the former case and urged.
161 that the entire matter requires careful consideration.
He submitted that Tulloch and Western Coalfields represent two lines of cases which need reconciliation and that this task has not been attempted at all in India Cement.
On the other hand, learned counsel for the respondents submitted that the authority of the Constitution Bench in Western Coalfields which endorsed Murthy should be considered weak after India Cement which has overruled Murthy.
The present case, it is submitted, is closer to Baijnath Kedia.
It is submitted that the principles of Tulloch have been referred to with approval in a number of cases [ Karunanidhi, 1979 3SCR 254 at 277] Hind Stone; , at 746m I.T.C., at 168 and are too well settled to need any reconsideration.
It is clear from a perusal of the decisions referred to above that the answer to the question before us depends on a proper understanding of the scope of M.M.R.D. Act 1957, and an assessment of the encroachment made by the impugned State legislation into the field covered by it.
Each of the cases referred to above turned on such an appreciation of the respective spheres of the two legislations.
As pointed out in Ishwari Khetan, the mere declaration of a law of Parliament that it is expedient for an industry of the regulation and development of mines and minerals to be under the control of the Union under Entry 52 or entry 54 does not denude the State legislatures of their legislative powers with respect to the fields covered by the several entries in List II or List III.
Particularly, in the case of a declaration under Entry 54, this Legislature Power is extended to the extent control is assumed by the Union pursuant to such declaration as spelt out by the legislative enactment which makes the declaration.
The measure of erosion turns upon the field of the enactment framed in pursuance of the declaration.
While the legislation in Hingir Rampur and Tulloch was found to fall within the pale of the prohibition, those in Chanan Mal, Ishwari Khetan and Western Coalfields were general in nature and traceable to specific entries in the State List and did not encroach on the field of the Central enactment except by way of incidental impact.
The Central Act, considered in Chanan Mal, seemed to envisage and indeed permit State legislation of the nature in question.
To turn to the respective spheres of the two legislations we are here concerned with, the Central Act (M.M.R.D. Act, 1957) demarcates the sphere of Union control in the matter of mines and mineral development.
While concerning itself generally with the requirements 162 regarding grants of licenses and leases for prospecting and exploitation of minerals, it contains certain provisions which are of direct relevance to the issue before us.
S.9, which deals with the topic of royalties and specifies not only the quantum by also the limitations on the enhancement thereof, has already been noticed.
S.9A enacts a like provision in respect of dead rent.
Reference may also be made to S.13 and S.18, which to the extent relevant, are extracted here.
Power of Central Government to make rules in respect of minerals (1) The Central Government may, by notification in the Official Gazette, make rules for regulating the grant of prospecting licenses and mining leases in respect of minerals and for purposes connected therewith.
(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely : (i) the fixing and collection of fees for prospecting licenses or mining leases, surface rent, security deposit, fines, other fees or charges and the time within which and the manner in which the dead rent or royalty shall be payable;* XXX XXX XXX XXX XXX (m) the construction, maintenance and use of roads, power transmission lines, tramways, railways, aerial rope ways, pipe lines and the making of passages for water for mining purposes on any land comprised in the mining lease; XXX XXX XXX XXX XXX (qq) The manner in which rehabilitation of flora and other vegetation such as trees and the like destroyed by reason of any prospecting a mining operation shall be made in the ______________________________________________________________ *Substituted by Act 37 of 1986 for the original clause (i) which read: (i) the fixing and collection of dead rent, fines, fees or other charges and their collection of royalties in respect of (i) prospecting licenses, (ii) mining leases, (iii) minerals, mines, quarried, excavated or collected".
163 same area or in any other area selected by the Central Government (whether by way of reimbursement of the cost of rehabilitation or otherwise) by the person holding the prospecting license or mining lease"* S.18, which originally laid a duty on the Central Government to take all such steps as may be necessary "for the conservation and development of minerals in India" has been amended by Act 37 of 1986 to cover steps "for the conservation and systematic development of minerals in India and for the protection of environment by preventing or controlling any pollution which may be caused by prospecting or mining operations" and the scope of the rule making power under S.18(2) has likewise been enlarged.
S.25(1) read thus: "25(1) Any rent, royalty, tax fee or other sum due to the Government under this Act or the rules made thereunder or under the terms and conditions of any prospecting licence or mining lease may, on a certificate of such effect as may be specified by the State Government in this behalf by general or special order, be recovered in the same manner as an arrear of land revenue".
and sub section (2) provides, further, that all such "rent, royalty, tax, fee" etc.
shall be a first charge of the assets of the holder of the prospecting licence or mining lease as the case may be.
If one looks at the above provisions and bears in mind that, in assessing the field covered by the Act of Parliament in question, one should be guided (as laid down in Hingir Rampur and Tulloch) not merely by the actual provisions of the Central Act or the rules made thereunder but should also take into account matters and aspects which can legitimately be brought within the scope of the said statute, the conclusion seems irresistible, particularly in view of Hingir Rampur and Tulloch, that the State Act has trespassed into the field covered by the Central Act.
The nature of the incursion made into the fields of the Central Act in the other cases were different.
The present legislation, traceable to the legislative power under Entry 23 or Entry 50 of the State List which stands impaired by the Parliamentary declaration under Entry 54, can hardly be equated to the law for land acquisition or municipal administration which were considered in the cases cited and which are traceable to different specific entries in List II or List III.
___________________________________________________________ *Newly inserted by Act 37 of 1986 164 Sri Iyer contended that the object and purposes of the Orissa Act and its provisions were quite distinct and different from the object and purposes of the Central Act with the result that the two enactments could validly coexist since they do not cover the same field.
It was argued that the impugned Act was concerned with the raising of funds to enable panchayats and Samitis to discharge their responsibilities of local administration and take steps for proper development of areas (including mining areas) under their jurisdiction whereas the Central Act was concerned not with any social purpose but merely with the development of mineral resources of the country and as such the State legislation in this regard may also be treated as referable to Entry No.5 of the State List as the statute in Western Coalfields (supra).
As to the reliance on Entry 5 of List II, it is plainly to tenuous.
As pointed out by Sri Bobde, there is a difference between the `object ' of the ACt and its `subject.
The object of the levy of the fees may be to strengthen the finances of local bodies but the Act has noting to do with municipal or local administration.
In this context, it may be pointed out that while S.10 of the Orissa Act, as originally enacted, provided for a distribution of the cess collected among local bodies, an amendment of 1970 restricted the utilisation of the cess partly for primary education and partly for the above purpose.
Even this was amended in 1976 whereafter there has been no restriction regarding the cess collected in respect of mining areas which form part of the consolidated fund of the State.
The levy has, therefore, ceased to be capable of being described as a fee.
Even if its purpose is only to levy a fee, the fee can be described only as one with respect of `land ' (Entry 18) if considered generally or with respect to mines and minerals development (Entry23) if restricted to the nature of the issue before us.
We shall discuss the relevance of Entry 18 later but, so far as Entry 23 is concerned, the State 's legislative competence is subject to the field covered by the Central Act.
Turning therefore to the distinction sought to be made between the respective areas of operation of the two Acts the answer to this contention is provided by Hingir Rampur.
The Constitution Bench first set out the scheme of the impugned Act thus : "The scheme of this Act thus clearly shows that it has been passed for the purpose of development of mining areas in the State.
The basis for the operation of the Act is the constitution of a mining area, and it is in regard to mining areas thus constituted that the provision of the Act come 165 into play.
It is not difficult to appreciate the intention of the State Legislature evidenced by this Act.
Orissa is an under developed State in the Union of India though it has a lot of mineral wealth of great potential value.
Unfortunately its mineral wealth is located generally in areas sparsely populated with bad communication.
Inevitably the exploitation of the minerals is handicapped by lack of communications, and the difficulty experienced in keeping the labour force sufficiently healthy and in congenial surroundings.
The mineral development of the State, thereof, requires that provision should be made for improving the communications by constructing good roads and by providing means of transport such as tramways, supply of water and electricity would also help.
It would also be necessary to provide for amenities of sanitation and education to the labour force in order to attract workmen to the area.
Before the Act wa passed it appears that the mine owners tried to put up small length roads and tramways for their own individual purpose, but that obviously could not be as effective as roads constructed by the State and tramway service provided by it.
It is on a consideration of these facts that the State Legislature decided to take an active part in a systematic development of its mineral areas which would held the mine owners in moving their minerals quickly through the shortest route and would attract labour to assist the excavation of the minerals.
Thus there can be no doubt that the primary and the principal object of the Act is to develop the mineral areas in the State and to assist more efficient and extended exploitation of its mineral wealth".
A little later, at pare 559, the provisions of Central Act LIII of 1948 which were less far reaching that those of 1957 ACt as can be seen from the observations at page 476 of Tulloch were analysed and the Court concluded : "Amongst the matters covered by S.6(2) is the levy and collection of royalties, fees or taxes in respect of minerals mined, quarried, excavated or collected.
It is true that no rules have in fact been framed by the Central Government in regard to the levy and collection of any fees; but, in our opinion, that would not make any difference.
If it is held that this Act contains the declaration referred to in Entry 166 23 there would be no difficulty in holding that the declaration covers the field of conservation and development of minerals, and the said field is indistinguishable from the field covered by the impugned Act.
What Entry 23 provides is that the legislative competence of the State Legislature is subject to the provisions of List 1 with respect of regulation and development under the control of the Union, the Entry 54 in List 1 requires a declaration by Parliament by law that regulation and development of mines should be under the control of the Union in public interest.
Therefore, if a Central Act has been passed for the purpose of providing for the conservation and development of minerals, and if it contains the requisite declaration, then it would not be competent to State Legislature to pass an Act in respect of the subject matter covered by the said declaration.
In order that the declaration should be effective it is not necessary that rules should be made or enforced; all that this required is a declaration by Parliament that it is expedient in the public interest to take the regulation and development of mines under the control of the Union.
In such a case the test must be whether the legislative declaration covers the field or not.
Judged by this test there can be no doubt that the field covered by the impugned Act is covered by the Central Act LIII of 1948".
The following observations in Tulloch are also apposite in this context: " On the other hand, Mr. Setalvad learned counsel for the respondent urged that the Central ACt covered the entire field of mineral development, that being the "extent" to which Parliament had declared by law and it was expedient that the Union should assume control.
In this connection he relied most strongly on the terms of s.18(1) which laid a duty upon the Central Government "to take all such steps as may be necessary for the conservation and development of minerals in India and " for that propose the Central Government may, by notification, make such rules as it deems fit".
If the entire field of mineral development was taken over, that would include the provision of amenities to workmen employed in the mines which was necessary in order to stimulate or maintain the working of mines.
The test which he suggested was whether, if under the power 167 conferred by s.18(1) of the Central Act, the Central Government has made rules providing for the amenities for which provision was made by the Orissa Act and if the Central Government had imposed a fee to defray the expenses of the provision of these amenities, would such rules be held to be ultra vires of the Central Government, and this particularly when taken in conjunction with the matters for which rules could be made under s.13 to which reference has already been made.
We consider there is considerable force in this submission of learned counsel for the respondent, and thus would require very detailed and careful scrutiny.
We are, however, relieved from this task of detailed examination and discussion of this matter because we consider that it is concluded by a decision of the Court in the Hingir Rampur Coal Co. Ltd & Ors.
vs The State of Orissa & Ors., [1961] 2.S.C.R. 537 The above argument was accepted by the Court, vide page 476, Reference may also be made here to the recent decision of this Court in Bharat Coking Coal vs State of Bihar, ; The question whether the State of Bihar had the authority to grant a lease for lifting coal slurry coming out of the appellants washeries and getting deposited on the river bed or other lands was answered in the negative the court came to the conclusion that the "slurry" was a "mineral" and that its regulation was within the exclusive jurisdiction of Parliament.
The Court, in coming to the conclusion, held that no rules had been framed under S.18(1) or 18(2) (k) disposal or discharge of waste, slime or tailing arising from any mining or metallurgical operations carried out but held that this was immaterial in view of the principles laid down in Hingir Rampur, Tulloch and Baijnath Kedia.
These observations establish on the one hand that the distinction sought to be made between mineral development and mineral area development is not a real one as the two types of development are inextricably and integrally interconnected and, on the other, that, fees of the nature we are concerned with squarely fall with the scope of the provisions of Central Act.
The object of S.9 of the Central Act cannot be ignored.
The terms of S.13 of the Central Act extracted earlier empower the Union to frame rules in regard to matters concerning roads and environment.
S.18(1) empowers the Central Government to take all such steps as may be necessary for the conservation and development of minerals in India and for protection of environment.
These, in the very nature of things, cannot mean such amenities only in the mines but take in also the areas leading to and all 168 around the mines.
The development of mineral areas is implicit in them.
S.25 implicitly authorises the levy of rent, royalty, taxes and fees under the Act and the rules.
The scope of the powers thus conferred is very wide.
Read as a whole, the purpose of the Union control envisaged by Entry 45 and the M.M.R.D. Act 1957, is to provide for proper development of mines and mineral areas and also to bring about a uniformity all over the country in regard to the minerals specified in Schedule I in the matter of royalties and, consequently prices.
Sri Bobde, who appears for certain Central Government undertakings, points out that the prices of their exports are fixed and cannot be escalated with the enhancement of the royalties and that, if different royalties were to be charged in different States, their working would become impossible.
There appears to be force in this submission.
As pointed out in India Cement, the Central Act bars an enhancement of the royalty directly or indirectly, except by the Union and in the manner specified by the 1957 Act, and this is exactly what the impugned Act does.
We have, therefore, come to the conclusion that the validity of the impugned Act cannot be upheld by reference to Entry 23 or Entry 50 of List II.
An attempt was made to rest the legislation of Entry 18 of List II viz. `land '.
This attempt cannot succeed for the reasons whichever have set out to negative the plea that it falls under Entry 49.
A similar pleas in Baijnath was rejected by Hidayatullah C.J. in the following words : "Mr. L.N. Sinha argued that the topic of legislation concerns land and therefore falls under entry 18 of the State List and he drew our attention to other provisions on the subject of mines in the Land Reforms Act as originally passed.
The abolition of the rights of intermediaries to the mines and vesting these rights as lessors in the State Government was a topic connected with land and land tenures.
But after the mining leases stood between the State Government and the lessees, any attempt to regulate those mining leases will fall not in entry 18 but in entry 23 even though the regulation incidentally touches land.
The pith and substance of the amendment to s.10 of the Reforms Act falls within entry 23 although it incidentally touches land and not vice versa.
Therefore this amendment was subject to the overriding power of Parliament as declared in Act 67 of 1957 in S.15.
Entry 18 of the State List, therefore, is no help".
169 It will be seen that, if the levy in question cannot be described as a tax on land, it cannot be described as fee with regard to land either.
For the reasons above mentioned, we hold that the levy of cess under S.5 to 7 of the Orissa Cess Act, 1962 is beyond the competence of the State Legislature.
Bihar: The relevant provisions of the Bihar statutes have been set out earlier.
While S.5 only lays down that all immovable property shall be liable to a local cess and S.6 provides for the levy to be based on the annual value of lands and sale value of other immovable properties, the latter section specifically enacts that the cess will be on royalty from mines and quarries and on the annual net profit the railways and tramways.
The further amendments of S.6 have not changed this basic position.
Though the section refers also to the value of the mineral bearing land, that furnishes only the maximum upto which the cess, based on royalty, could go.
In other words, the cess is levied directly on royalties from mines and quarries.
The case is, therefore, indistinguishable from India Cement.
The notifications place the matter beyond all doubt.
The levy is a percentage or multiple of the royalty depending upon the kind of mineral and in the case of iron ore the method of extraction and nature of the process employed.
There are no clear indications in the stature that the amounts are collected by way of fee and not tax.
The provisions of S.9 extracted earlier would indicate that only a small percentage goes to the district fund and the remaining forms parts of the consolidated fund of the State "for the construction and maintenance of other works of public utility".
However, the proviso does require at least ten percent to be spent for purposes relating to mineral development.
We shall, therefore assume that the levy can be treated, in part, as a fee and, in part, as a tax.
But even this does not advance the case of the respondents for the reasons already discussed.
Shri Chidambaram submits that, in the original counter affidavit filed on behalf of the State, no case was sought to be made out that it was a tax on land, the case was that it was a "tax on mineral rights".
He urged that, this being out of question because of India Cement (para 23 and 30) a belated attempt is made to bring it under Entry 49.
we do not need to discuss the contentions here in detail because this is a clearer case of levy on royalty than in Orissa; and, for the reasons we have outlines in our discussion in regard to the Orissa Acts, this levy 170 has also to be declared invalid.
Shri Chidambaram also contended that the State cannot seek sustain the levy by relying of article 277 of the Constitution , in view of the fact that the cess is being levied since 1880.
Article 277 is in these terms : "Any taxes, duties, cesses or fees which, immediately before the commencement of this Constitution, were being lawfully levied by the Government of any State or by an municipality or other authority or body for the purposes of the State, municipality, district or other local area may, notwithstanding that those taxes, duties, cesses or fees are mentioned in the Union List, continue to be levied and to be applied to the same purposes until provision to the contrary is made by Parliament by law".
We think, as rightly contended by Sri Chidambaram that a reliance on article 277 will be misplaced for three reasons : (a) The levy that is challenged is under S.6, as amended in 1975, i.e. a post constitution levy; (b) S.6 on its own language, is operative only "until provision to the contrary is made by the Parliament" and, as we have held that the field is covered by the M.M.R.D. Act, is supersedes the effect of S.6 re:mineral lands; and (c) Article 277 only saves taxes, duties, and cesses mentioned therein if they continue to be applied for the same purposes and until Parliament by law provides to the contrary and with the enactment of the M.M.R.D. Act, 1957, they cease to be valid.
In this context, the following observations of this Court in Ramakrishna Ramanath vs Janpad Sabha,[1962] Supp 3 SCR 70 quoted in Town Municipal Committee vs Ramachandra, ; at 959 are quire apposite : "Dealing next with the import of the words `may continue to be levied ' the same was summarized in these terms: (1) The tax must be one which was lawfully levied by a local authority for the purpose of a local area, 171 (2) the identity of the body that collects the tax, the area for whose benefit the tax is to be utilised and the purposes for which the utilization is to take place continue to be the same, and (3) the rate of the tax is not enhanced not its incidence in any manner altered, so that it continues to be the same tax".
It is obvious that if these tests were applied the attempt to sustain the tax on the basis of article 277 cannot succeed.
Indeed, no such attempt was made before us.
We, therefore, hold that the levy of cess has to be struck down.
It has also been brought to our notice that a Bench of two Judges of this Court has already allowed an appeal by an assessee from a judgement of the Patna High Court to the contrary viz. CA No.1521 of 1990.
It has been brought to our notice also that the Patna High Court has recently invalidated the levy of the cess in Central Coalfields Ltd. vs State, (CWJC 2085/89 and connected cases) in a judgement dated 6.11.90, following India Cement.
Madhya Pradesh : We now turn to the provisions of Madhya Pradesh Act 15 of 1982.
We are concerned only with Part IV which levies a cess not on land in general which could be referred to Entry 18 or Entry 49 but only on land held in connection with mineral rights which, in the State, are principally in regard to coal and limestone.
Under S.9 the proceeds are to utilised only towards the general development of mineral bearing areas.
Although there is no provision for the constitution of a separate fund for this purpose as is found in relation to the cesses levied under Part II or Part III of the Act this considerations alone does not preclude the levy from being considered as a fee:vide Srinivasa Traders V. STate [1983] 3.SCR 843 at 873.
The clear ear marking of the levy for purposes connected with development of mineral areas was considered by the High Court, in our view rightly, sufficient to treat it as a fee.
However, the High Court pointed out, such fee would be referable to item 23 and, hence, out of bounds for the State Legislature, after the enactment of M.M.R.D. Act, 1957.
For the reasons which have already been discussed in relation to the Orissa Statute, we uphold this conclusion.
172 The other statute viz. the Madhya Pradesh Upkar Adhiniyam (Act 1 of 1982) came up for consideration of a Full Bench of the Madhya Pradesh High Court in M.P. Lime Manufacturer 's Association vs State, (and connected cases) in AIR 1989 M.P. 264.
The Full Bench held that, in view of s.12 of the Act having been deleted by the 1989 amendment, the levy under s.11 of the Act ceased to be a fee and become a tax.
It held further that the levy was not covered by Entry 49 or Entry 50 of List II and was, therefore, ultra vires.
It observed : "It is significant to note that cess is not imposed on all land and that it is not dependent either on the extent of the land held in connection with mineral rights or on the value thereof.
The subject matter of tax, therefore, is major mineral raised from the land held in connection with mineral right.
If no minerals are raised, tax is not livable.
The tax is not dependent on the extent of the land held in connection with mineral rights.
It is not case where all land is liable to payment of cess, that the liability is assessed on the basis of the value of the land and that the measure of the tax in so far as land held under a mining lease is concerned, is the value of the minerals produced.
Under the impugned Act, value of the land or of the minerals produced does not play any part in the levy of cess.
The quantity of major minerals produced from the land determines the liability to pay tax.
In these circumstances, the impugned levy cannot be held to be a tax on land which is covered by Entry 49 of the State List.
After distinguishing Ajay Kumar Mukherjea vs Local Board, ; and referring to Union vs Bombay International Ltd. AIR 1984 SC 420 the Courted concluded : " The character of impost in the instant case is that though in form it appears to be a tax on land, in substance, it is a tax on minerals produced therefrom.
The subject matter of tax is, therefore, not covered by Entry 49 of the State List." As for Entry 50, after referring Hingir Rampur, the Court observed : "Now from a perusal of S.11 of the Act, it would be clear that in the instant case by the charging section, tax is not imposed on the mineral rights of every holder of mining 173 lease.
The tax is levied on minerals produced in land held under mining lease.
In these circumstances, the tax levied by the Act cannot be held to be a tax covered by Entry 50 of List II of the Seventh Schedule to the Constitution.
In our opinion, therefore, it has not been shown that the State Legislature is competent to levy the impugned cess.
" This conclusion is obviously correct in the light of our earlier discussion.
The court, however, expressed an opinion, in paras 10 to 12 of the judgment, that in case the levy could be treated as a tax imposable under Entry 49 or 50 of List II in the Second Schedule to the Constitution, such power "has not been taken away by the provision of the MMRD Act".
We think, as already pointed out by us that though the MMRD Act, 1957, unlike s.6(2) of the 1948 Act does not contain a specific provision for the levy of taxes, s.25 of the former does indicate the existence of such power.
The above observations of the High Court, therefore, in our view, do not attach sufficient importance to s.25 of the MMRD Act and the field covered thereby.
This aspect, however, is not of significance in view of the conclusion that the tax is not referable to Entry 49 or Entry 50.
We may add that a Bench of this Court has already dismissed the State 's petition for leave to appeal from the judgment of the Full Bench (S.L.P. 10052/89, 12696/84 etc.
disposed of on 5.2.90) in limine as squarely covered by India Cement.
It is brought to our notice that the Madhya Pradesh High Court, after India Cement, has reaffirment its conclusions in Hiralal and M.P. Lime Manufacturers ' Association in Ankur Textiles and Another vs South Eastern Coalfields, (M.P. No. 1547 of 1990) in the light of India Cement.
THE REFUND ISSUE Having thus concluded that the levy of cess under the Orissa, Bihar and Madhya Pradesh enactments is invalid,, it becomes necessary to consider the logical consequences of such a conclusion.
Prima facia it would seem that the levy should be considered bad since its inception and that all cess levied under the impugned provisions should be directed to be refunded to the assessees, particularly in view of Article 265 of the Constitution.
For the States, however, reliance is placed on the following observations in para 35 of the judgement in India Cement to contend to the contrary.
Towards the conclusion of his judgement, Sabyasachi Mukherjee, C.J. dealt with this issue thus : 174 "Mr. Krishnamurthy Iyer, however, submitted that, in any event, the decision in H.R.S. Murthy case was the decision of the Constitution Bench of this Court.
Cess has been realised on that basis for the organisation of village and town panchayats and comprehensive programme of measures had been framed under the National Extension of Service Scheme to which our attention was drawn.
Mr. Krishnamurthy Iyer further submitted that the Directive Principles of State Policy embodied in the Constitution enjoined that the States should take steps to organise village panchayats and endow them with power and authority as may be necessary to enable them to function as units of self government and as the amounts have been realised on that basis, it at all, we should declare the said cess on reality to be ultra vires prospective, In other words, the amounts that have been collected by virtue of the said provision,s should not be declared to be illegal retrospectively and the State made liable to refund the same.
We see good deal of substance in this submission.
After all, there was a decision of this Court in H.R.S. Murthy case and amounts have been collected on the basis that the said decision was the correct position.
We are, therefore, of the opinion that we will be justified in declaring the levy of the said cess to be ultra vires the power of the State Legislature prospectively only".
Relying on the above, observations, it is submitted for the States that they should not be directed to refund a cess which they have been levying for several years in the past on the basis of the law declared by the Supreme Court in Murthy.
Certain other circumstances have also been brought to our notice in this connection : (i) Several States have preceded on the basis that they are entitled to levy a cess of the nature in question.
In addition to the States referred to earlier in the judgement, Rajashtan and Andhra Pradesh have also similar statues.
(ii) The levy accounts for a substantial part of the States finances particularly in States which are rich in minerals.
For e.g. State of Madhya Pradesh accounts for a good percentage of this country 's mineral resource.
It produces 26.53% of the country 's production in limestone.
36% in dolomite, 28.14% in coal, 21.5% in iron ore, 13% in bauxite, 21.38% in Manganese ore, 175 14.43% in rock phosphate, 33% in copper ore and so on.
The amounts of cess run to several crores.
A direction to refund the cess collected thus far will result in crying halt to all developmental activities initiated and put through and cause irreparable loss to the State.
(iii) As pointed out (for e.g. in pars 5 to 8 in CMP Nos. 31187 to 31196 of 1984 in CA Nos. 1640 to 1643,1645,1649, 1654, 1655,1659, and 1662 of 1986) the impact of the cess has already been passed on by the assessees which are leading industries that can easily bear the brunt of the same to their customers.
A refund granted to them will only result in their unjust enrichment and this should be safeguarded against applying the principles in U.P. State Electricity Board, Lucknow & Ors.
vs City Board, Mussoorie & Ors., ; at page 824 and State of Madhya Pradesh vs Vyankatlal & Anr., ; at page 568.
The above request was vehemently opposed by the assessees counsel.
Presenting their case on this issue, Sri Nariman (appear for the appellants in C.A. 4353 4 of 1983 and C.A. 2053 80 of 1980) contended that we should ignore the dicta in para 35 of India Cement as per incuriam.
He submitted, first, that the Court there has acted on the assumption that a doctrine of prospective overruling had been enunciated in Golaknath; , Analysing the various judgments delivered in that case, he submitted that, while Subba Rao C.J. and four other judges (pp 805 813) approved of the applicability of this doctrine in India, five other judges spoke against it (pp 890, 897, 899 922, 921 and 952) and the eleventh judge was neutral (p.408).
He therefore, submitted that the judges who decided Golaknath were equally divided on the issue and so there is no reason disdained of the Court binding on us.
Second, he submitted that the doctrine of prospective overruling was evolved by the Supreme Court of the United States in the absence of any constitutional provision militating against it, vide sunburst (at page 366) and Linkletter; , (at page 604 8).
In India, however, the application of the doctrine, particularly in the context of an issue regarding the validity of a tax levy, would run counter to specific provisions contained Articles 246 and 265 of the Constitution.
Where the Court finds that a legislation is beyond the competence of the concerned legislature, it stands uprooted altogether because Articles 246 and 265 say so.
There is no scope for, and no room for the exercise of any discretion by, the Court to say that, there articles of the Constitution notwithstanding, they 176 would treat the legislation to be valid for a certain period or for certain purposes.
Third, he submitted that the above objection cannot be "circumvented" by a resort to Article 142.
Sri Nariman referred us in this context to the observations in the following decisions of this Court: Re: Article 246 Pesikaka at pp652,654,656 Chamarbaugwala at p. 940 Sundararamier & Co ; at pp 1468 1474 West Ramnad at p.764 M.L. Jain 1963 Supp 1SCR 912 at pp 530 41 Re: Article 265 Moopil Nayar at p. 89 Balaji at p. 996 Chottachan 1962 Supp.
2 SCR 1 at pp.
29 30 Bakshi Singh at p. 233 Re: Article 142 Garg 1963 Suppl.
1 SCR at pp.
896 8 It is submitted , relying on Mahabir Kishore Ors.
vs State of Madhya Pradesh, [1989] 4 SCC 1 that a refund is the automatic and inevitable consequence of the declaration of invalidity and should be granted proved a suit within a period of limitation or a writ for declaration and consequential relief is filed.
Supplementing the above arguments, Sri G. Ramaswamy appearing for some of the assessees, contended that there can be no question of the Court exercising any discretion under Article 142 so as to destroy a fundamental right of the assessees.
Learned counsel also submitted that considerations of hardship of the States, in case they are called upon to refund huge amounts, can be no relevant consideration at all.
He urged, that in some at least of the cases here, there is no averment, much less evidence, of any irreparable hardship that is likely to result if a refund is ordered.
He also pointed out that in the 177 converse situation where a retrospective levy is held to be valid, assessees have been held entitled to no relief from payment of back duty on grounds of hardship: vide Chhotabhai Jethabhai Patel & Co.v.
Union of India [1962] 2 Supp.
at Pp12,13 and urged that there cannot be a different rule for the State.
Sri B. Sen submitted that the ruling in Murthy could not be invoked to seek prospective invalidation as, at least so far as Orissa was concerned, as the decision in Tulloch had clearly defined the limitations of the State 's power to make such levies.
In addition to the above general arguments, reliance had also been placed by the assessees on certain specific interim orders passed in these cases and it has been contended that these orders should be given effect to, or at least taken into account, in deciding the issue of the final relief to be granted.
It is therefore necessary to refer to these orders : (i) In C.A. Nos.
4353 4 of 1983, there is no interim order staying recovery of the cess at all except of the arrears for the period from 1.1.1983 to 31.3.1983 and even this was made subject to the furnishing of a bank guarantee by the assessee.
(ii) In C.A. 2053 80 of 1980 there was initially (on 2/2/1981) an order of stay of recovery of cess on the furnishing of bank guarantees.
But this was later substituted by an order of 25.3.1983 by which the amounts of cess were to be deposited in the High Court every quarter and then withdrawn by the State but this was on the undertaking buy the State 's Advocate General to refund the amount "if deposited, in the event the appeal succeeds".
This continued till 30.1.90 when the Counsel of the State of Orissa undertook, in view of the decision in India Cement, that the levy of the cess for the quarter ending December, 1989 onwards will not be enforced until further orders.
Presumably, therefore, there has been no collection for cess in Orissa since that period.
(iii) The position in the Orissa case of Orient Paper & Industries Ltd. is somewhat different.
It is pointed out that when the levy of cess first came into force w.e.f.
1.4.1977, the Western Coalfields Ltd. who supplied coal to the assessees had challenged the levy of cess by a writ petition and obtained an interim injunction order but eventually withdrew the writ petition.
But simultaneously, the said company wrote to the assessee that the amounts of cess (which were collected from the assessee) would be kept in a suspense account and that, after a deci 178 sion is rendered by a court of law, it will be decided whether they should be deposited with the State against cess or be refunded to the assessees.
It was made clear that, in case the levy of cess is held invalid, "there will be no hitch in refunding the amount".
This arrangement went on between 1977 and 1982.
On 21.9.1982, the assessee filed a writ petition challenging the levy as it was enahanced from 25% to 100% from 1.4.80.
An interim stay was granted by the High Court restricted to be enhanced demand but even this was vacated by the High Court on 13.5.1983 in view of the decision in Lakshmi Narain Agarwala vs State AIR 1983 Orissa 210 that the levy was valid.
Finally, the High Court by its judgement dated 22.12.1989 followed India Cement and allowed the writ but directed that the collections so far made shall be allowed to be retained by the State as was directed by the Supreme Court in the case of India Cement (supra).
This judgement is the subject matter of SLP 1479 of 1990 by the State.
The assessee thereupon file a review petition in regard to the above direction contending ; (a) that a High Court had no jurisdiction to declare provision to the unconstitutional only "prospectively"; (b) that the cess in the case had been collected only by Western Coalfields Ltd. and had not been deposited in the State coffers; and (c) that the principle of `unjust enrichment ' should equally apply to the State which should not be permitted to enrich itself by the levy of an illegal exaction.
The application for review was dismissed by the High Court on 13.7.90.
Thereupon the assessee has preferred the unnumbered SLP on 1990 and SLP 11939 on 1990 respectively against the original judgement dated 22.12.1989 and the order on the review petition dated 13.7.1990.
It is contended that the High Court, having regard to the circumstances set out earlier, should have directed a refund of the cess.
collected.
IT is stated that, subsequently, Western Coalfields have paid over the amounts of cess to the Government [vide orders of this Court referred to in sub para (v) below].
It is also submitted that the averments by the State now made that the amounts collected have been utilized by the State on objects enumerated in Part IV of the Constitution are the result of an afterthought and are being put forward to defeat the rightful entitlement of the assessee to the refund.
(iv) In the Bihar case, there was an interim order on 10.2.1986 to the following effect: 179 "On the stay application there will be no stay of recovery of cess but in case appellants succeed in appeal in this Court, the excess amount so recovered will bepaid to the appellants with interest at the rate of 12% from the date of recovery" This was modified on 30.1.90 in view of the judgement in India Cement which had been delivered by this time, and it was directed that the State of Bihar should not also enforce any demand for cess for the quarters ending December, 1989 and thereafter until further orders.
Presumably, therefore, there has been no levy of cess in Bihar from the last quarter of 1989 onwards.
Counsel for the assessees from Bihar Sri Chidambaram and Sri Shanti Bhushan stated that they seek compliance with the order dated 10.2.86 and would not insist on refund of cess collected earlier to that date.
(v) Turning to the Madhya Pradesh matters, the position is this, The High Court, by its judgement dated 28.3.1986 held the levy to be invalid.
In C.A. 1640 to 1662 of 1986, the initial order passed on 2.5.1986 was this : " There will be stay of refund of the cess already collected pending disposal of the appeals.
Learned counsel for the State states that, in the event of the appeals being dismissed the State is prepared to pay interest at 12% per annum.
There will, however, be no stay of operation of the judgement.
" As a result of the order, there should have been no collection of cess by the State subsequent to the date of the judgement and only issue could have been regarding the refund of the cess already collected from 1982 to 28.3.1986.
However, the Western Coalfields Ltd. approached the Court with an application in one of the appeals (viz. C.A. 1649/86) praying that, pending disposal of the appeals, it should be permitted to collect the amount of cess and deposit the same in a separate account in the Bank vis a vis each of its customers.
This application was ordered on 1.8.86.
When this order was passed, the State Government moved an application praying that, instead of the monies being kept in deposit in bank account by Western Coalfields Ltd., it will be conducive to public interest if the State is permitted to utilise the moneys "in mineral areas development programs" and that the State would abide by such 180 terms as the Court may impose at the time of final decision.
It was, therefore, prayed that the Western Coal fields should be directed to deposit the amounts collected by it to the State Government.
The Court found this request reasonable and passed the following order on 15.10.86 : "The order dated 1.8.86 passed in the above appeal is modified as follows : The amount deposited by the Western Coalfields Ltd. in a separate account in the Bank in accordance with the directions issued by this Court on 1.8.1986 shall be paid to the State Government of Madhya Pradesh.
In the event, of the State Government failing in this appeal, the amount received by the Madhya Pradesh Government under this order shall be refunded by that Government within three months from the date of the judgement to the Western Coalfields Ltd. with interest at 12% per annum to disburse in favour of those who had paid it, subject to such directions which this court may give in its judgement.
The amount received by the Madhya Pradesh State Government shall be spent in accordance with the provisions contained in the impugned Act." Fresh applications were filed by the State in a number of the other appeals seeking similar direction as in C.A. 1649/86 but the request does not show that any such order were passed in appeal other than C.A. 1649/86.
However, it seems that, in the case of coal, the cess is being collected by Western Coalfields Ltd. and other like public sector organisation (which are subsidiaries of Coal India Ltd.) from all their customers and passed on to the State not only in Madhya Pradesh but also in Orissa (as indicated in sub para (iii) above), apparently on the understanding that it should be refunded by the concerned State Government with interest in case the levy is ultimately held invalid.
Sri Bobde, appearing for the Western Coalfields , made it clear that this company would abide by the direction of this Court, in so far as the amounts of cess collected by it remain with it or are directed to be refunded by the State Government to it.
We have given our earned consideration to these contentions and were are of opinion that the ruling in India Cement concludes the issue.
There the Court was specifically called upon to consider an argument that, even if the statutory levy should be found invalid, the 181 Court may not give directions to refund amounts already collected and the argument found favour with the bench of seven judges.
We are bound by their decision in this regard.
It is difficult to accept the plea that, in giving these directions, the Court overlooked the provisions of Article 246 and 265 of the Constitution.
The Court was fully aware of the position that the effect of the legislation is question being found beyond the competence of the State legislature was to render it void ab initio and the collections made thereunder without the authority of law.
Yet the Court considered that a direction to refund all the cesses collected since 1964 would work hardship and injustice.
The directions, now impugned, were given in the interest of equity and justice after due consideration and we cannot take a contrary view.
In our view, we need enter into a discussion of the principles of prospective validation enunciated by at lease some of the Judges in Golaknath (supra) as the direction in India Cement can be supported on another well settled principle applicable in the area of the writ jurisdiction of Courts.
We are inclined to accept the view under on behalf of the state that a finding regarding the invalidity of a levy need not automatically result in a direction for refund of all collections thereof made earlier.
The declaration regarding the invalidity of a provision and the determination of the relief that should be granted in consequence thereof are two different things and, in the latter sphere, the Court has, and must be held to have, certain amount of discretion.
It is a well settled proportion that it is open to the Court to grant , could or restrict the relief in a inner most appropriate to the situation before it is insuch a way as to advance the interests of justice.
It will be appreciated that it is not always possible in all situations to give a logical and complete effect to a finding.
Many situations of this arise in actual practice .
For instance , there are cases where a comes to the conclusion that the termination of the services of an employee is invalid, yet in refrains from giving him benefits of "reinstatement" (i.e. continuity in service) on "back wages".
In such cases, the direction of the Court does not result in a person being denied the benefits that should flow to him as a logical consequence of a declaration inhis favour.
It may be said that, in such a case, the Court 's direction does not violate any fundamental right as happens in a case like this were an "illegal" exaction is sought to be retained by the State.
But even in the latter type of cases relief has not been considered automatic.
One of the commonest issue that arose in the context of the situation we are concerned with is where a person affected by an illegal exaction files an application for refund under the provisions of the relevant statute of files a suit to recover the taxes as 182 paid under a mistake of law.
In such a case, the Court can grant relief only to extent permissible under the relevant rules of limitation.
Even if he files an application for refund or a suit for recovery of the taxes paid for several years, the relief will be limited only to the period in regard to which the application for refund or a suit for recovery of the taxes paid for several years, the relief will be limited only to the period in regard to which the application or suit is not barred by limitation.
If even this instance is sought to be distinguished as a case where the Court 's hands are tied by limitations inherent in the form of forum in which the relief is sought, let us consider a very case where a petitioner seeks relief against an illegal exaction in a writ petition filed under Article 226.
In this situation, the question has often arisen whether the petitioner 's prayer for refund of taxes collected over an indefinite period of years should be granted once the levy is found to be illegal.
To answer the question in the affirmative would result in discrimination between persons based on their choice on the forum for relief, a classification which, prima facie is too fragile to be considered a relevant criterion for the resulting discrimination.
This is one of the reasons why there has been an understandable hesitation on the part of Courts in answering the above question in the affirmative.
The above aspect of the matter has been considered in several decisions of this Court.
In State of Madhya Pradesh vs Bhailal Bhai & ORs.
, ; the respondents who were dealers in tobacco in the State of Madhya Bharat filed a writ petition under Article 226 of the Constitution for the issue of writ of mandamus directing the refund of sales tax collected from them on the ground that the impugned tax was violative of Article 301 (a) of the Constitution and that they had paid the same under a mistake of law.
It was contended on behalf of the State that even if the provision violated the fundamental rights, the High Court should not exercise its discretionary power of issuing a writ of mandamus directing refund since there was unreasonable delay in filing the petition.
This contention of the State was rejected by the High Court but on further appeal this Court tool a different view.
While agreeing that the Courts have the power, for the purposes of enforcement of fundamental rights and statutory rights, to give a consequential relief by ordering repayment of any money realised by the government without authority of law, the Court said: "At the same time we cannot lose sight of the fact that the special remedy provided under Article 226 is not intended to supersede completely the modes of obtained relief by an action in a civil court or to deny defends legitimately open in such actions.
It has been made clear more than once that the power to give relief under Article 226 is a discretionary 183 power.
This is specially true in the case of power to issue writs in the nature of mandamus.
Among the several matters which the High Courts rightly take into consideration in the exercise of that discretion is the delay made by the aggrieved party in seeking the special remedy and what excuse there is for it.
Another matter which can be rightly taken into consideration is the nature of the facts and law that may have to be decided as regarded the availability of consequential relief.
Thus, where, as in these cases, a person comes to the Court for relief under Article 226 on the allegations that he has been assessed to tax under a void legislation and having paid it under a mistake is entitled to get it back, if it the Court, finds that the assessment was void, being made under a void provision of law, and the payment was made by mistake, it is still not bound to exercise its discretion directing repayment.
Whether repayment should be ordered in the exercise of this discretion will depend in each case of its own facts and circumstances.
It is not easy nor is it desirable to lay down any rules of universal application it may however be stated as a general rule that if there has been unreasonable delay, the Court ought not ordinarily to lend its aid to a party by this extraordinary remedy of mandamus.
" The Court further pointed out that the delay may be considered unreasonable even if it is less than the period of limitation prescribed for a civil action for the remedy but where the delay is more than this period, it will almost always be proper for the court to hold that it is unreasonable.
The relief given by the High Court was modified on this basis.
In Tilokchand Mothichand vs Munshi the petitioners had collected sales tax from their customers and paid it over to the State.
The Sales Tax Authorities directed a refund but on the condition that the amounts should be passed on to the customers.
Since the petitioner did not comply with the condition, the sales tax officer forfeited the sum under S.21(4) of the Bombay Sales Tax Act, 1953.
A writ petition was filed by the petitioner contending that S.21(4) infringed Articles 19[10(f)] and 365 of the Constitution and hence, they were not liable to repay the amount.
This was dismissed on the ground that they had defrauded their customers and, therefore, not entitled to any relief even if there was a violation of fundamental rights.
An appeal to a Division Bench was also dismissed.
Subsequently, when coercive proceedings were taken for recovering the amounts as arrears of land revenue, the petitioners paid the amounts 184 in 1959 60.
Much later, there was a decision of this Court striking down the corresponding provision of the Bombay Sales Tax Act 1946 as ultra vires.
The petitioners thereupon filed a writ petition under Article 32 of the Constitution claiming a refund of the amounts paid by them in consequence of the recovery proceedings.
It was held by four of the five learned Judges of this Court that the writ petition should be dismissed on the ground of laches.
Chief Justice Hidayatullah held that though Article 32 gives the right to move the Court by appropriate proceedings for enforcement of fundamental rights and State cannot place any hindrance in the way of an aggrieved person, once the matter reached this court, the extent or manner of interference was for the Court to decide.
The learned Chief Justice pointed out that this Court had put itself in restraint in the matter of petitions under Article 32.
For example, if a party had already moved High Court under Article 226, this court would refuse to interfere.
Similarly, in inquiring into belated and stale claims, this Court should take note of evidence of neglect of the petitioner 's own rights for a long time or of the rights of innocent parties which might have merged by reason of the delay.
It was possible for this Court to lay down any specific period as the ultimate limit of action and the case will have to be considered on its own facts.
On the facts of the case before it, the majority found that the petitioner had by his own conduct abandoned his litigation years ago and could not be permitted to resume it several years later merely because some other person had got the statue declared unconstitutional.
While Hidayatullah C.J. was of the view that the Court should not, on the facts of the case apply for analogy of the article in the Limitation Act in cases of mistake of law give relief, Bachawat and Mitter JJ.
felt that even for a writ petition the limitation period fixed for a suit would be a reasonable standard for measuring delay.
Sikri J and Hegde J. dissented.
Sikri J. was of the view that on the facts of the case there was no delay but that the period under the Limitation Act should not be applied to such cases and that a period of one year should be taken as a period beyond which the claim would be considered a stale claim unless the delay is explained.
" Such a practice" the learned Judge observed, "would not destroy the guarantee under Article 32 because the article nowhere lays down that a petition however late, should be entertained.
Only Hegde J. was emphatic that laches or limitation should be no ground to deny relief.
The learned Judge observed (for brevity, we quote from head note): "Since the right given to the petitioners under Article 32 is itself a fundamental right and does not depend on the discretionary powers of this Court, as in the case of Article 185 226, it is inappropriate to equate the duty imposed on this Court to the powers of Chancery Court in England or the equitable jurisdiction of Courts in the United States.
The facts that the petitioner have no equity in their favour is an irrelevant circumstance in deciding the nature of the right available to an aggrieved party under Article 32.
This Court is charged by the Constitution with the special responsibility of protecting and enforcing the fundamental rights, and hence laches on the part of an aggrieved party cannot deprive him of his right to get relief under Article 32.
In fact, law reports do not show a single instance of this Court refusing to grant relief on the grounds of delay.
If this Court could refuse relief on the ground of delay , the power of the Court under Article 32 would be discretionary power and the right would cease to be a fundamental right.
The provisions contained in the Limitation Act do not apply to proceedings under Articles 226 and 32 and if these provisions of the Limitation Act are brought in indirectly to control the remedies conferred by the Constitution, it would be a case of Parliament indirectly abridging the fundamental rights which this court, in Golaknath 's case.
[1967]2 S.C.R. 752 held that Parliament cannot do.
The fear that forgotten claims and discarded right against Government may be sought to be enforced after the lapse of a number of years if fundamental rights are held to be enforceable without any time limit, is an exaggerated one, for , after all, a petitioner can only enforce an existing right.
" The above principles have been applied in several subsequent cases: Ramchandra Shankar Deodhar vs State of Maharastara, ; ; Shri Vallabh Glass works Ltd. vs union of India ; ; State of M.P. vs Nandlal Jaiswal, ; ; D. Cawasji & Co. vs State of Mysore, ; and Salonah Tea Co. Ltd. vs Superintendent of Taxes.[1988] 1 SCC 401.
The above cases no doubt only list situations where directions for refund have been refused, or considered to be liable to be refused, on grounds of unreasonable delay or laches on the part of the petitioners in approaching the Court in the interests of justice and equity.
The importance of these cases, however, lies not in the grounds on which refund has been held declinable but because they lay down unequivocally that the grant of refund is not an automatic consequence of a 186 declaration of illegality.
Once the principle that the Court has a discretion to grant or decline refund is recognised, the ground on which such discretion should be exercised is a matter of consideration for the Court having regard to all the circumstances of the case.
It is possible that a direction for refund may be opposed by the State on grounds other than laches or limitation.
To give an instance, in recent years the question has often arisen whether a refund could be refused on the ground that the person who seeks the refund has already passed on the burden of the illegal tax to others and that to grant a refund to him would result in his "unjust enrichment".
Some decisions have suggested a solution of neither granting a refund nor permitting the State to retain the illegal exaction.
This issue has been referred to a larger Bench of this Court and its is not necessary for us to enter into that question here.
so far as the present cases are concerned, it is sufficient to point out that all the decided cases unmistakably show that, even where the levy of taxes is fount to be unconstitutional, the Court is not obliged to grant an order of refund.
It is entitled to refuse the prayer for good and valid reasons.
Laches and undue delay or intervention of third party rights would clearly be one of those reasons.
Unjust enrichment of the refundee may or may not be another.
But we see no reason why the vital interests of the State, taken note of by the learned judges in India Cement should not be a relevant criterion for deciding that a refund should not be granted.
We are, therefore, unable to agree with the learned counsel for the petitioners that any different criterion should be adopted and that the direction in paragraph 35 of India Cement should not be followed in those cases.
For the reasons discussed above, we are of opinion that, though the levy of the cess was unconstitutional, there shall be no direction to refund the assessees of any amounts of cess collected until the date on which the levy in question has been declared unconstitutional.
This in regard to the Bihar cases, will be the date of this judgement.
In respect of Orissa, the relevant date will be 22.12.1989 on which date, the High Court, following India Cement declared the levy by the State Legislature unconstitutional.
In respect of Madhya Pradesh, the relevant date will be the date of the judgement in Hiralal Ramswarup and connected cases (viz. M.P. 410/83 decided on 28.3.1986) in respect of the levy under State Act 15 th 1982.
Though there are the dates of the Judgement of the appropriate High Court, which may not constitute a declaration of law within the scope of Article 141 of the constitution, it cannot be gainsaid that the State cannot, on any grounds of equity, be permitted to retain the cess collected on and after the date of the High Court 's judgement.
187 Another point that was raised, was that in many of these cases the State or a Coal field Companies had given an undertaking that incase the levy is held to be invalid by this Court, they would refund the amount collection with interest.
It is submitted that the condition imposed, or undertakings given, to this effect and recorded at the time of passing interim orders in the various cases should be given implemented.
The interim undertakings or directions cannot be understood in such a manner as to conflict with out final decision on the writ petitions set out above.
But we agree that, to the extend refunds of amounts of cess collected after the relevant dates are permissible on the basis indicated by us, the State should refund those amounts to the assessees directly or to the Coalfields from whom they were collected, with interest at the rate directed by this Court or mentioned in the undertaking from the date of the relevant judgment to the actual date of repayment.
The Coalfields, when hey get th refunds, should pass on the same to their customers, the assessees.
The appeals are disposed of accordingly.
There will be no order as to costs.
T.N.A. Appeals disposed of.
| IN-Abs | The States of Orissa, Bihar and Madhya Pradesh levied a cess which was based on the royalty derived from mining lands.
The cess was levied by these States under their respective statutes viz. Orissa Cess Act, 1962, Bengal Cess Act, 1880 (as applicable to the State of Bihar), Madhya Pradesh Upkar Adhiniyam 1981 and Madhya Pradesh Karadhan Adhiniyam, 1982.
The assesses challenged the constitutional validity of the cess by filing various petitions in the High Courts of Orissa declared the cess unconstitutional on the ground that it was beyond the legislative competence of the State Legislatures, but rejected the prayer of the assessees for a direction to the State to grant refund of the cess collected from the assessees.
Against the decision of the Orissa High Court the assessees have filed appeal in this Court whereas the State of Orissa has filed a cross appeal.
The High Court of Madhya Pradesh also declared the levy of cess unconstitutional on the ground that it was beyond the legislative competence of the State legislature.
Against the decision of the Madhya Pradesh High Court the State of Madhya Pradesh has filed an appeal in this Court.
On the other hand the High Court of Patna dismissed the writ petition of the assessee.
Against the decision of the Patna High Court the assessee has filed an appeal in this court.
In appeal to this court, it was contended on behalf of the State of Orissa; that (i) the levy of cess being referable to Entries 45, 49 and 50 of the State List of the Seventh Schedule of the Constitution the impugned legislation was within the legislative competence of the State legislature; (ii) the limitations imposed in the statute on the modes of utilisation of cess supports a view that the cess is fee on which the State legislature is competent to legislate under Entry 23 read with Entry 66 of the State List; (iii) since the impugned Act was concerned with the raising of funds to enable panchayats and Samithis to discharge their responsibilities of local administration and take steps for proper development of the area under their jurisdiction, the impugned legislation was referable to Entry 5 of State List; and (iv) the enactment of the Central Legislation viz. has not denuded the State legislation of its competence to enact the impugned legislation since the scope and subject matter of the two legislations are entirely different and the impugned State Legislation does not encroach upon the field covered by the Central Legislation i.e. 1957 Act.
107 On behalf of the assessees it was contended inter alia that (i) all the State levies were ultra vires for the reasons given by this Court in the India Cement case; (ii) the State cannot seek to sustain the levy under the Bengal Cess Act 1880 by relying on Article 277 of the Constitution; and (iii) the levy being unconstitutional the Court should direct the States to refund the cess collected from the assessees because (a) a refund is the automatic and inevitable consequence of the declaration of invalidity of tax and (b) the States have given undertakings before this Court that they would refund the amount collected in case the levy is declared invalid by this Court.
Disposing of the appeals, this Court, HELD: 1.
The levy of cess under sections 5 to 7 of the Orissa Cess Act, 1962 is beyond the competence of the State Legislature.
[169B] 1.1.
A royalty or the tax thereon cannot be equated to land revenue.
Therefore the cess cannot be brought under Entry 45 of List II.
[142D] India Cement & Ors.
vs State of Tamil Nadu & Ors., , followed.
1.2 A tax on royalties cannot be a tax on minerals and is outside the purview of Entry 50 of List II.
Even otherwise, the competence of the State Legislature under the said Entry is circumscribed by "any limitations imposed by Parliament by law relating to mineral development".
The is a law of Parliament relating to mineral development and Section 9 of the said Act empowers the Central Government to fix, alter, enhance or reduce the rates of royalty payable in respect of minerals removed from the land or consumed by the lessee, Sub Section (3) of Section 9 in terms States that the royalties payable under the Second Schedule to that Act shall not be enhanced more than once during a period of three years.
This is a clear bar on the State legislature taxing royalty so as, in effect, to amend the Second Schedule to the Central Act.
This is exactly what the impugned Act does.
Therefore the validity of the impugned Act cannot be upheld by reference to Entry 50 of List II.
And if the cess is taken as a tax falling under Entry 50 it will be ultra vires in view of the provisions of the Central ACt.
[144B, 153B D, 168D] India Cement & Ors.
vs State of Tamil Nadu & Ors.
, [1990] 1 S.C.C.12, followed.
108 Hingir Rampur Coal Co. Ltd. & Ors.
vs State of Orissa & Ors.
, [1961] 2 S.C.R.537, Justice Wanchoo 's dissent explained.
1.3 There is a difference in principle between a tax on royalties derived from land and a tax on land measured by reference to the income derived therefrom.
A tax on buildings does not cease to be such merely because it is quantified on the basis of the income it fetches.
But in the impugned legislation the levy is not measured by the income derived by the assessee from the land, as is the case with lands other than mineral lands.
The measure of the levy is the royalty paid, in respect of the land, by the assessee to his lessor which is quite a different thing.
The impugned statute only purports to levy a cess on the annual value of all land.
There is a clear distinction between tax on land and tax on income arising from land.
The former must be one directly imposed on land, levied on land as a unit and bearing a direct relationship to it.
A tax on royalty cannot be said to be a tax directly on land as a unit.
Hence the cess is outside the purview of Entry 49 List II.
[148H, 149A D] Ajay Kumar Mukherjea vs Local Board of Barpeta, [1965] 3 Ss.
C.R. 47; Ralla Ram vs The province of East Punjab, [1948] F.C.R.207; Buxa Dooars Tea Co. vs State, [1989] 3 S.C.R.211; Bhagwan Dass Jain vs Union of India, ; and R.R. Emgomeeromg Co. vs Zila Parishad, ; , referred to.
Union of India vs Bomnbay Tyre International, [1984] 1 S.C.R.347; Re: A reference under the Government of Ireland Act, 1920 and Section 3 of the Finance Act (Northern Ireland), 1934, (1963) 2 All E.R.III, cited.
If the levy in question cannot be described as a tax on land, it cannot be described as fee with regard to land either.
[169A] 2.1 Section 10 of the Orissa Cess Act, 1962 earmarks the purposes of utilisation of only fifty per cent of the proceeds of the cess and that, too, is limited to the cess collected in respect of "lands other than lands held for carrying on mining operations".
Therefore the levy cannot be correlated to any services rendered or to be rendered by the State to the class of persons from whom the levy is collected.
Accordingly the levy cannot be treated as a fee which the State legislature is competent to legislate for under entry 66 of the State List.
[153E F] 2.2 Even assuming that the levy is a fee, the State legislature can impose a fee only in respect of any of the matters in the State List.
The 109 entry relied upon for this purpose i.e. Entry 23 is itself "subject to the provisions of List I with respect to regulation and development" of mines and minerals under the control of the Union.
Under Entry 54 of List I, regulation of mines and mineral development is in the field of parliamentary legislation "to the extent to which such regulation and development under the control of the Union is declared by Parliament by law to be expedient in the public interest".
Such a declaration is contained in Section 2 of the .
The validity of the impugned Act cannot be upheld by reference to Entry 23 List II.
[153G H, 154A, 168D] 3.
There is a difference between the 'object ' of the Act and its 'subject '.
The object of the levy may be to strengthen the finances of local bodies but the Act has nothing to do with municipal or local administration.
Accordingly State 's reliance on Entry 5 of List II is plainly too tenuous.
[164D] 4.
The answer to the question whether the State Legislature was denuded of its competence to enact the impugned legislation because of the Parliament having enacted the depends on a proper understanding of the scope of the Act and an assessment of the encroachment made by the impugned State legislation into the field covered by it.
[161D] 4.1 The mere declaration of a law of Parliament that it is expedient for an industry or the regulation and development of miners and minerals to be under the control of the Union under Entry 52 or entry 54 of List I does not denude the State legislatures of their legislative powers with respect to the fields covered by the several entries in List II or List III.
Particularly, in the case of a declaration under Entry 54, this legislative power is eroded only to the extent control is assumed by the Union pursuance to such declaration as spelt out by the legislative enactment which makes the declaration.
The measure of erosion turns upon the field of the enactment framed in pursuance of the declaration.
[161E F] 4.2 In assessing the field covered by the Act of Parliament in question, one should be guided not merely by the actual provisions of the Central Act or the rules made thereunder but should also take into account matters and aspect which can legitimately be brought within the scope of the said statute.
Viewed in this light and in the Light of the provisions of the Bihar Cess Act the conclusion seems irresistible that the State Act has trespassed into the field covered by the Central Act 110 viz. Mines and Minerals (Regulation and Development)Act, 1957.[163F] 4.3 The impugned legislation which stands impaired by the Parliamentary declaration under Entry 54, can hardly be equated to the law for land acquistion or municipal adminstration which are traceable to different specific entries in List II or List III [163G H] Hingir Rampur Coal Co. Ltd. & Ors.
vs State of Orissa & Ors.
; ; State of Orissa vs M.A. Tulloch & Co., ; and Indian Cement & Ors vs State of Tamil Nadu & Ors., [1990]1 S.C.C. 12 followed.
State of Haryana vs Chanan Mal, ; ; Ishwari Khatan Sugar Mills (P) Ltd vs State of U.P. ; and Western Coalfields Ltd. vs Special Area Development Authority.
, [1982] 2 S.C.R.1,distinguished.
Indian tobacco Co. Ltd. vs Union, [1985] Supp. 1 S.C.R. 145; State of West Bengal vs Union [1964] 1.
S.C.R. 371; Central Coalfields vs State of M.P., A.I.R. (1986) M.P.33; M. Karunanidhi vs Union of India, ; ; State of Tamil Nadu vs Hind Stone etc.
; , ; I.T.C. vs State of Karnataka, ; Bharat Coking Coal vs State of Bihar, ; ; Kannan Dewan Hills Co. vs State of Kerala, [1973] 1.
S.C.R. 356; Baijnath Kedia vs State of Bihar ; ; H.R.S. Murthy vs Collection of Chittoor & Ors.
[1964] 6 S.C.R.; Ch.
Tika Ramji & Ors.
vs State of U.P.,[1956] S.C.R. 393; Laxmi Narayan Agarwala vs State, A.I.R. 919830 Ori.210; Bherulal vs State, A.I.R. (1965) Raj. 161; Sharma vs State A.I.R. (1969) P&H 79 and Saurashtra Cement & Chemical Industries Ltd. vs Union , referred to.
Trivedi & Sons vs State of Gujarat.
[1986] Suppl.
S.C.C. 20, cited.
Section 6 of the Bengal Cess Act, 1880 specifically enacts that the cess will be on royalty from mines and quarries and on the annual net profit of railways and tramways.
The further amendments to Section 6 have not changed this basic position.
Though the Section referees also to the value of the mineral bearing land, that furnishes only the maximum upto which the cess, based on royalty, could go.
Therefore, the cess is levied directly on royalties from mines and quarries.
The different notifications issued by the State of Bihar under section 6 111 of the Act determining the rate of cess on the amount of rayalty of all minerals of the State place the matter beyond all doubt.
The levy is a percentage or multiple of the royalty depending upon the kind of mineral and in the case of iron ore the method of extraction and nature of the process employed.
There are no clear indications in the statute that the amounts are collected by way of fee and not tax.
Section 9 indicates that only a small percentage goes to the district fund and the remaining forms part of the consolidated fund of the State " for the constrution and maintenance of other works of public utility".
However, the proviso does require at least ten percent to be spent for purposes relating to mineral development.
Even the assumption that the levy can be treated, in part, as a fee and, in part, as a tax will not advance the case of the respondents.
Therefore, the levy of cess sunder the Bengal Cess Act, 1880 is declared invalid.
[169C F,H,170A] Indian Cement & Ors.
vs State of Tamil Nadu & Ors., followed.
Central Coalfields Ltd. vs State (CWJC 2085/89 decided on 6.11.90 by Patna High Court, referred to.
5.1 The attempt to sustain the tax under the Bengal Cess Act 1880 on the basis of Article 277 cannot also succeed.[171C] Ramkrishna Ramanath vs Janpad Sabha, [1962]Suppl.
3.S.C.R. 70; Town Municipal Committee vs Ramachandra ; , referred to.
The levy of cess under section 11 of the Madhya Pradesh Upkar Adhiniyam, 1981 is not covered by Entry 49 or Entry 50 of List II and is therefore, ultra vires.
, [172B] M.P. Lime Manufacturers ' Association vs State, A.I.R. (1989) M.P. 264 referred to.
6.1 Under Section 9 of Madhya Pradesh Karadhan Adhiniyam, 1982 the proceeds of the cess are to be utilised only towards the general development of mineral bearing areas.
Although there is no provision for the constitution of a separate fund for this purpose as is found in relation to the cesses levied under Part II or Part III of the Act yet this consideration alone does not preclude the levy from being considered as a fee.
The clear ear marking of the levy for purposes connected with development of mineral areas was rightly considered by 112 the High Court, as sufficient to treat it as a fee.
The High Court was also right in holding that such a fee would be referable to item 23 but out of bounds for the State Legislature, after the enactment of the .
[171F H] Srinivasa Traders vs State, ; , referred to.
The grant of refund is not an automatic consequence of a declaration of illegality i.e. where the levy of taxes is found to be unconstitutional, the Court is not obliged to grant an order of refund.
Therefore a finding regarding the invalidity of a levy need not automatically result in direction for a refund of all collections thereof made made earlier.
The declaration regarding the invalidity of a provision and the determination of the relief that should be granted in consequence thereof are two deferent things and, in the latter sphere, the Court has, and must be held to have, a certain amount of discretion.
Once the principle that the Court has a discretion to grant or decline refund is recognised, the ground on which such discretion should be exercised is a matter of consideration for the Court having regard to all the circumstances of the case.
The Court can grant, would or restrict the relief in a manner most appropriate to the situation before it is such a way as to advance the interests of justice.
The Court is entitled to refuse the prayer for good and valid reasons.
Laches or undue delay or intervention of third party rights would clearly be one of those reasons.
Unjust enrichment of the refundee may or may not be another.
Also there is no reason why the vital interest of the State should not be a relevant criterion for deciding that a refund should not be granted.
[185H, 186A C, D & E 181D E] 7.1 In the instant case though the levy of the cess is unconstitutional, yet there shall be no direction to refund to the assessees of any amounts of cess collected until the date on which the levy in question has been declared unconstitutional.
This, in regard to the Bihar cases, will be the date of this judgment i.e. 4.4.1991.
In respect of Orissa and Madhya Pradesh cases the relevant date will be the date on which the concerned High Court has declared the levy unconstitutional i.e.22.12.1989 in case of Orissa and 28.3.1986 in case of Madhya Pradesh.
The dates of the judgments of the appropriate High Court, may not constitute a declaration of law within the scope of Article 141 of the Constitution, but it cannot be gainsaid that the State cannot, on any ground of equity, be permitted to retain the cess collected on and after the date of the High Court 's judgment.
Accordingly the State should refund the amounts of cess collected after the relevant dates to assesses directly or in the Coalfields from whom they were collected, with 113 interest at the rate directed by this Court or mentioned in the undertaking from the date of the relevant judgment to the actual date of repayment.
The Coalfields, when they get the refunds, should pass on the same to their customers, the assessees.
[186F G, 187B C] India Cement & Ors.
State of Tamil Nadu & Ors, [1990] 1 S.C.C.12, followed.
Linkletter, 14 L Ed.
(2d) 601; Sunburst.
77 L.Ed.310; Mahabir Kishore & Ors.
vs Stte of Madhya Pradesh, [1989] 4 S.C.C. 1; Chhotabhai Jethabhai Patel & Co. vs Union of India, ; ; State of Madhya Pradesh vs Bhailal Bhai & Ors., ; ; Tilok Chand Motichand vs Munshi, [1969] 2 S.C.R> 824; Ramchandra Shankar Deodhar vs State of Maharashtra, ; ; Shri Vallabh Glass Works Ltd. vs Union of India, [1984] 3 S.C.R> 180; State of M.P. vs Nandlal Jaiswal, [1986] 4 S.C.C.566 ' D. Cawasji & Co. vs State of Mysore, [1975] 2 S.C.R.511; Salonah Tea Co. Ltd. vs Superintendent of Taxes, ; and Lakshmi Narain Agarwala vs State, A.I.R. (1983_ Orissa 210, referred to.
Behram Khursheed Pesikaka vs State of Bombay, [1955] 1 S.C.R.613; R.M.D. Chamarbaugwala vs Union of India, ; ; M.P.V. Sundararamier & Co. vs State of Andhra Pradesh & Anr.
, ; ; West Ramnad Electric Distribution Co. vs State of Madras, ; ; M.L.Jain vs State of U.P., [1963] suppl. ; K.T. Moopil Nayar vs State of Kerala & Anr., [1961] 3 S.C.R.77; Balaji vs I.T.O. Special Investigation Circle, ; ; Raja Jagannath Bakshi Singh vs State of U.P., ; ; Prem Chand Garg vs Excise Commissioner, U.P. Allahabad, [1963] Suppl.
1 S.C.R. 885 and I.C. Golaknath & Ors.v.
State of Punjab & Ors.
,[1967] 2 S.C.R. 762, cited.
The undertaking given by the parties or interim directions given by the Court cannot be understood in such a manner as to conflict with the Court 's final decision.
|
: Criminal Appeal No.490 of 1985.
From the Judgment dated 29.5.1985 of the Judge, Special Court, Ferozepur in Case No.62/84, Trial No.23/85 and FIR No.154 of 1984.
U.R.Lalit and Prem Malhotra for the Appellants.
261 N.S.Das Behl and R.S.Suri (NP) for the Respondent.
The Judgement of the Court was delivered by K.RAMASWAMY,J.
This appeal under s.14(1) of the , 61 of 1984 for short `the Act ' the reference under s.15(3) thereof and s.366 of the Code of Criminal Procedure, 1973 for short `the Code ' for confirmation of the death sentence of Malkiat Singh, accused No. 1 in Sessions case No.62 of 1984, Trial No.23 of 1985 on the file of the Special Court, Ferozepur.
The first accused was convicted under s.302 read with s.34, I.P.C. for causing the deaths of Ram Babu, D 1, Sunder Lal, D 2, Ram Nath, D 3 and Ram Chand, D 4 of each death and sentenced to death subject to confirmation by this court.
He was also further convicted under s.307 read with s.34, I.P.C. and sentence to undergo rigorous imprisonment for 5 years for attempt to murder Ashok Kumar, PW 4.
Sukhdev Singh A 2 and Sohna Singh, A 3 were convicted under s.302 read with s.34, I.P.C. for causing deaths of D 1, to D 4 and sentenced to undergo imprisonment for life.
A 2 and A 3 were convicted under s.307 read with S.341 I.P.C. for attempt to murder of PW 4 and were sentenced to undergo rigorous imprisonment for 5 years, all the sentences to run concurrently.
Ram Avtar, PW 3 and D 3 Ram Nath, first cousin, had liquor contract in the village Kotli Ablu from 1983 and 1984.
D 2 and PW 4 were working in the liquor shop.
The wives of D 2 and D 4 are sisters.
D 4 came to see D 2.
D 1 was working in the liquor shop at Ablowbad.
Since the liquor therein had exhausted he came to Kotli Ablu to sell the liquor in the shop of D 3.
A 1 and A 2 are brothers and are residents of Kotli Ablu and Sohna Singh, A 3 is their maternal uncle (mother 's brother) and a resident of Rameana situated at a distance of 8 km.
to Kotli Ablu.
These are the admitted facts.
It is the case of the prosecution that at about 9.00 p.m. On June 4, 1984, A 1 and A 3 came to the liquor shop of D 3 wherein PW 3, D 1, D 2 and PW 4 were also present and were vending the liquor.
They sold one bottle of liquor to A 1 and A 3 on credit.
After its consumption A 1 and A 3 demanded another bottle to which D 3 refused to sell on credit.
Thereon A 1 and A 3 abused them and a quarrel ensued.
Both left the shop in anger.
D 1 and D 2 slept on a cot in front of the liquor shop.
D 3 and D 4 slept wooden takthposh in front of the liquor shop.
PW 3 and PW 4 climbed the roof of the shop and slept there.
During past midnight of June 4 5, 1984 at about 12.30 a.m. PW 3 and PW 4 heard gun shot fire and got up and saw with visibility of electric light emanating 262 from the house of one Gurbax Singh whose son was examined on DW 2 that A 1 was firing with rifle at D 1 to D 4 and A 2 and A 3 hitting them with Gandasas (sharp edged weapons).
Seeing PW 3 and PW 4 on the terrace A 1 fired at them but they escaped uninjured and they jumped down.
PW 3 jumped towards back side of the shop and ran towards the village and hid in the school.
PW 4 jumped to the front side and ran towards the village.
A 1 fired at PW 4 and A 2 hit him.
He received seven bullet injuries fired by A 1 on the backside, of right, leg, thigh and left side of the abdomen while he was running.
A 2 hit him on the right shoulder and had incised injury.
He ran to the house of Gurmail Singh, PW 3 with bleeding injuries, knocked the door and fell down unconscious.
On June 5, 1984 at about 9.00 a.m. Jit Singh, the Chowkidar of the village reached Kotli Police Station and reported to PW 5, S.H.O. who reduced Ex.P 24 into writing.
In the F.I.R. he stated that he had heard gun shot firing from the side of the liquor shop.
Due to fear and the prevailing tense situation he did not come out.
Next day morning he saw several people collected at the liquor shop and saw the dead bodies of D 1 to D 4 and PW 4 was lying unconscious in the house of DW 3 and he was asked to report the matter accordingly.
PW 5 after issuing F.I.R. to all the concerned, went alongwith police party to the spot at noon and saw the dead bodies.
He went to the house of DW 3 and found PW 4 under shock and unconscious.
He sent him for medical examination by PW 2, the Doctor as his condition was serious.
PW 3 on coming to know the arrival of the police and the military people at noon mustered courage and came out from the school and went to the shop.
He was examined at the inquest and he also attested the statement recorded by the police at the inquest.
PW 5 enclosed the copies of his statement to the inquest report Ex.P 4, P 6, P 8 and P 10 and sent the dead bodies with the reports for post mortem by PW 2 Doctor.
He also prepared rough sketch of the scene under Ex P1/A.
He recovered the blood stained earth and cots etc under exhibit
He recovered 7 empty and two live cartridges exhibit M 0/1 to M 0/9 under panchnama Ex.p 18.
He remained on the spot till 10.30 p.m. and saw the light emanating from the house of Gurbax Singh and falling at the scene of occurrence.
He sent requisition twice to the hospital to find whether PW 4 was in a fit condition for recording his statement.
On June 7, 1984 at about 7.00 a.m. he received an endorsement that PW 4 was in a fit condition to make the statement.
Accordingly he recorded the statement.
He sent M.O.S.1 to 9 cartridges and pellets recovered from body of D 4 under exhibitP 25 to ballistic expert for report.
on June 15, 1984 when he was picketing on the drain of village Chand Bhan at about 3.30 a.m. he arrested the appellants and recovered from the person of A 1.
exhibit 263 M 0/11 rifle, 351 bore (semi automatic) of U.S.A. make loaded with two cartridges M 0/12 and M 0/13 under panchnama in the presence of panch.
Pursuant to a statement made under s.27 Evidence Act by A 3 leading to discover Gandasa M 0/14 was recovered under ex.P 27 and sent them to the chemical examination and the ballistic reports.
Under exhibitP 28, the Ballistic expert found that the empties exhibit M 0/1 to M 0/9 had been fired from rifle exhibit M 0/11.
Gandasa was stained with human blood as per the report exhibit PW 2 who conducted the post mortem on D 1 and D 2 found on each of the dead bodies two gun shot entry and exit wounds.
D 3 and D 4 were found to have 4 gun shot lacerated and two incised injuries and 5 lacerated and two incised injuries respectively.
He removed M.O.S.16 and 17 pellet from the body of D 4.
He issued post mortem certificates Ex.P 3, P 5, P 7 and P 9 respectively.
He also examined PW 4.
He found as many as 7 lacerated gun shot injuries and one incised injury and issued medical certificate Ex.
Injuries and one incised injury and issued medical certificate exhibit Injuries 1 to 7 were caused by gun shot fire and injury 8 by a sharp weapon.
PW 5 sent two pellets recovered by him from the body of D 4 to the Ballistic and Chemical Examination.
The defence consented to mark F.I.R., the affidavits of panch witnesses and constables; the fire arms licence of A 1 under exhibit P 17 and also the reports of the ballistic expert and chemical examination reports without oral evidence.
PW 6, the Deputy Superintendent of Police supervised the investigation conducted by PW 5.
The prosecution examined 6 witnesses and defence examined 3 witnesses and marked the documents.
The accused were examined 3 witnesses and marked the documents.
The accused were examined under s.313 and denied their complicity and examined DW 1 to DW 3 to prove that the bulb of Gurbax Singh was not burning and PW 3 was residing at Medhak and he was brought to Kotli Ablu by the Police and PW 4 was conscious and did not disclose the names of the appellants at that time.
The lower court believed the direct evidence of PW 3 and PW 4 and the prosecution case that A 1 fired at the deceased with M 0/11 rifle, A 2 and A 3 also participated in the attack.
If also found that M 0/11, the rifle belongs to A 1 and he fired the deceased and PW 4.
Accordingly convicted them for an offences under sections 302/34 and 307/34 I.P.C. When they were asked under s.235(2), they declined to lead evidence and the Sessions Court awarded sentence to the accused as referred to earlier.
Shri Lalit, the learned senior counsel for the appellants contended that the evidence of PW 3 and PW 4 is highly artificial, unbelievable and untrustworthy; barring their evidence, there is no other evidence to connect the appellants with the commission of the crime.
The story that PW 3 and PW 4 climbed on the terrace and were sleeping is 264 false as they cannot climb to a height of 8/1/2 ft. PW 3 did not disclose his witnessing the occurrence to any one till noon.
DW 3 the Sarpanch of Madhok spoke that PW 3 alongwith the panch witnesses were brought from Madhok in a Jeep by the police, so he is a planted witness.
In support thereof he contends that the specific evidence of DW 3 in this regard was not challenged in cross examination.
PW 4 was not examined at the inquest though he was conscious.
The police requisitioned the dog squad to sniff the scene of offence to identify the unknown accused.
PW 5 and PW 2 the Doctor admitted that the omission of the names of the accused in the case diary and memos would belie the theory of witnesses.
The omission of the names of the accused in the cause title (Banam) would clearly show that PW 3 and PW 4 were not direct witnesses and PW 3 was introduced at a later stage and he was not examined at the inquest and that PW 4 did not identify the appellants.
This was also further corroborated from the fact that admittedly exhibit P 24, recited that three unknown assailants had killed the deceased.
Admittedly the dog squad was requisitioned.
The appellants were falsely implicated.
As regards PW 4, he further contended that as per the evidence of DW 2 son of Gurbux Singh and DW 3, Gurmail Singh, PW 4 was conscious at that time of his coming to the house of DW 3 and remained to be conscious.
The police did not examine him till June 7, 1984 as the assailants were not known.
There was no light in the house of DW 1 and PW 3 and PW 4 could not have identified the assailants.
The theory of liquor vending is doubtful for the reason that the entire State was under curfew on that day due to blue star operation on June 3, 1984 and no vending would take place when there is a curfew.
If really the appellants 1 and 3 had taken the liquor on credit, nothing prevented the prosecution to produce the chit admittedly taken by D 3.
The theory of burning the shop shows that it is an act of terrorists as was noted in the case diary by PW 6.
Thus the appellants were implicated by suspicion and the prosecution had not established the guilt of the appellant beyond reasonable doubt.
The conviction and sentence by the special court was on the same day, namely May 29, 1985 which contravenes the mandatory provision of s.235 of the Code.
In view of the decision of this court in Allauddin vs State of M.P., J.T.(1989) 2 SC 171 and Anguswamy vs State of Tamilnadu, J.T. the sentence of death awarded to A 1 is illegal.
A 2 had no axe to grind against the deceased.
He neither went for drinking at 9.00 p.m. on that day nor had a quarrel.
He bears no motive to kill the deceased or attack PW 4.
No recovery of Gandasa was made from him.
PW 3 and PW 4 have no prior acquaintance with him.
Therefore, it was highly doubtful whether A 2 had participated in the offence.
As regards to the third 265 appellant (A 3), it is his contention that he is a resident of Rameana.
PW 3 or PW 4 do not know A 6 at all.
Therefore, he may not be able to have participated in the crime.
It was resisted by Mr.Das Bahl, learned counsel for the State.
The acceptance of the prosecution case rests on the evidence of PW 3 and PW 4.
PW 3 and D 3 had the licence to vend liquor at Kotli Ablu.
PW 4 and D 2 were vending liquor under them.
D 4 came to see D 2 as they were married sisters.
D 1 came and was vending on the fateful day in the shop.
D 1 to D 4 were killed in the intervening night of June 4 5, 1984 is practically admitted from the evidence of DW 3.
During the course of the same transaction PW 4 sustained 7 lacerated gunshot injuries and one incised injury is also admitted through the evidence of DW 2 and DW 3, PW 2, the Doctor 's evidence conclusively established that D 1 and D 2 died due to gun shot injuries.
D 1 and D 2 each had two entry and exit wounds due to gun shots.
D 3 and D 4 also had gunshot lacerated as well as incised injuries.
They also died on the spot due to the injuries which are sufficient to cause death in the ordinary course of nature.
Seven empty and two live cartridge fired from M 0/11 rifle of 351 bore of U.S.A. make belonging to A 1 were recovered from the scene of occurrence.
Therefore, the deaths of D 1 and D 2 due to gunshot injuries and D 3 and D 4 due to gunshot and incised injuries are proved beyond doubt.
Equally PW 4 sustained injuries is also established.
The only question is whether the appellants are assailants.
The conviction of the appellants hinges upon the acceptability of the testimony of PW 3 and PW 4.
Let us first take the evidence of PW 4, the injured witness whose presence at the time of occurrence stands confirmed.
He is aged about 19 years.
He was working in the liquor shop of D 3 and PW 3 at Kotli Ablu.
He is residing in that village was not disputed.
As stated earlier he sustained 8 injuries (7 gunshot and one incised) during the course of the same transaction is also indisputable, and in fairness, was not disputed by Shri Lalit.
His serious attack is that PW 4 did not disclose the names of the assailants for two days which would show that he did not either see the assailants or the assailants were not known him.
We find it difficult to accept.
His case that he jumped from the terrace in front of the shop and he was attacked by the assailants was not disputed in the cross examination.
The suggestion that he was sleeping alongwith D 4 would show that he could see A 1 who fired at him while he was running away and it receives corroboration from medical evidence of PW 2 that the injuries are on the backside while he was chased by the accused.
So he 266 could clearly identify his own assailants as the occurrence did not take place at a fleet or glimpse.
In the F.I.R. at the earliest, it was specifically stated that PW 4 was not in a condition to speak.
It would mean that he was either under shock or unconscious.
The First Information Report given by the Chowkidar was admitted in evidence with the consent of the defence.
It is settled law that the First Information Report is not substantive evidence.
It can be used only to contradict the maker thereof or for corroborating his evidence and also to show that the implication of the accused was not an after thought.
Since the examination of first information was dispensed with by consent Ex P 24, F.I.R. became part of the prosecution evidence.
Under section 11 of the Evidence Act read with s.6 the facts stated therein namely, PW 4 was not in a speaking condition, could be used only as a relevant fact of prior existing state of facts in issue as resgestae of "the earliest information".
It is not used to corroborate the prosecution case, but can be looked into as an earliest information of the existing condition of PW 4 at 9.00 a.m. on June 5, 1984 i.e. when the report was given in exhibit p 24, PW 4 was still unconscious.
When PW 4 had stated that he became unconscious as soon as he came and tapped the door of DW 3, and fell down, by operation of section 11 of the Evidence Act it may be relevant fact of the previous existing condition that PW 4 contained to remain unconscious till the report was given.
Therefore, the F.I.R. could be used as relevant existing state of fact namely the continuous unconscious condition of PW 4 till PW 5 S.H.O.reached and saw him within the meaning of s.11 read with s.6 of the Evidence Act.
When PW 4 received 7 gun shot injuries and one incised injury and ran for life to a distance with bleeding injuries, it would be quite likely that he would be under severe shock and his evidence that after reaching the home of DW 3 and knocked the door he fell down unconscious appears to be quite natural and probable.
The evidence of PW 5, that on seeing PW 4 in critical unconscious condition he sent him to the Doctor for medical examination and the doctor administering sadation appear to be human probabilities and there is nothing intrinsic to suspect their evidence.
Thus PW 4 was not in a fit condition to give statement till June 7, 1984 at 7.00 a.m. PW 4 's evidence that he was residing at Kotli Ablu and that he knew the accused was not disputed in the cross examination.
It is not uncommon in normal human probability that he was not expected to know the names of the relations of A 3.
When A 1 and A 3 came in that very night to the shop and quarreled for non supply of liquor on credit, it would be fresh in the memory of PW 4 and as he saw the assailants he could have easily recognized A 3. 267 Undoubtedly, ocular defence evidence, if it is not subjected to critical cross examination, is entitled to the same weight as prosecution evidence.
But merely because the prosecution, as usual, made insipid cross examination, the defence evidence is not to be believed automatically.
Witnesses may be prone to speak lies but circumstances will not.
So even though the burden of the defence is not as heavy as of the prosecution, the oral evidence tendered by the defence must also be subjected to critical scrutiny and be considered in the light of the given facts and attending circumstances of the case and human probabilities.
The evidence on record is clear that PW 4 was left attended, though was lying with injuries at the house of DW 3, till the investigating officer PW 5 came and saw him in critical condition.
The normal human conduct, which is common in the country side, is to give immediate first aid and then to make inquire of the cause for injuries and the persons who caused the same.
As DW 3 betrayed such conduct, make us to suspect the credibility and veracity of his evidence and of DW 2 that PW 4 was conscious all through and that he did not disclose the assailants ' names.
Therefore, the evidence of DW 2 and DW 3 that PW 4 was professed to have disclaimed the names of the assailants is unbelievable despite no specific cross examination was directed on that aspect.
That apart they did not tender themselves to be examined by PW 5, the investigating officer.
As regards the shedding of the light from the house of Gurbax Singh is concerned, there is uncontroverted evidence of PW 5, that he remained in the village till 9.30 p.m. on June 5, 1984 to see whether the light was emanating from the house of Gurbax Singh and found to be so and sufficient for PW 3 and PW 4 to identify the assailants.
No cross examination on this aspect was directed.
Gurbax Singh, the owner of the house was not examined by the defence.
Only his son DW 2, an youngster, came into the box and perjured the evidence.
Therefore, the claim that the light was not working for three months prior to the date of occurrence, cannot be believed.
Even assuming that there was no light, even then, PW 4 could identify his own assailants when he was attacked and chased in the course of the same transaction.
Nothing worthwhile was brought out in the cross examination to disbelieve his testimony.
He had no axe to grind against any of the accused.
To motive to make false implication of the accused was even suggested.
He cannot be expected to allow his own assailants to go unpunished and would implicate innocent persons.
Moreover the medical evidence of PW 2 fully corroborated the evidence of PW 4.
It is settled law that corroboration is not a rule of law, but one of caution as an assurance.
The conviction could be made on the basis of 268 the testimony of a solitary witness.
The occasion for the presence at the time of occurrence, opportunity to witness the crime, the normal conduct of the witness after the incident, the nearness of the witness to the victim, his pre disposition towards the accused, are some of the circumstances to be kept in view to weigh and accept the ocular evidence of a witness.
It is not the quantum of the evidence but its quality and credibility of the witness that lends assurance to the court for acceptance.
Considered in this light, we have no hesitation to conclude that PW 4 is a witness of truth and inspires us to believe his evidence.
He would, even in the absence of any light have identified the accused, who had attacked him and committed the murders of sleeping, unarmed and innocent D 1 to D 4.
The evidence of PW 3, though was severely attacked by Shri Lalit, giving our anxious consideration and subjecting to careful analysis, we find that the Special Court committed no error in accepting his evidence.
It is common knowledge that the villagers during summer sleep outside the house, court yard of the house, if any, or on the terrace of the concrete houses.
No doubt there is no stairs to the terrace of the shop whose height is only 8 and 1/2 feet.
PW 4 and PW 3 being young men it is not difficult to climb up and sleep and now it was proved providential for them.
Therefore, the absence of producing, the quilts or lack of steps is not a serious infirmity to doubt the presence of PW 3 and PW 4 and that they slept on the terrace of the shop.
In view of curfew and tense condition in the State, it would be unlikely that PW 3 would have traveled in the night to Madhok at a distance of 23 km.
The evidence on record clearly shows that the defence has freely used the entries in the case diary as evidence and marked some portions of the diary for contradictions or omissions in the prosecution case.
This is clearly in negation of and in the teeth of s.172(3) of the Code.
Section 172 reads thus: "Diary of proceedings in investigation. (1) Every police officer making an investigation under this Chapter shall day by day enter his proceedings in the investigation in a diary, setting forthwith the time at which the information reached him, the time at which he began and closed his investigation, the place or places visited by him, and a statement of the circumstances ascertained through his investigation.
269 (2) 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.
(3) 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 Section 161 or Section 145, as the case may be, of the (1 of 1872) shall apply.
" It is manifest from its bare reading without subjecting to detailed and critical analysis that the case diary is only a record of day to day investigation of the Investigating Officer to ascertain the statement of circumstances ascertained through the investigation.
Under sub section(2) the Court is entitled at the trial or enquiry to use the diary not as evidence in the case, but as aid to it in the inquiry or trial.
Neither the accused, nor his agent, by operation of sub section(3), shall be entitled to call the diary, nor shall he be entitled to use it as evidence merely because the Court referred to it.
Only right given thereunder is that if the police officer who made the entries in the diary uses it to refresh his memory or if the Court uses it for the purpose of contradicting such witness, by operation of s.161 of the Code section 145 of the Evidence Act, it shall be used for the purpose of contradicting the witness, i.e. Investigation Officer or to explain it in re examination by the prosecution, with permission of the court.
It is, therefore, clear that unless the investigating officer or the Court uses it either to refresh the memory or contradicting the investigating officer as previous statement under s.161 that too after drawing his attention thereto as is enjoined under s.145 of the Evidence Act.
The entries cannot be used by the accused as evidence.
Neither PW 5, nor PW 6, nor the court used the case diary.
Therefore, the free use thereof for contradicting the prosecution evidence is obviously illegal and it is inadmissible in evidence.
Thereby the defence cannot place reliance thereon.
But even if we were to consider the same as admissible that part of the evidence does not impinge upon the prosecution evidence.
As regards the omission of the names of the appellants in the memos sent to the Medical Officer PW 2 under exhibit D 13 and 15 it is also not evidence except as record of investigation.
It is not a rule of 270 law that the memo should bear names with cause title of accused.
It is enough if the name of the injured is mentioned in the memo.
Therefore, the omission to refer their names after the word Banam in the memos sent to the Doctor would not create any doubt that the appellants were later implicated.
Equally the prosecution cannot rely on the statement of PW 3 enclosed to the inquest reports as substantive evidence, as is done and argued with vehemence by Sri Das Bahl.
Section 174 of the Code empowers a police officer to investigate in the presence of two or more respectable witnesses and report only the cause of death and the person, if known, that has committed the offence.
Section 175 empowers him to summon any person who appears to be acquainted with the facts of the case and every person so summoned shall be bound to attend the inquest and answer truely all the questions other than questions the answers to which would have a tendency to expose him to a criminal charge or to a penalty or forfeiture.
The statement made by such person is a "previous statement" within the meaning of s.162 and it shall not be signed.
So the statement made by such a person to police officer is in the course of the investigation, and when reduced to writing, it shall be used only by the accused to contradict such witness in the manner provided by s.145 of the Evidence Act or with the permission of the court the prosecution could use it for re examination only to explain the matter referred to in his cross examination.
It is settled law that s.162 was conceived to protect an accused creating an absolute bar against the previous statement made before the police office being used for any purpose whatsoever.
The obvious reason is that the previous statement under the circumstances was not made inspiring confidence.
It enables the accused to rely thereon only to contradict the witnesses in the manner provided by s.145 drawing attention of the witness of that part of the statement intended to be used for contradiction.
It cannot be used for corroboration of a prosecution or defence witness or even a court witness, nor can it be used contradicting a defence or a court witness.
The investigating officer is enjoined to forward the inquest report to the Magistrate alongwith the statement recorded at the inquest, so that the court would see the record, at the earliest of the circumstances leading to the cause of the death of the deceased and the witness examined during the inquest.
Therefore, the statement of PW 3 record during inquest is not evidence.
It is a previous statement reduced to writing under s.162 of the Code and enclosed to the inquest report and cannot be used by the prosecution for any purpose including to show the names of the accused except to contradict the maker thereof, or to explain the same by prosecution.
271 It is true that DW 1 had stated and was not effectively cross examined that PW 3 was brought by the police in a jeep alongwith the Panch.
But he was examined at the inquest is evident from the record.
PW 3 was present at 9.00 p.m. at the time of vending liquor on credit to A 1 and A 3 and the quarrel.
PW 4 stated that PW 3 and himself slept together on the terrace.
He was examined at the inquest is corroborated by doctor 's evidence that statement of PW 3 recorded under s.162 was enclosed to the inquest reports and sent to PW 2, the Doctor alongwith the dead bodies.
There is ring of truth in the evidence of PW 3.
During curfew, in the night he would not have under taken to go to Madhok at a distance of 23 km.
The attending circumstances for coming to the scene of offence appear to be natural and probable in the ordinary course of human conduct.
Having seen that four of his companions were done to death, the instinct of self preservation and the grip of fear would have made him not to stir out from the school and mustered courage only when the police and the military people arrived at the scene at noon.
Thus he came to be examined at the earliest at inquest whereat he disclosed the names and the participation of the appellants.
Thus the evidence of PW 3 would lend to corroborate PW 4 's evidence.
In addition there is a strong circumstantial evidence against A 1 and A 3.
On his arrest on June 15, 1984, M/0/11, rifle was recovered from A 1.
As per exhibit P 17 licence, it belongs to him, the ballistic report exhibit P 20 establishes that the empty cartridges exhibit M.1 to M.7 were discharged from the bore of M/0/11.
This evidence clearly established that M/0/11 was used by A 1 in the crime.
In his examination under s.313, no explanation was given as to how M/0/11 rifle could go out from his custody for being used, in committing the crime by third parties.
From its recovery from the person of A 1, it is clear that it continued to remain in his custody from the time of user in the crime till it was recovered from him.
These circumstances coupled with oral evidence of PW 4 and PW 3 clearly establish the complicity of A 1 in committing the offences of murder of D 1 to D 4.
As equally A 3 accompanied A 1 to the liquor shop and had quarrel.
When A 1 and A 3 left the shop in anger, it is clear that they left the shop in a huff smarting from humiliation at the hands of the contractor from out side the state and their staff.
To avenge the humiliation heaped upon them, they animated to finish the prosecution party.
Obviously they chose past mid night to be sure that all would be asleep and no evidence of their crime would be available.
Thus they have strong motive to kill the deceased and to make murderous attack on PW 4.
Moreover gandasa was recovered pursuant to A 3 's statement under s.27 of 272 Evidence Act leading to its discovery and it contained human blood though blood group could not be detected due to disintegration.
The two incised injuries each on the persons of D 3 and D 4 as corroborated by medical evidence clearly establishes the participation of A 3 in attacking the deceased.
He accompanied A 1 at dead of night to the liquor shop and killed D 1 to D 4 and attempted to kill PW 4.
Thus he shared with A 1 the common intention to kill the deceased D 1 to D 4 and attempt to kill PW 4.
The production of the credit chit kept on the table in the shop would have lent corroboration to the prosecution case of the sale of liquor to A 1 and A 3 on credit.
It is not the prosecution case that it was signed by either of the accused.
It is now in evidence that it was burnt out also with the shop, though no definite evidence for cause of burning is on record, except vague suggestions but denied by the prosecution witnesses that the terrosists committed the arson and killings.
From a totality of facts and circumstances it cannot be concluded that terrorists committed the offence.
As regards A 2 we have grave doubt of his participation in the crime.
Admittedly, he had no motive to kill any of the deceased or to attack PW 4.
He did not come at 9.00 p.m. on June 4, 1984 to the liquor shop for drinking.
There is no recovery of gandasa from him, though he was arrested alongwith A 1 and A 3.
The doubt whether A 2 was likely to be a participant in the commission of this grave crime of four deaths has not been removed from our minds.
It is undoubtedly true that PW 4 had stated that A 2 attacked him with the gandasa but when he was attacked while he was fleeing for life the possibility of mistaken identity of A 2 to A 3 cannot be ruled out.
We make it clear that we are not doubting the veracity of PW 4.
In these circumstances A 2 is entitled to the benefit.
Accordingly, we hold that A 1 and A 3 have shared common intention, they had motive to kill the deceased.
They came together, killed the sleeping innocent four persons D 1 to D 4 and also attempted to kill PW 4.
Accordingly, we hold that A 1 committed the offence of murder of D 1 and D 2 punishable under s.302; D 3 and D 4 's under s.302 read with s.34 I.P.C. and attempt of murder of PW 4 punishable under s.307 read with s.34, I.P.C. A 3 shared the common intention with A 1 and also committed the said offences under s.302 read with s.34; s.307 read with s.34 I.P.C. A 3 was given the minimum sentence of imprisonment of life.
The sentences were directed to run concurrently.
273 On finding that the accused committed the charged offences, s.235(2) of the Code empowers the Judge that he shall pass sentence on him according to law on hearing him.
Hearing contemplated is not confined merely to oral hearing but also intended to afford an opportunity to the prosecution as well as the accused to place before the Court facts and material relating to various factors on the question of sentence and if interested by either side to have evidence adduced to show mitigating circumstances to impose a lesser sentence or aggravating grounds to impose death penalty.
Therefore, sufficient time must be given to the accused or the prosecution on the question of sentence, to show the grounds on which the prosecution may plead or the accused may show that the maximum sentence of death may be the appropriate sentence or the minimum sentence of life imprisonment may be awarded, as the case may be.
No doubt the accused declined to adduce oral evidence.
But it does not prevent to show the grounds to impose lesser sentence on A 1.
This Court in the aforestated Alluddin and Anguswamy 's cases held that the sentence awarded on the same day of finding guilt is not in accordance with the law.
That would normally have the effect of remanding the case to the Special Court for reconsideration.
But in the view of the fact that A 1 was in incarceration for long term of six years from the date of conviction, in our considered view it needs no remand for further evidence.
It is sufficient that the sentence of death awarded to A 1 is converted into rigorous imprisonment for life.
The sentences of death is accordingly modified and A 1 is sentenced to undergo rigorous imprisonment for life for causing the deaths of all four deceased.
The conviction of A 1 for attempt to murder PW 4 and sentence of five years ' rigorous imprisonment is also upheld and all the sentences would run concurrently.
A 2 is acquitted of all charges.
The bail bonds are cancelled.
He shall be set at liberty unless he is required in any other case.
The appeal is allowed only to the above extent.
V.P.R. Appeal Partly allowed.
| IN-Abs | The case of the prosecution was that at about 9.00 p.m. on June 4,1984, A 1 and A 3 came to the liquor shop of D 3 wherein PW 3, D 1, D 2 and PW 4 were also present and were vending the liquor.
They sold one bottle ofliquor to A 1 and A 3 on credit.
After its consumption A 1 and A 3 demanded another bottle to which D 3 refused to sell on credit.
There on A 1 and A 3 abused them and a quarrel ensued.
Both left the shop in anger.
D 1 and D 2 slept on wooden takthposh in front of the liquor shop.
PW 3 and PW 4 climbed the roof of the shop and slept there.
During past mid night of June 4 5, 1984 at about 12.30 a.m., PW 3 and PW 4 heard gun shot fire and got up and saw with the visibility of electric light emanating from the house of one Gurbax Singh, the father of DW 2 that A 1 was firing with rifle at D 1 to D 4 and A 2 and A 3 hitting them with Gandasas (sharp edged weapons).
Seeing PW 3 and PW 4 on the terrace A 1 fired at them but they escaped uninjured and they jumped down.
PW 3 jumped towards back side of the shop and ran towards the village and hid in the school.
PW 4 jumped to the front side and ran towards .
the village A 1 fired at PW 4 257 and A 2 hit him.
He received seven bullet injuries fired by A 1 on the backside, of right leg, thigh and left side of the abdomen while he was running.
A 2 hit him on the right shoulder and had incised injury.
He ran to the house of PW 3 with bleeding injuries, knocked the door and fell down unconscious.
On June 5, 1984 at about 9.00 a.m. the Chowkidar of the village reached Kotli Police Station and reported to PW 5, H.O.who reduced F.I.R. into writing.
In the F.I.R. the chowkidar stated that he had heard gun shot firing from the side of the liquor shop.
Due to fear and the prevailing tense situation he did not come out.
Next day morning he saw several people collected at the liquor shop and saw the dead bodies of D 1 to D 4 and PW 4 was lying unconscious in the house of DW 3 and he was asked to report the matter accordingly.
The defence consented to mark F.I.R., the affidavits of the panch witnesses and constables, the fire arms licence of A 1 under Ex.p 17 and also the reports of the ballistic expert and chemical examination reports without oral evidence.
The lower court believed the direct evidence of PW 3 and PW 4 and the prosecution case that A 1 fired at the deceased with MO 11 rifle, A 2 and A 3 also participated in the attack.
The first accused was convicted under s.302 read with s.34, I.P.C. for causing the deaths of D 1, D 2, D 3 and D 4 and sentenced to death subject to confirmation by this Court.
He was also further convicted under s.307 read with s.34, I.P.C. and sentenced to undergo rigorous imprisonment for 5 years for attempt to murder PW 4.
A 2 and A 3 were convicted under s.302 read with s.34, I.P.C. for causing deaths of D 1 to D 4 and sentenced to undergo imprisonment for life.
A 2 and A 3 were convicted under s.307 read with s.34 I.P.C. for attempt to murder of PW 4 and were sentenced to undergo rigorous imprisonment for 5 years, all the sentences to run concurrently, against which the accused filed appeal u/s.14(1) of the Terrorist Affected Areas (Special Court) Act, 1984.
The appellants contended that the evidence of PW 4 was highly artificial, unbelievable and untrustworthy; that barring their evidence, there was no other evidence to connect the appellants with the commission of the crime; that the omission of the names of the accused in the case diary and memos would belie the theory of witnesses; that the appellants were implicated by suspicion and the prosecution had not 258 established the guilt of the appellant beyond reasonable doubt; that the conviction and sentence by the special court was on the same day, which contravened the mandatory provision of s.235 of the Code.
Partly allowing the appeal, this Court, HELD: 1.
The First Information Report is not substantive evidence.
It can be used only to contradict the maker thereof or for corroborating his evidence and also to show that the implication of the accused was not an after thought.
[266B C] 2.
Since the examination of first information was dispensed with by consent F.I.R. became part of the prosecution evidence.
[266B C] 3.
Ocular defence evidence, if it is not subjected to critical cross examination, is entitled to the same weight as prosecution evidence.
But merely because the prosecution, as usual, made insipid cross examination, the defence evidence is not to be believed automatically.
[267A B] 4.
Witnesses may be prone to speak lies but circumstances will not.
So even though the burden of the defence is not as heavy as of the prosecution, the oral evidence tendered by the defence must also be subjected to critical scrutiny and be considered in the light of the given facts and attending circumstances of the case and human probabilities.
[267A C] 5.
Corroboration is not a rule of law, but one of caution as an assurance.
The conviction could be made on the basis of the testimony of a solitary witness.
The occasion for the presence at the time of occurrence, opportunity to witness crime the normal conduct of the witness after the incident, the nearness of the witness to the victim, his pre disposition towards the accused, are some of the circumstances to be kept in view to weigh and accept the ocular evidence of a witness.
It is not the quantum of the evidence but its quality and credibility of the witness that lends assurance to the court for acceptance.
[267H 268B] 6.
The case diary is only a record of day to day investigation of the Investigating Officer to ascertain the statement of circumstances ascertained through the investigation.
Under Section 172(2) the Court is entitled at the trial or inquiry to use the diary not as evidence in the case, but as aid to it in the inquiry or trial.
Neither the accused, nor his agent, by operation of sub section
(3), shall be entitled to call the diary, nor shall he be entitled to use it as evidence merely because the Court 259 referred to it.
Only right given thereunder is that if the police officer who made the entries in the diary uses it to refresh his memory or if the Court uses it for the purpose of contradicting such witness, by operation of s.161 of the Code and s.145 of the Evidence Act, it shall be used for the purpose of contradicting the witness, i.e., Investigation Officer or to explain it in re examination by the prosecution, with permission of the Court.
It is, therefore, clear that unless the investigating officer or the court uses it either to refresh the memory or contradicting the investigating officer as previous statement under s.161 that too after drawing his attention thereto as is enjoined under s.145 of the Evidence Act.
The entries cannot be used by the accused as evidence.
[269C G] 7.
The memos sent to the Medical Officer are not evidence except as record of investigation.
It is not a rule of law that the memo should bear names with cause title of accused.
It is enough if the name of the injured is mentioned in the memo.
[269H 270A] 8.
Section 174 of the Code empowers a police officer to investigate in the presence of two or more respectable witnesses and report only the cause of death and the person if known, that has committed the offence.
Section 175 empowers him to summon any person who appears to be acquainted with the facts of the case and every person so summoned shall be bound to attend the inquest and answer truely all the questions other than questions the answers to which would have a tendency to expose him to a criminal charge or to a penalty or forfeiture.
The statement made by such a person is a "previous statement" within the meaning of section 162 and it shall not be signed.
So the statement made by such a person to police officer is in the course of the investigation, and when reduced to writing, it shall be used only by the accused to contradict such witness in the manner provided by section 145 of the Evidence Act or with the permission of the court the prosecution could use it for re examination only to explain the matter referred to in his cross examination.[270B E] 9.
S.162 was conceived to protect an accused creating an absolute bar against the previous statement made before the police officer being used for any purpose whatsoever.
The obvious reason is that the previous statement under the circumstances was not made inspiring confidence.
It enables the accused to rely thereon only to contradict the witnesses in the manner provided by s.145 drawing attention of the witness of that part of the statement intended to be used for contradiction.
It cannot be used for corroboration of a prosecution or defence witness or even a court witness, nor can it be used contradicting a 260 defence or a court witness.
The investigating officer is enjoined to forward the inquest report to the Magistrate alongwith the statement recorded at the inquest, so that the court would see the record, at the earliest of the circumstances leading to the cause of the death of the deceased and the witness examined during the inquest.
[270E G] 10.
The statement of witness PW 3 recorded during inquest is not evidence.
It is a previous statement reduced to writing under s.162 of the Code and enclosed to the inquest report and cannot be used by the prosecution for any purpose including to show the names of the accused except to contradict the maker thereof, or to explain the same by prosecution.
[270G H] 11.
On finding that the accused committed the charged offence, s.235(2) of the Code empowers the Judge that he shall pass sentence on him according to law on hearing him.
Hearing contemplated is not confined merely to oral hearing but also intended to afford an opportunity to the prosecution as well as the accused to place before the Court facts and material relating to various factors on the question of sentence and if interested by either side to have evidence adduced to show mitigating circumstances to impose a lesser sentence or aggravating grounds to impose death penalty.
Therefore, sufficient time must be given to the accused or the prosecution on the question of sentence to show the grounds on which the prosecution may plead or the accused may show that the maximum sentence of death may be the appropriate sentence or the minimum sentence of life imprisonment may be awarded, as the case may be.
If the accused declines to adduce oral evidence, it does not prevent to show the grounds to impose lessor sentence on.
[273A D] 12.
The sentence awarded on the same day of finding guilt is not in accordance with the law.[273C D] Allauddin vs State of M.P., J.T.(1989) 2 SC 171 and Anguswamy vs State of Tamilnadu, J.T.(1989) 2 SC 184, referred to.
|
Civil Appeal No.1779 of 1991.
From the Judgment and Order dated 10 4 1990 of the Bombay High Court in W.P.No.1944 of 1987.
M.C.Bhandare, CPU Nair, Ms.
Kamini Lao and M.N.Shroff for the Appellants.
V.N.Ganpule, S.K.Agnihotri, A.S.Bhasme and Ms.
H.Wahi for the Respondents.
The Judgment of the Court was delivered by Sawant,J.
Leave granted.
Appellant No.1 is a Trust which runs and manages an Ayurveda College in Bombay.
Appellant No.2, is the Principal of the College.
There was a vacancy in the post of a lecturer in Sanskrit for the academic year 1983 84 which was admittedly reserved for a candidate from the backward classes.
The Ist respondent had applied for the said post on 19th September, 1983 even before the appellant Trust had invited applications by advertising the vacancy as it was required 286 to do.
Subsequently, on October 13, 1983, the appellant Trust issued an advertisement inviting applications for the post without mentioning for which academic year the appointment was to be made.
The parties before us agree that it was for the academic year 1983 84.
In the advertisement, it was specifically mentioned that the post was reserved for a backward class candidate and if no suitable candidate from the backward classes was available, a candidate from the non backward classes may be appointed for an year.
It appears that within a month thereafter on the 12th November, 1983, a second advertisement was issued repeating the earlier advertisement.
No application was received from any candidate from the backward classes in response even to this advertisement, and hence, the Ist respondent who had already applied as stated earlier, was appointed to the said post for the period from March 19, 1984 till April 30, 1984.
The total period of service put in by the Ist respondent for the said academic year was 41 days.
On April 28, 1984, the appellant Trust issued an advertisement for the same post repeating the contents of the earlier advertisement, but for the academic year 1984 85.
The applications were invited by 30th April, 1984.
No candidate from the backward classes applied in response to the said advertisement.
The interview was held on June 30, 1984 and the Ist respondent was appointed for the period from 21st August, 1984 to 19th April, 1985.
In the third academic year 1985 86, admittedly no advertisement was issued and no applications from the candidates including candidates from the backward classes were invited.
However, the Ist respondent was appointed to the post from July 10, 1985 to April 30, 1986.
Thereafter the Ist respondent 's services were terminated w.e.f.
30th April, 1986 by a notice dated March 12, 1986.
No appointment was made to the said post for the academic year 1986 87.
On May 1,1987, the Trust issued advertisement inviting applications to the said post from candidates belonging to all classes since, according to the Trust, the post was dereserved during the said period.
Three candidates belonging to the non backward classes including the Ist respondent and the 5th respondent applied for the post and the 5th respondent was selected and appointed to the same.
It appears that the Ist respondent was not paid salary for the summer vacations following the academic years 1984 85 and 1985 86.
She was also not paid salary from November 1985 to April 1986.
She approached the College Tribunal praying for salary for (i) November 1985 to April 1986, and (ii) for the summer vacations following 287 academic years 1984 85 and 1985 86, i.e., for the months of May and part of June 1985, and May and part of June 1986, and (iii) for setting aside her termination of service and for reinstatement.
The Tribunal allowed her claim for the salary for the relevant periods, but dismissed her claim for reinstatement holding that her appointment was purely temporary and her claim that she should be deemed to have been confirmed because she had served for two academic years was not established in the circumstances of the case.
This decision was delivered by the Tribunal on December 9, 1986.
As stated earlier, during the academic year 1986 87, no appointment was made to the said post and it was subsequent to this decision that an advertisement was issued calling for applications from candidates belonging to all classes and 5th respondent was appointment to the said post.
Against the decision of the Tribunal the Ist respondent approached the High Court under Article 226 of the Constitution, and the High Court held that notwithstanding the break in her actual appointment, she was continuously in employment from March 19, 1984 to April 30, 1986.
She was, therefore, entitled to the benefit of the resolutions of the State Government and the University of Bombay dated September 29, 1986 and February 27, 1987 respectively which, according to the High Court, laid down that an employee who was appointed for two consecutive academic years must be deemed to have been on probation right from the time of the first appointment and, therefore, confirmed in the post.
The High Court, therefore, allowed her petition and directed the appellants to reinstate her forthwith in the post and also to treat her as if she had been in continuous employment from March 19, 1984 with the benefit of full back wages, seniority etc.
The High Court also directed the University, the Director of Ayurveda, Maharashtra and the State of Maharashtra who were respondents 3,4 and 5 respectively to the petition, and who are respondents 2,3 and 4 to the present appeal respectively, to make appropriate sanctions including grant of money, if necessary.
The High Court further granted cost and directed compliance with the orders by the appellants within six weeks from the date of its order, which is April 10, 1990.
Although various contentions have been raised we find that it is not necessary to go into them.
According to us the appellant Trust has violated the directions of the Government as well as of the University in the appointments in question in two major respects, as a result of which neither the appointment of the Ist respondent nor that of the 5th respondent can be said to have been validly made.
Unfortunately, these aspects of the matter which are evident from the record 288 were lost sight of both by the Tribunal and the High Court.
The result has been that the illegalities which are patent on the face of the record have been perpetuated.
The Government of Maharashtra had issued a Govt.
resolution No.
1177/129387/XXXII (CELL) on October 25, 1977 prescribing conditions of service as shown in Appendix III to the resolution.
By a further resolution of April 3, 1978, Government made it clear that the revised scales of pay which were sanctioned by the resolution of October 25, 1977 could be implemented only after statutes had been duly made by the University.
Since the making of the statutes was to take some time and the revised scales of pay recommended of the University Grants Commission were to be effective from January 1, 1973 as laid down in the GR of October 25, 1977, the Vice Chancellor exercised his powers conferred upon him under Section 11(6)(b) of the Bombay University Act 1974 (hereinafter referred to as the "Act") and issued his direction No.192 of 1978 on 7th June, 1978.
This direction, among other things, laid down the mode of recruitment of the teachers and principals, as follows: "Futuer recruitment to posts of Teachers and Principals of colleges shall be made through a Selection Committee, the composition of which is specified in the terms and conditions (Appendix II)." Appendix II states as follows: " Terms and conditions attached to the revised scales of pay.
(i) x x x x x x x x (ii) All appointments of teachers in colleges shall be made on merit and on the basis of all India advertisement.
The qualifications prescribed for the posts should essentially be related to the academic attainment in the subject concerned and should not be linked with language or other regional consideration.
Appointment should not be made on communal or caste consideration.
The constitution of Selection Committee for recruitment to the posts of lectures in a college should be as follows: (a) Chairman, Governing Body of the College or his nominee; 289 (b) a nominee of the Vice Chancellor.
(c) one expert to be nominated by the University.
(d) one nominee of the Director of Education (Higher Education).
(e) Principal of the college; and (f) Head of the Department concerned of the college.
No selection shall be considered valid unless at least one expert is present.
The recommendations of the Selections Committee shall be subject to the approval of the Vice Chancellor.
* * * * * * * * (Emphasis Supplied) 8.
The effect of the aforesaid government resolutions and the University directions is (a) that all appointment of teachers in colleges have to be made on merit and on the basis of all India advertisement;(b) that the appointments have to be made by a Selection Committee which consists, among others, of nominee of the Vice Chancellor, an expert to be nominated by the University and a nominee of the Director of Education (Higher Education).
No selection will be considered valid unless at least one expert is present for the selection.
Admittedly, the selection of the 5th respondent was made by a committee where neither the nominee of the Vice Chancellor nor the expert nominated by the University nor the nominee of the Director of Education (Higher Education), i.e., in the present case of the Director of Ayurveda was present.
The selection so made was, therefore, not valid.
Shri Bhandare, the learned counsel for the appellant Trust Pointed out to us the letter of June 6, 1989 sent by the University of Bombay according approval to the appointment of the 5th respondent as a lecturer in Sanskrit on probation from 2nd July, 1987 and contended that in view of the said approval the invalidity of the appointment, if any, on account of the absence of the expert in the Selection Committee, should be deemed to have been condoned.
We are not impressed by this contention.
In the first instance, there is nothing on record to show whether when the appellant Trust forwarded its report on appointment of the 5th respondent, the Trust had apprised the 290 University of the absence of the expert at the time of his selection.
Secondly, the University has not reserved the power to relax the rule and permit selection without the presence of the expert.
There is nothing in the University 's letter to show why the University had condoned the absence of the expert.
It is, therefore, obvious that the approval given by the University being in ignorance of the true state of affairs and in breach of the rule is legally ineffective and cannot validate the appointment.
There is further a common illegality in the appointment of both the 1st and the 5th respondent which arises on account of the failure to follow the Government Resolutions and University directions in the matter of reservation of the seats for the backward classes, which are binding on the College.
On 30th March 1981, the Government of Maharashtra passed a resolution in exercise of the powers conferred on it under sub Section (2) of Section 77 C of the Act issuing instruction to all the non agricultural Universities in regard to the reservation of posts to be made in favour of Scheduled Castes and Scheduled Tribes while making appointments to teaching and non teaching posts in the University affiliated colleges and recognized institutions.
The reservation prescribed was as follows: (1) Scheduled Castes 13 p.c.
(2) Scheduled Tribes 7 p.c.
(3) Nomadic Tribes & Vimukta Jatis 4 p.c.
Total 24 p.c.
That resolution further says that the various orders contained in the booklet "Reservation and other concessions in Government service for backward classes" will be applicable for recruitment to the teaching and non teaching posts reserved for backward classes in the University and the affiliated colleges and recognized institutions subject to the following modifications in regard to recruitment to the teaching posts.
The modifications, among other things, were as follows: "Similarly, at any given time of recruitment to the teaching posts, only the total number of reserved vacancies and the sections from which they are to be filled in should be 291 determined.
It would be enough if the require percentage is fulfilled as a whole and not with reference to any particular post.
If the reserved vacancies cannot be filled, then so many posts as cannot be filled in may be kept vacant for six months and should be again advertised thrice.
Even after readvertising the posts 3 times if suitable candidates belonging to backward classes do not become available, they may be filled in by candidate belonging to the open category." "For giving effect to the aforesaid instructions, it will be necessary for the Universities to make statutes under Section 77C(1) under their respective Universities Acts of 1974.
For ensuring immediate implementation, the Vice Chancellors of the Universities, under clause (b) of Section 11(6) of the respective Universities Act of 1974.
" (Emphasis supplied) 12.
By its subsequent resolution of October 20, 1983, the Government of Maharashtra clarified its earlier resolution of March 30, 1981 and stated as follows: "1. x x x x x x x x 2.
After reconsideration of the above decision, it is now directed that if suitable candidates cannot be found to fill posts reserved for backward classes in Universities, affiliated colleges and recognized institutions, those posts should be temporarily filled with candidates belonging to non backward classes for one academic year.
But as mentioned in the resolution the appointment of a non backward class candidate to a reserved vacancy should be made only in the event of failure to find a backward class candidate even after the post has been advertised thrice.
x x x x x x x x" (Emphasis supplied) 13.
Thereafter a further resolution was issued by the Government on September 29,1986 on the subject stating therein that it had come to the notice of the Government that some institutions had not 292 implemented the instructions contained in the earlier resolutions of March 30, 1981 and of October 30, 1983.
The Government therefore directed that the said directions should be implemented strictly.
This resolution further directed that the non backward class candidates who were being repented for the second and third academic years when backward class candidates were not found for appointment for the first academic year, should not be called for interview every year and that the candidates belonging to the non backward classes should be appointed for the second and third academic year also, without calling them for interview.
It is further stated in the said resolution that, similarly, as soon as the reserved post is dereserved, the appointed candidate should be confirmed in that post from the date of dereservation subject to all other terms and conditions.
It was also directed that necessary statutes should be made by the University in accordance with the provisions of the Act and for ensuring immediate implementation, the vice Chancellor should issue directions under clause (b) of Section 11(6) of the Act.
Pursuant to the said resolution of the Government, the Vice Chancellor of the University issued direction on March 11, 1987 as follows: "x x x x x x x (1) That the reserved teaching post which is filled in by appointment of a suitable non backward class candidate in the first year by following the prescribed procedure of selection shall be advertised again for the second and third years for inviting applications only from persons belonging to Scheduled Castes, Scheduled Tribes, Denotified Tribes and Nomadic Tribes.
However, applications may also be invited from persons belonging to non backward class if the suitable non backward class candidate already appointed in the first year is not available for reappointment in the second or third year and or his services are required to be terminated on account of unsatisfactory performance of work in the first year; (2) That if in the second year, in response to the advertisement, a backward class candidate is not available, then the suitable non backward class candidate already appointed in the reserved post shall not be required to appear for interview before the Selection Committee again for the second 293 and: or third year (s) but that he shall be reappointed in the reserved post, if he is available for reappointment; (3) That if in response to the third advertisement in the third year, no application is received for the reserved post from candidates belonging to SC, ST, DT, or NT, the college authorities shall start the process of dereservation of the reserved post.
After the process of dereservation of the post is completed, the appointment of non backward class teacher shall be deemed to be on probation with retrospective effect from the date of his initial appointment if he has held continuous appointment for two years in the college or in any other college under the same management, and that his appointment shall be confirmed from the dates of completion of two years of continuous appointment.
The aforesaid direction shall come into force with retrospective effective from the date of the Maharashtras Government Resolution, that is, of 29 9 1986, which means that non backward class teacher who is eligible to get the benefit of the above direction shall be confirmed in his post with effect from 29 9 1986 or from any later date on which he may become eligible for confirmation in accordance with the aforesaid directions.
x x x x x x x x x" (Emphasis supplied) 14.
According to these Government resolutions and University directions (a) whenever a post is reserved to be filled in by the candidates from the backward classes, the post is to be advertise thrice within 6 months in each academic year.
The post is to be kept vacant for the said months 6 months if no suitable candidate from the backward classes is available; (b) the post is to be filled in temporarily for one academic year by a non backward class candidate only after the three advertisements have been given as above; (c) the aforesaid process is to be repeated for two more academic years; (c) the candidate from the non backward classes appointed temporarily in the first academic, year for want of a backward class candidate, is to be continued as a temporary appointee for the next two academic years without being interviewed afresh for the next two years; (d) if in spite of the third advertisement in the third academic year, no application is received from a backward class candidate, the College authorities are free to 294 start the process of dereservation of the reserved post; (e) after the process of dereservation of the post is completed, the appointment of non backward class teacher will be deemed to be on probation with retrospective effect from the date of his initial appointment and he shall be confirmed in the post on his completing two years of his continuous service.
Admittedly, as pointed out earlier, the post was reserved for the academic year 1983 84.
The Trust had not given three advertisements within six months for any of the academic years 1983 84, 1984 85 and 1985 86.
On the other hand for the academic year 1983 84, it issued only two advertisements, viz., on October 30, 1983 and November 12, 1983.
It is not known as to why even two advertisements were not issued at the beginning of the said academic year.
The academic year admittedly begins from June.
May that be, as it is.
As regards the second academic year 1984 85, it issued only one advertisement and that was on April 28, 1984.
It did not issue any advertisement for the academic year 1985 86.
The initial appointment of the 1st respondent for the academic year 1983 84 and her continuation for the subsequent academic years, viz., 1984 85 and 1985 86 was thus in breach of the Government resolutions and the University directions and, therefore, illegal.
Similarly, since the appointment of the 5th respondent was made without fallowing the procedure prior to dereservation, viz., three advertisements repeated every year for all the three academic years for which the post was to be reserved, his appointment to the post, as if the post stood legally dereserved was also illegal since in the facts and circumstances of the case, it is obvious that the post could not have been dereserved to make it available for non backward class candidate.
Shri Bhandare, however, contended that in the meanwhile the appellant Trust had taken steps to shift the reservation from the post of a lecturer in Sanskrit to the post of lecturer in Sanhita.
The Trust had written a letter on July 2, 1986 for the purpose to the Directorate had by its letter of July 11, 1986 accorded the sanction.
It may, however, be pointed out the representation made by the lecturer in Sanskrit to the post of lecturer in Sanhita had proceeded on the basis that the Trust had made efforts to fill in the said post from the candidates of the backward classes as required by the Government resolutions and the University directions.
As pointed out above, the Trust had not made the efforts as required by the said resolutions and directions.
It had not issued the advertisements 295 as it was required to do.
The sanction was obtained and granted obviously on the basis of inadequate information.
The sanction was, therefore, defective in law.
The High Court unfortunately did not notice these infirmities in the appointment of either of the respondents.
Shri Ganpule, the learned counsel appearing for the 1st respondent contended that since the 1st respondent was appointed in the first academic year, viz., 1983 84 and continued for the next two academic years, viz., 1984 85 and 1985 86 she was entitled to the benefit of the directions of the University contained in Circular No. 98 of 1987 dated March 11,1987 which had stated that if the non backward class teacher is on probation continuously for two years he would be deemed to be on probation with retrospective effect from the date of ;his initial appointment.
Although the services of the 1st respondent were terminated w.e.f.
April 30, 1986, since she was entitled to the benefit of the vacation salary following the academic year 1985 86 she would be deemed to be in service after the completion of the vacation and, therefore, she may be said to be in service on September 29, 1986 from which date the said University direction was to be effective.
The contention proceeds on the footing that her initial appointment and the continuation of service for the next two academic years was valid.
We have already pointed out above that they cannot be considered to be valid.
However, assuming that her initial appointment and subsequent continuation of service was valid, she would not be entitled to the b benefit of the University Direction of March 11, 1987 because her entitlement to the vacation salary does not extend her period of employment up to the end of the vacation.
That is a perquisite which is conferred on every teacher who has served during the academic year.
It has no connection with the continuation of the employment since even those teachers whose services are validly terminated before the beginning of the vacation period are given the benefit of the salary of the vacation period.
Statute 424 of the University which is reproduced as Annexure 'C ' to the petition makes this position clear.
The argument, therefore, has no merit.
In the view we have taken the appointments of both 1st and the 5th respondents were not valid.
The post was reserved for the academic year 1983 84.
We are now at the end of the academic year 1990 91 A fresh appointment, therefore, will have to be made for the academic year 1991 92.
In the meanwhile, several events have occurred.
The appointment of the 1st 296 respondent has already been terminated w.e.f. April 30, 1986.
The 5th respondent has been in service from July 2, 1987.
We are informed across the bar that today he has become overaged.
The 1st respondent was overaged even at the time of her initial appointment.
Although the advertisemently had stated that the candidate should not be above 32 years, at the time of her initial appointment itself, she was about 40 years old.
The advertisement had also not l;mentioned anywhere that the age was relaxable.
But that is a matter of history.
In the meanwhile.
as pointed out above, on incomplete information, the Directorate of Ayurveda has allowed the appellant Trust to shift the reservation from the post to the post of a lecturer in Sanhita.
Taking into account all the facts and circumstances, we are of the view that an opportunity should be given to the appellant Trust to cure the illegalities.
While, therefore, we maintain the order of Tribunal and set aside the order of the High Court, we direct the appellant Trust to advertise the post three times sufficient in advance and in any case within six months from the close of the present academic year, viz.
,1990 91 as a post reserved for the backward class candidate, and if no application is received from a suitable backward class candidate, the post will be deemed to have been dereserved.
The Trust will then proceed to fill in the same by a candidate belonging to non backward classes.
This fact may be made clear in all the three advertisements.
The 5th respondent will be entitled to apply for the post notwithstanding the fact that he has by this time become overaged.
If he is selected on the basis of his other qualifications, the Selection Committee shall relax in his favour the condition with regard to the maximum age.
If he is appointed to the post, his appointment will be a fresh one and his past service will not count for the probation period.
The Trust shall for the purpose constitute a proper Selection Committee according to the rules.
The appeal is allowed accordingly.
The parties will bear their own costs.
Before parting with this appeal, we must observe that our decision has proceeded on the basis of the Government resolutions and University directions placed before us.
The resolutions and directions as pointed out above require that the posts reserved for backward class candidates should be kept vacant for six months and it is only after the third advertisement during the said six months in each academic year that they should be filled in by candidates belonging to 297 the non backward classes if suitable candidate from backward classes are not available.
Literally interpreted, it would mean that in each academic year, there will be no teacher for the first six months, if the process of advertisement is to begin at the commencement of the academic year.
This is bound to cause hardship to the students.
It is, therefore, incumbent upon the institutions concerned to advertise the posts thrice within six months well before each academic year begins.
Since in the present case the academic year begins in June, the process of advertisement must begin in December of the preceding year.
This should be the normal practice.
An exception has to be made in the present case because the decision is being given today.
To overcome the hardship to the decision is being given today.
To overcome the hardship to the students, we would recommend that the 5th respondent may be permitted to teach as a purely temporary teacher during the period that the process is not completed for the academic year 1991 92.
However, the appellant Trust will take steps within two weeks from the receipt of this order to start the process of advertisement as directed above.
G.N. Appeal allowed.
| IN-Abs | For the academic year 1983 84, there was a vacancy for the post of Lecturer in Sanskrit, in the College managed by the appellant Trust.
The said post was reserved for candidate from backward classes.
The first Respondent, not belonging to any backward class, applied for the post, even before the appellant Trust issued an advertisement.
An advertisement was issued later without mentioning the academic year for which the appointment was to be made, though admittedly it was for the academic year 1983 84.
The advertisement specifically stated that the post was reserved for a backward class candidate and if no such candidate was available, a candidate from the non backward classes may be appointed for one year.
Within a month, the advertisement was repeated and yet no application was received from any candidate from backward classes.
Hence the appellant trust appointed the First Respondent, who had earlier applied, from 19.3.84 till 30.4.1984.
Again, an advertisement was issued in 1984 for the academic year 1984 85.
And there was no response from any candidate belonging to backward classes.
The First Respondent was interviewed and appointed for one year, till 19.4.1985.
For the academic year 1985 86, no advertisement was issued.
The First Respondent was again appointment to the said post from July 10, 1985 to April 30, 1986.
Thereafter her services were terminated after issue of notice.
No appointment was made to the said post for the academic year 1986 87.
However, on 1.5.1987, an advertisement was issued inviting applications for the said post from candidates belonging to all classes, 283 dereserving the post.
Respondents 1 and 5 and another candidate, all belonging to non backward classes applied.
The 5th Respondent was selected and appointed to the said post.
Thereafter, in respect of non payment of salary for certain period and for setting aside her termination order, the First Respondent approached the College Tribunal.
The Tribunal allowed her claim for salary for the relevant periods, but dismissed her claim for reinstatement, holding that her appointment was purely temporary and her claim that she should be deemed to have been confirmed because she had served for two academic years was not established in the circumstances of the case.
Against the Tribunal 's decision, the First Respondent approached the High Court by way of a Writ Petition.
The High Court allowed the Writ Petition holding that notwithstanding the break in her actual appointment, she was continuously in employment from March 19, 1984 to April 30, 1986, and hence entitled to the benefit of the resolutions of the State Government and the University directions which, according to the High Court, laid down that an employee who was appointed for two consecutive academic years must be deemed to have been on probation right from the time of the first appointment and, therefore, she should be confirmed in the post.
The benefit of full back wages, seniority etc.
was also ordered.
Aggrieved by the Judgment of the High Court, the appellants preferred the present appeal, by special leave.
Allowing the appeal, this Court, HELD: 1.
The appellant Trust had violated the directions of the Government as well as of the University in the appointments in question as a result of which neither the appointment of the 1st respondent nor that of the 5th respondent can be said to have been validly made.
Both the appointments were made without following the Government Resolutions and the University directions in the matter of reservation of seats for backward classes which are binding on the college.
Unfortunately, these aspects of the matter which are evident from the record were lost sight of both by the Tribunal and the High Court.
[287G H;288A] 2.1.
Admittedly, the selection of the 5th respondent was made by a committee where neither the nominee of the Vice Chancellor nor the expert nominated by the University nor the nominee of the Director of 284 Education (Higher Education), i.e., the Director of Ayurveda, was present.
The selection so made was, therefore, not valid.
[289F] 2.2 There is nothing on record to show that when the appellant Trust forwarded its report on appointment of the 5th respondent, it apprised the University of the absence of the expert at the time of his selection.
The University has not reserved the power to relax the rule and permit selection without the presence of the expert.
There is nothing in the University 's letter to show why the University had condoned the absence of the expert.
The approval given by the University being in ignorance of the true state of affairs and in breach of the rule, is legally ineffective and cannot validate the appointment.
[289H,290A B] 3.
Admittedly, the post was reserved for the academic year 1983 84.
The Trust had not given three advertisements within six months for any of the academic years 1983 84, 1984 85 and 1985 86.
On the other hand, for the academic year 1983 84, it issued only two advertisements.
It is not known as to why even these two advertisements were not issued at the beginning of the said academic year.
As regards the second academic year 1984 85, it issued only one advertisement, and no advertisement was issued for the academic year 1985 86.
The initial appointment of the Ist respondent for the academic year 1983 84 and her continuation for the subsequent academic years, viz., 1984 85 and 1985 86 was thus in breach of the Government resolutions and the University direction and, therefore, illegal.
Similarly, since the appointment of the 5th respondent was made without following the procedure prior to dereservation, viz., three advertisements repeated every year for all the three academic years for which the post was to be reserved, his appointment to the post, as if the post stood legally dereserved, was also illegal since the post could not have been dereserved to make it available for a non backward class candidate.[294B E] 4.
Even assuming that her initial appointment and subsequent continuation of service was valid, the First Respondent would not be entitled to the benefit of the University direction of March 11, 1987 because her entitlement to the vacation salary does not extend her period of employment up to the end of the vacation.
That is a perquisite which is conferred on every teacher who has served during the academic year.
It has no connection with the continuation of the employment since even those teachers whose services are validly terminated before the beginning of the vacation period are given the benefit of the salary of the vacation period.
[295E F] 285 5.
The appellant Trust shall advertise the post three times sufficiently in advance and in any case within six months from the close of the present academic year, viz., 1990 1991 as a post reserved for the backward class candidate, and if no application is received from a suitable backward class candidate, the post will be deemed to have been dereserved.
The Trust will then proceed to fill in the same by a candidate belonging to non backward classes.
This fact may be made clear in all the three advertisements.
The 5th respondent will be entitled to apply for the post notwithstanding the fact that he has become overaged.
If he is selected on the basis of his other qualifications, the Selection Committee shall relax in his favour the condition with regard to the maximum age.
If he is appointed to the post, his appointment will be a fresh one and his past service will not count for the probation period.
The Trust shall constitute a proper Selection Committee according to the rules.
[296D F] 6.
To overcome the hardship to the students, the 5th respondent may be permitted to teach as a purely temporary teacher till the process is completed for the academic year 1991 92.
[297C]
|
121 of 1958.
Petition under Article 32 of the Constitution for enforcement of Fundamental rights.
G. B. Pai and Sardar Bahadur, for the petitioner.
M. C. Setalvad, Attorney General for India, B. Sen and T. M. Sen, for the respondents.
December 11.
The Judgment of the Court was delivered by GAJENDRAGADKAR, J.
The petitioner has been doing business as an exporter of coir products to foreign countries for the last twenty years.
On July 4, 1958, he applied to respondent 2, the Chairman, Coir Board, Ernakulam, requesting that he should be registered as an established exporter.
This application was accompanied by an income tax clearance certificate and attested copies of bills of lading.
Respondent 2 declined to register the petitioner on the ground that his application was defective inasmuch as the requisite certificate regarding his financial status bad not been produced and no evidence had been given to show that he had exported the minimum quantity required (500 Cwts.).
The petitioner was told that unless he complied with the requirements asked for within seven days his application would be rejected without further notice.
The petitioner found that he could not comply with the directions issued by respondent 2 and so it became impossible for the petitioner to get registration and licence applied for by him.
That is why he filed the present petition under article 32 of the Constitution and prayed for the issue of a writ or order in the nature of mandamus to direct the second respondent to grant the petitioner registration and licence as applied for by him and to prohibit or restrain the said respondent from acting on, or implementing, the rules issued under the , by issue of a writ of certiorari, prohibition or such other writ or order appropriate to protect his rights.
The petitioner also prayed that " if found necessary " the said 781 rules should be declared to be ultra vires the powers of the Central Government and invalid being in violation of the fundamental rights guaranteed by articles 14 and 19 of the Constitution.
The Union of India has, been impleaded as respondent 1 to the petition.
Before dealing with the points raised by the petition it would be necessary to refer briefly to the provisions( of the (45 of 1953), hereinafter called the Act, and the rules framed under it in 1958.
This Act was enacted by the Parliament because it was thought expedient in the public interest that the Union should take under its control the coir industry (section 2).
Section 4 of the Act provides for the establishment and constitution of the Coir Board and section 10 enumerates its functions and duties.
Under section 10(1) it shall be the duty of the Board to promote by such measures as it thinks fit the development under the control of the Central Government of the coir industry.
Sub section (2) enumerates the measures which the Board may take with the object of developing the coir industry without prejudice to the generality of the provisions of sub section
Amongst the measures thus enumerated, sub section
(2) (b) refers to the regulation under the supervision of the Central Government of the production of husks, coir yarn and coir products by registering coir spindles and looms for manufacturing coir products, as also manufacturers of coir products, licensing exporters of coir yarn and coir products and taking such other appropriate steps as may be prescribed.
Sub section (2)(g) refers to the promotion of co operative Organisation among producers of husks, coir fibre and coir yarn and manufacturers of coir products, and sub section
(2)(1) refers to the licensing of retting places and warehouses and otherwise regulating the stocking and sale of coir fibre, coir yarn and coir products both for internal market and for exports.
Section 26(1) confers on the Central Government power to make rules for carrying out the purposes of the Act subject to the condition of previous publication.
Sub section (2) enumerates the matters in res pect of which rules may be made, in particular and without prejudice to the generality of the power 782 conferred by sub section
Sub section (2) (k) refers inter alia to the registration of manufacturers of coir products and the conditions for such registration and the ,,grant or issue of licences under the Act; and sub section
(2)(1) deals with the form of applications for registration and licences under the Act and the fee, if any, to be paid in respect of any such applications.
Under the powers conferred by section 26 the Central Government framed rules in 1958.
For the purposes of the present petition it would be relevant to refer to rr.
17 to 22.
Rule 17 deals with registration and licensing of exports; and it provides that no person shall, after the coming into force of the rule, export coir fibre, coir yarn or coir products unless he has been registered as an exporter and has obtained an export licence under these rules.
The proviso deals with exemptions with which we are not concerned.
Rule 18 lays down that any person who has in any of the three years immediately preceding the commencement of the rules exported not less than twenty five tons of coir yarn or coir products other than coir rope, or exported any quantity of coir fibre or coir rope, may be registered an exporter of coir yarn, coir products other than coir rope or coir fibre or coir rope as the case may be.
Rule 19 provides for the registration of persons other than those covered by r. 18 and it lays down inter alia that such persons may be registered as exporters of coir yarn if, during the period of twelve months immediately preceding the date of application, a minimum quantity of twenty five tons of coir yarn had been rehanked or baled in a factory owned or otherwise possessed by the applicant and registered under the Indian , or, if the applicant has had a total purchase turnover of one hundred tons of coir yarn.
The proviso to this rule authorises the Chairman by notification to exempt from the operation of this rule any co operative society the members of which are owners of industrial establishments or any Central Co operative Marketing Society.
Rules 20 and 22 prescribe the mode of making an application for registration as an exporter and for licence respectively while r. 21 provides for the 783 cancellation of registration.
The present petition does not challenge the validity of any of the provisions of the Act.
It, however, seeks to challenge the vires of rr. 18, 19, 20(1)(a), 21 and 22(a).
There is no doubt that coir and coir products play an important role in our national economy.
They are commodities which earn foreign exchange, the total ' value of our exports in these commodities being of the order of Rupees Ten Crores per year.
It was found that several malpractices had crept in the export trade of these commodities such as non fulfilment of contracts, supplying goods of inferior qualities and cut throat competition; and these in turn considerably affected the volume of the trade.
That is why Parliament thought it necessary that the Union should take under its control the coir industry in order to regulate its export trade.
It is with the object of developing the coir industry that the Coir Board has been established and the registration and licensing of exporters has been introduced.
The petitioner does not dispute this position and makes no grievance or complaint against the relevant provisions in the Act.
It is, however, urged that the relevant rules which prescribe the quantitative test for the registration of established exporters are ultra vires because the introduction of the said test is inconsistent with the provisions of the Act.
In this connection Mr. Pai, for the petitioner, sought to rely on the report submitted by the Ad Hoc Committee for external marketing which the Coir Board had appointed on August 20, 1954.
His grievance is that the report of the said Committee does not recommend the adoption of the quantitative test, but seems to suggest that a qualitative test would be more appropriate ; and that, according to Mr. Pai, also indicates that the quantitative test had been improperly prescribed by the rules.
We are not impressed by these arguments.
It is clear that there is no provision in the Act which excludes or prohibits the application of the quantitative test in making rules for registration of exporters or for issuing licences for export trade.
In fact the Act has deliberately left it to the rule making authority to frame rules 784 which it may regard as appropriate for regulating the trade; and so it would be impossible to accept the argument that the rule making authority was bound to prescribe the qualitative rather than the quantitative test.
Besides, it does not appear that the report of the Committee on which Mr. pai relied definitely indicated its partiality for the adoption of the qualitative test.
Indeed Appx.
XI to the said report would suggest that the Committee in fact was not averse to the adoption of a quantitative test; but even if the Committee had expressly recommended the adoption of a qualitative, not a quantitative, :test, it would be idle to suggest that the Coir Board was bound to accept the said recommendation or that the Central Government was not competent to make rules contrary to the recommendations of the Committee.
The validity of the rules can be successfully challenged if it is shown that they are inconsistent with the provisions of the Act or that they have been made in excess of the powers conferred on the rule making authority by section 26 of the Act.
In our opinion, no such infirmity has been established in respect of the impugned rules.
It is then contended that the relevant rules would ultimately tend to establish a monopoly in the export trade of coir commodities and would thereby extinguish the trade or business of small dealers like the petitioner.
It is also contended that the application of the quantitative test discriminates between persons carrying on business on a large scale and those who carry on business on a small scale.
That is how articles 19 and 14 of the Constitution are invoked and the validity of the relevant rules is challenged on the ground that they violate the fundamental rights of the petitioner under the said Articles.
We think there is no substance in this contention.
If it is conceded that the regulation of the coir industry is in the public interest, then it would be difficult to entertain the argument that the regulation or control must be introduced only on the basis of a qualitative test.
It may well be that there are several difficulties in introducing and effectively enforcing the qualitative test.
It is well known that granting 785 permits or licences to export or import dealers on the basis of a quantitative test is not unknown in regard to export and import of essential commodities.
It would obviously be for the rule making authority to decide which test would meet the requirements of public interest and what method would be most expedient in controlling the industry for the national ' good. Beside,%, even the adoption of a qualitative test may tend to extinguish the trade of those who do not satisfy the said test; but such a result cannot obviously be treated as contravening the fundamental rights under article 19.
Control and regulation of any trade, though reasonable within the meaning of article 19, sub article
(6), may in some cases lead to hardship to some persons carrying on the said trade or business if they are unable to satisfy the requirements of the regulatory rules or provisions validly introduced ; but once it is conceded that regulation of the trade and its control are justified in the public interest, it would not be open to a person who fails to satisfy the rules or regulations to invoke his fundamental right under article 19(1)(g) and challenge the validity of the regulation or rule in question.
In our opinion, therefore, the challenge to the validity of the rules on the ground of article 19 must fail.
The challenge to the validity of the said rules on the ground of article 14 must also fail, because the classification of traders made by rr. 18 and 19 is clearly rational and is founded on an intelligible differentia distinguishing persons falling under one class from those falling under the other.
It is also clear that the differentia has a rational relation to the object sought to be achieved by the Act.
As we have already pointed out, the export trade in coir com modities disclosed the existence of many malpractices which not only affected the volume of trade but also the reputation of Indian traders; and one of the main reasons which led to this unfortunate result was that exporters sometimes accepted orders far beyond their capacity and that inevitably led to non fulfilment of contracts or to supply of inferior commodities.
In 99 786 order to remedy this position the trade had to be regulated and so the intending exporter was required to satisfy the test of the prescribed minimum capacity and to establish the prescribed minimum status before his application for registration is granted.
In this connection it may also be relevant to point out that the rules seem to contemplate the granting of exemption from the operation of some of the relevant tests to co operative societies; and that shows that the intention of the Legislature is to encourage small traders to form co operative societies and carry on export trade on behalf of such societies; and so it would not be possible to accept the argument that the impugned rules would lead to a monopoly in the trade.
It is thus clear that the main object which the rules propose to achieve is to remove the anomalies and malpractices prevailing in the export trade of coir commodities and to put the said trade on a firm and enduring basis in the interest of national economy.
We are, therefore, satisfied that the challenge to the impugned rules on the ground of infringement of article 14 of the Constitution must also fail.
In the result we hold that there is no substance in the petition.
It accordingly fails and is dismissed with costs.
Petition dismissed.
| IN-Abs | The petitioner, an unsuccessful applicant for registration as an exporter and licensee for exporting coir products, challenged the vires of the rr. 18, 19, 20(1)(a), 21 and 22(a) made by the Central Government in exercise of its powers under section 26(1) of the (45 Of 1953).
The Act had for its object the regulation and control of the Coir industry in public interest.
It was contended on his behalf that the impugned rules, which prescribed the quantitative, and not the qualitative, test for registration of established exporters, were inconsistent with the provisions of the Act and as such, ultra vires the Act and that they tended to create a monopoly in the export trade of coir commodities and thereby destroy the business of small dealers and discriminated between those who carried on large scale business and those who carried on small scale business and thus impugned articles 19 and 14 Of the Constitution.
Held, that the contentions were without substance and must be negatived.
There was no provision in the , that excluded or prohibited the application of the quantitative test and the rules were in no way inconsistent with the Act nor in excess of the powers conferred on the Central Government by section 26 of the Act.
Where an Act sought to control an industry in public interest it would obviously be for the rule making authority to decide which rules and regulations would meet the requirement of public interest.
Such rules and regulations, though reasonable within the meaning of article 19(6), might cause hardship to those who failed to comply with them.
But once it was conceded that the regulation and control of the trade were justified in public interest, article 19(1)(g) could not be invoked to challenge the validity of the rules.
Nor did the impugned rules violate article 14 Of the Constitu tion.
The classification of traders under rr.
18 and 19 was clearly founded on an intelligible differentia that had a rational relation to the object of the Act.
The exemption made by the rules in favour of co operative societies from some of the relevant tests indicated that the Legislature intended to encourage small 780 traders.
It was not, therefore, correct to say that the rules would lead to a monopoly in the trade.
|
Civil Appeal No.951 of 1977.
From the Judgment and Order dated 29.7.1976 of the Madras High Court in S.A. No.89 of 1972.
A.T.M. Sampath and P.N.Ramalingam for the Appellant.
S.Balakrishnan and S.Prasad for the Respondent.
The Judgment of the Court was delivered by THOMMEN, J.
The appellant is the defendant in a suit insti 392 tuted by the respondent to set aside a transfer of property made by the guardian of a minor and for recovery of possession of the property.
The suit was decreed, and the decree was confirmed by the first appellate court as well as by the High Court.
The plaintiff respondent purchased the suit property from an ex minor within three years after the minor attained majority.
During his minority, the property was sold by his father as his natural guardian to a person from whom the present appellant purchased the property.
All the courts found that the guardian had not obtained the permission of the Court for the sale of the property, as required by section 8 of the Hindu Minority & Guardianship Act, 1956 ("the Guardianship Act") and that the sale of the property was not for legal necessity.
Dismissing the second appeal, the High Court held that the suit was rightly instituted by the respondent as a transferee from the ex minor within three years after the minor attained majority and that the contention of the defendant that the suit by a transferee from the ex minor was hit by section 6(e) of the was unsustainable.
The only question which arises in the present appeal, as it did before the High Court, is (to quote the words of the High Court) "Whether a transferee from a minor after he attained majority, can file a suit to set aside the alienation made by the minor 's guardian or the said right is one to be exercised only by the minor?".
The relevant facts are that the suit property belonged to one Veerammal.
She had a daughter by name Kaliammal.
Veerammal died shortly after she purchased the property in 1948.
She left behind her husband Kandayya and their duaghter Kaliammal.
Subsequently, Kandayya married a second time when his daughter Kaliammal was a minor.
She thereupon left her father 's house and resided with her maternal grand father who protected and maintained her.
During her minority, Kandayya sold the property on 29.10.1959 to Jainulavudeen.
On 25.4.1966, Jainulavudeen in turn sold the property to the defendant appellant.
Subsequently, on 26.5.1966 the plaintiff obtained a deed of sale of the suit property in his favour from Kaliammal who had by then attained majority.
The Plaintiff thereafter instituted the present suit (O.S. No. 491 of 1968) against the appellant to set aside the transfer of property made by Kandayya and for recovery of its possession.
393 The question is whether the respondent in his capacity as a transferee from the ex minor was competent to bring a suit to set aside the sale effected by the minor 's guardian.
It is no longer disputed that the suit was brought within three years after the minor attained majority.
Nor is it any longer contended that the father of the minor, as her natural guardian, had obtained the permission of the Court or that the sale effected by him was one for legal necessity.
These two vital points have been concurrently found against the appellant.
The only contention which Mr. Sampath, appearing for the appellant, is in a position to urge is as regards the question whether the suit is hit by section 6(e) of the T.P. Act.
Counsel says that all that the ex minor was in a position to transfer, was her mere right to sue to set aside the sale and recover possession of the property transferred by her father as her natural guardian.
The property itself had been transferred by the father prior to its sale by the ex minor.
The minor had, therefore, no property to sell, except a right to set aside the sale.
Accordingly, whatever transfer that was effected by the minor in favour of the plaintiff was nothing more than a mere right to sue and such transfer was invalid by reason of section 6(e) of the T.P. Act.
Mr. Balakrishnan, appearing for the respondent plaintiff, contends that the ex minor was fully competent to bring a suit to set aside the sale within a period of three years after attaining majority and any person claiming under her is equally competent to institute action for the same purpose.
He refers to the provisions of section 8(3) of the Guardianship Act.
He contends that a suit to set aside a sale is not for the enforcement of any personal right, but a right in property, and is, therefore, not hit by section 6(e) of the T.P. Act.
In any view, counsel says, section 8(3) of the Guardianship Act sepcifically allows such a suit to be brought by a person claiming under a minor and, therefore, such a statutory right specially granted by an enactment dealing with the protection of the minor cannot be defeated by the general provisions of an earlier enactment.
The two provisions, counsel says, can be read harmoniously so as to avoid an artificial conflict.
What the Guardianship Act intends to protect is the right of a person claiming under a minor to sue for setting aside the sale of property sold otherwise than as permitted by section 8 of the Act.
On the other hand, the T.P. Act only prohibits suits in the the nature of champerty and maintenance based on bare or naked right of litigation.
The general provision contained in section 6(e) of the T.P. Act does not derogate from the special protection of the minor 's interest and the interest of a person claiming under him, as afforded by the Guardianship Act, which is addressed to a specific problem, In any view, counsel says a sale by the guardian 394 otherwise than as permitted by section 8 is void and is, therefore, incapable of passing a title.
For all these reasons, Mr. Balakrishna submits that the suit was competent and was rightly decreed on the facts found and the appeal by the defendant has no merits.
As concurrently found by the courts below, the sale effected by the guardian during the minority of his daughter was not in compliance with the provisions of section 18(i) of the Guardianship Act.
The property was transferred by him without obtaining the previous permission of the Court and the transfer was not for the benefit of the minor.
Such a sale by the minor 's father who is his natural guardian is, unlike in the case of transfer by a de facto guardian (Section 11), not a void sale, but only a voidable sale.
Such a sale until set aside is sufficiently effective to pass title, but being a voidable sale, what the buyer has obtained is a defeasible title which is liable to be set aside at the instance of the person entitled to impeach it.
Section 8(3) of the Guardianship Act says: "Any disposal of immovable property by a natural guardian, in contravention of sub section (1) or sub section (2), is voidable at the instance of the minor or any person claiming under him." (emphasis supplied) The effect of this sub section is that any disposal of immovable property by a natural guardian otherwise than for the benefit of the minor or without obtaining the previous permission of the Court is voidable.
A person entitled to avoid such a sale is either the minor or any person claiming under him.
This means that either the minor, or his legal representative in the event of his death, or his successor in interest claiming under him by reason of transfer inter vivos, must bring action within the period prescribed for such a suit, i.e., three years from the date on which the minor died or attained majority, as the case may be.
In the present case, the suit was brought, as found by the courts below, within three years after the minor attained majority.
Mr. Sampath, however, contends that a person claiming under a minor, referred to in section 8(3), can only be a legal representative of a deceased minor and not a person succeeding to the interests of the minor by reason of transfer inter vivos.
He refers to the decisions in Jhaverbhai Hathibhai Patel vs Kabhai Bechar Patel & Ors, ; Mon Mohan Bhattacharjee & Ors.
vs Bidhu Bhusan Dutta & Ors., ; Palani Goundan & Anr.
vs Vanjiakkal & 395 Anr., ; Premprakash Surajmal vs Maharashtra Revenue Tribunal, Nagpur & Ors., AIR 1969 Bom.361 and Ghanshyam Dass vs Dr. Shiva Shankar Lal & Ors., [1980] All.
Law Journal 130 and other cases in which certain High Courts have taken the view that the right of the minor is a personal right and it cannot be transferred otherwise than by inheritence.
The "person claiming under him" mentioned under section 8(3) of the Guardianship Act, counsel says, can only be a representative and not a purchaser or transferee inter vivos.
He refers to Article 60 of the and submits that the provision refers only to a legal representative and not any other successor.
In Jhaverbhai Hathibhai Patel vs Kabhai Bechar Patel & Ors.
, , it was held: "what was assigned by the minor to the plaintiff in that suit was not the property in question but his right to sue for it, and if he could establish his allegation, to have the sale avoided, this I think was no more than a right of suit, and if I am correct such a transfer is forbidden by section 6, Cl.
(e), T.P. Act.
" Similar reasoning was adopted in the other decisions cited by Mr. Sampath on the point.
The rationale of these decisions is that the right to impeach a sale effected by the guradian is a personal right vested in the minor and it is not transferable inter vivos.
The expression "person claiming under him", according to this line of reasoning, must, therefore, be understood as a legal representative and not an assignee.
On the other hand, a Division Bench of the Madras High Court in P. Kamaraju vs C. Gunnayya & Ors., AIR 1924 Madras 322 held that the right of the minor was not a bare right to sue and it was an assignable right.
The High Court held: ".
.By selling the property to the plaintiff on the footing that the sale by the mother was not binding on him he has chosen to avoid it, and the result of it is that from his point of view he has got a complete title.
The title no doubt will only be effective if the Court ultimately finds that the sale by the mother is not binding on him.
But contingent on that event he has got a complete title and this title is not a bare right to sue and is, therfore, assignable. . " 396 In Palaniappa Goundan vs Nallappa Goundan & Ors., AIR 1951 Madras 817, Viswanatha Sastri, J. observed: "Where an ex minor transfers property unauthorisedly sold by his guardian during his minority he transfers not a mere right to use but his interest in the property, though a suit may be necessary to avoid the transfer by the guardian & recover possession of the property from his alienee.
Conversely, the liability of the transferee from the guardian is not a liability to pay damages for the unauthorised act of the guardian, but is a liability to restore the property to the rightful owner or his transferee".
Similar view was expressed in Karnam Nagabhushana Rao vs Karnam Gowramma & Ors., [1968] 2 Andhra Weekly Reporter 57.
These decisions on which reliance was placed by the Madras High Court in the impugned judgment are to the effect that the right of the minor is not a bare or naked right to sue but a right in property which is assignable.
In Halsbury 's Laws of England, 4th edn.
, Vol. 6, paragraphs 86 87 at pages 49 50, this is what is stated "A bare right of litigation, such as a mere right to damages for a wrongful act, is not assignable, on the principle that the law will not recognise any transaction savouring of maintenance or champerty.
By way of exception to the rule stated in the previous paragraph there is nothing unlawful in the purchase of property which the purchaser can only enjoy by defeating existing adverse claims, or in the assignment (for example by mortgage) of property, being the fruits of litigation.
In every case it is a question whether the purchaser 's real object was to acquire an interest in the property, or merely to acquire a right to bring an action, either alone or jointly with the vendor . ".
In the instant case, on the facts found, the transfer of the property made by the guardian was a voidable transaction and it was, therefore, open to the minor to challenge it and seek recovery of possession.
Such a right of the minor is a right or interest in property 397 which he himself or "any person claiming under him" may enforce by instituting a suit [Section 8(3) of the Guardianship Act].
"Any person claiming under him" must necessarily include a purchaser.
Section 8(3) confers a right of suit in the special circumstances postulated in that provision.
The object of the Act being the protection of the minor, the legislature has thought it fit to confer a right of suit in certain circumstances not only on the minor, but also on a person to whom the minor has transferred his rights.
The right transferred is an interest in property which is capable of enforcement at the instance of the transferee as it was at the instance of the ex minor prior to the transfer.
Such a provision, indeed specially for the protection of the interests of the minor, must be read in harmony and consistently with the general provisions contained in section 6 of the T.P. Act.
[See The J.K. Cotton Spinning & Weaving Mills Co. Ltd. vs The State of Uttar Pradesh & Ors., ; , 194 and Ashoka Marketing Ltd. & Anr.
vs Punjab National Bank & Ors., [1990] 3 JT SC 417, 439].
The transfer made by the father during his son 's minority was voidable at the instance of his son who was the real owner, and any person purchasing such property from the natural guardian obtained only a defeasible title.
The minor retained a right in the property to defeat existing adverse claims, and such right is an assignable right.
We are in complete agreement with what has been stated on the point in Palaniappa Goundan vs Nallappa Goundan & Ors., AIR 1951 Madras 817 and in P. Kamaraju vs C. Gunnayya & Ors., AIR 1924 Madras 322.
We do not agree with the contrary view expressed on the point in Jhaverbhai Hathibhai Patel vs Kabhai Bechar Patel & Ors., ; Mon Mohan Battacharjee & Ors.
vs Bidhu Bhushan Dutta & Ors., and Palani Goundan & Anr.
vs Vanjiakkal & Anr., A construction which is unduly restrictive of the statutory provisions intended for the protection of the interest of the minor must be avoided.
This is all the more so in view of section 5(b) of the Guardianship Act which says.
Save as otherwise expressly provided in this Act (a) . . . . . . . . (b) any other law in force immediately before the com 398 mencement of this Act shall cease to have effect in so far as it is inconsistent with any of the provisions contained in this Act.
" For the reasons stated by us, we see no merit in the challenge against the judgment under appeal.
The appeal is accordingly dismissed.
We do no, however, make any order as to costs.
V.P.R. Appeal dismissed.
| IN-Abs | The appellant purchased the suit property of the minor from a person, to whom the same was sold by the father, the natural guardian, whereas the respondent purchased the suit property from the minor within three years on his attaining majority.
The respondent plaintiff instituted a suit against the appellant defendant, to set aside the transfer of property made by the natural guardian and for recovery of possession of property.
The suit was decreed and the decree was confirmed by the appellate Court as well as by the High Court.
Dismissing the second appeal, the High Court held that the suit instituted bythe respondent as a transferee from the ex minor within three years after the minor attained majority was not hit by section 6(e) of the , against which the present appeal preferred by the appellant defendant.
The appellant contended that the suit was hit by section 6(e) of the , as all that the ex minor was in a position to transfer was the mere right to sue to set aside the sale and recover possession of the property transferred by the natural guardian; and 390 that a person claiming under a minor, referred to in section 8(3) of the Hindu Minority and Guardianship Act, 1956 can only be a legal representative of a deceased minor and not a person succeeding to the interest of the minor by reason of transfer inter vivos.
The contentions of the respondent were that the ex minor was competent to bring a suit to set aside the sale within a period of three years of his attaining majority and any person claiming under the minor was equally competent to institute action for the same purpose; that the suit to set aside a sale was not for the enforcement of any personal right, but a right in property and the suit was not hit by Section 6(e) of the T.P.Act; and that the provisions contained in Section 6 of the T.P. Act and Section 8 of the Guardianship Act were to be read together.
On the question, whether the respondent in his capacity as a transferee from the ex minor was competent to bring a suit to set aside the sale effected by the minor 's guardian, who had sold the property without obtaining the permission of the Court as required under Section 8 of the Hindu Minority and Guardianship Act 1956 and without any legal necessity.
Dismissing the appeal of the appellant defendant this Court, HELD: 1.
In the instant case, on the facts found, the transfer of the property made by the guardian was a voidable transaction and it was, therefore, open to the minor to challenge it and seek recovery of possession.
Such a right of the minor is a right or interest in property which he himself or "any person claiming under him" may enforce by instituting a suit (Section 8(3) of the Guardianship Act).
"Any person claiming under him" must necessarily include a purchaser.
[396G 397A] 2.
Section 8(3) confers a right of suit in the special circumstances postulated therein.
The object of the Act being the protection of the minor, the legislature has though it fit to confer a right of suit in certain circumstances not only on the minor, but also on a person to whom the minor has transferred his rights.[397A B] 3.
The right transferred is an interest in property which is capable of enforcement at the instance of the transferee as it was at the instance of the ex minor prior to the transfer.
Such a provision intended specially for the protection of the interests of the minor, must be read in harmony and consistently with the general provisions con 391 tained in section 6 of the T.P. Act.
[397B C].
A construction which is unduly restrictive of the statory provisions intended for the protections of the interests of the minor must be avoided.
[397F G] 5.
The transfer made by the father during his son 's minority was voidable at the instance of his son who was the real owner, and any person purchasing such property from the natural guardian obtained only a defeasible title.
The minor retained a right in the property to defeat existing adverse claims, and such right is an assignable right.
[397D E] The J.K.Cotton Spinning & Weaving Mills Co.Ltd.
vs The State of Uttar Pradesh & Ors., [1961] 3 S.C.R.185, 194 and Ashoka Marketing Ltd. & Anr.
vs Punjab National Bank & Ors., , 439, followed.
Palaniappa Goundan vs Nallappa Goundan & Ors., AIR 1951 Madras 817 and P.Kamaraju vs C.Gunnayya & Ors., AIR 1924 Madras 322, approved.
Jhaverbhai Hathibhai Patel vs Kabhai Bechar Patel & Ors., AIR 1933 Bom.42; Mon Mohan Battacharjee & Ors.
vs Bidhu Bhusan Dutta & Ors., and Palani Goundan & Anr.
vs Vanjiakkal & Anr., [1956] I.L.R. Mad.1062, over ruled.
Preprakash Surajmal vs Maharashtra Revenue Tribunal.
Nagpur &Ors., A.I.R. 1969 Bom.361; and Ghanshyam Dass vs Dr.
Shiva Shankar Lal & Ors., [1980] All Law Journal 130, referred to.
|
ivil Appeal No. 1824 of 1991.
From the Judgment and Order dated 14.5.1990 of the Orissa High Court in O.J.C. No. 4426 of 1989.
401 Shanti Bhushan and Prashant Bhushan for the Appellant.
Gobind Das, S.B. Upadhyay, Harish Salve, Ms. Kirti Misra and S.R. Grover for the Respondents.
The Judgment of the Court was delivered by SAWANT, J.
Leave granted.
The only question which falls for consideration in the present case is what is the meaning of "Implementation Machinery" within the meaning of the Code of Discipline (hereinafter referred to as the "Code") ratified by all Central Employers ' and Workers ' Organisations at the 16th session of the Indian Labour Conference held in May 1958 and which came into force from June 1, 1958.
The question assumes importance in the present case because the High Court by the impugned decision has held that since the appellant Union had addressed its application for recognition not to the Implementation Machinery but to the Implementation Officer, the same was not properly made and the Implementation Officer had no authority to initiate the process of recognition.
The admitted facts are that the appellant Rourkela Sramik Sangh had addressed a letter on October 9, 1989 to the Implementation and Evaluation Officer cum Labour Comissionner Orissa, Cuttack intimating him that as per the Code it had called upon the Rourkela Steel Plant to recognise it as the sole bargaining agent in the Plant, but that the Plant had not replied to the same.
The appellant in the said letter had further requested the Labour Commissioner to pass orders for immediate verification of the membership of all the trade unions operating in the said Plant and to recommend for recognition, the Union having majority of the membership.
On receipt of this request, the Labour Commissioner as the Implementation and Evaluation Officer authorised the Deputy Labour Commissioner on December 5, 1989 to carry out the process of verification of the membership of the registered trade unions.
In pursuance of the same, the Deputy Labour Commissioner passed an order on December 14, 1989 calling upon the different trade unions to produce the necessary records within 10 days of the receipt of the notice.
These orders passed by the Labour Commissioner and Deputy Labour Commissioner were challenged by the Ist respondent Rourkela Mazdoor Sabha which is a rival union in the Plant by way of a Writ Petition being OJC No. 4426 of 1989 in the High Court of Orissa.
At the same time, the appellant 402 Union filed a Writ Petition being OJC No. 361 of 1990 seeking a direction to the Labour Commissioner, and the Deputy Labour Commissioner to complete the verification of the membership of the Unions and to fix a time limit to complete the process and recognition and for ancillary reliefs.
Both the writ petitions were heard together by a Division Bench of the High Court and by its impuged common judgment, the Court was pleased to allow the Ist respondent 's petition and dismiss the appellant 's petition.
The decision of the Court was based only on the finding that the Implementation and Evaluation Officer was not the "Implementation Machinery" under the Code and the Implementation Officer had no authority to process the application for recognition.
The relevant provisions of the Code are as follows: Section II of the Code deals with "Implementation Machinery" and is headed as such.
It begins as follows: "2.
To implement the Code of Discipline, labour enactments, awards and agreements, a separate machinery has been set up at the Centre and in all States.
This machinery comprises: (a) implementation units in Labour Departments, and (b) tripartite implementation committees at the Central, State and local levels.
" Thereafter it proceeds to deal with Implementation Units and states as follows: "(i) Implementation Units: 3.
A Central Implementation and Evaluation Division has been set up in the Ministry of Labour and Employment under the charge of a Joint Secretary.
In the State also, Implementation Units have been set up under the charge of either a whole time officer of the Labour Department or of the State Labour Commissioners.
According to the recommendations of the Labour Ministers ' Conference held in January, 1960 the Implementation Officer in each State should, as far as possible, he whole time and of sufficient seniority.
The following functions have been assigned to 403 Implementation Units: (1) to ensure Implementation of the Code of Discipline, Code of Conduct, labour enactments, awards, agreements, etc., with a view to reducing at the source the main cause of industrial strife; (2) to supplement the work of the Industrial Relations Machinery in taking preventive action where disputes are brewing and in settling long pending disputes which could not be settled otherwise; (3) to maintain liaison with Central, State or local units, as the case may be, to ensure effective working of the implementation machinery; (4) to arrange meetings of Implementation Committees and to function as their Secretariat; (5) to bring about out of court settlement of cases pending in High Courts and the Supreme Court; (6) to ensure that cases are screened by the Screening Committees set up by the Central Employers ' and Workers ' Organisations before appeals are filed in higher courts; (7) to evaluate; (a) major strikes, lock outs and disputes in order to fix responsibility for them, and (b) the working of important Labour legislations, awards, policies, decisions, etc.
in order to see how far they have produced the results which they were intended to produce and suggest measures to improve them.
(8) to collect and maintain necessary statistics regarding implementation of the Code of Discipline, labour enactments awards etc.
X X X X X X X X X X X It then deals with Implementation Committees and states as follows: 404 "(iii) Implementation Committees: 6.
The Implementation Committees at the Centre and in the States represent both Central Employers ' and Workers ' Organisations.
The Central Implementation and Evaluation Committee consists of an equal number of employers ' and workers ' representatives four each from the Central employers ' Organisations.
They are nominated by the organisations to which they belong and not by Government .
State/Administration Implementation Committees are also required to be constituted in consultation with the Central Employers ' and Workers ' Organisations wherever they have affiliates in the States/Territories concerned.
These Committees are presided over as far as possible by respective Labour Ministers.
At the local level, the Committees comprise an equal number of representatives of employers and workers in the area and are presided over by an officer of the Labour Department of by a prominent person in the region.
The functions assigned to Implementation Committees by the Standing Labour Committee in October, 1957 and other Committees are as follows: (1) to examine the extent of implementation of agreements, awards and settlements and to advise the parties which are anxious to implement an award but are unable to do so, as to how the difficulties in implementation could be overcome.
(2) to fix responsibility for violations of the Code in cases brought to its notice by the Implementation Unit or in those enquired into by it or a sub committee appointed by it.
In doing so, the Committee may hear the parties concerned if considered necessary.
(3) To consider cases for out of court settlement with the consent of the parties, screening of cases of industrial disputes before appeals are filed, etc.
that may be brought to its notice by the Implementation Unit or such other cases that the Committee may desire, to bring about harmonious labour management relations.
405 (4) to review periodically the working of the Code in their respective spheres.
(5) to maintain a two way exchange of experience between the Committees at the lowest level and the Central Committee.
At points of importance arising at any level should be given wide circulation.
" The Code further assigns the Implementation Units among others the duty to provide the secretariat for the Implementation Committees and to ensure that their decisions are implemented promptly.
We have also seen from the enumeration of the functions of the Implementation Units above, that the Units have to arrange meetings of the Implementation Committees and to function as their secretariat.
Section IV of the Code provides for "Grievance Procedure".
It states, among other things, that it is the responsibility of the Central and State/Administration Implementation Units to ensure that a grievance procedure is set up by every management in consultation with their workers.
Section V of the Code deals with Recognition of Unions and states as follows: "11.
Except in those States where the procedure to conferrecognition on unions is governed by a statute the conditions and procedure for recognitions of unions are governed by the provisions of the Code of Discipline.
It is the responsibility of Implementation Units to ensure that recognition is granted to unions by managements wherever they satisfy the prescribed criteria.
The procedure to be followed for this purpose is at Appendix IV.
For the sake of uniformity the State Implementation Units are requested to adopt it." Appendix IV which is referred to above is headed as follows: "PROCEDURE FOR VERIFICATION OF MEMBERSHIP OF UNIONS FOR THE PURPOSE OF RECOGNITION UNDER THE CODE OF DISCIPLINE" It is not necessary to set out the entire procedure stated in the said Appendix.
A reference to only first who clauses and clause (10) of the 406 said procedure would suffice for our purpose.
They state follows: "(1) On receipt of a representation from a union for recognition under the Code of Discipline the Central/State Implementation Machinery will first ascertain: (a) the names of unions functioning in the establishment together with their number and date of registration by reference to the Registrar of Trade Unions concerned; (b) whether any of the unions functioning in the establishment was responsible for an established breach of the Code during the past one year.
(By an `established breach of the Code ' is meant a breach reported to and on enquiry established by the Implementation Machinery of the State or the Centre), (c) whether the existing recognised union, if any, has completed a period of two years of recognition.
(2) After ascertaining the above facts, the Implementation Machinery at the Centre will request the Chief Labour Commissioner to arrange verification of membership of unions entitled to recognition under the Code.
In the States, either the Implementation Officer will carry out this verification or get it done through the State Labour Commissioner, depending on the practice in each State.
X X X X X X X X X X (10) The verification officer will report his findings to the Central/State Implementation machinery which in turn will communicate its decision to the management as well as to the unions.
In his report the verification officer will also indicate the total numbers of workers in the establishment and the percentage of the verified membership to it.
" We may also mention in this context that Annexure I to the Code lays down a criteria for recognition on unions.
It will thus be apparent from the aforesaid provisions of the Code that the "Implementation Machinery" envisaged by the Code consists of two separate Organisations viz., Implementation Units in 407 the respective Labour Departments, and Tripartite Implementation Committees at the Central, State and local levels.
Each of the Organisations has been assigned different functions and they are independent of each other while carrying out the same.
While the Central Implementation and Evaluation Division is set up in the Ministry of Labour and Employment under the charge of a Joint Secretary, the Implementation Units in the States are set up under the charge of a whole time officer of the Labour Department.
It is recommended that the Implementation Officer should be a whole time officer and of sufficient seniority as far as possible.
The Implementation Units have, among other things, been entrusted with the task of ensuring that every management sets up a grievance procedure in consultation with their workers and ensuring that recognition is granted to Unions by management wherever they satisfy the prescribed criteria by following the procedure laid down for the purpose in Apendix IV.
We have already pointed out that the prescribed criteria is laid down in annexure I of the Code.
Further pre conditions for recognition are laid down in clause (1) of Appendix IV.
Thus the constitutions of the Implementation Units and Implementation Committees are different and they function in different areas.
It appears that the High Court has basically been swayed by the fact that in clause (1) of the Appendix IV it is stated that on the receipt of the representation from unions for recognition, the Central/State "Implementation Machinery" will first ascertain the facts stated in sub clauses (a), (b) and (c) thereof and thereafter, if at the Centre the "Implementation Machinery" will require the Chief Labour Commissioner to arrange the verification of membership of unions entitled to recognition and if in the States either the Implementation Officer will carry out the verification or get it done through the State Labour Commissioner depending upon the practice obtaining in each State.
The High Court also seems to have been influenced by the provisions of clause (10) of the said Appendix which requires the Verification Officer to report his findings on membership to the Centre/State "Implementation Machinery".
The High Court has obviously mistaken the whole for the part.
As we have pointed out earlier, although Section II of the Code is headed "Implementation Machinery" the "Implementation Machinery" consists of two separate Organisations, viz., Implementation Units and Tripartite Implementation Committees.
This is obvious from the language of Section II itself.
Their separate constitutions and functions also make this aspect clear.
What is further, to hold that the Implementation Unit in the respective Labour Department together with the respective Tripartite Implemen 408 tation Committee at the Central, State or Local Level would constitute the Implementation Machinery jointly and not each of them separately would run not only counter to the intention of the Code as is manifest from the clear language of Section II and their separate composition and functions, but would also be impracticable in working.
We have reproduced above the composition of the Implementation Committees at the Centre and the State Level.
These Committees consist of, at the central level, an equal number of employers ' and workers ' representation four each from the central Employers ' and Workers ' Organisations as nominated by the Organisations themselves.
At the State level, they are required to be constituted similarly and in consultation with the Central Employers ' and Workers ' Organisations wherever they have affiliates in the State concerned.
The Committees are further presided over as far as possible by respective Labour Ministers and even where it is not possible for Labour Minister to preside over them, they have to associate themselves as much as possible with the deliberation of the Committees.
At the local level, the Committees are similarly constituted of an equal number of representatives of the employers ' and Workers ' in the area and are presided over by an Officer of the Labour Department or by a prominent person in the region.
In a given case there may be more associations than one of employers and employees, and the Committees would thus consist of an unwieldy number.
To except such a Committee to carry out the work mentioned in Appendix IV is unrealistic.
That is why the Code itself has entrusted to the Implementation Units and not to the Implementation Committees the task of ensuring that recognition is granted to unions by management.
At the Centre, the Implementation Unit is kept in charge of a Joint Secretary and at the State level it is in charge of a whole time officer of the State Labour Department.
The record further shows that as early as on May 26, 1959, i.e., after about a year of the ratification of the Code, the Government of India issued a statement naming and designating Officers Incharge of Evaluation and Implementation work in all the States and further stated as follows: ".
.It is requested that all complaints of non implementation of Labour Laws, awards settlements, agreements, Code of Discipline etc., relating to undertakings in the State sphere may kindly be referred, in future, to State Implementation Officers concerned . .
" So far as the State of Orissa is concerned, the Implementation 409 Officer named by the Government of India is the Labour Commissioner of the State.
Since the Implementation Unit/Implementation Officer entrusted with the task of granting recognition to the Unions in the State of Orissa was the Labour Commissioner of the State, the appellant Sangh had rightly approached the Labour Commissioner for the purpose.
The High Court having committed the basic error of confusing the Implementation unit and Tripartite Implementation Committee together with the Implementation Machinery was misled into holding that the Implementation Unit/Implementation Officer was not the proper authority to initiate the procedure for recognition.
The High Court was further wrong in holding that clause (10) of Appendix IV which mentions that the Verification Office will report his findings to the Implementation Machinery conveyed the meaning that the Implementation Unit or the Labour Commissioner was not the "Implementation Machinery" but only a Verification Officer.
Since the State Labour Commissioner was named as the Implementation Officer who is none but the officer in charge of the Implementation Unit, the State Labour Commissioner as the Implementation Officer had an option either to carry out the verification of membership himself or entrust it to some other Officer like the Deputy Labour Commissioner as in the present case.
That was only an entrustment of a ministerial work.
The Deputy Labour Commissioner in the present case is the Verification Officer and under clause (10) of Appendix IV, he has to send his report to the Implementation Officer or Unit, i.e., the State Labour Commissioner, and the State Labour Commissioner will in turn communicate his decision as the State Implementation Machinery to the management as well as the Unions.
For the aforesaid reasons we are of the view that the High Court has erred in allowing Writ Petition No. 4426 of 1989 filed by the Ist respondent and dismissing the appllant 's Writ Petition being No. 361 of 1990.
We, therefore, set aside the decision of the High Court and direct the Deputy Labour Commissioner to complete the process of verification of membership and the Labour Commissioner to complete the proceedings of recognition as expeditiously as possible and preferably within four months from the receipt of this decision.
In the circumstances of the case, the parties will bear their own costs.
R.S.S. Appeal allowed.
| IN-Abs | The appellant, Rourkela Sramik Sangh, is a trade union in the Rourkela Steel Plant.
It addressed a letter to the Implementation and Evaluation Officer cum Labour Commissioner, under the Code of Discipline 1958, whereby it sought recognition as the sole bargaining agent in the Rourkela Steel Plant.
For this purpose, it requrested the Labour Commissioner to pass orders for immediate verification of the membership of all the trade unions operating in the Plant and to recommend for recognition of the union having majority of the membership.
The Labour Commissioner as the Implementation and Evaluation Officer authorised the Deputy Labour Commissioner to carry out the process of verification of the membership of the registered trade unions, who in turn passed orders calling upon the different trade unions to produce the necessary records.
The Ist respondent Rourkela Mazdoor Sabha which is a rival union, challenged by way of a writ petition the orders passed by the Labour Commissioner and the Deputy Labour Commissioner.
At the same time, the appellant union filed a writ petition seeking a direction to the Labour Commissioner, and the Deputy Labour Commissioner, to complete the process of verification and recognition within a stipulated time.
The High Court by its common judgment allowed the Ist respondent 's petition and dismissed the appellant 's petition.
The High Court held that since the appellant Union had addressed its application for recognition not to the Implementation Machinery but to the Implementation Officer, the same was not properly made as the Implementation Officer had no authority to initiate the process of recognition.
The decision of the High Court was based on the finding that the Implementation and Evaluation Officer was not the "Implementation Machinery" within the meaning of the Code of Discipline.
400 Allowing the appeal and directing the Deputy Labour Commissioner and the Labour Commissioner to complete the proceedings of recognition as expeditiously as possible, this Court, HELD: (1) The "Implementation Machinery" envisaged in section 11 of the Code of Discipline consists of two separate Organisations, viz., Implementation Units in the respective Labour Departments, and Tripartite Implementation Committees at the Central, State and local levels.
Each of the Organisations has been assigned different functions and they are independent of each other while carrying out the same.
Thus, the constitutions of the Implementation units and Implementation Committee, are different and they function in different areas.
[406H 407D] (2) Since the Implementation Unit/Implementation Officer entrusted with the task of granting recognition to the union in the State of Orissa was the Labour Commissioner of the State, the appellant Sangh had rightly approached the Labour Commissioner for the purpose.
[409A] (3) Since the State Labour Commissioner was named as the Implementation Officer who is none but the officer in charge of the Implementation Unit, the State Labour Commissioner as the Implementation Officer has an option either to carry out the verification of membership himself or to entrust it to some other officer like the Deputy Labour Commissioner as in the present case.
That was only an entrustment of a ministerial work.
[409D] (4) The Deputy Labour Commissioner in the present case is the Verification Officer and under clause (10) of Appendix IV, he has to send his report to the Implementation Officer or Unit, i.e., the State Labour Commissioner, and the State Labour Commissioner will in turn communicate his decision as the State Implementation Machinery to the management as well as the Unions.
[409E] (5) The High Court was wrong in holding that the Implementation Unit or the Labour Commissioner was not the "Implementation Machinery" but only a Verification Officer.
[409C]
|
IVIL Appeal No.768 (NT) of 1977 etc.
From the judgment Order dated 9.10.1975 of the Madhya Pradesh High Court in M.C.C. No.144 of 1966.
V.A. Bobde, B.R.Aggarwala and U.A.Rana for the Appellant.
S.V.Deshpande and S.K.Agnihotri for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISHRA, CJ.
These are appeals by special leave 252 and are directed against the separate decisions of the Madhya Pradesh High Court in references under the Madhya Pradesh Sales Tax Act.
Civil Appeal No.768/77 relates to the assessment period 1951 52, Civil Appeal 539/78 relates to 1950 51 and Civil Appeal 1038/78 to 1952 53.
The appellant is a manufacturer of cement in the factory located at Kymore in Madhya Pradesh.
Several cement manufacturing companies as also the appellant had entered into arrangement with the Cement Manufacturing Company of India Limited whereunder the Marketing Company was appointed as the sole and exclusive sales manager for the sale of cement manufactured by the manufacturing companies and the manufacturing companies had agreed not to sell directly or indirectly any of their cement to any person save and except through the Marketing Company.
The manufacturing companies were entitled to be paid a certain sum for every ton of cement supplied by them or at such other rate as might be decided upon by the Directors of the Marketing Company.
The Marketing Company had the authority to sell cement at such price or prices and upon such terms as it might in its sole discretion consider appropriate.
For the three periods referred to above the appellant had supplied cement manufactured by it to the Marketing Company and maintained at the assessment stage for the respective periods that these were covered by the Explanation to Article 286(1)(1) as it then stood and, therefore, the transactions were not exigible to sales tax in Madhya Pradesh.
This stand was negatived by the Assessing Officer, the First Appellate Authority and the Board of Revenue.
The Board in the statement of the case drawn up by it held that cement became a controlled commodity from 8th of August, 1942, and notwithstanding the expiry of the Defence of India Rules with effect from 30th of September, 1946, distribution of cement continued to be controlled even during the period.
The Marketing Company had its establishment at Nagpur then within Madhya Pradesh which received the orders of authorisations and managed the supply from the factory at Kymore.
The Board in its statement further stated: "The entire question in dispute hinges round the fact as to whether the sales in question are inter State in nature or should be regarded as intra State.
It is seen that the Cement Marketing Company is an independent organisation and is carrying on business as an independent entity.
It is also seen that what has actually been taxed are the sales effected by the appellant to the Cement Marketing Company 253 of India and not the sales made to the parties which obtained an authorisation from the Cement Controller.
This seems to be the crux of the matter.
" On this basis reliance was placed on the decision of this Court in the case of Rohtas Industries Limited vs State of Bihar, 12 STC 621 where, after analysing the terms of the contract between the manufacturer (appellant before the Supreme Court) and the Marketing Company, this Court held: "On a review of these terms of the agreement, it is manifest that the manufacturing companies had no control over the terms of the contract of sales by the Marketing Company and that the price at which cement was sold by the Marketing Company could not be controlled by the manufacturing companies; that the manufacturing companies were entitled, for ordinary cement, to be paid at the rate of Rs.24 per ton at works, or at such other rate as might be decided upon by the Directors of the Marketing Company, and in respect of special cement, at such additional rates as the Directors of the Marketing Company might determine; that sale by the Marketing Company was not for and on behalf of the manufacturing companies but for itself and the manufacturing companies had no control over the sales nor had they any concern with the persons to whom cement was sold.
In fine, the goods were supplied to the orders of the Marketing Company, which had the right, under the terms of the agreement, to sell on such terms as it thought fit and that the manufacturing companies had the right to receive only the price fixed by the Marketing Company.
The relationship in such cases can be regarded only as that of a seller and buyer and not of principal and agent.
" This Court in Rohtas Industries case on a detailed analysis of the terms of the contract came to hold that there was a sale between the manufacturer and the Marketing Company.
It is not in dispute that the agreement between the appellant and the Marketing Company in this case has the same terms as this Court considered in Rohtas Industries case.
It follows, therefore, that it must be held that there was a sale between the appellant and the Marketing Company.
The Marketing Company had its establishment at Nagpur within the State of Madhya Pradesh at that time.
There was, therefore, a 254 preceding local sale prior to the sales between the Marketing Company and the allottee of cement by the regulating authority.
This Court in Rohtas Industries further found that the transaction between the manufacturer and the Marketing Company had nothing to do with the Marketing Company 's sales to third parties.
There was no privity between the manufacturer and the ultimate consumer who was said to have been located outside the State of Madhya Pradesh.
The question for consideration is whether the sale that look place between the manufacturer and the Marketing Company can be taken to be covered by the Explanation.
The Explanation which was repealed by the Sixth Amendment of the Constitution in 1956 read thus: "For the purposes of sub clause (a), a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State notwithstanding the fact that under the general law relating to sale of goods the property in the goods has by reason of such sale or purchase passed in another State." Rohtas Industries case was dealing with a period prior to the Constitution; therefore, without the Explanation.
The question for consideration thus is: does the presence of the Explanation make any difference? What has been found as a fact in the statement of the case is that there was preceding local sales complete in every respect within Madhya Pradesh by which title to the cement had passed from the appellant to the Marketing Company.
The concept of inter State sale as brought in by the Sixth Amendment or in the subsequent statute known as the Central Sales Tax Act was not in existence for the relevant period now under consideration.
The finding recorded by the authorities is that the delivery of the cement was not the direct result of such sale or purchase of the cement outside the State.
In the absence of such privity the Explanation is not attracted to the transactions.
An attempt was made by counsel to rely upon some of the later decisions of this Court where with reference to the provisions contained in the Central Sales Tax Act the law had been laid down.
It is unnecessary to refer to them in view of the finding recorded by the authorities that the cement in this case actually had not been delivered 255 as a direct result of such sale or purchase for the purpose of consumption outside the State.
That is a finding clinching enough and once that is taken as binding on this Court, the only conclusion that can follow is that the Explanation does not apply and the assessments are justified.
The ratio of Mohd. Serajuddin vs State of Orissa, is also against the appellant 's stand.
We accordingly dismiss the appeals and uphold the decisions of the High Court.
There would be no order for costs.
V.P.R. Appeals dismissed.
| IN-Abs | The appellant, a manufacturer of cement, entered into an agreement with the Cement Manufacturing Company of India Limited, for sale of cement.
Under the agreement, the appellant was to sell its cement only through the marketing company, and certain sums would be paid for the cement supplied by the marketing company, which had the discretion to fix the sale price.
For the 1950 51, 1951 52 and 1952 53 periods when the appellant was assessed to sales tax for the supply of cement, it maintained at the assessment stage that the transactions were not exigible to sales tax as they were covered under the Explanation to Article 286(1)(a).
The first Appellate Authority and the Board of Revenue did not accept the stand of the appellant.
The Board of Revenue held that cement being a controlled commodity, distribution of cement continued to be controlled during the period, notwithstanding the expiry of the Defence of India Rules.
Relying on the decision of this Court in the case of Rohtas Industries Limited vs State of Bihar, 12 STC 621 the Board of Revenue held that the Cement Marketing Company was an independent organisation and was carrying on business as an independent entity and that what had actually been taxed were the sales effected by the appellant to the Cement marketing Company and not the sales made to the parties which obtained authorization from the Cement Controller.
After analyzing the terms of the contract between the manufacturer and the Marketing Company, this Court held in Rohtas Industries case that there was sale between the manufacturer and the Marketing Company.
251 Following its view taken in Rohtas Industries case as the present case had the same terms, which had been considered in the earlier case, and examining the question whether the sale that took place between the manufacturer and the Marketing Company could be taken to be covered by the Explanation to Article 286(1)(a), this Court, dismissing the appeals, HELD: 1.
There was preceding local sales complete in every respect within Madhya Pradesh by which title to the cement had passed from the appellant to the Marketing Company.
The concept of inter State sale as brought in by the Sixth Amendment or in the subsequent statute known as the Central Sales Tax Act was not in existence for the relevant period now under consideration.
The finding recorded by the authorities was that the delivery of the cement was not the direct result of such sale or purchase of the cement outside the State.
In the absence of such privity the Explanation is not attracted to the transactions.[254E G].
In view of the finding recorded by the authorities that the cement in this case actually had not been delivered as a direct result of such sale or purchase for the purpose of consumption outside the State, the only conclusion that can follow is that the Explanation does not apply and the assessments are justified.[254H 255A].
Rohtas Industries Limited vs State of Bihar, 12 STC 621, followed.
Mohmd.
Serajuddin vs State of Orissa, , distinguished.
|
N: Criminal Appeal No. 276 of 1991.
From the Judgment and Order dated 16.7.1990 of the Orissa High Court in Criminal Appeal No. 117 of 1990 And Death Reference No. 1 of 1990.
H.K. Puri (Amicus Curiae) for the Appellant.
A.D. Giri, Solicitor General and A.K. Panda for the Respondent.
The Judgment of the Court was delivered by K. JAYACHANDRA REDDY, J.
Leave granted.
This is a case of death sentence.
The fact that such a sentence is awarded even in the year 1990 would immediately suggest that the offence involved should be of a grave nature.
Yes, the offence is not only grave but heinous and inhuman.
A girl aged five years was a victim of rape and thereafter murder.
The sole appellant before us was tried, convicted and sentenced to death by the Sessions Court and confirmed by the High Court.
It is a 301 case depending entirely on circumstantial evidence and the obvious contention is that the circumstantial evidence is wholly insufficient to bring home the guilt to the accused.
No doubt the offence is a shocking one but the gravity of the offence cannot by itself overweigh as far as legal proof is concerned.
Invariable in such cases a person last seen with the victim, unless otherwise there are circumstances prima facie exonerating him, would be the prime suspect but in the ultimate judicial adjudication suspicion, howsoever strong, cannot be allowed to take the place of proof.
With that caution in mind we shall now proceed to examine the facts and circumstances as put forward and the various arguments advanced.
The deceased Disco alias Sukumari, a girl aged 5 years was the daughter of P. Ws 1 and 6, the father and the mother who were drummers by castes.
They belong to village Badachatra, an interior part of Mayurbhanj District.
They had three children and the deceased was the eldest.
In the year 1988 during Kalipuja time the accused who was the resident of Tulsibani village about one kilometre away, came to the house of P.Ws 1 and 6.
He named their newly born daughter.
He took his meals in their house and went away saying that he would come with the new dresses for the newly born daughter.
Next day i.e. on 9.11.88 he came to their house in the morning with new dresses.
He told the parents that he would take the deceased with him to Bombay Chhak to get new dresses for the other two children.
He took his lunch and went with deceased towards Bombay Chhak.
Sometime after his departure P.W 6 told her husband P.W.1 to proceed to Bombay Chhak as the deceased might be crying.
Accordingly P.W. 1 accompanied by one Sambhu proceeded towards that Chhak.
On the way they met one Babuli and asked him whether he had seen the accused and the deceased to which he replied in the negative.
P.W. 1 came back to the village and sat in the shop of P.W. 2 who informed that he had seen the accused going towards village Tulsibani alongwith the deceased.
P.W. 1 and Sambhu then went to that village but could not find them there.
Therefore they went to Jharpokharia Police Station and gave a report to the Officer in charge P.W.11 stating that the deceased.
P.W. 1 again went to the Tulshibani Village where a person informed him that he has seen the accused going towards his house.
P.W. 1 went there and enquired the accused.
He told P.W. 1 that the deceased had gone back home but P.W. 1, caught hold of him but the accused squirmed away from his grip.
P.W. 1, however, again caught him and took him to his Village and according to P.W. 1 302 on being questioned the accused confessed to have raped and committed murder of the deceased.
The accused is alleged to have pointed the place where he had thrown the dead body, whereafter P.W. 1 and others proceeded in that direction.
P.W. 11 the Police Officer also came in a jeep and took the accused into custody, drew up F.I.R. and sent the same to the Police Station for registration of a case.
The accused is alleged to have led the Police party to the spot where the dead body was lying.
P.W. 11 found the deceased lying with injuries on her vagina and other parts.
He held the inquest in the presence of P.W. 4 and others and sent the dead body for post mortem.
P.W. 7 conducted the post mortem.
He noticed abrasions all over the body.
He also found one bruise on the left side of the forehead and a lacerated wound of 2.5 cm x 1 cm x muscle deep starting from the posterior angle of vagina along the perinium upto the anus.
On internal examination he found the following injuries. "(1) Soft tissues and muscles below the external injuries to the neck were contused with extra vassation of blood into the soft tissues.
(2) Heamatoma under the scalp corresponding to external injury No. 11.
(3) The hymen was torn and the floor of the vagina i.e., vaginal channel was lacerated.
This injury corresponds to external injury No. 15.
" The Doctor opined that all the injuries were antemortem and homicidal in nature and cause of death was due to asphyxia and shock as a result of strangulation and also due to injuries to the vagina.
He also opined that the injuries on the neck suggest that the deceased was strangulated by pressure of hands.
So far injury to the vagina is concerned, he was of the opinion that the same could have been caused by forcible penetration of a male organ.
The accused also was examined on 10.11.88 itself by another Doctor P.W 8 for some abrasions on his genital.
P.W. 8, however, categorically stated that on examining the accused he could not find any recent sign of sexual intercourse.
The prosecution relied on some blood stains which were found on his dhoti but the accused explained away by saying that they were caused by the bleeding of his gums.
The accused when examined under Section 313 pleaded not guilty.
He however, admitted that he went to the house of P.W. 1 but denied the rest of the case.
303 The trial court did not accept the P.W. 1, s evidence regarding the extra judicial confession alleged to have been made by the accused.
It held that nobody else has mentioned about this extrajudicial confession and at any rate it was supposed to have been made in the presence of the police.
We have also examined the evidence of P.W. 1 as well as the evidence of the other witnesses.
The trial court has rightly rejected this part of the prosecution case regarding the alleged extra judicial confession.
As a matter of fact we do not find anywhere mentioned that such a confession was made by the accused to P.W. 1 neither in the F.I.R. nor in the evidence of other witnesses who were also said to have been present when the accused was brought to the village by P.W. 1.
P.W. 6, who is no other than the wife of P.W. 1, did not even mention about it.
The trial court, however, relying on the other circumstances convicted the accused under Sections 302 and 376 I.P.C. and sentenced him to death subject to confirmation by the High Court and for seven years ' rigorous imprisonment for the offence of rape.
The sentences are directed to run concurrently.
The High Court confirmed the conviction and sentence awarded by the trial court.
As already mentioned this case rests purely on circumstantial evidence.
It is well settled that the circumstantial evidence in order to sustain the conviction must satisfy three conditions; 1) the circumstances from which an inference of guilt is sought to be drawn, must be cogently and firmly established; ii) those circumstances should be of a definite tendency unerringly pointing towards the guilt of the accused; iii) the circumstances, taken cumulatively, should form a chain so complete that there is no escape from the conclusion that within all human probability the crime was committed by the accused and none else, and it should also be incapable of explanation on any other hypothesis than that of the guilt of the accused.
In the leading case Hanumant and Another vs The State of Madhya Pradesh, it is also cautioned thus: "In dealing with circumstantial evidence there is always the danger that conjecture or suspicion may take the place of legal proof.
It is therefore right to remember that 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 304 circumstances should be of a conclusive nature and tendency, 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 leave 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.
" Mahajan, J., as he then was, has also aptly referred to a passage containing the warning addressed by Baron Alderson to the Jury in Reg vs Hodge, which is stated as under; "The mind was 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 was it, considering such matter, 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.
" In Dharam Das Wadhwani vs State of Uttar Pradesh, it was held that " unlike direct evidence the indirect light circumstances may throw may vary from suspicion to certitude and care must be taken to avoid subjective pitfalls of exaggerating a conjecture into a conviction. " In Jagta vs State of Haryana, ; it was held that "The circumstances that the accused could not give trustworthy explanation about the injuries on his person and about his being present on the scene of ;occurrence are hardly sufficient to warrant conviction.
" It may not be necessary to refer to other decisions of this Court except to bear in mind a caution that in cases depending largely upon circumstantial evidence there is always a danger that the conjecture or suspicion may take the place of legal proof and such suspicion however so strong cannot be allowed to take the place of proof.
The Court has to be watchful and ensure that conjectures and suspicions do not take the place of legal proof.
The Court must satisfy that the various circumstances in the chain of evidence should be established clearly and that the completed chain must be such as to rule out a reasonable likelihood of the innocence of the accused.
Bearing these principles in mind we shall now consider the reasoning of the courts below in coming to the conclusion that the accused along has committed the offence.
305 The trial court relied on the following circumstances: "(a) 'Last seen ' theory that the accused and the deceased were last seen together.
(b) Conduct of the accused that the accused attempted to flee away when he could be seen at his village by P.W.1; (c) False explanation the accused when questioned gave false explanation regarding the whereabout of the deceased; (d) Recovery of the dead body of the deceased on the showing of the accused That the accused pointed out the place where the dead body of the deceased was lying inside a paddy field; (e) Presence of injury on the genital as well as stains of blood on the wearing apparel and nailclippings of the accused.
" The evidence of P.Ws 1, 2 and 6 are relied upon in support of the first circumstance namely that the deceased was last seen in the company of the accused.
P.W. 1 the father and P.W. 6 the mother deposed that on the day of occurrence the accused came to their house and took the deceased towards Bombay Chhak to purchase new clothes.
The accused only admitted to the extent namely that he had been to their house and denied the rest of the prosecution case.
However, we shall accept the evidence of P.Ws 1 and 6 to the effect that the accused took the deceased on that day to Bombay Chhak.
But that by itself is not enough to conclude that the deceased was last seen in the company of the accused because even according to them on being enquired, the accused told them that he sent the girl back in a truck.
Even otherwise the distance between the two villages is not much.
P.W. 2 's evidence, however, is relied upon that the deceased was going in the company of accused.
P.W. 2 is also a native of the same village to which P.Ws 1 and 6 belong.
He deposed that on a Wednesday he had been to village pond to take his bath at about 12 noon and while returning she saw the accused going towards east with a minor girl aged about 5 years but P.W. 2 does not say that the deceased was in his company.
He, however, proceeded to depose that he found P.W. 1 searching for some one and thereupon P.W. 2 told him that he has seen the accused with a minor girl going towards the paddy field.
He admitted that did not know whose daughter was in the company of the accused.
In the cross 306 examination he further admitted that he did not talk to the accused.
No. doubt P.W. 2 's evidence, to some extent, corroborates the evidence of P.Ws 1 and 6 but unfortunately even at the stage of inquest this circumstance namely that the deceased was last seen in the company of the accused, was not noted.
We will advert to this aspect at a later stage.
The important and crucial circumstance heavily relied upon by the prosecution is the alleged recovery of the dead body of the deceased on showing of the accused and the accused pointed the place where the body of the deceased was lying.
For this again the prosecution relied on the evidence of lP.Ws 1 and 11.
Having carefully gone through the evidence of P.W. 1 we find that he has improved his version from stage to stage.
As already noted both the courts below were not prepared to place any reliance on his evidence regarding the extra judicial confession about which he made no mention at any earlier stage.
As far as the recovery of the body is concerned, P.W. 1 however deposed that he managed to catch hold of the accused and brought him to the village and that the police came in a jeep and took the accused into custody.
Then all of them went towards paddy field which had been pointed by the accused and on search they found the dead body.
P.W. 11 the Investigating Officer deposed at he went to village and found the accused to have been detained.
He therefor prepared the F.R.I. and sent the same for registration of the crime.
Then he arrested the accused and his evidence and his evidence thereafter to put in his own words reads as under: "The accused pointed out the place where the dead body of the deceased was lying and thereafter led me to the paddy field wherefrom I could recover the dead body of the deceased Disco.
As there were good number of persons present apprehending danger to the accused I sent him to the police station.
During course of investigation, I examined witnesses, seized the dhoti (M.O. iii),Shirt (M.O. iv) and this chadi marked M.O.VII from the accused under the seizure list already marked Ext.
The dead body of the deceased was lying in the paddy field where there were paddy plants which had been damaged and scattered.
I held inquest over the dead body of the deceased Disco in presence of witnesses under the inquest report already marked Ext.
I noticed INJURIES on the vagina and other parts of the body of the deceased.
After inquest I sent the dead body for P.M. examination through constables.
" 307 According to this evidence the accused is alleged to have taken P.W. 11 and others to the open paddy field where the dead body was lying.
It is only thereafter that the inquest report was drawn up.
However, P.W. 11 stated in his evidence that before going to the paddy field the F.I.R. exhibit P. 10 was drawn up by him.
Surprisingly we find a mention about the discovery of the body in the F.I.R. itself.
But the same is not found in the inquest.
There is not even a reference to the accused in the column No. 9 of the inquest report where the information of witness as to the cause of death has to be noticed.
We are aware that the purpose of inquest report is only to ascertain the cause of death but in a case of this nature there should have been atleast a mention in the inquest report as to how the body was discovered.
Apart from that usually a panchanama is prepared for such a discovery made under Section 27 of the Evidence Act but strangely in this case there is no such panchanama nor there is any other evidence of P.Ws 1 and 11.
P.W. 6 does not say anything about this aspect.
As a matter of fact the trial court has noted the discrepancies in the evidence of P.Ws 1 and 11 and it is observed as under: "The Investigating Officer, P.W. 11 has stated something more about the find of the dead body.
He speaks that the accused pointed out the place where the dead body of the deceased was lying and thereafter led him to the paddy field wherefrom the dead body of the deceased could be recovered.
Though this part of this evidence has not been supported by P.W. 1,but from the evidence of both P.Ws 1 and 11 coupled with the evidence of P.W.4 I am persuaded to hold that on the showing of the accused, the dead body of the deceased was recovered from a paddy field.
" We have perused the evidence of P.W. 4.
His evidence does not in any manner incriminate the accused.
P.W. 4 deposed that the dead body of the deceased was found lying in paddy field and that the police held inquest over the dead body in his presence and that the inquest report is P. 1 in which he put his signature as a witness.
Nothing more is stated by him.
He does not even refer to the presence of the accused at the place where the dead body was found or at the time of inquest, which was held also there.
P.W. 4 does not in any manner help the prosecution case so far as this circumstance is concerned.
If ready the body has been discovered at the instance of the accused there should have been discovered at the instance of the accused there should have been a panchanama and a mention about the same in the inquest report.
P.W. 11 categorically in his evidence has stated that after sending the F.I.R. the accused was questioned and the body was discovered there 308 after at the instance of the accused and the inquest was held over the dead body and P.W. 4 was a panch witness to the inquest and he also affixed his signature in the inquest report.
But as mentioned above P.W. 4 does not say anything about the accused being present anywhere near the place where the dead body was found nor there is a reference to the accused in the inquest report.
The only two remaining witnesses P.Ws 1 and 11 namely the father of the girl and the Investigating Officer respectively have contradicted each other.
That is the type of evidence regarding this crucial circumstance.
It is highly dangerous to accept the same and hold that the dead body was discovered at the instance of the accused.
Having given our careful consideration we are of the firm opinion that the prosecution has not established this circumstance conclusively.
On the other hand there is any amount of doubt and suspicion about the accused having shown the place of occurrence.
We may also point out at this stage that the circumstance that the deceased was last seen in the company of the accused was not mentioned in the inquest report.
Therefore the first circumstance also namely that the deceased was last seen in the company of the accused is not established beyond reasonable doubt.
However, when once it is held that the crucial circumstance namely the discovery of the body at the instance of the accused is not established, then the other circumstances are hardly sufficient to establish the guilt of the accused.
The courts below have also observed that the accused gave a false explanation.
According to the prosecution case the accused is supposed to have stated to P.Ws 1 and 6 that he sent away the deceased in a truck.
The courts below held that this explanation is false mainly on the surmise that a minor girl could not have come back on her own in a truck.
We are not convinced that on this surmise alone we can hold that the accused has given a false explanation.
It is not uncommon in villages for children to go about the field and walk short distances while coming back to the village.
In any event the accused had given an explanation that he sent the girl back to the village in a truck and the same cannot be held to be not plausible and therefore false.
Then the last circumstance relied upon by the courts below is the presence of some abrasions on the genital of the accused and presence of stains blood on the wearing apparels and nail clippings.
The prosecution wanted to show that because of the penetration the accused sustained the abrasions on his penis.
The Doctor, P.W. 8 who examined the accused has stated that he found only two pin head abrasion on the genital of the accused and on examination he opined that he could not find any recent sign of sexual intercourse and he also 309 added that there was no such sign of having intercourse within one hour of his examination.
However to a court question, P.W 8 stated that as a result of forcible sexual intercourse those abrasions can be possible.
We are unable to see as to how this evidence, in any manner, is helpful to the prosecution.
When P.W. 8 stated that he couldn 't find any sign of sexual intercourse atleast within one hour of his examination then it is only a mater of conjectures as to when the accused had any intercourse.
The accused is a man aged 57 years and it is not as if he was not used to sexual intercourse.
In any event the prosecution has not established that the accused had an intercourse on the day of the occurrence.
Then the presence of blood in the nail clippings and on the underpant does not also incriminate and do not connect the accused in any manner with the alleged offences.
The accused also had given an explanation namely that his gums were bleeding and in wiping out the same he got these blood stains.
Even otherwise having given our earnest consideration, we are not able to say that this last circumstance coupled with the circumstance of last seen in the company of the accused amount to legal proof of the guilt particularly when the crucial circumstance namely that the accused showed the dead body is held to be not established.
when such a main link goes, the chain gets snapped and the other circumstances cannot in any manner establish the guilt of the accused beyond all reasonable doubts.
It is at this juncture the Court has to be watchful and avoid the danger of allowing the suspicion to take the place of legal proof for sometimes unconsciously it may happen to be a short step between moral certainty and the legal proof.
At times it can be case of 'may be true '.
But there is a long mental distance between 'may be true ' and 'must be true ' and the same divides conjectures from sure conclusions.
The least that can be said in this case is that atleast there is a reasonable doubt about the guilt of the accused and the benefit of the same should go to him.
We are conscious that a grave and heinous crime has been committed but when there is ;no satisfactory proof of the guilt we have no other option but to give the benefit of doubt to the accused and we are constrained to do so in this case.
Accordingly, the appeal is allowed.
The conviction and sentence of the accused is set aside and he shall be set at liberty forthwith if not required in any other case.
T.N.A. Appeal allowed.
| IN-Abs | The appellant was tried for rape and murder of a girl aged five years.
The entire evidence against him was circumstantial: (a) the accused and the deceased were last seen together; (b) false explanation given by the accused regarding the whereabouts of the deceased; (c) alleged recovery of the dead body of the deceased at the instance of the accused and (d) presence of abrasions on the genital of the accused as well as blood stains on his wearing apparels and nail clippings.
Relying on the circumstantial evidence the Trial Court convicted him under Sections 302 and 376 and sentenced him to death for the offence of murder and seven years rigorous imprisonment for the offence of rape.
The High Court confirmed the conviction and the sentence awarded by the Trial Court.
In appeal to this court it was contended on behalf of the appellant that the circumstantial evidence is wholly insufficient to bring home the guilt of the accused.
Allowing the appeal, this Court, HELD: 1.
The circumstantial evidence in order to sustain the conviction must satisfy three conditions; (1) the circumstances from which an inference of guilt is sought to be drawn, must be cogently and firmly established; (ii) those circumstances should be of a definite tendency nerringly pointing towards the guilt of the accused; (iii) the circumstances, taken cumulatively, should form a chain so complete that there is no escape from the conclusion that within all human probability the crime was committed by the accused and none else, and it should also be incapable of explanation on any other hypothesis than that of the guilt of the accused [303E F].
299 Hanumant and Anr.v.
The State of Madhya Pradesh, ; Reg vs Hodfe, [1838] 2 Lew.227; Dharam Das Wadhwani vs State of Uttar Pradesh, and Jagta vs State of Haryana, ; , referred to.
2.In cases depending largely upon circumstantial evidence there is always a danger that the conjecture or suspicion may take the place of legal proof and such suspicion however so strong cannot be allowed to take the place of proof.
The Court has to be watchful and ensure that conjectures and suspicions do not take the place of legal proof for sometimes unconsciously it may happen to be a short step between moral certainty and the legal proof.
At times it can be case of 'may be true.
But there is a long mental distance between 'may be true ' and 'must be true ' and the same divides conjectures from sure conclusions.
The Court must satisfy itself that the various circumstances in the chain of evidence should be established clearly and that the completed chain must be such as to rule out a reasonable likelihood of the innocence of the accused.
[304 G, 309E F] 3.In the instant case the circumstance that the deceased was last seen in the company of the accused is not established beyond reasonable doubt.
This circumstance was not mentioned in the Inquest Report prepared by the Investigating Officer.
Further the statement of the parents of the deceased that the accused took the deceased girl by itself is not enough to conclude that the deceased was last seen in the company of accused because even according to them on being inquired the accused told them that he had sent the girl back in a truck.
[308C, 305F] 3.1 The prosecution has not conclusively proved the crucial circumstance of the recovery of the dead body of the deceased girl at the instance of the accused.
No Panchnama was prepared for such a discovery under Section 27 of the Evidence Act and there is no mention in the Inquest Report as to how the body was discovered.
On the other hand there is any amount of doubt and suspicion about the accused having shown the place of occurrence.
Once it is held that the crucial circumstances namely the discovery of the body at the instance of the accused is not established, than the other circumstance are hardly sufficient to establish the guilt of the accused.
[308B C D, 306B, 307C] 3.2 The explanation given by the accused that he sent the girl back to the village in a truck cannot be held to be not plausible and therefore false because it is not uncommon in villages for children to go about the fields and walk short distance while coming back to the village.
[308E] 300 3.3 The prosecution has also not established that the accused had an intercourse on the day of the occurrence.
When the doctor who examined the accused stated that he could not find any sign of sexual intercourse atleast within one hour of his examination then it is only a matter of conjectures as to when the accused had any intercourse.
The presence of blood in the nail clippings and on the underpant does not also incriminate and do not connect the accused in any manner with the alleged offences.
The accused also had given an explanation namely that his gums were bleeding and in wiping out the same he got these blood stains.
Even otherwise this circumstance coupled with the circumstance of last seen in the company of the accused would ;not amount to legal proof of the guilt particularly when the crucial circumstance namely that the accused showed the dead body is held to be not established.
When such a main link goes, the chain gets snapped and the other circumstances cannot in any manner establish the guilt of the accused beyond all reasonable doubts.
Therefore there is a reasonable doubt about the guilt of the accused and the benefit of the same should go to him.
Accordingly the conviction and sentence of the accused is set aside.
[309B C, F G]
|
Civil Appeal No. 722 of 1978.
From the Judgment and Decree dated 11.4.1977 of the Madhya Pradesh High Court in Second Appeal No. 315 of 1970.
S.K.Gambhir for the Appellant.
S.S. Khanduja for the Respondent .
The Judgment of the Court was delivered by K.RAMASWAMY,J.
The facts in this appeal would lie in a short compass.
The appellant appointed the respondent as Lower Division Clerk on September 22, 1966 and put him on probation for a period of two years which expired on September 21, 1968.
On December 9, 1968, the appellant served him with one month 's notice terminating the services with effect from January 9, 1969.
Calling in question the order of termination, the respondent laid the suit for declaration that the termination without enquiry and an opportunity of being heard was violative of Rule 9A of the Madhya Pradesh Civil Service Classification Control & Appeal (Rules), 1966 with consequential declaration that he became a permanent employee of the corporation with cotiuity of service and arrears of salary.
The Trial Court dismissed the suit and on appeal it was confirmed.
The High Court in Second Appeal No. 315/70 by judgment and decree dated April 11, 1977 allowed the appeal and decreed the suit as prayed for.
On leave under article 136 the Appellant filed this appeal.
Shri S.k.
Gambhir, learned counsel for the appellant contended that the respondent being a probationer, acquires permanent status only on confirmation.
Before confirmation the appellant had exercised its power, in terms of the rules, and terminated the respondent 's service.
The High Court committed manifest error of law in its finding that on expiry of two years period of probation the respondent must be deemed to have been confirmed under Rule 14 of the Municipal Officers and Servants Recruitment Rules which no longer were in force.
He further contended that rule 8 of the Madhya Pradesh Government Servants ' General Conditions of Service Rules, 1961 for short 'the Rules ' expressly provides confirmation of probation as a condition precedent.
Notice was issued terminating the service before confirmation and so it is valid in law.
Shri S.S. Khanduja, learned counsel for the respondent contended that by operation of the resolution passed 324 by the Municipal Corporation under section 25 of the Central Provinces and Berar Municipality Act 1922 the Municipal Officers and Servants are governed by recruitment rules thereunder.
Rule 14 thereof, relied on by the High Court expressly provided to put an employee on probation for a period of two years subject to being confirmed.
At the end of the probationary period, if the probationer was found unfit, the Municipal Committee shall, if he was a direct recruit, to dispense with his service and if he has been recruited by tranfer, to revert to his original post.
On expiry of the period of two years, no action was taken by the Municipal Corporation.
Therefore, the respondent must be deemed to have been confirmed.
Thereafter the only power which the Corporation had was to terminate the service of the respondednt in accordance with Classification Control and Appeal Rules after conducting an enquiry and giving him reasonable opportunity that too for misconduct.
No such procedure was adopted.
Therefore, the impugned notice was illegal and the High Court was justified in granting the decree.
The first question is, which are the relevant rules that would be applicable to the respondent? Admittedly, the Municipal Council became a Municipal Corporation on or after August 26, 1967.
A resolution was passed making a draft bye law by a Municipal Council on November 11, 1960, exercising the power under section 178(3) of the Madhya Pradesh Municipal Act, 1922 and confirmed the same under section 25 (1) of the said Act, adopting Government Rules to regulate the conditions of service of officers and servants of Municipal Committee which provides thus: "The fundamental rules and the Civil Service regulations as amended from time to time in their applications to M.P., the M.P.Government Servants Conduct Rules 1959, as amended from time to time and the General Book Circulars of the Govt.
of M.P. as in force for the time being shall apply to the officers and servants of the M.C. in the same way as they apply to Govt.
Servants".
Thus, it is clear that the Fundamental Rules, Civil Service Regulations, Govt, Servants Conduct Rules and the General Book Circulars of the Government of Madhya Pradesh as amended from time to time, etc.
shall apply to the officers and servants of the Municipal Committee.
The Previous rules were thus superseded and were no longer in force.
Reliance on Rule 14 referred to above made by the High Court is, therefore, wrong.
Rule 8 of the Rules reads thus: 325 "Probation (1) A person appointed to a service or post by direct recruitment shall ordinarily be placed on probation for such period as may be prescribed.
(2) The appointing authority may, for sufficient reasons, extend the period of probation by a further period not exceeding one year.
Note A probationer whose period of probation is not extended under this Sub Rule but who has neither been confirmed nor discharged from service at the end of the period of probation shall be deemed to have been continued in service, subject to the condition of his service being terminable on the expiry of a notice of one calender month given in writing by either side.
(3) A probationer shall undergo such training and pass such departmental examinations during the period of his probation as may be prescribed.
(4) and (5) are not relevant, hence omitted.
(6) On the successful completion of probation and the passing of the prescribed departmental examinations, the probationer shall be confirmed in the services or post to which he has been appointed." Thus, it is clear from Rule 8 of the Rules that the procedure to place a direct recruit on probation for a prescribed period was provided.
The appointing authority would be entitled to place a direct recruit on probation for a specified period and for sufficient reasons may extend the period of probation to a further period not exceeding one year.
Under the note to sub rule (2) if the probationer is neither confirmed nor discharged from service at the end of the period of probation, he shall be deemed to have been continued in service as probationer subject to the condition of his service being terminated on the expiry of a notice of one calender month given in writing by either side.
As per sub rule (6) on passing the prescribed departmental examination and on successful completion of the period of probation, the probationer shall be confirmed in the service or post to which he has been appointed.
Then he becomes an approved probationer.
Therefore, after the expiry of the period of probation and before its confirmation, he would be deemed to have been continued in service 326 as probationer.
Confirmation of probation would be subject to satisfactory completion of the probation and to pass in the prescribed examinations.
Expiry of the period of probation, therefore, does not entitle him with a right to a deemed confirmation.
The rule contemplate to pass an express order of confirmation in that regard.
By issue of notice of one calender month in writing by either side, the tenure could be put to an end, which was done in this case.
In State of Punjab vs
Dharam Singh; , considering the effect of continuing a probationer in service after the period of probation was completed, the Constitution Bench held that there was no rule for the extension of probation after October 1, 1960 and it was not possible to presume the competent authority extended it beyond October 1, 1960.Thus in the above case there was no power to extend the probation in the rules beyond the specified period.
It was held that: "The initial period of probation of the respondents ended on October 1, 1958.
By allowing the respondents to continue in their posts thereafter without any express order of confirmation, the competent authority must be taken to have extended the period of probation upto October 1, 1960 by implication.
But under the proviso to Rule 6(3), the probationary period could not extend beyond October 1, 1960.
In view of the proviso to Rule 6(3), it is not possible to presume that the competent authority extended the probationary period after October 1, 1960, or that there after the respondents continued to hold their posts as probationers".
Accordingly it was held that the respondent therein was deemed to have been confirmed.
In Om Prakash Maurya vs U.P. Co op.
Sugar Factories Federation, Lucknow & Ors.
; this Court held that U.P. Co op.
Sugar Factories Federation Service Rules, 1976 made under the U.P. Co op.
Societies Act were in force.
Regulations 17 of 1975 Regulations does not permit continuance of an employee for a period of more than two years.
One year normally was the period of probation and further being extended to a period of one more year.
Rule 5 of 1976 Rules does not prescribe any limit on the extension of the probationary period.
In the light of the operation of those rules when the probationary period was prescribed on promotion to the post of Commercial Officers with a condition that his probationary period may be extended and he could be reverted to the post of Office Superinten 327 dent without any notice, this Court held that the stipulation for extension of probationary period in the appointment order must be considered in accordance with the proviso to regulation 17(1) which means that the probationary period could be extended for a period of one year more and the probationary period was further extended to one year during which period the service of the appellant was neither terminated nor was he reverted to his substantive post, instead he was allowed to continue.
On those facts this Court held that "since under those regulations ' appellant 's probationary period could not be extended beyond the maximum period of two years, he stood confirmed on the expiry of maximum probationary period and there after he could not be reverted to lower post treating him on probation".
In M.A. Agarwal vs Gurgaon Bank & Ors., and in State of Gujarat vs Akhilesh C. Bhargav & Ors. ; this Court reiterated the same view.
Exercise of the power to extend the probation is hedged with the existence of the rule in that regard followed by positive act of either confirmation of the probation or discharge from service or reversion to the substantive post within a reasonable time after the expiry of the period of probation.
If the rules do not empower the appointing authority to extend the probation beyond the prescribed period, or where the rules are absent about confirmation or passing of the prescribed test for confirmation of probation and inaction for a very long time may lead to an indication of the satisfactory completion of probation.
But in this case Rule 8 expressly postulates otherwise.
The period of probation is subject to extension by order in writing for another period of one year.
Passing the prescribed examinations and successful completion of probation and to make an order of confirmation are condition precedent.
Mere expiry of the initial period of probation does not automatically have the effect of deemed confirmation and the status of a deemed confirmation of the probation.
An express order in that regard only confers the status of an approved probationer.
We are of the view that note to sub rule (2) read with sub rule (6) of Rule 8 manifests the legislative intent that confirmation of the probation of the respondent would be made only on successful completion of the probation and the passing of the prescribed examinations.
It is not the respondent 's case that he passed all the examinations.
He shall be deemed to be continued on probation.
Before confirmation the appointing authority is empowered to terminate the service of the probationer by issuing on calender month 's notice in writing and on expiry thereof the service stands terminated without any further notice.
Within three months from the date of expiry of original two 328 years period of probation and within one year 's period, the order of termination was made.
In this view the question of conducting an inquiry under the Classification Control and Appeal (Rules) after giving an opportunity and that too for specific charges does not arise.
The High Court, therefore, committed manifest error of law in decreeing the suit.
By an interim order passed by this court, the respondent received a sum of Rs. 5,000 from the appellant.
The appellant shall not recover the same from him.
The appeal is accordingly allowed.
The judgment and decree of the High Court is set aside and that of the Trial Court and the Ist Appellate Court are confirmed.
But in the circumstances parties are directed to bear their own costs.
N.P.V. Appeal allowed.
| IN-Abs | The respondent was appointed in the appellant Corporation and put on probation for a period of two years.
About three month 's after the completion of two years ' period he was served with one month 's notice for termination of his service.
Challenging the termination order the respondent filed a suit for declaration that the termination without enquiry and opportunity of being heard was violative of Rule 9A of the Madhya Pradesh Civil Services Classification, Control and Appeal Rules 1966 and that he became a permanent employee of the Corporation with continuity of service and arrears of salary.
The trail court dismissed the suit, and appeal, it was confirmed.
The High Court allowed the respondent 's second appeal and decreed the suit.
In the appeal, by special leave, before this Court, on behalf of the appellant Corporation it was contended that the respondent being a probationer, would acquire permanent status only on confirmation, that the High Court had committed manifest error in law in holding that on the expiry of two years ' period of probation, the respondent must be deemed to have been confirmed under Rule 14 of the Municipal Officers ' and Servants ' Recruitment Rules, which were no longer in force, and that Rule 8 of the Madhya Pradesh Government Servants ' General Conditions of Service expressly proved confirmation of probation as a condition precedent and since notice terminating respondent 's service was issued, in terms of the rules, before confirmation, it was valid in law.
On behalf of the respondent, it was contended that by operation of the resolution passed by the Municipal Corporation under Section 25 of 321 the Central Provinces and Bearer Municipality Act, 1922, the Municipal Officers and Servants was governed by recruitment rules thereunder, that since no action was taken by the appellant Corporation to dispense with the respondent 's service, on the expiry of the period of two years, as envisaged in Rule 14 of the Municipal Officers ' and Servants ' Recruitment Rules, the respondent must be deemed to have been confirmed, and consequently, the only power the Corporation had was to terminate the respondent 's service in accordance with the classification, Control and Appeal Rules, after conducting an enquiry and giving him reasonable opportunity, that too for misconduct, but since no such procedure was adopted, the notice was illegal and the High Court was justified in granting the decree.
Allowing the appeal, this Court, HELD: 1.1 Under the Note to sub rule (2) of Rule 8 of the Madhya Pradesh Govt.
Servant 's, General Conditions of Service Rules, 1961 if the probationer is neither confirmed nor discharged from service at the end of the period of probation, he should be deemed to have been continued in service as probationer subject to the condition of his service being terminated on the expiry of a notice of one calendar month, given in writing by either side.
As per sub rule (6) on passing the prescribed departmental examination and on successful completion of the period of probation, the probationer should be confirmed in the service or post to which he has been appointed.
Then he becomes an approved probationer.
Therefore, after the expiry of the period of probation and before its confirmation, he would be deemed to have been continued in service as probationer.
[375F H] 1.2 Confirmation of probation would be subject to satisfactory completion of the probation and pass in the prescribed examinations.
Expiry of the period of probation, therefore, does not entitle him with a right to deemed confirmation.
The rule contemplates to pass an express order of confirmation in that regard.
By issue of notice of one calendar month in writing by either side, the tenure could be put to an end.
[326A B] 1.3 If the rules do not empower the appointing authority to extend the period of probation beyond the prescribed period, or where the rules are absent about confirmation or passing of the prescribed test for confirmation of probation, inaction for a very long time may lead to an indication of the satisfactory completion of probation.
[327D E] 322 1.4 Rule 8 expressly postulates otherwise.
Hence mere expiry of the initial period of probation which is subject to extension for another period of one year does not automatically have the effect of deemed confirmation, and the status of a deemed confirmation of the probation.
An express order in that regard on fulfillment of the conditions stipulated in the Rule only confers the status of approved probation.[327E F] State of Punjab vs Dharam Singh ; ; Om Prakash Maurya vs U.P. Co op.
Sugar Factories Federation, Lucknow & Ors.
; ; M.A. Agarwal vs Gurgaon Bank & Ors., and State of Gujarat vs Akhilesh C. Bhargav & Ors., ; , distinguished.
1.5 Note to sub rule (2) read with sub rule (6) of Rule 8 manifest she legislative intent that confirmation of the probation of the respondent would be made only on successful completion of the probation and the passing of the prescribed examinations.
The respondent shall, therefore, be deemed to be continued an probation.
Before confirmation the appointing authority is empowered to terminate the service of the probationer by issuing one calendar month 's notice in writing and on expiry thereof the service stands terminated without any further notice.
Within three months from the date of expiry of original two years period of probation and within th extendable period of one year the order of termination was made.
Hence, the question of conducting an inquiry under the Classification, Control and Appeal Rules after giving an opportunity and that too for specific charges does not arise.
[327G H, 328A] In the circumstances the High Court, committed manifest error of law in decreeing the suit.
[328B] 2.
By virtue of the resolution passed by the Municipal Council, which subsequently became Municipal Corporation, making a draft bye law , exercising power under section 173(2) of the Madhya Pradesh Municipal Act, 1922 and confirmed under Section 25(1) of the Act, adopting Government rules to regulate the conditions of service of officers and servants of the Municipal Committee, the Fundamental Rules, Civil Service Regulations, Government Servants ' Conduct Rules, and General Book Circulars of the State Government, as amended from time to time, etc. would apply to the officers of the Municipal Committee and the previous rules were superseded and were no longer in force.
Hence the reliance placed by the High Court on Rule 14 of the Municipal Officers ' and Servants ' Rules is wrong.
[324D E, G H] 323
|
N: Criminal Appeal No. 294 of 1991.
422 From the Judgment and Order dated 10.4.1990 of the Punjab & Haryana High Court in Crl.
No. 3635 of 1989.
R.S. Suri for the Appellant.
Brijender Chahar and Ashok Mathur for the Respondent.
The following Order of the Court was delivered We have heard the learned counsel for the parties.
The delay in filing the special leave petition is condoned and leave is granted.
The respondent who was undergoing sentence of life imprisonment, had served a period of eleven and an half years when he made an application for pre mature release.
The Punjab and Haryana High Court by the impugned order issued a direction to release the respondent on bail, observing further that if his mercy petition, which was pending, is dismissed, he will have to surrender.
The High Court has not taken into consideration the provisions of Section 433A of the Criminal Procedure Code while passing the order.
A week back we have allowed a criminal appeal against a judgment of the Punjab & Haryana High Court in another case directing pre mature release on account of good conduct of the respondent in jail serving a life sentence although he had actually been in jail for a period of nine years only.
We set aside the order as the provisions under Section 433A had not been taken into consideration, and remitted the matter to the High Court for reconsideration in accordance with the provisions of Jail Manual.
The learned counsel for the respondent in the present appeal attempted to distinguish the case on the ground that here the respondent has been only enlarged on bail and has not been finally released.
We do not think that Section 433A, which is quoted below, is inapplicable in the present case: "Restriction on powers of remission or commutation in certain cases Notwithstanding anything contained in Section 432, where a sentence of imprisonment for life is imposed on conviction of a person for an offence for which death is one of the punishments provided by law, or where a sentence of death imposed on a person has been commuted under Section 433 into one of imprisonment for life, such person shall not be released from prison unless he had 423 served at least fourteen years of imprisonment." (emphasis supplied) The respondent in his writ petition before the High Court relied upon three instructions (Annexures P 1 to P 3) in support of his claim that he is entitled to pre mature release.
Earlier the High Court had directed the mercy petition, pending before the Governor, to be decided within a period of three months.
This was not done and a reply was filed on behalf of the State explaining the circumstances under which the matter remained pending.
In this background the impugned order was passed.
The judicial proceeding dealing with the conviction and sentence of the accused had been earlier concluded, and the order of his release on bail was passed while finally disposing of the writ petition alleging delay in disposal of the mercy petition.
In other words, no case in now pending before the Court, and it cannot be suggested that the order of the respondent 's release on bail has been passed as an interim measure pending the decision of a case before the Court.
In such a situation the provisions of Section 433A are attracted.
The words in the Section quoted above and underlined by us are wide in their application and cannot be restricted as suggested by the learned counsel for the respondent.
We, therefore, allow the appeal, set aside the impugned judgment and remit the case to the High Court for reconsideration of the writ petition confined to its limited scope in accordance with law.
The respondent shall surrender without delay and only thereafter he shall be allowed to press his application before the High Court.
N.P.V. Appeal allowed.
| IN-Abs | On the application for pre mature release, made by the respondent, who was undergoing sentence of life imprisonment and had served a period of eleven and a half years the High Court directed that the respondent 's mercy petition pending before the Governor, should be decided within three months.
Since this was not done, the High Court directed his release on bail, observing that if his mercy petition was dismissed he would have to surrender.
Against this decision the State filed an appeal before this Court.
Allowing the appeal, this Court, HELD: The High Court has not taken into consideration the provisions of Section 433A of the Criminal Procedure Code, 1973 while passing the order for the respondent 's release on bail.
The judicial proceeding dealing with the conviction and sentence of the accused had been earlier concluded, and the order was passed while finally disposing of the writ petition alleging delay in disposal of the mercy petition.
Thus, no case is now pending before the court.
The order for the respondent 's release on bail has not therefore, been passed as an interim measure pending the decision of a case before the Court.
In such a situation the provisions of Section 433A are attracted.
The words "such person shall not be released from prison" are wide in their application and cannot be restricted only to case where the person has been released finally.
The judgment in question is set aside and the case remitted to the High Court for reconsideration of writ petition confined to its limited scope.
|
ON: civil Appeal No. 4032 of 1984.
From the Judgment and Order dated 13.12.1983 of the Madras High Court in Second Appeal No. 166 and CMP No. 1714 of 1983.
U.R. Lalit and section Srinivasan for the Appellant.
Dr. Y.S. Chitale, Darshan Singh, Praveen Kumar and Sumit Sen for the Respondent.
The judgment of the Court was delivered by THOMMEN, J.
The appellant, the East India Corporation Limited, is the defendant in O.S. No. 623 of 1980, which is a suit instituted by the respondent, Shree Meenakshi Mills Limited, for recovery of possession of a building on the ground of arrears of rent, etc.
The respondent plaintiff alleged that the appellant defendant was the tenant of the building in question and that it has not paid the agreed rent of Rs. 900 per month for a long period, despite persistent demands, and has thus been in "wilful default" of payment of the agreed rent.
The appellant denied these allegations.
It specifically denied any relationship of landlord and tenant between the parties, and contended that its occupation of the building was not as a tenant of the respondent, but as one of its "associates" or "co sharers" or "co owners".
The suit was decreed.
The decree of the learned Munsif was affirmed in appeal by the First Appellate Court as well as by the High Court.
All the three courts, rejecting the appellant 's contentions 314 to the contrary, found that it was a tenant of the respondent; it questioned without bona fide the respondent 's title as landlord; it was in default of payment of rents, and, if was liable to be evicted from the building.
Against these concurrent findings, the present appeal was brought to this Court by means of a special leave petition.
Leave was granted by order of this Court dated 24.9.84.
At the time of the institution of the suit, or the grant of leave by this Court, the building in question did not come within the purview of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 ( 'the Act ') for the agreed rent, as alleged by the plaintiff respondent and as found by all the courts, was Rs. 900 per month, and as such was outside the limit prescribed under section 30(ii) of the Act for a residential building to fall within the statutory ambit.
Section 30, as it stood at the relevant time, stated: "30.
Exemption in the case of certain buildings.
Nothing contained in this Act shall apply to (i) any building for a period of five years from the date on which the construction is completed and notified to the local authority concerned; or (ii) any residential building or part thereof occupied by any one tenant if the monthly rent paid by him in respect of that building or part exceeds four hundred rupees.
" Clause (ii) of section 30 was, however, struck down by this Court in Rattan Arya & Ors.
vs State of Tamil Nadu & Anr.
, ; This Court stated: ".
Section 30(ii) of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 has to be struck down as violative of Article 14 of the Constitution.
A writ will issue declaring Section 30(ii) as unconstitutional".
As a result of this declaration of the constitutional invalidity of section 30(ii), the Act in question, according to the appellant, has to be read as if clause (ii) of section 30 was never brought into force, and consequently all residential buildings, which are older than five years (see clause (i) of section 30) and let out for whatever rent, came within the ambit of the Act.
Accordingly, although the suit was properly 315 instituted in the civil court without regard to the special provisions of the Act, it is now contended that as a result of the declaration by this Court of the constitutional invalidity of clause (ii) of section 30, which excluded from the purview of the Act any building or part thereof let out on a monthly rent of Rs. 400 the decree of the civil court, whatever be the merits of the findings on the respective contentions of the parties, has become null and void and of no effect whatever.
This contention of the appellant is based on the principle that any decree passed by an incompetent court is a nullity.
The appellant 's counsel relies on the principle reiterated by this Court in Sushil Kumar Mehta vs Gobind Ram Bohram ; and the earlier decisions referred to therein on the point.
In Kiran Singh & Ors.
vs Chaman Paswan & Ors., ; at 121, Venkatarama Ayyar, J. pointed out : ".
It is a fundamental principle well established that a decree passed by a court without jurisdiction is nullity, and that its invalidity could be set up whenever and where ever it is sought to be enforced or relied upon, even at the stage of execution and even in collateral proceedings.
A defect of jurisdiction, whether it is pecuniary or territorial, or whether it is in respect of the subject matter of the action, strikes at the very authority of the court to pass any decree, and such a defect cannot be cured even by consent of parties.
If the question now under consideration fell to be determined only on the application of general principles governing the matter, there can be no doubt that the District Court of Monghyr was coram no judice, and that its judgment and decree would be nullities." Dr Y.S. Chitale, appearing for the respondent, however, submits that the decree passed by the civil court in the present case is not a nullity for the Act has not barred the jurisdiction of the civil court, but only prohibits execution of a decree for eviction otherwise than in accordance with the relevant statutory provisions.
Such a decee, he says, is not void, but is merely under an eclipse, and will become executable as and when the bar is removed.
He refers to section 10 of the Act which reads : "section 10.
Eviction of tenants. (1) A tenant shall not be evicted whether in execution of a decree or otherwise except in accordance with the provisions of this section or sections 14 to 16: 316 . . . . . . . . .
Relying on certain observations of this Court in B.V. Patankar & Ors.
vs C.G.Sastry, ; in the context of the Mysore House Rent and Accommodation Control Order, 1948, Dr. Chitale submits that, like in that case, what is prohibited by section 10 in the present case is execution of the decree and the validity of the decree as such is not affected.
We do not agree.
Section 9 of the Mysore House Rent and Accommodation Control Order, 1948 reads : "section 9(1) A tenant in possession of a house shall not be evicted therefrom whether in execution of a decree or otherwise except in accordance with the provisions of this clause.
. . . . . . . . . " Section 16 of that Order reads: "section 16.
Nothing in this order shall prevent a landlord from filing a suit for eviction of a tenant before a competent civil court, provided that no decree for eviction of a tenant, passed by a civil court shall be executed unless a certificate to that effect is obtained from the Controller.
" Section 16 of the Mysore Order, 1948, thus specifically allows the institution of a civil suit for eviction of a tenant, although a decree passed by such a court for eviction cannot be executed without a certificate to that effect from the Controller.
Jurisdiction of the civil court is thus not only not barred but specifically preserved, except for the restriction imposed on the execution of decrees in matters of eviction.
On the other hand, such a provision is significantly absent in the enactment in question, The provisions of the Mysore Order considered by this court in B.V. Patankar & Ors.
vs C.S.Sastry, ; and those of the Act in question here are not in pari materia.
The observations of this Court relied on by Dr. Chitale are not, therefore, helpful in understanding the provisions in question in the instant case.
Section 10 of the Act, as seen above, prohibits eviction of a tenant whether in execution of a decree or otherwise except in accordance with the provisions of that section or sections 14 to 16.
These provisions as well as the other provisions of the Act are a self contained code, regulating the relationship of parties, creating special rights and liabilities, and, providing for determination of such rights 317 and liabilities by tribunals constituted under the statute and whose orders are endowed with finality.
The remedies provided by the statute in such matters are adequate and complete.
Although the statute contains no express bar of jurisdiction of the civil court, except for eviction of tenants "in execution or otherwise", the provisions of the statute are clear and complete in regard to the finality of the orders passed by the special tribunals set up under it and their competence to administer the same remedy as the civil courts render in civil suits.
Such tribunals having been so constituted as to act in conformity with the fundamental principles of judicial procedure, the clear and explicit intendment of the legislature is that all questions relating to the special rights and liabilities created by the statute should be decided by the tribunals constituted under it.
Although the jurisdiction of the civil court is not expressly barred the provisions of the statute explicitly show that, subject to the extra ordinary powers of the High Court and this Court, such jurisdiction is impliedly barred, except to the limited extent specially provided by the statute.
See in this connection the principle stated by this Court in Dhulabhai & Ors.
vs The State of Madhya Pradesh & Anr., ; See also Secretary of State vs Mask & Co., [1939 40] 1A 222 (PC): Raleigh Investment Co. Ltd. vs Governor General in Counsil.
[1946 47] IA 50 (PC) and Barraclogh vs Brown & Ors., Judged by this test, the jurisdiction of the civil court in respect of eviction of tenants is barred except to the extent and subject to the conditions prescribed under Section 10.
The second provision to section 10(1) reads: "Provided further that where the tenant denies the title of the landlord or claims right of permanent tenancy, the Controller shall decide whether the denial or claim is bona fide and if he records a finding to that effect, the landlord shall be entitled to sue for eviction of the tenant in a civil court and the Court may pass a decree for eviction on any of the grounds mentioned in the said sections, notwithstanding that the Court finds that such denial does not involve forfeiture of the lease or that the claim is unfounded".
What is stated in the second proviso to section 10(1) is the sole circumstance in which the civil court is invested with jurisdiction in matters of evictions.
But this jurisdiction cannot be invoked otherwise than as stipulated in the second proviso.
This means that the condition 318 precedent to the exercise of jurisdiction by a civil court is that the tenant should have denied the title of the landlord or claimed right of permanent tenancy and the Controller should, on such denial or claim by the tenant, reach a decision whether such denial or claim is bona fide.
Upon such decision, the Controller must record a finding to that effect.
In that event, the landlord is entitled to sue for eviction of the tenant in a civil court.
Where these conditions are satisfied, the civil court will have jurisdiction to pass a decree for eviction on any of the grounds mentioned, in section 10 or Sections 14 to 16, notwithstanding that the Court has found that the tenant 's denial of the landlord 's title does not involve forfeiture of the lease, or, his claim of right of permanent tenancy is unfounded.
Except to this limited extent, the jurisdiction of the civil court in matters of eviction of a tenant is completely barred and the jurisdiction in such matters is vested in the tribunals set up under the statute.
Significantly, the jurisdiction of the civil court can be invoked only where the controller comes to a decision, and records a finding, that the denial or claim by the tenant, as aforesaid, is bona fide.
If the Controller were to come to the opposite conclusion, no question of invoking the jurisdiction of the civil court would arise.
But the decision of the controller is concerned solely with the bona fides and not the correctness or validity, of the denial or claim, for these difficult questions of title are by the statute reserved for decision by the appropriate civil court which is the more competent forum in such matters (See the principle discussed in Magiti Sasamal vs Pandap Bissoi, In such an event, the civil court will become competent to pass a decree for eviction on any of the grounds mentioned in section 10 or sections 14 to 16.
On the other hand, if the decision of the controller is that the tenant 's denial or claim is not bona fide the jurisdiction of the civil court cannot be invoked by the landlord and the Controller will then be the competent authority to order eviction, after affording the parties a reasonable opportunity of being heard, on any one of the grounds specified under the statute, including the ground that the tenant has, without bona fide, denied the landlord 's title or claimed right of permanent tenancy.
What is significant is that the decision of the Controller, duly recorded by him, as regards the bona fide denial or claim by the tenant is the condition precedent to the invocation of power of the civil court.
Any suit instituted by the landlord for eviction of a tenant from a building falling within the ambit of the Act, otherwise.
Than as stipulated by the section, is, therefore, incompetent for lack of jurisdiction of the Court and any decree of the Court in such a suit is null and void and no effect.
319 In the present case, the procedure stipulated in the second proviso to section 10 has not been complied with.
At the time of the institution of the suit, the building in question did not come within the ambit of the Act, owing to the exclusionary provision contained in clause (ii) of section 30, but after leave to appeal was granted by this Court, the applicability of the Act was extended to the building by reason of the decision of this Court in Rattan Arya & Ors.
vs State of Tamil Nadu & Anr., ; declaring the invalidity of clause (ii) of section 30 on account of its inconsistency with Article 14 of the Constitution.
Whatever be the consequence of that declaration whether it has rendered the statutory provision null and void and of no effect.
See Behram Khurshed Pesikaka vs The State of Bombay, and Saghir Ahmed vs The State of U.P. and others; , or merely inoperative, unenforceable and dormant to be revitalised on subsequent removal of the constitutional ban.
See Bhikaji Marain Dhakras and Others vs The State of Madhya Pradesh and Another. ; and M.P.V. Sundararamier & Co. vs The State of Andhra Pradesh & Another, ; in either event, the Civil Court acting without the aid of the exclusionary provision in clause (ii) of section 30, during the period of invalidity, has become coram no judice and its proceedings resulting in the decree a nullity.
See Kiran Singh & Others vs Chaman Paswan & Others, ; at 121.
In the circumstances, we set aside the decrees of the courts below.
The appeal is allowed and the appellant is entitled to costs throughout.
R.P. Appeal allowed.
| IN-Abs | The respondent field a suit against the appellant for recovery of possession of a building on the ground of wilful deflault in payment of rent which was Rs. 900 per ;month.
The appellant denied the relationship of landlord and tenant, claiming himself as one of the "associates" or "co sharers" or "co owners" of the building.
The Munsif decreed the suit; and the decree was affirmed in appeal by the first appellate court as also by the High Court.
Hence the present appeal.
During the pendency of the present appeal, cl.
(ii) of section 30 of Tamil Nadu Buildings (Lease and Rent Control) Act, 1960, which exempted from application of the Act premises the monthly rent in respect of which exceeded Rs. 400, and on the basis of which the suit giving rise to the present appeal emanated, was struck down in a judgment by this Court.
** The appellant contended that as a result of the declaration by this Court of the constitutional invalidity of clause (ii) of section 30, of the Act, 311 which excluded from the purview of the Act any building or part thereof let out on a monthly rent of Rs. 400, the decree of the civil court became null and void and of no effect.
On behalf of the respondent it was submitted that the decree passed by the civil court was not a nullity for the Act did ;not bar the jurisdiction of the civil court but only prohibited execution of a decree of eviction otherwise than in accordance with the relevant statutory provision; and that such a decree was not void, but was merely under an eclipse, and would become executable as and when the bar is removed.
Allowing the appeal, this Court, HELD; 1.1 Section 10 of Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 prohibits jurisdiction of the civil court in respect of eviction of a tenant whether in execution of a decree or otherwise except in accordance with the provisions of that section and sections 14 to 16.
The sole circumstance and the condition precedent to the exercise of jurisdiction by a civil court as stated in second proviso to section 10(1) is that the tenant should have denied the title of the landlord or claimed right of permanent tenancy and the Controller, on such denial or claim by the tenant, reaches a decision and duly records a finding that such denial or claim was bona fide and only when these conditions are satisfied jurisdiction of the civil court can be invoked to pass a decree for eviciton on any of the grounds mentioned in section 10 or sections 14 to 16.
Except to this limited extend the jurisdiction of the civil court is completely barred and the same is vested in the tribunals set up under the Act.
Any suit instituted by a landlord for eviction of a tenant from a building falling within the ambit of the Act,otherwise than as stipulated by the section is, therefor, incompetent for lack of jurisdiction of the court and any decree of the court in such a suit is null and void and of no effect.
[317D E, G H; 318 D,G H] Sushil Kumar Mehta vs Gobind Ram Bohra, [1990] 1 SCC page 193, referred to.
1.2 The decision of the Controller is concerned solely with the bona fides, and not the correctness or validity, of the denial or claim, for these difficult questions of title are by the statute reserved for decision by the appropriate civil court which is the more competent forum in such matters.
[318D E] Magiti Sasamal vs Pandab Bissoi,[1962] 3 SCR 673, referred to.
1.3 If the decision of the Controller is that tenant 's denial or 312 claim is not bona fide, the jurisdiction of the civil court cannot be invoked by the landlord and the Controller will then be the competent authority to order eviction, after affording the parties a reasonable opportunity of being heard, on any one of the grounds specified under the statute, including the ground that the tenant has, without bona fide denied landlord 's title or claimed right of permanent tenancy.[318E F] 1.4 Although the Act contains no express bar of jurisdiction of the civil court, its provisions explicitly show that, subject to the extraordinary powers of the High Court, and this Court, such jurisdiction is statute for eviction of tenants "in execution or otherwise".
The provision of the Act are clear and complete in regard to the finality of the orders passed by the special tribunals set up under it, and their competence to administer the same remedy as the civil courts render in civil suits.
Such tribunals having been so constituted as to act in conformity with the fundamental principles of judicial procedure, the clear and explicit intendment of the legislature is that all questions relating to the special rights and liabilities created by the statute should be decided by the tribunals constituted under it.
[317A C] Dhulabhai &Ors.
vs The State of Madhya Pradesh & Anr.
, ; ; Secretary of State vs Mask & Co., [1939 40] IA 222 (PC, Raleigh Investment Co. Ltd. vs Governor General in Council, [1946] 47 IA 50 (PC and Barraclough vs Brown & Ors., , referred to.
In the instant case, the procedure stipulated in the second proviso to section 10 had not been complied with.
At the time of institution of the suite, the building in question did not come within the ambit of the Act, owing to the exclusionary provision contained in cl.
(ii) of section 30, but after leave to appeal was granted, the applicability of the Act was extended to the building by reason of the decision of this Court, declaring the invalidity of cl.
(ii) of section 30 on account of its inconsistency with Article 14 of the Constitution.
Whatever be the consequences of that declaration whether it has rendered the statutory provision null and void and of no effect, or, merely inoperative, unenforceable and dormant to be revitalised on subsequent removal of the constitutional ban in either event, the civil court acting without the aid of the exclusionary provision in cl.
(ii) of section 30, during the period of invalidity,had become coram non judice and its proceedings resulting in the decree a nullity.
[319A D] 313 Ratan Arya & Ors.
vs State of Tamil Nadu & Anr.
, ; , referred to.
Kiran Singh & Ors.
vs Chaman Paswan & Ors., ; relied on.
V.B. Patankar & Ors.v.
C.G. Sastry, ; , held inapplicable.
Behram Khurshed Pesikaka vs State of Bombay, ; Saghir Ahmad vs State of U.P. and Ors. ; ; Bhikaji Narain Dhakras & Ors.
vs The State of M.P.
The State of A.P. & Anr., ; , referred to.
|
ivil Appeal No. 1976 of 1991.
From the Judgment and Order dated 27.7.1987 of the Central Administrative Tribunal, Delhi in Regn.
No. O.A.No. 511 of 1986.
V.C. Mahajan, C.V.S. Rao, A.K. Srivastava and P.Parmeshwaran for the Appeallants.
Dr. D.C. Vohra, P.K. Bansal and S.K. Bisaria for the Respondent.
The Judgment of Court was delivered by SINGH, J. Leave granted.
This appeal is directed against the order of the Central Administrative Tribunal, Principal Bench, Delhi, quashing the order of the Ministry of Commerce dated 6.1.1986 rejecting the respondent 's representation against remarks awarded to him.
E.G. Nambudiri respondent is a Section Officer in the office of Chief Controller of Import and Exports, Ministry of Commerce.
By a 455 memorandum dated 7th May, 1985, the Director communicated adverse remarks awarded to the respondent for the year ending 1984.
These remarks were under: "1.
That you were not associated with the important work of the section such as the open house discussions, monthly analysis of the returns received from regional offices, complaints and port Officers meetings.
That the quality of performance and application of knowledge, delegated authority and conceptual and professional skills on the jobs is very poor.
That you had a casual attitude to the work assigned.
Your devotion to duty was insufficient.
That subordinates used to complain that they could not work under you, as you could not give proper guidance.
That your job did not involve contact with the public indications and your intellectual honesty and innovative opaity are average.
That nothing adverse has come to notice regarding your integrity.
That you were given advice/warning at various levels both orally and in writing but you did not react to these.
" The respondent made representation against the adverse remarks but the same was rejected by the order dated 6.1.1986.
The respondent, thereafter, made a memorial to the President of India against the adverse remarks, as a result of which the adverse remarks as contained in Item Nos.
1 to 4 as quoted above were expunged, whereas the remaining adverse entries were maintained.
The Govt '.s decision was communicated by a memorandum dated 14.8.1986.
But before the aforesaid decision of the Government partially expunging the adverse remarks could be communicated to the respondent, he filed a petition before the Central Administrative Tribunal challenging the order of the Ministry of Commerce dated 6.1.1986 rejecting his representation made against the adverse entries.
The respondent challenged the order dated 6.1.1986 rejecting his representation on the ground that it did not contain any reasons.
Plea of mala fide was also raised against the Joint Director, Ministry of Commerce, who had awarded the adverse 456 remarks to the respondent.
The Tribunal by its order dated 27.7.1987 quashed the Government Order as contained in the communication letter dated 6.1.1986 and also subsequent order dated 14.8.1986 on the ground that those orders were vitiated in law in the absence of reasons.
The Tribunal held that it was a basic principle of natural justice of every quasi judicial process, that order should contain reasons.
Arriving at a just decision is the aim of both quasi judicial as well as administrative inquiries, an unjust decision in an administrative enquiry may have more far reaching effect than in a quasi Judicial enquiry, therefore, it was necessary that in rejecting the representation against an adverse entry, reasons must be stated and in the absence of reasons the order would be arbitrary and liable to be quashed.
Placing reliance on a number of decisions of High Courts, the Tribunal held that a bald communication rejecting the representation made against the adverse entries does not meet the requirement of law.
The Tribunal further held that in the absence of reasons it would follow that the competent authority rejected the representation without applying its mind to the grounds raised in the representation.
Learned counsel for the parties conceded that there are no statutory rules framed under Article 309 of the Constitution regulating the award of entries in the character roll of a Central Government employee or providing for filing of representation against the adverse entries, or its disposal.
The entire field in this regard is regulated by administrative directions issued from time to time.
Under these directions the character roll of Government servants is required to be maintained wherein the entries are made every year by superior competent authority regarding the work, conduct and character of the Government servant.
These entries are confidential in nature, which contain the assessment of the work and conduct of the Government servant, reflecting his efficiency or defect in his work and conduct.
The confidential reports, contain general assessment of character, conduct and qualities of a Govt.
Servant which may include comments about his good work, drive, initiative, devotion to duty and integrity.
These entries also reflect the inefficiency, delay, lack of initiative, carelessness in handling the problems, or any defect in character and integrity.
These entries contain reference to any penalty which may have been awarded to a government servant in departmental proceedings.
These entries are important in nature as on the basis of these entries, a Government servant 's suitability to the office is assessed for the purposes of his confirmation, promotion and even for retention in service.
Any adverse remark awarded against a Government servant is 457 communicated to him to afford him opportunity of explaining the correct position by means of a representation.
The competent authority is required to examine the adverse remarks in consultation, if necessary, with the reporting officer and counter signing authority.
If the competent authority finds that the remarks are justified and there are no sufficient grounds for interference, he may reject the representation and the Government servant is informed accordingly.
If, however, the competent authority finds that the adverse remarks are incorrect, unfounded or unjustified, he would expunge the same and inform the Government servant.
The competent authority may having regard to the facts and circumstances of the cast modify, or tone down the remarks.
The administrative instructions issued by the Government do not require the competent authority to record reasons either in accepting or rejecting the representation of a Government servant, made against adverse entries.
Entries made in the character roll and confidential record of a Government servant are confidential and those do not by themselves affect any right of the Government servant, but those entries assume importance and play vital role in the matter relating to confirmation, crossing of efficiency bar, promotion and retention in service.
Once an adverse report is recorded, the principles of natural justice require the reporting authority to communicate the same to the Government servant to enable him to improve his work and conduct and also 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.
The superior authority competent to decide the representation is required to consider the explanation offered by the Government servant before taking a decision in the matter.
Any adverse report which is not communicated to the Government servant, or if he is denied the opportunity of making representation to the superior authority cannot be considered against him.
See: Gurdial Singh Fijji vs State of Punjab & Ors., In the circumstances it is necessary that the authority must consider the explanation offered by the Government servant and to decide the same in a fair and just manner.
The question then arises whether in considering and deciding the representation against report, the authorities are duty bound to record reasons, or to communicate the same to the person concerned.
Ordinarily, Courts and Tribunals, adjudicating rights of parties, are required to act judicially and to record reasons.
Where an administrative authority is required to act judicially it is also under an 458 obligation to record reasons.
But every administrative authority is not under any legal obligation to record reasons for its decision, although, it is always desirable to record reasons to avoid any suspicion.
Where a statute requires an authority though acting administratively to record reasons, it is mandatory for the authority to pass speaking orders and the absence of any statutory or administrative requirement to record reasons, the order of the administrative authority is not rendered illegal for absence of reasons.
If any challenge is made to the validity of an order on the ground of it being arbitrary or mala fide it is always open to the authority concerned to place reasons before the Court which may have persuaded it to pass the orders.
Such reasons must already exist on records as it is not permissible to the authority to support the order by reasons not contained in the records.
Reasons are not necessary to be communicated to the Government servant.
If the statutory rules require communication of reasons, the same must be communicated but in the absence of any such provision absence of communication of reasons do not affect the validity of the order.
On behalf of the respondent it was contended that principles of natural justice require the superior authority to record reasons in rejecting the Government servant 's representation made against the adverse remarks as the order of rejection affected the respondent 's right.
It is true that the distinction between judicial act and administrative act has withered away and the principles of natural justice are now applied even to administrative orders which involve civil consequences, as held by this Court in State of Orissa vs Dr. (Miss) Binapani Dei & Ors., ; What is a civil consequence has been answered by this Court in Mohinder Singh Gill & Ors.
vs The Chief Election Commissioner, New Delhi & Ors., Krishna Iyer, J. speaking for the Constitution Bench observed: "But what is a civil consequence, let us ask ourselves, by passing verbal booby traps? "Civil consequences" undoubtedly cover infraction of not merely property or personal rights out of civil liberties, material deprivations and nonpecuniary damages.
In its comprehensive connotation, everything that affects a citizen in his civil life inflicts a civil consequence.
" The purpose of the rules of natural justice is to prevent miscarriage of justice and it is no more in doubt that the principles of natural justice are applicable to administrative orders if such orders affect the right of 459 a citizen.
Arriving at the just decision is the aim of both quasi judicial as well as administrative enquire, an unjust decision in an administrative enquiry may have more far reaching effect than decision in a quasi judicial enquiry.
Now, there is no doubt that the principles of natural justice are applicable even to administrative inquiries.
See: A.K. Kraipak & Ors.
vs Union of India & Ors., The question is whether principles of natural justice require an administrative authority to record reasons.
Generally, principles of natural justice require that opportunity of hearing should be given to the person against whom an administrative order is passed.
The application of principles of natural justice, and its sweep depend upon the nature of the rights involved, having regard to the setting and context of the statutory provisions.
Where a vested right is adversely affected by an administrative order, or where civil consequences ensue, principles of natural justice apply even if the statutory provisions do not make any express provision for the same, and the person concerned must be afforded opportunity of hearing before the order is passed.
But principles of natural justice do not require the administrative authority to record reasons for its decision as there is no general rule that reasons must be given for administrative decision.
Order of an administrative authority which has no statutory or implied duty to state reasons or the grounds of it decision is not rendered illegal merely on account of absence of reasons.
It has never been a principle of natural justice that reasons should be given for decisions.
See: Regina vs Gaming Board for Great Britain ex p. Benaim and Khaida ; at 431.
Though the principles of natural justice do not require reasons for decision, there is necessity for giving reasons in view of the expanding law of judicial review to enable the citizens to discover the reasoning behind the decision.
Right to reasons is an indispensable part of a sound system of judicial review.
Under our Constitution an administrative decision is subject to judicial review if it affects the right of a citizen, it is therefore desirable that reasons should be stated.
There are however, many areas of administrative activity where no reasons are recorded or communicated, if such a decision is challenged before the Court for judicial review, the reasons for the decision may be placed before the court.
The superior authority while considering the representation of a Government servant against adverse remarks, is not required by law to act judicially, it is under no legal obligation to record or communicate reasons for its decision to the Government servant.
The decision, rejecting the representation does 460 not adversely affect any vested right of the Government servant nor does it visit him with any civil consequences.
In many cases having regard to infinite variations of circumstances, it may not be possible to disclose reasons for the opinion formed about the work and conduct or character of the Government servant.
In the instant case adverse remarks as contained in item Nos. 1 to 4 were expunged but those at serial numbers 5 and 6 were not expunged and the respondent 's representation to that extent was rejected.
On a careful scrutiny of the two remarks, it would appear that observation contained in Item No. 5 "that nothing adverse has come to notice regarding your integrity" is not adverse to the respondent 's work and conduct.
These remarks are neutral in nature, and they do not adversely comment upon the respondent 's work, conduct or character, though they are no commendatory in nature.
As regards the remarks at Serial No. 6, they are self explanatory, which show that inspite of oral and written warnings the respondent the respondent did not improve.
If the superior authority was not satisfied with the explanation of the respondent as cantained in his representation, what reasons could be stated, except that the authority was not satisfied with the explanation.
The superior authority was not obliged to write detail judgment or order giving detais of the warnings or the material on which he formed opinion.
There is no dispute that there is no rule or administrative order for recording reasons in rejecting a representation.
In the absence of any statutory rule or statutory instructions requiring the competent authority to record reasons in rejecting a representation made by a Government servant against the adverse entries the competent authority is not under any obligation to record reason.
But the competent authority has no licence to act arbitrarily, he must act in a fair and just manner.
He is required to consider the questions raised by the Government servant and examine the same, in the light of the comments made by the office awarding the adverse entries and the officer counter signing the same.
If the representation is rejected after its consideration in a fair and just manner, the order of rejection would not be rendered illegal merely on the ground of absence of reasons.
In the absence of any statutory or administrative provision requiring the competent authority to record reasons or to communicate reasons, no exception can be taken to the order rejecting representation merely on the ground of absence of reasons.
No order of an administrative authority communicating its decision is rendered illegal on the ground of absence of reasons ex facie and it is not open to the court to interfere with such orders merely on the ground of absence of any reasons.
However, it does not mean that the administrative authority 461 is at liberty to pass orders without there being any reasons for the same.
In governmental functioning before any order is issued the matter is generally considered at various levels and the reasons and opinions are contained in the notes on the file.
The reasons contained in the file enable the competent authority to formulate its opinion.
If the order as communicated to the Government servant rejecting the representation does not contain any reasons, the order cannot be held to be bad in law.
If such an order is challenged in a court of law it is always open to the competent authority to place the reasons before the Court which may have led to the rejection of the representation.
it is always open to an administrative authority to produce evidence alinude before the court to justify its action.
The President was under no legal obligation to record reasons in rejecting the respondent 's representation against the adverse remarks.
Consequently, the order of the president was not vitiated in law.
The Central Administrative Tribunal committed error in quashing the order of the president as well as the order of the Ministry of Commerce dated 6.1.1986.
Assuming that there was some defect in the order rejecting the respondent 's representation, the Tribunal was not justified in holding that the adverse entries awarded to the respondent should be treated as having been expunged.
We accordingly allow the appeal, set aside the order of the Tribunal dated 27.7.1987.
There will be no order as to costs.
T.N.A Appeal allowed.
| IN-Abs | The respondent, a Section Officer in the office of the Chief Controller of Import and Exports, was communicated adverse remarks for the year 1984.
He made a representation against the adverse remarks but the same was rejected by the Ministry of Commerce by its order dated 6.1.1986.
Thereafter he made a Memorial to the President and the Government by its order dated 14.8.86 partially expunged the adverse remarks.
The respondent filed a petition before the Central Administrative Trubunal challenging the order rejecting his representation on the ground that it did not contain any reasons.
The Tribunal by its order dated 27.7.87 quashed both the order dated 6.1.86 as well as 14.8.86 by holding that the orders were vitiated in law in the absence of reasons.
In appeal to this Court by the Union of India, it was contended on behalf of the respondent that the principles of natural justice require the superior authority to records reasons in rejecting the Government servant 's representation made against the adverse remarks as the order of rejection affected the respondent 's right.
Allowing the appeal, this Court, HELD: 1.
The superior authority while considering the represen 452 tation of a Government servant against adverse remarks, is not required by law to act judicially, it is under no legal obligation to record or communicate reasons for its decision to the Government servant.
There is no rule or administrative order for recording reasons in reacting such a representation.
In the absence of any statutory rule or statutory instructions requiring the competent authority to record reasons in rejecting a representation made by a Government servant against the adverse entries the competent authority is not under any obligation to record reasons.
The decision, rejecting such a representation does not adversely affect any vested right of the Government servant nor does it visit him with any civil consequences.
It does not mean that the competent authority has licence to act arbitrarily, he must act in a fair and just manner.
He is required to consider the questions raised by the Government servant and examine the same, in the light of the comments made by the officer awarding the adverse entries and the officer counter signing the Confidential Reports.
If the representation is rejected after its consideration in a fair and just manner, the order of rejection would not be rendered illegal merely on the ground of absence of reason.
In many cases having regard to infinite variations of circumstances it may not be possible to disclose reasons, for the opinion formed about the work and conduct or character of the Government servant.
However, it does not mean that the administrative authority is at liberty to pass orders without there being any reasons for the same.
In Governmental functioning before any orde is issued the matter is generally considered at various levels and the reasons and opinions are contained in the notes on the file.
The reasons contained in the file enable the competent authority to formulate its ipinion.
If the order as communicated to the Government servant rejecting the representation does not contain any reasons the order cannot be held to be bad in law.
If such an order is challenged in a court of law it is always open to the competent authority to place the reasons before the Court which may have led to the rejection of the representation.
It is always open to an administrative authority to produce evidence ali unde before the court to justify its action.
[459G H, 460A, E F H, 461A B] Gurdial Singh Fijji vs State of Punjab & Ors., , referred to. 2 The President was under no legal obligation to record reasons in rejecting the respondent 's representation against the adverse remarks.
Consequently, the order of the President was not vitiated in law.
The Central Administrative Tribunal committed error in quashing the order of the President as well as the order of the Ministry of Com 453 merce dated 6.1.1986.
Accordingly, the Tribunal 's order dated 27.7.1987 is set aside.
[461C E] 3.
The purpose of the rules of natural justice is to prevent miscarriage of justice and the principles of natural justice are applicable to administrative orders if such orders affect the right of a citizen.
Arriving at the just decision is the aim of both quasi judicial as well as administrative enquiry, an unjust decision in an administrative enquiry may have more far reaching effect than decision in a quasijudicial enquiry.
Generally, principles of natural justice require that opportunity of hearing should be given to the person against whom an administrative order is passed.
The application of principles of natural justice, and its sweep depend upon the nature of the right involved, having regard to the setting and context of the statutory provisions.
Where a vested right is adversely affected by an administrative order, or where civil consequences ensue, principles of natural justice apply even if the statutory provisions do not make any express provision for the same, and the person concerned must be afforded opportunity of hearing before the order is passed.
But principles of natural justice do not require the administrative authority to record reasons for its decision as there is no general rule that reasons must be given for administrative decision.
Order of an administrative authority which has no statutory or implied duty to state reasons or the grounds of its decision is not rendered illegal merely on account of absence of reasons.
It has never been a principle of natural justice that reasons should be given for decisions.
[458H, 459A D] State of Orissa vs Dr. (Miss) Binapani Dei & Ors., ; ; Mohinder Singh Gill & Ors.
vs The Chief Election Commissioner, New Delhi & Ors., ; A. K. Kraipak & Ors.
vs Union of India & Ors., and Regina vs Gaming Board for Great Britain ex.
p. Benaim and Khaida, ; , referred to.
Though the principles of natural justice do not require reasons for decision, there is necessity for giving reasons in view of the expanding law of judicial review to enable the citizens to discover the reasoning behind the decision.
Right to reasons is an indispensable part of a sound system of judicial review.
Under our Constitution an administrative decision is subject to judicial review if it affects the right of a citizen, it is therefor desirable that reasons should be stated.
[459F] 4.
Ordinarily, Courts and Tribunals, adjudicating rights of parties, are required to act judicially and to record reasons.
Where an 454 administrative authority is required to act judicially it is also under an obligation to record reasons.
But every administrative authority is not under any legal obligation to record reasons for its decision, although, it is always desirable to record reasons to avoid any suspicion.
Where a statute requires an authority though acting administratively to record reasons, it is mandatory for the authority to pass speaking orders and in the absence of reasons the order would be rendered illegal.
But in the absence of any statutory or administrative requirement to record reasons, the order of the administrative authority is not rendered illegal for absence of reasons.
If any challenge is made to the validity of an order on the ground of it being arbitrary or mala fide it is always open to the authority concerned to place reasons before the Court which may have persuaded it to pass the orders.
Such reasons must already exist on records as it is not permissible to the authority to support the order by communicated to the Government servant.
If the statutory rules require communication of reasons, the same must be communicated but in the absence of any such provision absence of communication of reasons do not affect the validity of the order.
[457H, 458A C]
|
ivil Appeal No. 3644 of 1989.
From the Judgment and Order dated 10.10.1988 of the Allahabad High Court in S.A. No. 194 of 1987.
Yoeshwar Prasad and Mrs. Shobha Dikshit for the Appellants.
471 B.D. Agarwala, Gopal Subramaniam, Ms. Bina Gupta, Arvind Verma, Ms. Monika Mohil, R.K. Srivastava and P. Misra for the Respondents.
The Judgment of the Court was delivered by THOMMEN, J.
This appeal is by defendants 1 and 2 in a suit for mandatory injunction.
The appellants are officers of Nandganj Sihori Sugar Co. Ltd., Rae Bareli, of which the third defendant, the U.P. State Sugar Corporation Ltd. (the second respondent herein) is the holding company.
The State of Uttar Pradesh (the third respondent) is the fourth defendant.
The plaintiff, Badri Nath Dixit (the first respondent), instituted the suit for mandatory injunction to enforce a contract alleged to have been entered into between the plaintiff and defendants 1 & 2 for appointment of the plaintiff to the post of Instrumentation Foreman in the defendants company and for consequential reliefs.
The plaintiff contended that he had been sponsored by the Chairman and Managing Director of the third defendant, by his letters dated 18 October, 1982 and 14 December, 1982 for appointment by defendants 1 & 2 as an Apprentice Engineer in terms of a scheme formulated by the Government of India, but such appointment was not made by defendants 1 & 2.
The plaintiff prayed for an injunction compelling defendants 1 & 2 to appoint him to the post of `Instrumentation Foreman ', which post, according to him, was at the time of the suit lying vacant.
In effect, what the plaintiff seeks is a decree to compel the specific performance of a contract of personal service.
Defendants 1 to 3 filed a joint written statement denying the allegations.
They stated that there was no contract, as alleged, and there was no vacancy for any post to which the plaintiff was qualified to be appointed.
They further stated that the plaintiff had been conditionally offered appointment as a Fitter Trade Apprentice, subject to his possessing the requisite qualifications and his selection by the Apprentice Board, Kanpur.
The plaintiff was not qualified and was, therefore, not selected.
They further contended that neither as an Apprentice nor as Instrumentation Foreman was the plaintiff qualified to be appointed.
The suit was dismised by the trial court.
However, on appeal by the plaintifif it was decreed by the learned Additional District Judge who directed defendant 1 to appoint the plaintiff to the post of Apprentice Engineer under the s cheme sponsored by the Government of India.
This decree was confirmed in appeal by the High Court by the impugned judgment.
The High Court further held 472 that the plaintiff was entitled to be appointed to the post of Instrumentation Foreman with effect from the date on which the former incumbent of that post had resigned.
Counsel for the appellants (defendants 1 & 2 ) submit that there is no evidence of the alleged contract having been entered into by the defendants with the plaintiff; nor is there any evidence of a scheme of the Government of India which entitled the plaintifif to be appointed to any post in the defendants ' company.
Counsel states that, in any view, the plaintiff was not qualified for appointment as an Apprentice and much less to the higher post of Instrumentation Foreman.
The plaintiff 's counsel, however, submits that the letters addressed by the third defendant in his capacity as Chairman and Managine Director of the holding company to defendants 1 & 2, the officers of the subsidiary company, made it obligatory on the part of the latter to appoint the plaintiff in terms of the Government of India scheme.
It was so found by the first Applleate Court and the High Court.
That finding is not liable to be impeached in the present proceeding.
He says that the defendants are, therefore, liable to be compelled by means of a mandatory injunction to honor the offer held out by them to the plaintiff, who is entitled to enforce the contract founded on such offer by seeking specific performance of it.
We are surprised that the first Appellate Court and the High Court should have proceeded on the assumption that any enforceable contract existed.
Neither from the plaint nor from the evidence is it possible to identify and concluded contract to which the plaintiff is a party or which the plaintiff can enforce.
The defendants deny the existence of any contract or any other relationships which gives the paintiff any cause of action against the defendants.
There is no specific plea or evidence as regards the particulars of the alleged scheme of the Government of India in terms of which the plaintiff seeks relief.
Whether it is a statutory scheme, and if so what are the provisions relied on by the plaintiff, and whether a duty is cast on the defendants and a benefit conferred on persons like the plaintiff, is neither pleaded nor spoken to inevidence.
Assuming that any such scheme existed or any such contract bound the parties, to have decreed a suit for specific performance of a contract of personal service on the facts alleged by the plaintiff, was to violate all basic norms of law.
Courts do not ordinarily enforce performance of contracts of a personal character, such as a contract of employment.
In the words of Jessel M.R.: 473 "The courts have never dreamt of enforcing agreements strictly personal in their nature, whether they are agreements of hiring and service, being the common relation of master and servant . " [Rigby vs Connol, , 487; see Cheshire, Fifoot and Furmston 's Law of Contract, 11th ed., p. 614].
" In the joint written statement filed by defendants 1 to 3, representing the holding and subsidiary companies, the alleged contract has been clearly denied.
We fail to see how the letters addressed by the Chairman of the holding company to the officers of the subsidiary company advising the appointment of the plaintiff to a post which he was found to be not qualified to hold could have resulted in any contract between the defendants of the one part and the plaintiff of the other part.
Assuming that the letters written by the Chairman of the holding company were in the nature of a direction which a subsidiary company was compelled to carry out, we fail to see how on the facts of this case, the plaintiff, who had no privity whatever to a contract, assuming there was a contract, could enforce any right under it.
In the first place, the letters sent by the Chairman of the holding company are merely in nature of an advise giving rise to no contractual relationship.
Even if the advise is taken to be of the character of a direction which the subsidiary company is bound to comply with, any obligation arising from such direction is not enforceable at the instance of a total stranger.
The Chairman was in no sense acting as a trustee of the plaintiff and no relationship of a fiduciary character whatever is alleged or proved to have existed between them.
Assuming that the then Chairman was personally interested in the plaintiff, that was not an interest which is legally enforceable against the defendants.
Such predilection on the part of the Chairman of a holding company, whatever be its impact on the subsidiary company, does not give rise to any actionable claim.
There is no evidence, whatsoever, as to the existence of a Government scheme, apart from a reference to it in the Chairman 's letter.
The plaintiff has not shed any light upon it.
The defendants have not admitted any such scheme.
Even if a scheme existed, there is no evidence that it was enforceable at the instance of a person seeking its benefit.
Nor has the plaintiff pleaded estoppel or adduced any evidence to support any such contention.
In the absence of any specific plea or evidence as regards the nature and other particulars of the scheme, it is preposterous that the courts below should have thought it fit to issue a mandatory injunction to compel the performance of the alleged contract of service in terms 474 of or pursuant to an unknown scheme.
Subject to certain well defined categories of exceptions, the law does not permit, and the does not contemplate, the enforcement of a contract of a personal nature by a decree for specific performance.
The facts of this case do not fall within the exceptions.
Assuming that the fact alleged by the plaintiff to be true as stated earlier, there is no evidence whatever to support them the plaintifif is not entitled to any relief other than damages in the even of his being in a position to prove that he has been damnified by reason of the defendants ' failure to carry out the obligations arising under what he calls a contract.
In Halsbury 's Laws of England, Fourth Edition, Volume 44, at page 407, it is stated: "407.
Contracts for personal work or services.
A judgment for specific performance of a contract for personal work or services is not pronounced, either at the suit of the employer or the employee.
The court does not seek to compel persons against their will to maintain continuous personal and confidential relations.
However, this rule is not absolute and without exception.
It has been held that an employer may be restrained from dismissing an employee in breach of contract if there is no loss of confidence between employer and employee or if (at least in a contract of employment to carry out a public duty) the employee has been dismissed in a manner which does not comply with statutory or contractual regulations governing dismissal.
No court may, whether by way of an order of specific performance of a contract of employment or an injunction restraining a breach or threatened breach of such a contract, compel an employee to do any work or attend at any place for the doing of any work.
This principle applies not merely to contracts of employment, but to all contracts which involve the rendering of continuous services by one person to another, such as a contract to work a railway line. " (emphasis supplied) As stated by this Court in Executive committee of Vaish Degree College, Shamli and Others vs Lakshmi and Ors., ; at 1020: 475 ". a contract of personal service cannot ordinarily be specifically enforced and a Court normally would not give a declaration that the contracts subsists and the employee even after having been removed from service can be deemed to be in service against the will and consent of the employer.
This rule, however, is subject to three well recognised exceptions; (i) where a public servant is sought to be removed from service in contravention of the provisions of Art.311 of the Constitution of India; (ii) where a worker is sought to be reinstated on being dismissed under the Industrial Law; and (iii) where a statutory body acts in breach or violation of the mandatory provisions of the statute." (emphasis supplied) A contract of employment cannot orodinarily be enforced by or against an employer.
The remedy is to sue for damages.
(See section 14 read with section 41 of the ; see Indian Contract and Specific Relief Acts, by Polock & Mulla, Tenth Edn., page 983).
The grant of specific performance is purely discretionary and must be refused when not warranted by the ends of justice.
Such relief can be granted only on sound legal principles.
In the absence of any statutory requirement, courts do not ordinarily force an employer to recruit or retain in service an employee not required by the employer.
There are, of course, certain exceptions to this rule, such as in the case of a public servant dismissed from service in contravention of Article 311 of the Constitution; reinstatement of a dismissed worker under the Industrial Law; a statutory body acting in breach of statutory obligations, and the like.
(B.N. Tiwari vs District Board, Agra, ; ; U.P. State Warehousing Corporation vs C.K. Tyagi, ; ; Executive Committee of Vaish Degree College, Shamli and Ors.
vs Lakshim Narain and Ors., ; see Halsbury 's Laws of England, Fourth Edn., Volume 44, paragraphs 405 to 420.) On the facts of this case, the High court was clearly wrong in issuing a mandatory injunction to appoint the plaintiff.
Even if there was a contract in terms of which the plaintiff was entitled to seek relief, the only relief which was available in law was damages and not specific performance.
Breach of contract must ordinarily sound in damages, and particularly so in the case of personal contracts.
Assuming that a contractual relationship arose consequent upon the letters addressed by the third defendant to the 1st defendant, the plaintiff was a total stranger to any such relationship, for, on the facts of this case, no relationship of a fiduciary character existed between the plaintiff and 476 the third defendant or other defendants.
Neither on principles of law or equity nor under any statute did the plaintiff acquire an enforceable right by reason of the letters exchanged between the first and third defendants.
The plaintiff had no privity of any kind to their relationship.
No collateral contract to which the plaintiff was a party did arise on the facts of this case.
At no time was the third defendant acting as an agent of the plaintiff.
There is no express or implied contract which is enforceable by the plaintiff.
(See Halsbury 's Laws of England., Fourth Edn., Volume 9, paragraphs 334 to 342).
The plaintiff 's counsel suggests that the claim is justifiable on the basis of legitimate expectations for appointment.
There is no specific plea or evidence to support any such contention.
Whatever expectations might have arisen from the letters of the third defendant, they could not have in law given rise to any right enforceable by specific performance.
For all these reasons we hold that the plaintiff 's suit for mandatory injunction, on the facts of the case, was rightly dismissed by the trial court and wrongly decreed by the first Appellate Court and the High Court.
We set aside the decrees of the High Court and the first Appellate Court and restore that of the trial court.
The plaintiff 's suit shall accordingly stand dismissed and the defendants ' appeal allowed with costs throughout.
N.P.V. Appeal allowed.
| IN-Abs | The first respondent instituted a suit for mandatory injunction to enforce a contract alleged to have been entered into between him and the appellant, officers of the second respondent Corporation, for appointment to the post of Instrumentation Foreman in the appellants ' company, and for consequential reliefs.
He contended that he had been sponsored by the Chairman and Managing Director of the second respondent Corporation, which was the holding company of the appellants 'company by his two letters for appointment as an Apprentice Engineer in terms of a scheme formulated by the Government of India.
The appellants and the second respondent denied the existence of any contract.
The trial court dismissed the suit.
However, on appeal, the first appellate court decreed the suit and directed the first appellant to appoint the first respondent to the post of Apprentice Engineer under the scheme sponsored by the Government of India.
This was confirmed, in appeal, by the High Court, which held the first respondent was entitled to be appointed to the post of Instrumentation Foreman with effect from the date on which the former incumbent of that post had resigned.
In the appeal before this Court, on behalf of the appellants it was contended that there was no evidence of the contract having been entered into by the appellant with the first respondent; nor was there any evidence of a scheme of the Government of India, which entitled him to be appointed to any post in the appellants ' company, and that, in any view, he was not qualified for appointment as an Apprentice, much less to the higher post of Instrumentation Foreman.
469 On behalf of the first respondent it was contended that the letters addressed by the second respondent in his capacity as Chairman, and Managing Director of the holding company, to the appellants, the officers of the subsidiary company, made it obligatory on the part of the latter to appoint him in terms of the Government of India scheme, as so found by both the first Appellate court and the high Court.
Allowing the appeal, this Court, HELD: 1.1 A contract of employment cannot ordinarily be enforced by or against an employer.
The remedy is to sue for damages.
The grant of specific performance is purely discretionary and must be refused when not warranted by the ends of justice.
Such relief can be granted only on sound legal principles.
In the absence of any statutory requirement, courts do not ordinarily force an employer to recruit or retain in service an employee not required by the employer.
There are, of course, certain exceptions to this rule, such as in the case of a public servant dismissed from service in contravention of Article 311 of the Constitution; reinstatement of a dismissed worker under the Industrial Law; a statutory body acting in breach of statutory obligations, and the like.
[475 E] B.N. Tiwari vs District Board, Agra, ; ; U.P. State Warehousing Corporation vs C.K. Tyagi, ; and Executive Committee of Vaish Degree College, Shamli and Ors.
vs Lakshmi Narain and Ors., ; , referred to.
Indian Contract and Specific Relief Acts, by Polock & Mulla, Tenth Edn., page 983 and Halsbury 's Laws of England.
Fourth Edn., Volume 44, paragraphs 405 to 420, referred to.
1.2 In the instant case, neither from the plaint nor from the evidence is it possible to identify and concluded contract to which the first respondent is a party or which he can enforce.
There is no specific plea or evidence as regards the particulars of the scheme of the Government of India in terms of which he seeks relief whether it is a statutory scheme, and if so, what are the provision relied on by him and whether a duty is cast on the appellants and a benefit is conferred on persons like the first respondent.
Assuming that such a scheme existed or any such contract bound the parties, it would be violative of all basic norms of law to decree a suit for specific performance of a contract of personal service.[472E G] 470 1.3 Courts do not ordinarily enforce performance of contracts of a personal character, such as a contract of employment.
Subject to certain well defined categories of exceptions, law does not permit, and the does not contemplate, the enforcement of a contract of a personal nature by a decree for specific performance.
The facts of the instant case do not fall within the exceptions.
[472A, 474D] Rigby vs Connol, , 487 and Executive Committee of Vaish Degree College, Shamli and Others vs Lakshmi Narain and Ors., ; at 1020, referred to.
Cheshire, fifoot and Furmston 's Law of Contract, 11th ed., p. 614 and Halsbury 's Laws of England Fourth Edition, Volume 44, at page 407, referred to.
1.4 Even if there was a contract in terms of which the first respondent was entitled to seek relief, the only which was available in law was damages and not specific performance.
Breach of contract must ordinarily sound in damages, and particularly so in the case of personal contracts.
Assuming that a contractual relationship arose consequent upon the letters addressed by the second respondent to the first appellant, the first respondent was a total stranger to any such relationship, for no relationship of a fiduciary character existed between the first respondent and the second respondent or the appellants.
Neither on principles of law or equity nor under any statute did the first respondent acquire an enforceable right by reason of the letters exchanged between the appellant and second respondent, nor did he have private of any kind to their relationship.
No collateral contract to which he was a party did arise on the facts of this case and at no time was the second respondent acting as his agent.
There is no express or implied contract which is enforceable by him.
[475 H, 476 B] In the circumstances, the decrees of the High Court and the first appellate Court are set aside and that of the trial court is restored.[476D]
|
ition No. 505 of 1990 etc.etc.
(Under Article 32 of the Constitution of India) R.N. Sachtey, S.K. Bhattacharya, S.C. Patel, Anip Sachthey, Mahabir Singh, R.K. Agnihotri, R.K. Kapur, Ms. Anil Katyar, N.D, Garg, C.M. Nayar (NP), H.S. Munjral, V. B. Joshi, V.K. Verma, S.K. Agnihotri, Sakesh Kumar, N. Ganapathy, M. Veerappa, ,Mrs. Rani Chhabra, M.N. Shroff, Indra Makwana, Sushil Kumar Jain, S.N. Aggarwal, Ms. Vijay Lakshmi Menon, C.V.S Rao, Aruneshwar Gupta and Sushil Kumar for the appearing parties.
The Judgement of the Court was delivered by RANGANATH MISHRA, CJ.
These are applications under Article 32 of the Constitution on behalf of petitioners who hold All India Tourist Permits granted under section 63(7) of the .
corresponding to section 88(9) of the .
The respondent States in these writ petitions are Haryana, Punjab, Gujarat, Rajasthan and Madhaya Pradesh .
There is a common Act the Punjab Motor Vehicles Taxation Act, 1924 which is applicable to the States Punjab and Haryana.
In each of the other States there is a similar separate legislation.
Under the taxing power in the several Act provision has been made for taxation as also for levy of additional tax.
It is the contention of the petitioners that the demand of additional tax is neither compensatory nor regulatory and , therefore, the levy is violative of Article 10(1)(g) read with Article 301 of the Constitution.
In regard to the State of Punjab and Haryana a special contention has been raised to effect that rule 8(v) of the Punjab Motor Vehicles Taxation Rules, 1925 provide total exemption from liability of tax if the vehicle is brought into Punjab and kept for use within the State for a period not exceeding 30 days in a year and it is the contention of the petitioners that since the vehicles registered outside the State of Punjab and Haryana are not kept within State for more than 30 days a year, the demand of tax in the face of rule 8(v) is contrary to law.
In the State of Gujarat, the Bombay Motor Vehicles Tax Act, 1958 has been amended, Section 3A of the Amending Act provides that: "3A (1) On and from the first day of April 1982 there shall 527 be levied and collected.
on all ominibuses which are exclusively used or kept for use in the State as contract carriages (hereinafter in this section referred to as the omnibus) a tax (hereinafter referred to as " the additional tax") in addition to the tax levied under section 3, at the rates fixed by the State Government by notification in the official Gazettte but not exceeding the maximum rates specified in the table below: Description of Maximum rate of an omnibus additional tax.
A. ordinary (i) Monthly rate of Rs. Omnibuses 240 per passenger permitted to be carried.
(ii) Weekly rate of Rs. 80 per passenger permitted to be carried.
(iii)Daily rate of Rs. 16 per passenger permitteed to be carried.
B. Luxury or tourist(i) Monthly rate of Rs. 360 Omnibuses per passenger permitted to be carried.
(ii)Weekly rate of Rs. 120 per passanger permitted to be carried.
(iii)Daily rate of Rs. 24 per passenger permitted to be carried.
The validity of levy of this type came up for consideration before this Court in the case of the Automobile Transport (Rajasthan) Ltd.v.
The State of Rajasthan and Ors., [1963] 1 S.C.R.491.
Four learned Judges who constitued the ,majority held that the provisions of Rajasthan Motor Vehicles Taxation Act, 1951 did not violate the provisions of Article 301 of the Constitution and the taxes imposed under the Act were compensatory or regulatory in nature which did not hinder the freedom of trade, commerce and intercourse assured by that Article, At page 586 of the Report the following test was indicated: 528 "It seems to us that working test for deciding whether a tax is compensatory or not is to inquire whether the trades people are having the use of certain facilities for the better conduct of their business and paying not patently much more than what is required for providing the facilities .
It would be impossible to judge the compensatory nature of a tax by meticulous test, and in the nature of things that cannot be done.
The same question came up for consideration before a Two Judge Bench in M/s. International Tourist Corporation and Ors.
vs State of Haryana and Ors,.
, ; This Court followed the decision referred to above of the larger group and observed: "There cannot be the slightest doubt that the State of Haryana incurs considerable expenditure for the maintanance of roads and providing facilities for the transport of goods and passengers within the State of Haryana .
The maintenance of highways other than the National Highways is exclusively the responsibility of the State Government.
While the maintenance of National Highwauyys is the responsibility of the Union Government, under section 5 of the National Highways Act, that very provision empowers the Central Government to direct that any function in relation to the developement and maintenance of a National Highway shall also be exercisable by the concerened State Government.
Section 6 further empowers the Central Government to give directions to the State Government as to the carrying out of the provisions of the Act and section 8 authorises the Central Government to enter into an agreement with the State Government in relation to the developement and maintenance of the whole or part of a National Highway situated within the State including a provision for sharing of expenditure.
Therefore, the State government is not altogether devoid of responsibility in the matter of developement maintenance of National Highway, though the primary responsibility is that of the Union Government.
It is under a statutory obligation to obey the directions given by the Central government with respect to the development and maintenance of National Highways and may enter into an agreement to share the expenditure.
That part of the Highway which is within a municipal area is excluded from the definition of a National 529 highway and therfore, the responsibility for the development and maintenace of that part of the Highway is certainly on the State Government and the Municipal Committee concerned.
Since the development and maintenance of the part of the Highway which is within a municipal area is equally inportant for the smooth flow of passengers and goods along the National Highway it has to be said that in developing and maintaining the Highway which is within a municipal area, the State Government is surely facilitating the flow of passengers and goods along the National Highway.
Apart from this , other facilities provided by State Government along all Highways including National Highways, such as lighting, traffic control, amenities for passengers, halting places for buses and trucks are available for use by everyone including those travelling along the National Highways .
It cannot, therfore, be said that the State Government confers no benefits and renders no service in connection with traffic moving along National Highways and is, therfore, not entitled to levy a compensatory and regulatory tax on passengers and goods carried on National Highways.
We are satisfied that there is sufficient nexus between the tax and passengers and goods carried on National Highways to justify the imposition.
" This view has been appoved in B.A. Jayaram and Ors.v.
Union of India and Ors.
,[1984] 1 S.C.C. 168.
That case also relates to permit holders under section 63(7) of the , and challenge of the present type was negatived in the case.
Law is settled that uphold levy of a tax of this type, what is necessary is existence of a nexus between the subject and the object of the levy and it is not necessary to show that the whole or substantial part of the tax collected is utilised.
We are, therefore, satisfied that the demand of tax is not open to challenge and the plea raised against the levy, whether of tax or additional tax, is not justified.under the taxing provision a statutory outer limit has been provided and the actual amount is left to be determined by the State Government by notification.
Obviously, discretion is left with the State Government to demand at a rate which in a given situation would be justified.
Once it is held that the tax is either compensatory or regulatory that forms the guideline for the State Government to keep in view to determine the rate at which within the upper limit fixed by law the demand has to be made.
The second contention which has been raised is applicable to the 530 State of punjab and Haryana and that depends upon the scope of rule 8(v) of the Punjab Motor Vehicles Taxation Rules,1925.
We note that the provision perscribes that a motor vehicle temporarily brought into Punjab and kept for use therein for a period not exceeding 30 days is entitled to total exemption and that is not in dispute before us.
Nor is it in dispute that the rule applies to Haryana .
The words 'Kept for use ' came up for consideration in the case of International Tourist Corporation (supra) where this Court held that once a vehicle is used within the State the Taxable event occured and it must be taken for use.
In State of Mysore and Ors.v.
M/s. T.V. Sundaram Iyengar & Sons(P) Ltd., ; the meaning of 'kept 'was examined at length and this Court held that vehicle in transit through the State of Mysore, or even making a necessary halt for a short interval, during transit , cannot be said to be a vehicle 'kept ' for use on roads in the State of Mysore.
The word 'kept ' has not been defined in the Act.
It must , tharefore, be interpreted in its ordinary popular sense consistent with the context.
The ordinary dictionary meaning of the word 'kept ' is 'to retain ', 'to maintain ' or 'cause to stay or remain in place ' or 'to detrain ' or 'to stay or continue in specified condition, position etc. ' It is something different from a mere state of transit or a course of journey through the State.
It is something more than a mere stoppage or halt for rest, food or refreshment, etc.
in the course of transit through the territory of the State.
That being the position rule 8(v) which uses the terms 'kept for use ' may not cover a case of bare transit and in terms of the rule exemption is available for vehicle kept upto 30 days in a year.
In that view of the matter tourist vehicles registered outside the State of Punjab and Haryana when brought into these two States for regular use and not by way of transit and when used for more than 30 days in a year would attract taxability otherwise the exemption provision in rule 8(v) would be available .
We have settled the legal position and we leave it to the individual taxing authorities as also the operators of tourist vehilces to work out their respective rights.
We would , therefore , like to clarify that the first aspect being a challenge against the taxing provision whether by way of tax or additional tax is rejected and the question of exigibility of tax in the States of Punjab and Haryana with reference to rule 8(v) of the Punjab Motor Vehicles Taxation rules, 1925 is left to be determined in individual cases as and when raised.
There would be no order as to costs.
G.N. Petitions deposed of.
| IN-Abs | Under the taxing power contained in the several Motor Vehicles Tax Acts in vogue in the Respondent States, provision has been made for taxation as also for levy of additional tax.
The petitioners who hold All India Tourist Permits challenged the constitution validity of the additional tax, on the ground that it was neither compensatory nor regulatory, and therefore was violative of Articles 19(1) (g) and 301 of the Constitution.
In respect of the State of Punjab and Haryana which have a common Act, an additional contention was raised to the effect that Rule 8(v) of the Punjab Motor Vehicles Taxation Rules 1925, provides total exemption from liability of tax if the vehicle was brought into the State and kept for use within the State for a period not exceeding 30 days in a year, and since the vehicles registered outside Punjab and Haryana States are not kept within the State for more than 30 days in a year, the demand of tax in the face of Rule 8(v) is contrary to law.
Disposing of the Writ Petitions, this Court, HELD : 1.
Law is settled that to uphold levy of tax as in the present case, what is necessary is existence of a nexus between the subject and 525 the object of the levy and it is not necessary to show that the whole or a substantial part of the tax collected is utilised.
Hence the demand of tax is not open to challenge and the plea raised against the levy, whether of tax or additional tax, is not justified.
Under the taxing provision a statutory outer limit has been provided and the actual amount is left to be determined by the State Government by notification.
Obviously, discretion is left with the State Government to demand at rate which in a given situation would be justified .
Once it is held that the tax is either conmpensatory or regulatory that forms the guideline for the State Government to keep in view to determine the rate at which within the upper limit fixed by law the demand has to be made.
{525E H} Automobile Transport (Rajasthan) Ltd. vs The State of Rajasthan and Ors , {1963} 1 SCR 491; M/s. International Tourist Corporation and Ors.
vs State of Haryana and Ors.
,[1981] 2 SCC 318 and B.A. Jayaram and Ors.
vs Union of India and Ors.
, [1984] SCC 168., relied on.
The word 'kept ' has not been defined in the Punjab Motor Vehicles Taxation Act, 1924.
It must , therefore, be interpreted in its ordinary popular sense consistent with the context.
The ordinary dictionary meaning of the word 'keep ' is 'to retain ', ' to maintain ' or 'cause to stay or remain in a place ' or 'to detain ' or 'to stay or continue in a specified condition , position etc.
, It is something different from a mere state of transit or a course of journey through the State .
it is something more than a mere stoppage or halt for rest, food or refreshment, etc.
in the course of transit through the territory of the State.
That being the position, rule 8 (v) which uses the term 'kept for use ' may not cover a case of bare transit and in terms of the rule exemption is available for vehicles kept upto 30 days in a year.
In that view of the matter tourist vehicles registered outside the State of Punjab and Haryana when brought into these two States for regular use and not by way of transit and when used for more than 30 days in a year would attract taxability; otherwise the exemption provision in rule 8(v) would be available [530C F] M/s. International Tourist Corporation and Ors.
vs State of Haryana and Ors.
, [ 1981] 2SCC 318 and State of Mysore and Ors.
vs M/s. T.V. Sundaram Iyengar & Sons (P) Ltd., ; , referred to.
The question of exigibility of tax in the State of Punjab and Haryana with reference to rule 8(v) of the Punjab Motor Vehicles Taxation Rules, 1925 is left to be determined in individual cases as and when raised.
[530G].
|
minal Appeal No. 187 of 1956.
Appeal by special leave from the judgment and order dated December 7, 1955, of the Patna High Court in Criminal Revision No. 875 of 1954, arising out of the judgment and order dated May 31, 1954, of the Court of the Additional Sessions Judge at Arrah in Criminal Appeal No. 293 of 1953.
B. K. Saran and K. L. Mehta, for the appellants.
B. H. Dhebar and T. M. Sen, for the respondent.
November 14.
The Judgment of the Court was delivered by GAJENDERAGADKAR, J.
This criminal appeal raises a short question about the construction of the word " detains " occurring in a. 498 of the Indian Penal Code.
It arises in ' this way.
The two appellants were charged before the trial magistrate under section 498 of the Code in that on or about October 27, 1952, at the village Mohania they wrongfully detained Mst.
59 466 Rahmatia, the legally married wife of the complainant Saklu Mian, when they knew or had reason to believe that she was the wedded wife of the, complainant and was under his protection, with intent to have illicit intercourse with her.
The prosecution case was that Mst.
Rahmatia had disappeared from her husband 's house on October 21, 1952; the complainant made J. search for her for several days but was not able to trace her whereabouts.
Ultimately he filed a complaint at the police station after he was informed by Shakoor Mian (P. W. 4) that he had seen the complainant 's wife at the house of the two appellants.
The complainant then went to the house of the appellants along with Shakoor Mian (P. W. 4), Musa Mian (P. W. 2) and Suleman Mian (P. W. 3); they saw the woman in the house of the appellants whereupon the complainant asked appellant No. I Alamgir to let his wife go with him but appellant No. I told him that he had married her and appellant No. 2 warned him to get away and said that, if he persisted, he would be driven out.
This story is corroborated by the three companions of the complainant.
The appellants denied the charge.
They pleaded that the complainant had not validly married the woman and that she had not been detained by them.
According to them, the woman was tired of living with the complainant and that she had voluntarily and of her free will come to stay with the appellants.
The learned trial magistrate believed the prosecution evidence, rejected the pleas raised by the defence, con victed the appellants of the charge framed and sentenced them to undergo simple imprisonment for two months each.
This older of conviction and sentence was challenged by the appellants by their appeal before the court of sessions.
The appellate court confirmed the conviction of the appellants but reduced their sentence from simple imprisonment for two months to a fine of Rs. 50 or in default simple imprisonment for one month each.
The appellants then moved the High Court at Patna in its revisional jurisdiction.
When the revisional application came to be heard before Choudhary, J., the learned judge thought 467 that the appellate court should not have reduced the sentence imposed on the appellants by the trial magistrate and so he issued a notice against the appellants calling upon them to show cause why their sentence should not be enhanced.
This notice and the main revisional application were ultimately heard by Ramaswamy and Imam, JJ., who confirmed the order of conviction and enhanced the sentence against both the appellants by ordering that each of them should suffer six months ' rigorous imprisonment.
An application made by the appellants to the High Court for a certificate to appeal to this Court was rejected.
The appellants then applied for and obtained special leave to appeal to this Court.
That is how this appeal has come before us for final disposal.
On behalf of the appellants, Mr. B. K. Saran has urged that the evidence in the case clearly shows that the woman was dissatisfied with her husband and had left his house and protection voluntarily and of her free will.
If having thus left the house she came to stay with the appellants and they allowed her to stay with them, it cannot be said that they have detained her within the meaning of section 498.
According to him, the word " details " used in section 498 must necessarily imply that the woman detained is unwilling to stay with the accused and has been compelled so to stay with him against her will, and desire.
It is difficult to imagine that, if a woman is willing to stay with a person, it can be said that the person has detained her.
That is not the plain grammatical meaning of the word " detains ".
It is this argument which calls for our consideration in the present appeal.
At the outset it would be relevant to remember that section 498 'occurs in Ch.
XX of the Indian Penal Code which deals with offences.
relating to marriage.
The provisions of section 498, like those of section 497, are intended to protect the rights of the husband and not those of the wife.
The gist of the offence under section 498 appears to be the deprivation of the husband of his custody and his proper control over his wife with the object of having illicit intercourse with her.
In this connection it would be material to compare and contrast the 468 provisions of section 498 with those of section 366 of the Code.
Section 366 deals with cases where the woman kidnapped or abducted is an unwilling party and does not respond to the criminal intention of the accused.
In these cases the accused intends to compel the victim afterwards to marry any person against her will or to force or seduce her to illicit intercourse.
In other words section 366 is intended to protect women from such abduction or kidnapping.
If it is shown that the woman who is alleged to have been abducted or kidnapped is a major and gave her free consent to such abduction or kidnapping, it may prima facie be a good defence to a charge under section 366.
On the other hand section 498 is intended to protect not the rights of the wife but those of her husband; and so prima facie the consent of the wife to deprive her husband of his proper control over her would not be material.
It is the infringement of the rights of the husband coupled with the intention of illicit intercourse that is the essential ingredient of the offence under a. 498.
Incidentally it may be pointed out that the offence under section 498 is a minor offence as compared with the offence under section 366.
The policy underlying the provisions of section 498 may no doubt sound inconsistent with the modern notions of the status of women and of the mutual rights and obligations under marriage.
Indeed Mr. Saran vehemently argued before us that it was time that sections 497 and 498 were deleted from the Penal Code.
That, however, is a question of policy with which courts are not concerned.
It is no doubt true that if the words used in a criminal statute are reasonably capable of two constructions, the construction which is favourable to the accused should be preferred; but in construing the relevant words, it is obviously necessary to have due regard to the context in which they have been used; and, as we will presently point out, it is the context in which the word" detains " has been used in section 498 that is substantially against the construction for which the appellant contends.
Section 498 provides: 469 " Whoever takes or entices away any woman who is and whom he knows or has reason to believe to be the wife of any other man, from that man, or from any person having the care of her on behalf of that man, with intent that she may have illicit intercourse with any person, or conceals or detains with that intent any such woman, shall be punished with imprisonment, of either description for a term which may extend to ' two years, or with fine, or with both.
It would be noticed that there are three ingredients of the section.
The offender must take or entice away or conceal or detain the wife of another person from such person or from any other person having the care of her on behalf of the said person.
He must know or has reason to believe that the woman is the wife of another person; and the taking, enticing, concealing or detaining of the woman must be with intent that she may have illicit intercourse with any person.
It is clear that if the intention of illicit intercourse is not proved the presence of the first two ingredients would not be enough to sustain the charge tinder section 498.
It is only if the said intention is proved that it becomes necessary to consider whether the two other ingredients are proved or not.
It is plain that four different kinds of cases are con templated by the section.
A woman may be taken away or enticed away or concealed or detained.
There is no doubt that when the latter part of the section refers to any such woman, it does not mean any woman who is taken or enticed away as described in the first part, but it refers to any woman who is and whom the offender knows or has reason to believe to be the wife of any other man.
It is not seriously disputed that in the first three classes of cases the consent of the woman would not matter if it is shown that the said consent is induced or encouraged by the offender by words or acts or otherwise.
Whether or not any influence proceeding from the offender has operated on the mind of the woman or has co operated with or encouraged her inclimations would always be a question of fact.
If, on evidence, the court is satisfied that the act of the woman in 470 leaving her husband was caused either by the influence of allurement or blandishments proceeding from the offender, that may be enough to bring his case within either of the three classes of cases mentioned by section 498.
In this connection, when the consent or the free will of the woman is relied upon in defence, it is necessary to examine whether such alleged consent or free will was not due to allurement or blandishments or encouragement proceeding from the offender.
It is, however, urged that, when the latter part of the section speaks of detention, it must prima facie refer to the detention of a woman against her will.
It may be conceded that the word " detains" may denote detention of a person against his or her will ; but in the context of the section it is impossible to give this meaning to the said word.
If the object of the section had been to protect the wife such a construction would obviously have been appropriate; but, since the object of the section is to protect the rights of the husband, it cannot be any defence to the charge to say that, though the husband has been deprived of his rights, the wife is willing to injure the said rights and so the person who is responsible for her willingness has not detained her.
Detention in the context must mean keeping back a wife from her husband or any other person having the care of her on behalf of her husband with the requisite intention.
Such keeping back may be by force; but it need not be by force.
It can be the result of persuasion, allurement or blandishments which may either leave caused the willingness of the woman, or may have encouraged, or co operated with, her initial inclination, to leave her husband.
It seems to us that if the willingness of the wife is immaterial and it cannot be a defence in cases falling tinder the first three categories mentioned in section 498, it cannot be treated as material factor in dealing with the last category of case of detention mentioned in the said section.
Therefore, we are satisfied that the High Court was right in holding that the charge of detention has been proved against appellant No. I inasmuch as both the courts of facts have found that 471 he had offered to marry Mst.
Rahmatia and thereby either persuaded or encouraged her to leave her husband 's house.
It may be that Rahmatia was dissatisfied with her husband and wanted voluntarily to leave her husband; but, on the evidence, it has been held that she must have been encouraged or induced not to go back to her husband because she knew that she would find ready shelter and protection with appellant No. 1 and she must have looked forward to marry him.
In fact appellant No. 1 claims to have married her.
Thus there can be no doubt that he intended to have illicit sexual intercourse with her.
That is the effect of concurrent findings of fact recorded against appellant No. I ; and it would not be open to him to challenge their correctness or propriety in the present appeal.
This section has been the subject matter of several judicial decisions and it appears that, except for a few notes of dissent, there is a fair amount of unanimity of judicial opinion in favour of the construction which we feel inclined to place on the word " detains " in section 498.
It is, however, true that the relevant decisions, to some of which we would presently refer disclose a striking difference of approach in dealing with questions of fact.
It would appear that though the relevant portion of the section has received the same construction in dealing with same or similar facts, the learned judges have differed in their conclusion as to whether the accused person had been guilty of conduct which would bring his case within section 498.
This, however, is a difference in the method of approaching evidence and assessing its effects.
It would be futile and even improper to consider whether a particular conclusion drawn from the specific evidence adduced in the case was right or not.
What is important in such cases is to see how the section has been construed and, as we have just indicated, in the matter of construction there appears a fair amount of unanimity.
Let us now refer to some of the decisions cited before us.
In 1868, the Madras High Court held in Sundara Dass Tevan (1) that depriving the husband of his (1) (1868) IV Mad.
H.C.R. 20.
472 proper control of his wife for the purpose of illicit inter course is the gist of the offence just as it is the offence of taking away a wife under the same section; and a detention occasioning such deprivation may be brought about simply by the influence of allurement and blandishment.
On the facts of the case, however, the court was not satisfied that the accused bad offered any such allurement or blandishment and so the order of conviction passed against the appellant was quashed.
It appears that the construction put by the Madras High Court on section 498 in this case has been generally accepted in the said High Court (Vide: Ramaswamy Udayar vs Raju Udayar (1) ).
The Bombay High Court has taken the same view in Emperor vs Jan Mahomed (2).
It was held by the High Court that the offence contemplated by & 498 is complete if it appears that the accused went away with the woman in such a manner as to deprive her husband of the control of his wife; the fact that the woman accompanied the accused of her own free will does not diminish the criminality of the act.
Even in this case, the court was unable to discover any evidence, direct or indirect, about the intention of the accused or any allurement or blandishment offered by him and so the order of conviction passed against the accused was set aside.
This question came to be considered by the said High Court again in Emperor vs Mahiji Fula (3).
Mr. Justice Broomfield who delivered the main judgment of the Bench has expressed the view that " the word I detains ' means, by deprivation, and according to the ordinary use of the language I keeps back" '; and he adds that ,there may be various ways of keeping back.
It need not necessarily be by physical force.
It may be by persuasion or, as the Court " (Madras High Court) " has observed in this particular case" (Sundara Dass Thevan (4)) " by allurement or blandishment ".
On the facts, however, it appeared to the trial court that the conduct of the accused did not bring his case within the mischief of section 498.
The wife of the complainant had been taken (1) A.I.R. (1953) Mad. 333.
(3) Bom.
88, 92.
(2) (1902) IV Bom.
L. R. 435.
(4) (1868) IV Mad. H. C. R. 20.
473 away by her brother and she was subsequently married by natra marriage to the accused.
The complainant learnt about this incident and went to the accused to ask him to allow his wife to go back to him.
On seeing the complainant and his friends the accused came out with a dharia and threatened the complainant and his companions who then re turned to their village.
The conduct of the accused ' when the complainant approached him, it was said, cannot necessarily indicate that the accused had detained the woman.
This was the ' view taken by the trial court who acquitted the accused ; on appeal the High Court saw no reason to differ and so the order of acquittal was confirmed by it.
Divatia, J., who delivered the concurring judgment apparently differed from Broomfield, J., in regard to the construction of the word " detains ".
He agreed that the scheme of section 498 showed that though the woman may be perfectly willing to go with the man the offence of taking or enticing away would occur because it simply consists of taking or enticing away a woman without anything more; but according to him, in the latter part of the section, which speaks of concealing or detaining the woman, the woman would be detained only if she is prevented from going in any quarter where she wants to go.
In our opinion, this construction is not sound.
It is not easy to see how the act of concealing the woman would necessarily import any considerations of the consent of the woman ; besides, according to Divatia, J., himself, the woman 's Consent would be irrelevant in the cases of taking or enticing her away.
If that be so, it is difficult to make her consent relevant and decisive in dealing with the cases of detention.
Unfortunately the learned judge does not appear to have appreciated the fact that the primary and the sole object of section 498 is to protect the husband 's rights and not the rights of the wife.
If it is shown that the woman 's inclination to stay away from her husband was either instigated or encouraged by the offender, she can be said to have been detained or kept away from her husband within the meaning of the section 60 474 though at the time of the detention she may be willing to say with the offender.
The same view has been expressed by Broomfield and Sen, JJ., in Emperor vs
Ram Narayan Baburao Kapur (1) and by Beaumont C.J., and Sen, J., in Mahadeo Rama vs Emperor (2).
We may point out that in both these cases the court was have detained the woman.
The Calcutta High Court appears to have put a similar construction on the word "detention".
In Prithi Missir vs Harak Nath Singh (3) it has been held by the said High Court that " the word ' detention ' is ejusdem generis with enticement and concealment.
It does not imply that the woman is being kept against her will but there must be evidence to show that the accused did something which had the effect of preventing the woman from returning to her husband ".
On the merits, however, the court held that the learned trial magistrate had not come to any definite finding of fact.
In fact it did not appear that the accused was keeping the complainant 's wife as his mistress; and on the whole, the court was not satisfied that the accused was responsible for the conduct of the complainant 's wife for leaving her husband 's house and so detention was held not proved against the accused.
In Mabarak Sheikh vs Ahmed Newaz (4) the same High Court held that there can be no detention of a woman within the meaning of section 498, second part, if the woman is an absolutely free agent to go away from the person charged whenever she likes.
It appears that the learned judges were inclined to hold that there could be no detention if the woman was an absolutely free agent to go away from the person charged whenever she likes to do so; and in support of this view they have referred to some of the decisions which we have already considered.
With respect, it appears that the effect of the earlier decisions has not been properly considered and the findings of fact recorded in the said decisions are assumed to lend colour to, and modify, the construction of the section (1) (3) I.L.R. (2) A.I.R. (1943) Bom. 179.
(4) 475 adopted by them.
Besides, the relevant observations appear to be obiter because, on the facts, it was found in this case that the woman was not a free agent and so the charge against the accused under section 498 was held established.
In Bipad Bhanjan Sarkar vs Emperor (1), Henderson and Khundkar, JJ., have considered the word " detains " in the same manner as we have done.
However, as in many other cases, in this case also, the court found that there was absolutely nothing to show that the accused had done anything which could bring his case within the mischief of section 498.
The Patna High Court, in Banarsi Raut vs Emperor (2), has held that providing shelter to a married woman is such an inducement as to amount to detention within the meaning of section 498.
This case shows that where a married woman was found living in the house of the accused for some time and sexual intercourse between them had been established, the court was inclined to draw the inference that there was per suasion or inducement of the woman as would come within the meaning of the word " detention ".
This is a case on the other side of the line where on facts the inference was drawn against the accused.
The Lahore High Court has taken a similar view as early as 1913 in Bansi Lal vs The Crown (3 ).
The court has held that where the accused had provided a house for the woman where she stayed after deserting her husband under the protection of the accused as his mistress, it was active conduct on his part which was sufficient to bring him within the terms of section 498.
In 1939, however, a Division Bench of the Lahore High Court has taken a contrary view in Harnam Singh vs Emperor (4).
In this case the revisional application filed by Harnam Singh against his conviction under section 498 was first argued before Din Muhammad, J., who referred it to a Division Bench because he thought that the question of law raised was of some importance.
In his referring judgment the learned judge mentioned some of the relevant decisions to which his attention was drawn and indicated his own view that (1) I.L.R. (3) (1913) XlV Punjab L. R. 1066.
(2) A.I.R. (1938) Pat.
(4) A.I.R. (1939) Lah.
476 the word " detains " would naturally imply some overt act on the part of the person who detains in relation to the person detained.
He thought that mere blandishment would not constitute any relevant factor in the matter of detention.
The matter was then placed before a Division Bench consisting of Young, C. J., and Blacker, J. Unfortunately the judgment of the Division Bench does not discuss the question of the construction of section 498 ; it merely records the conclusion of the court in these words: " In our opinion, the word " detains " clearly implies some act on the part of the accused by which the woman 's movements are restrained and this again implies unwillingness on her part.
Detention cannot include persuasion by means of blandishments or similar inducements which would leave the woman free to go if she wished ".
The learned judges also added that they were of the opinion that the word " detains " cannot be reasonably construed as having reference to the husband.
In our opinion, these observations do not correctly represent the true purport and effect of the provisions of section 498.
The position, therefore, is that, on the findings of fact made by the lower courts against appellant No. I it must be held that he has been rightly convicted under section 498.
That takes us to the question of sentence imposed on him by the High Court in its revisional jurisdiction.
We are satisfied that the High Court was not justified in directing appellant No. I to suffer rigorous imprisonment for six months by way of enhancement of the sentence.
It is unnecessary to emphasise that the question of sentence is normally in the discretion of the trial judge.
It is for the trial judge to take into account all relevant circumstances and decide what sentence would meet the ends of justice in a given case.
The High Court undoubtedly has jurisdiction to enhance such sentence under section 439 of the Code of Criminal Procedure; but this jurisdiction can be properly exercised only if the High Court is satisfied that the sentence imposed by the trial judge is unduly lenient, or, that, in passing the order of sentence, the trial judge had manifestly failed to consider the 477 relevant facts.
It may be that the High Court thought that the appellate order passed by the Sessions Judge modifying the original sentence was wrong, and in that sense, the issue of notice under section 439 of the Code of Criminal Procedure against appellant No. 1 to show cause why his sentence should not be enhanced may have been justified; but, in enhancing the sentence, the High Court should, we think, have restored the sentence passed by the trial judge himself.
It is true that, in enhancing the sentence, the High Court has observed that " women in this country, whether chaste or unchaste, must be protected and that it is the duty of the court to see that they are given sufficient protection ".
We are inclined to think that the considera tion set out in this observation is really not, very helpful and not decisive because, as we have already observed, section 498 does not purport to protect the rights of women but it safeguards the rights of husbands.
Besides, in the present case, it is clear that Mst.
Rahmatia, who is a woman of loose moral character, was dissatisfied with the complainant, who is her second husband, and was willing to marry appellant No. 1.
In such a case, though appellant No. I is guilty under section 498, it is difficult to accept the view of the High Court that the sentence of two months ' simple imprisonment imposed on him, by the trial court was so unduly or manifestly lenient as not to meet the ends of justice.
It would not be right for the appellate court to interfere with the order of sentence passed by the trial court merely on the ground that if it had tried the case it would have imposed a slightly higher or heavier sentence.
We would accordingly modify the order of sentence passed against appellant No. 1 by reducing it to that of simple imprisonment for two months.
The case of appellant No. 2 is clearly different from that of appellant No. 1.
The findings of fact recorded by the courts below do not implicate appellant No. 2 in the act of persuasion or offering blandishments or inducements to Mst.
Rahmatia.
The only evidence against this appellant is that when the complainant went to take away his wife appellant No. 2 threatened 478 him.
The record shows that appellant No. 2 is the brother of appellant No. 1; and, if knowing that Rahmatia had married his brother, appellant No. 2 told the complainant to walk away, that cannot legally justify the inference that he must have offered any inducement, blandishment or allurement to Rahmatia for leaving the protection of her husband and refusing to return to him.
Indeed the courts below have not considered the case of this appellant separately on its own merits at all.
In our opinion, the conviction of appellant No. 2 is not supported by any evidence on the record.
The result is the appeal preferred by appellant No. 2 is allowed, the order of conviction and sentence passed against him is set aside and he is ordered to be acquitted and discharged.
Appeal of appellant No. 1 dismissed.
Appeal of appellant No. 2 allowed.
| IN-Abs | One R, the wife of S, disappeared from her husband 's house.
She was traced to the house of the appellants, A and his brother B.
When S went there and asked A to let his wife go with him A told him that he had married her and B threatened S and asked him to go away.
The appellants were charged under section 498 Indian Penal Code for detaining R when they knew or had reason to believe that she was the wedded wife of S, with intent to have illict intercourse with her.
The appellants pleaded that R was not validly married to S and that she had not been detained by them inasmuch as she was tired of living with S and had voluntarily and of her free will come to stay with them.
The Magistrate found the appellants guilty, convicted them and sentenced them to undergo simple imprisonment for two months each.
On appeal the Sessions Judge confirmed the conviction but reduced the sentence to a fine of Rs. 50/ each.
The appellants filed a revision before the High Court.
The High Court issued a notice of enhancement and after hearing the appellants dismissed the revision and enhanced the sentence to rigorous imprisonment for six months each.
Held, that detention in section 498 means keeping back a wife from her husband or any other person having the care of her on behalf of her husband.
Such keeping back may be by force; but it need not be by force.
It can be the result of persuasion, allurement or blandishments which may have either caused the willingness of the woman, or may have encouraged, or co operated with, her initial inclination to leave her husband.
The object of the section is to protect the rights of the husband and it cannot be any defence to the charge to say that, though the husband has been deprived of his rights, the wife is willing to injure the said rights and so the person who is responsible for the willingness has not detained her.
A was rightly convicted as the charge of detention was proved against him on the findings of the Courts below that he had offered to marry R and had thereby either persuaded or encouraged her to leave her husband 's house.
But the charge was not made out against B as it was not proved that he had offered any inducement, blandishment or allurement to R for leaving the protection of her husband and for refusing to return to him.
465 Sundara Dass Teva, (1868) IV Mad. H. C. R. 20; Ramaswamy Udayar vs Raju Udayar, A. 1.
R. ; Emperor vs Jan Mohomed, (1902) IV Bom.
L.R. 435; Broomfield, J., in Emperor vs
Mahiji Fula, Bom.
88, Emperor vs Ram Narayan Baburao Kapur, ; Mahadeo Rama vs Emperor, A.I.R. (1943) Bom.
179; Prithi Missir vs Harak Nath Singh, I.L.R. ; Bipad Bhanjan Sarkar vs Emperor, I.L.R. ; Banarsi Raut vs Emperor, A.I.R. (1938) Pat.
432 and Bansi Lal vs The Crown, (19I3) Punj.
L.R. 1066, approved.
Divatia, J., in Emperor vs Mahiji Fula, Bom.
88, Mabarak Sheikh vs Ahmed Newaz, and Harnam Singh vs Emperor, A.I.R. (1939) Lah.
295, disapproved.
Held further, that the High Court was not justified in en hancing the sentence to six months rigorous imprisonment, and it should have only restored the sentence passed by the trial Court.
The question of sentence is normally in the discretion of the trial Court and the High Court can enhance the sentence only if it is satisfied that the sentence imposed by the trial Court is unduly lenient, or, that in passing the order of sentence, the trial Court had manifestly failed to consider the relevant facts.
The sentence of two months simple imprisonment imposed by the trial Court was not so unduly or manifestly lenient as not to meet the ends of justice.
|
ivil Appeal Nos.
998 999 of 1991.
From the Judgment and Order dasted 1.3.1990 of the Allahabad 480 High Court in C.M.W.P. Nos. 11465 & 3085 of 1987.
Satish Chandra, and Prashant Bhushan for the Appellants.
V.C.Mahajan, S.D. Sharma, S.N.Terdol and Mrs.Suri for the Respondents.
The Judgment of the Court was delivered by YOGESHWAR DAYAL, J.
1.
Civil Appeal Nos.
998 and 999 of 1991 have been filed against the judgment of the Division Bench of the Allahabad High Court dated 1st March, 1990 whereby the Allahabad High Court dismissed the writ petitions filed by the District Exhibitors Association, Muzaffarnagar and others as well as some other Theatres upholding the Notification dated 30th April, 1986 issued by the Central Government under Section 5 read with sub section (1) of Section 7 of the Employees ' Provident Funds and Miscellaneous Provisions Act,1952 (hereinafter referred to as`the Provident Funds Act ').The main judgment was delivered by the High Court in the Civil Miscellaneous Writ Petition filed on behalf of Shakti Theatre, Civil Lines, Bijnore, which was followed in the petition filled by the District Exhibitors Association Muzaffarnagar and others and some other writ petitions.
Before us also the Notification dated 30th April, 1986 of the Goernment of India, Ministry of Labour, amending the Employees ' provident Funds Scheme, 1952 (For short `Scheme ') issued under the Provident Funds Act has been challenged.
2.The Provident Funds Act came into force on 14th March,1952.
The preamble of the Act states that it is an Act to provide for the institution of provident funds, family pension fund and deposit linked insurance fund for employees in factories and other establishments.
The Act by Section 1(3) makes it applicable to every factory referred to in clause (a) and also to any other establishment referred to in clause (b) employing twenty or more persons or class of such establishments which the Central Government may, by Notification in the Official Gazette, specify in that behalf.
The scheme under Section 5 alongwith other schemes were issued in 1952.
The Provident Funds Act by Notification of the Government of India issued on 31st July, 1961, under Section 1(3) was made applicable to cinema theatres employing twenty or more persons.
The (hereinafter referred to as `the Cinema 481 Theatre Workers Act) received the assent of the President on 24th December, 1981, and was published in the Gazette on the same day.
The Cinema Theatre Workers Act came into force with effect from 1st October, 1984.
The preamble of the Act says that it is to provide for the regulation of the conditions of employment of certain cine workers and cinema theatre workers and for matters connected therewith.
Section 2(a) defines `cinema theatre ' to mean a place which is licensed under of the , or under any other law for the time being in force in a State for the exhibition of cinematograph films.
Section 24 enacts: "The provisions of the Employees~ Provident Funds and Miscellaneouss Provisions Act, 1952, as in force for the time being, shall apply to every cinema theatre in which five or more workers are employed on any day, as if such cinema theatre were an establishment to which the aforesaid Act had been applied by a notification of the Central Government under the proviso to sub section (3) of section 1 thereof, and as if each such worker were an employee within the meaning of that Act." 4.
The Notification of the Government of India amending the Scheme under the Provident Funds Act was issued in conformity with Section 24 of the Cinema Theatre Workers Act.
The impugned Notification dated 30th April, 1986 is being reproduced for facility of under standing the submissions made on behalf of the appellants: `NOTIFICATION G.S.R.
In exercise of the powers conferred by Section 5 read with Sub section (1) of Section 7 of the (19 of 1952), the Central Government hereby makes the following Scheme further to further to amend the Employees ' Provident Funds Scheme, 1952 namely; 1.
This Scheme may be called the Employees ' Provident Funds (Amendment) Scheme, 1986.
In the Employees ' Provident Funds Scheme in paragraph 1, in sub paragraph (3), in clause (b) after item (XOV11) the following item shall be added, namely: 482 `(XOV11) as respect the Cinema Theatre employing 5 or more workers as specified in Section 24 of the Cine WorKers and Cinema Theatres Workers (Regulation of Employment) Act, 1981 (50 of 1981) be deemed to have come into force with effect from the 1st day of October, 1984 '.
(No. S 35016/1/86 SS11) Sd/ A.K.Bhattari Under Secretary 30.4.1986 ' 5.
A perusal of the Notification shows that the Scheme has been retrospectively made applicable in respect of cinema theatres employing five or more workers as specified in Section 24 of the Cinema Theatre Workers Act with effect from 1st October , 1984 though the Notification was issued on 30th April, 1986.
1st October, 1984 is also the date of coming into force of Cinema Theatre Workers Act.
Before the High Court the main arguments raised by the appellants were: a) that the Notification dated 30th April 1986 was ultra vires of the provisions of the provident Funds Act inasmuch as the Central Government could not extend the scheme to an establishment which is neither an industry nor a notified establishment under Section 3(b) of the Provident Funds Act; b) that there was no liability under the scheme framed by the Central Government to make contribution towards the provident fund in respect of the employees who ceased to be a cinema employee before the Provident Funds Act came into force from 30th April,1986:and c) that the demand of the Provident Funds Commissioner from the employers about the arrears of contribution even for prediscovery period i.e. the date from which the scheme became applicable to employers, who were called upon to pay contribution by notice, leads to hardship and injustice and, therefore, violates Article 14 of the Constitution.
483 7.
The High Court while dealing with these submissions took the view that Section 24 of the Cinema Theatre Workers Act has applied the provisions of the Provident Funds Act to every cinema theatre in which five or more workers were employed on any day, as if such cinema theatre were an establishment to which the provisions of the Provident Funds had been applied by a Notification of the Central Government under the proviso to clause (b) of sub section (3) of Section 1 of the Provident Funds Act.
The High Court, in view of the averments made in the counter affidavit filed on behalf of the respondent as well as on the interpretation of the scheme, took the view that only those employees who were in employment on 30th April, 1986 and had not ceased working in a cinema in respect of whom the benefit was being claimed, could be entitled to get the benefit of the scheme.
In the notice the demand of contribution was sought under the Sachem in respect of the employees working on 30th April, 1986 with effect from Ist October, 1984.
The High Court took the view that since the demand was made for the employers ' contribution in respect of the employees who were working on 30th April, 1986, it was wrong to argue that the scheme was being incorrectly applied.
Those workers who had left the cinema and had ceased to be its workers on 3oth April, 1986, would certainly not be entitled to any benefit under the scheme.
Regarding the challenge to the demand by the Provident Fund Commissioner from the employers about the arrears of contribution, the High Court felt that there was no substance in that argument.
Before us Mr. Satish Chandra, learned counsel for the appellants submitted: i) that the Provident Funds Act would not be applicable so long as the Notification as required by the proviso to Section 1(3)(b) has not been issued; ii) even if we assume that Section 24 of the Cinema Theatre Workers Act takes the place of a Notification being issued as contemplated by the proviso to Section 1(3)(b) of the Provident Funds Act, an express Notification under Section 5 is required to make the scheme applicable to those establishments and without such a Notification the scheme will not be applicable: iii) that under Section 6 of the Provident Funds Act, the liability is only fixed for employers; share of contribution towards Provident Funds and there is no liability fixed to 484 pay employees ' share, and unless paragraph 30 of the scheme is made applicable there is no inability of the employers to pay employees ' share; iv) that the Notification is very harsh and unjust as the appellants are being asked to pay the contribution of the employees share to the Provident Fund Account retrospectively without the corresponding right of employer to recover it from the wages of employees.
It may be mentioned that the vires of any of the provision of the Provident Funds Act or the Scheme has not been challenged before us.
As would be seen from the preamble of the Provident Funds Act, the Act is intended for the benefit of the employees.
It is also so clear from its objects and reasons extracted below: "The question of making some provision for the future of the industrial worker after he retires or for his dependants in case of his early death, has been under consideration for some years.
The ideal way would have been provision through old age and survivors ' pensions as has been done in the industrially advance countries.
But in the prevailing conditions in India the institution of a pension scheme cannot be visualised in the near future.
Another alternative maY be for provision of gratuities after a prescribed period of service.
The main defect of a gratuity scheme, however, is that amount paid to a worker or his dependants would be small, as the worker, would not himself he making any contribution to the fund.
Taking into account the various difficulties, financial and administrative, the most appropriate course appears to be the institution compulsorily of contributory provident funds in which both the worker and the employer would contribute.
Apart from other advantages, there is the obvious one of cultivating among the workers a spirit of saving something regularly.
The institution of a provident fund of this type would also encourage the stabilisation of a steady labour force in industrial centres".
It is a legislation for the benefit of the worker sections of the society and the beneficial legislation is made applicable to cinema theatres if it employs five or more workers.
The classification of cinema theatres as a separate class for purposes of coverage under the Provi 485 dent Funds Act has also not been challenged.
Further no challenge has been made to any of the provision of the Cinema Theatre Workers Act.
Before we deal with the submissions of learned counsel for the appellants we may notice the relevant part of provisions of the Provident Funds Act and the Scheme.
Section 1(3) of the Provident Funds Act reads as follows: "Subject to the provisions contained in Section 16, it applies (a) to very establishment which is a factory engaged in any industry specified in Schedule 1 and in which twenty or more persons are employed, and (b) to any other establishment employing twenty or more persons or class of such establishments which the Central Government may, by notification in the Official Gazette, specify in this behalf: Provided that the Central Government may, after giving not less than two months ' notice of its intention so to do, by notification in the Official Gazette, apply the provisions of this Act to any establishment employing such number of persons less than twenty as may be specified in the notification.
Section 5(1) and (2) provide as follows: "5.
Employees ' Provident Fund Schemes (1) The Central Government may, by notification in the Official Gazette, frame a Scheme to be called the Employees ' Provident fund Scheme for the establishment of provident funds under this Act for employees or for any class of employees and specify the establishments or class of establishments to which the said Scheme shall apply and there shall be established as soon as may be after the framing of Scheme, a Fund in accordance with the provisions of this Act and the Scheme.
(1 A). . . (1 B). . . 486 (2) A Scheme framed under sub section (1) may provide that any of its provisions shall take effect either prospectively or retrospectively on such date as may be specified in this behalf in the Scheme" 14.
The relevant part of Section 6 reads as follows: "6.
Contributions and matters which may be provided for in Schemes The contribution which shall be paid by the employer to the Fund shall be eight and one third per cent of the basic wages, dearness allowance and retaining allowance, if any, for the time being payable to each of the employees, whether employed by him directly or by or through a contractor, and the employee 's contributions shall be equal to the contribution payable by the employer in respect of him and may, if any employee so desires, b an amount exceeding eight and one third per cent of his basic wages, dearness allowance and retaining allowance, if any, subject to the condition that the employer shall not be under an obligation to pay any contribution over and above his contribution payable under this section.
Para 1(1) and relevant parts of paras 1(3)(a) and 1(3)(b) of the Scheme read as follows: "1.
Short title and application (1) This Scheme may be called the Employees ' Provident Funds Scheme 1952.
(2). . . (3)(a) Subject to the provisions of Sections 16 and 17 of the Act, this Scheme shall apply to all factories and other establishments to which the Act applies or is applied under sub section (3) or sub section 4(1) of Section 1 or Section 3 thereof: . . . (b) Provisions of this Scheme shall . . . . (xcviii) as respect the cinema theatres employing 5 or more workers as specified in Section 24 of the Cine Workers and Cinema Theatres Workers (Regulations of Employment) Act, 1981 (50 of 1981) be deemed to have come into force with effect from the 1st day of October, 1984." 487 16.
The relevant parts of paras 30 and 32 of the Scheme read as follows: "30.
Payment of contribution (1) The employer shall, in the first instance, pay both the contribution payable by himself in this Scheme referred to as the employer 's contribution and also, on behalf of the member employed by him directly or by or through a contractor, the contribution payable by such member 's in the Scheme referred to as the member 's contribution.
(2). . . (3) It shall be the responsibility of the principal employer to pay both the contribution payable by himself in respect of the employees directly employed by him and also in respect of the employees employed by or through a contractor and also administrative charges.
Explanation . . . . 32.
Recovery of a member 's share or contribution (1) The amount of a member 's contribution paid by the employer or a contractor shall, notwithstanding the provisions in this Scheme or any law for the time being in force or any contract to the contrary, be recoverable by means of deduction from the wages of the member and otherwise: Provided that no such deduction may be made from any wage other than that which is paid in respect of the period or part of the period in respect of which the contribution is payable: . . . .
Provided further that where no such deduction has been made on account of an accidental mistake or a clerical error, such deduction may, with the consent in writting of the Inspector, be made from the subsequent wages.
(2). . . (3). . . 17.
A combined reading of Section 6 of the Provident Funds Act 488 and paras 30 to 32 of the Scheme is that the contribution to the Provident Fund is to be 12 1/2% of the basic wages and dearness allowance, that is to be borne equally by the employer and the employee and that the employer is to pay the whole of it, half on his account, and the other half on account of the employee and he is to recoup himself by deducting it from the wages of the employee.
A bare reading of Section 24 of the Cinema Theatre Workers Act shows that it has fulfilled the purpose of the Notification which the Central Government could have issued under Section 1(3)(b) of the Provident Funds Act read with the proviso.
Therefore, no further Notification as contemplated by Section 1(3)(b) of the Provident Funds Act was necessary.
Section 24 has taken the place of the Notification contemplated by Section 1(3) (b) of the Provident Funds Act read with the proviso thereto.
Therefore the Provident Funds Act became applicable to the theatres who employ five or more workers with effect from 1st October, 1984.
Again in view of Section 6 of the Provident Funds Act, noticed earlier, the employers became liable to pay their contribution to the fund as soon as the Act came into force i.e. w.e.f. 1st October, 1984.
It is also clear from reading of Section 5 of the Provident Funds Act that before the Provident Funds Scheme can become applicable, the Central Government has to frame a Scheme and also specify the establishment to which the said Scheme shall apply.
Till the impugned Notification dated 30th April, 1986 was published the Scheme was not applicable to such cinema theatres who are employing less than 20 employees and it became applicable to cinema theatres employing five or more workers only when the impugned Notification was issued under Section 5 of the Provident Funds Act.
It is only by the impugned Notification that the scheme was amended so as to be made applicable in respect of cinema theatres employing five or more persons.
Without such a Notification the Scheme would not have became applicable.
The Notification on the face of it shows that the Scheme has been made applicable to the cinema theatres covered by the Notification with effect from 1st October, 1984.
This could be done in view of not only the provisions of Section 5(2) of the Provident Funds Act but also in view of Section 7(1) of the Provident Funds Act.
Both these provisions confer express powers of making the Scheme applicable retrospectively.
The question however, is whether by making the Scheme with retrospective operation, the employer could be saddled with the 489 liability to pay employees ' contribution w.e.f.
1st October, 1984 and if not from what other date? The answer to the question turns upon the implementation of the Scheme and in particular the giving effect to paras 30 and 32 of the Scheme.
Para 30 provides that the employer shall, in the first instance, pay both the contributions payable by himself and also the contribution payable by the employees.
It shall be the responsibility of the principal employer to pay both the contributions payable by himself and also in respect of the employees directly employed by himself and also in respect of the employees directly employed by himself and also in respect of the employees employed by him or through a contractor.
Para 32 confers upon the employer the right to recover the employees contribution that has been paid by him under para 30.
That could be recovered by the employer by means of deduction from the wage of the employees who are liable to pay.
First proviso to para 32(1) however, limits that liability in expressly stating that no such deduction may be made from any wage other than that which is paid in respect of the period of which the contribution, is payable.
It is obvious from paras 30 and 32 that the employer has to pay the contribution of the employee 's share but he has a right to recover that payment by deducting the same from the wages due and payable to the employees.
It is significant to note that the deduction is not from the wages payable for any period, but only from the wages for the period in respect of which the contribution is payable and no deduction could be made from any other wages payable to the employees.
In other words, the payment of employees contribution by the employer with the corresponding right to deduct the same from the wages of the employees could be only for the correct period during which the employer has also to pay his contribution.
In the instant case for the period from 1st October, 1984 up to the date of the impugned Notification the employer has paid the full wages to the employees since during that period, there was no scheme applicable to his establishment.
By retrospectively applying the scheme, could he be asked to pay the employees contribution for the period antecedent to the impugned notification.
We think not.
The Act and the Scheme neither permit any such payment nor deduction.
He cannot be saddled with the liability to pay the employees ' contribution for the retrospective period, since he has no right to deduct the same from the future wages payable to the employees.
Mr. Vikram Mahajan, learned counsel for the Central Government submitted that it may be possible for the employers to make deduction from subsequent wages of the workmen with the consent in writing of the Inspector as required under the third proviso to 490 para 32(1) of the Scheme.
This submission cannot be accepted since the third proviso could be taken advantage of by the employer only where no deduction has been made from the wages of the employees due to accidental mistake or clerical error when the scheme is operative.
Such deduction which has not been made by accidental mistake or clerical error, could be made from the subsequent wages with the consent in writing of the Inspector concerned.
The case with which we are concerned is not covered by the third proviso.
It is not the case of any body that the employer could not make deduction from the wages of the employees by accidental mistake or clerical error.
The employer indeed could not have made the deduction prior to the impugned notification dated 30th April, 1986 since the Scheme was not then applicable.
The Scheme has been given retrospective effect w.e.f.
1st October, 1984.
The employer therefore, cannot take the benefit of the third proviso to para 32(1) for deducting the employees contribution in their wages payable in future.
Reference was also made to the decisions of this Court in M/s. Orissa Cement Ltd. vs Union of India, [1962] (Suppl) 3 SCR 837 and in M/s. Lohia Machines Ltd., vs Union of India and Ors., [1965]2 SCR 686 by learned counsel for the appellants in support of his contentions.
It will be noticed that the Supreme Court in Orissa Cement Ltd. [1962] (Suppl) 3 SCR 837 was concerned with the validity of certain Notifications which were struck down as infringing Article 19(1)(g) of the Constitution.
The decision, has no applicability to the facts of the present case.
Equally, the decision, in Lohia Machines Ltd., has also no applicability to the facts of the present case.
In the result and for the foregoing reasons, we allow the appeals as indicated above by setting aside the judgment of the High Court.
We declare that the appellants are not liable to pay the employees contribution for the period from 1st October, 1984 to 30th April, 1986.
In the facts and circumstances of the case, however, we make no order as to costs.
G.N. Appeals partlly allowed.
| IN-Abs | On 30.4.1986, a Notification was issued by the Government of India amending the scheme under the in conformity with Section 24 of the Cine Workers and Cinema Theatre Workers (Regulation of Employment) Act, 1981, with retrospective effect from 1.10.1984.
The effect of the amendment was to extend the benefit of the Provident Funds Act and the Scheme thereunder to the Cine Workers and Cinema theatre workers.
The appellants challenged the validity of the Notification before the High Court by way of writ Petitions, contending that the said Notification was ultra vires the provisions of the Provident Fund Act since the Central Government could not extent the scheme to an establishment which is neither an industry nor a notified establishment under Section 3(b) of the Act and there was no liability under the scheme to make contribution towards Provident Fund in respect of the employees who ceased to be Cinema workers before 30.4.1986.
It was further contended that calling upon the employers to contribute arrears from the date the scheme was made applicable led to hardship and injustice and hence violative of Article 14 of the Constitution of India.
The Writ Petitions were dismissed by the High Court.
In their appeals to this Court, the appellants contended that so long as the Notification as required by the proviso to Section 1(3)(b) of the Provident Funds Act has not been issued, the Act cannot be made applicable to them and even assuming that Section 24 of the Cinema Theatre Workers Act takes the place of the required Notification, an express notification under Section 5 would be required.
It was also contended 478 that under Section 6 of the Provident Funds Act the liability is fixed only for employers 'share of contribution and not the employees 'share, and since paragraph 30 of the Provident Fund Scheme was not made applicable, there arose no liability of the employers to pay employees 'share and as the appellants were being asked to pay the contribution of the employees ' share retrospectively without the corresponding right of employer to recover it from the wages of employees, it was harsh and unjust.
On behalf of the Respondents, it was contended that it might be possible for the appellants to make deduction from subsequent wages of workmen with the consent of the Inspector as required under the third proviso to para 32(1) of the Provident Fund Scheme.
Partly allowing the appeals, this Court, HELD: 1.
Section 24 of the Cine Workers and Cinema Theatre Workers (Regulation of Employment) Act, 1981 has fulfilled the purpose of the Notification which the Central Government could have issued under Section 1(3)(b) of the Provident Funds Act read with the proviso.
Therefore, no further Notification as contemplated by Section 1(3)(b) of the Provident Funds Act was necessary.
Section 24 has taken the place of the Notification contemplated by Section 1(3)(b) of the Provident Funds Act read with the proviso thereto.
Therfore, the Provident Funds Act became applicable to the theatres who employ five or more workers with effect from 1st October, 1984.
Again in view of Section 6 of the Provident Funds Act, the employers became liable to pay their contribution to the fund as soon as the Act came into force i.e.w.e.f.1st October, 1984.
[488B D] M/s. Orissa Cement Ltd. vs union of India, [1962] (Suppl) 3 SCR 837 and M/s. Lohia Machines Ltd.v.
Union of India and Ors., , distinguished.
It is only by the Notification dated 30.4.1986 that the Provident Funds Scheme was amended so as to be made applicable in respect of the cinema theatres employing five or more persons.
Without such a Notification the Scheme has been made applicable to the cinema theatres covered by the Notification with effect from 1st October, 1984.
This could be done in view of not only the provisions of Section 5(2) of the Provident Funds Act but also in view of Section 7(1) of the Provident Funds Act.
Both these provisions confer express powers of making the 479 Scheme applicable retrospectively.[488E G] 3.
It is obvious from paras 30 and 32 of the Provident Funds Scheme that the employer has to pay the contribution of the employee 's share, but he has a right to recover that payment by deducting the same from the wages due and payable to the employees.
It is significant to note that the deduction is not from the wages payable for any period but only from the wages for the period in respect of which the contribution is payable and no deduction could be made from any other wages payable to the employees.
In other words, the payment of employees 'contribution by the employer with the corresponding right to deduct the same from the wages of the employees could be only for the current period during which the employer has also to pay his contribution.
[489A E] 4.
In the instant case, for the period from 1st October, 1984 up to the date of the Notification i.e.30th April 1986 the employer has paid the full wages to the employees since during that period, there was no scheme applicable to his establishment.
By retrospectively applying the scheme, he could not be asked to pay the employees ' contribution for the period antecedent to the notification.
The Act and the Scheme neither permit any such payment nor deduction .
The employer cannot be saddled with the liability to pay the employees ' contribution for the retrospective period, since he has no right to deduct the same from the future wages payable to the employees.
[489F G] 5.
The third proviso to paragraph 32(1)of the Provident Funds Scheme could be taken advantage of by the employer only where no deduction has been made from the wages of the employees due to accidental mistake or clerical error when the scheme is operative.
Such deduction which has not been made by accidental mistake or clerical error, could be made from the subsequent wages with the consent in writing of the Inspector concerned.
The present case is not covered by the third proviso.
The employer could not have made the deduction prior to the notification dated 30th April, 1986 since the Scheme was not applicable then.
The Scheme has been given retrospective effect w.e.f.
1st October, 1984.
The employer, therefore, cannot take the benefit of the third proviso to para 32(1) for deducting the employees 'contribution in their wages payable in future.[489H;490A C]
|
(CRL.) No. 133 of 1991.
(Under Article 32 of the Constitution of India).
R.K. Jain, Ravi Prakash, Mrs. Swati Kapoor Ms. Abha R. Sharma and Ms. Rajni K. Prasad for the Petitioner.
464 Altaf Ahmed, Additional Solicitor General, Ms. Kusum Choudhary, C. Ramesh and Ms. A. Subhashini for the Respondents.
The Judgment of the Court was delivered by SHARMA, J.
On the basis of a letter received from a prisoner detained in Alipore Central Jail, Calcutta, drawing the attention of this Court to the long wait of Daya Singh, the petitioner convicted for the murder of late Chief Minister of Punjab Pratap Singh Kairon, lodged at present in Rohtak Jail Haryana, pending the execution of his death sentence, this case was registered as a writ petition and was listed before us on 27.3.1991.
All the relevant facts were not available from the letter but from the Office Report it appeared that the case of the condemned prisoner had earlier come to this Court.
We directed the Registry to examine the earlier files and place before us the relevant details.
In the meantime we stayed the execution of the death sentence.
The learned carousel for the State of Haryana was also informed about the case.
As directed, the case was placed before us again on Monday, the 1st April, 1991, when Ms. Kusum Chaudhary appeared on behalf of State of Haryana and orders were passed for notice to the counsel representing the Union of India.
Having heard about the case, the convict Daya Singh engaged his own counsel to represent him and to press this writ petition and accordingly Mr. R.K. Jain appeared for him on 5.4.1991.
We have, in the circumstances, treated this application as one directly by Daya Singh.
The Union of India is represented by Additional Solicitor General of India.
The case was further adjourned at the request of the counsel and was ultimately heard on 16.4.1991.
Mr. Jain has contended that if the relevant circumstances of this case are examined in the light of the decisions of this Court, the conslusion is irresistible that there has been inexcusable delay in executing the death sentence of the petitioner, and the sentence should, therefore, be quashed by this Court under Article 32 of the Constitution.
The petitioner was tried for the murder of Sardar Pratap Singh Karion which took place in 1965 and was convicted and sentenced to death by the trial court on 13.12.1978.
The sentence was confirmed by the High Court on 22.3.1980.
His Special leave petition was dismissed by this Court on 21.8.1980 and a further prayer for review was rejected on 2.9.1981.
He filed mercy petitions before the Governor and the President of India, which were also rejected.
465 Seveal orders of stay were passed from time to time, the details whereof are not very significant in view of the rejection by this Court of an earlier application under Article 32, being Writ Petition No. 191 of 1986, filed through his brother Lal Singh.
The case was dismissed on October 11, 1988 and the stay of the execution of the sentence stood vacated.
The reasoned judgment, however, was pronounced later and is resported in Smt.
Triveniben vs State of Gujarat; , The petitioner filed another mercy petition thereafter before the Governor of Haryana on 18.11.1988 and an order for stay of execution was again passed.
The matter remained pending and the petitioner has been awaiting the final outcome of his last petion since then.
On the basis of a newspaper report dated December 24, 1990 it is alleged that the attention of the Deputy Prime Minister was drawn to the petitioner 's case and the Deputy Prime Minister gave an assurance that he would examine the matter.
The report drew the attention of Alipore Jail prisoner which prompted him to send the letter which led the Registry of this Court to register the present writ petition.
The earlier writ petition of the petitioner Writ petition No. 191 of 1986, filed through his brother Lal Singh, was initially heard by a Division Bench of this Court and the matter, along with a number of other applications on behalf of other convicts was referred for the decision of the Constitution Bench.
The cases were heard at considerable length by the Constitution Bench of which one of us (Sharma,L) was a member and the leading argument at that stage was also made by Mr. R.K. Jain when all aspects of the cases were thoroughly considered.
Finally, this Court substituted the sentence of death of one convict (Harbhajan Singh) in another case by the sentence of imprisonment for life, but the other writ petitions including that of the prisoner were dismissed.
In the circumstances the petitioner cannot succeed on the basis of the earlier delay.
The operative part of the judgment, as stated earlier, was passed in October, 1988 and what is now relevant to consider is the delay subsequent to this date.
Before proceeding further we may refer to the decision in Smt.
Triveniben 's case laying down the principle which governs the present petition.
Although the cases were disposed of by two judgements, according to the opinion of the Bench, which was unanimous, undue delay in execution of the sentence of death entitles the condemned prisoner to approach this Court under Article 32, but this Court will examine only the nature of delay caused and circumstances ensued after the sentence was finally confirmed by the judicial process, and will have no jurisdiction to reopen the conclusions reached by the 466 Court while finally maintaining the sentence of death.
Further, while considering the grievance of inordinate delay this Court may consider all the circumstances of the case for deciding as to whether the sentence of death should be altered into imprisonment for life, and no fixed period of delay could be held to make to sentence of death inexecutable.
In the light of these observations the circumstances of the present case are to be examined.
It is true that while rejecting the earlier prayer of the petitioner on October 11, 1988 all the relevant considerations were taken into account and the petitioner cannot be permitted to raise the same plea once rejected, by repeated petitions.
But this does not deprive the petitioner the right to renew the prayer on fresh circumstances arising later and, therefore, not considered.
This is the position in the present case.
Although the matter was finally closed by this Court in October, 1988, the petitioner continues to remain in a state of suspense since then.
The main question is as to what is the effect of this delay.
The initial reason for the further delay has been a fresh mercy petition filed by the petitioner.
Does this fact justify keeping him under a sence of anticipation for more than two years? If the prayer was not considered fit be rejected at once it was certainly appropriate to have stayed the execution, but the matter should have been disposed of expeditiously and not kept in abeyance as has been done.
The counter affidavit filed on behalf of the Union of India states that on the receipt of the last mercy petition the Governor of Haryana immediately made a reference to the President of India seeking enlightenment on the question as to whether the Governor, while dealing with such applications, is bound by the advice of the Chief Minister of the State and whether it is open to the Governor to exercise his constitutional power in a case where an earlier application to the same effect had been rejected by the President.
Soon after the receipt of this communication, the matter was referred to the Department of Legal Affairs, Ministry of Law and Justice for advice, and the Ministry suggested that the question should be discussed with the Attorney General of India.
Since the matter remained under consideration no reply could be sent to the quarry and ultimately it was only in March this year, that the reply could be sent in the shape of a directive under Article 257(1) of the Constitution to all the Chief Secretaries of the State Governments and Union Territories.
The affidavit, however, does not furnish any fact or circumstance in justification of the delay.
In absence of any reasonable explanation by the respondents we are of 467 the view that if the concerned officers had bestowed the necessary attention to the matter and devoted the time its urgency needed, we have no doubt that the entire process of consideration of the questions referred would have been completed within a reasonable period without leaving any yawning gap rightly described by the learned Additional Solicitor General as "embarrassing gap".
There has, thus, been an avoidable delay, which is considerable in the totality of circumstances in the present case, for which the condemned prisoner in in no way responsible.
As was cautioned by this Court in Smt.
Triveniben 's case we are not laying down any rule of general application that the delay of two years will entitle a convict, sentenced to death, to conversion of his sentence into one for life imprisonment, rather we have taken into account the cumulative effect of all the circumstances of the case for considering the prayer of the petitioner.
Although the fact that the petitioner has been continuously detained in prison since 1972 was taken into account while rejecting his earlier writ petition, the same is not rendered completely irrelevant for the purpose of the present case and we have taken it into consideration merely as a circumstance assuming significance as a result of the relevant circumstances arising subsequent to the judgment rendered in October, 1988.
Having regard to all the circumstances of the case, we deem it fit to and accordingly substitute the sentence of imprisonment for life in place of the petitioner 's death sentence.
The writ petition is accordingly allowed.
In the letter from Alipore Jail a prayer has been made for the release of the petitioner.
As was indicated in Triveniben 's case, the only relief a convict awaiting execution of death sentence can get from this Court on the ground of delay is conversion of the sentence into that of life imprisonment.
However, on conversion of the death sentence to life imprisonment, the petitioner would now be governed and dealt with as a life convict for all purposes.
We are not required to say anything more in this behalf.
This prayer made in the letter is rejected.
R.P. Petition allowed.
| IN-Abs | The petitioner was convicted of murder and was sentenced to death by the Sessions Court on 13.12.1978.
His appeal to the High Court and Special Leave petition to this Court were dismissed.
His mercy petitions to the Government and to the President of India were also rejected.
The execution of the sentence remained stayed till it stood vacated on 11.10.1988 on dismissal of a writ petition** under Article 32 of the Constitution filed by his brother for conversion of the death sentence into one of life imprisonment on the ground of delay in its execution.
On 18.11.1988 the petitioner again filed a mercy petition before the Governor and his execution was once more stayed, and since then he was awaiting the final outcome of his petition.
meanwhile, on 24.12.1990, a prisoner sent a letter praying for release of the petitioner, which was treated as a writ petition on behalf of the convict under Article 32 of the Constitution.
It was contended on behalf of the petitioner that the death sentence awarded to him should be quashed as there had been inexcusable delay in executing the same.
On consideration on nature and effect of the delay in execution of the sentence after the petitioner filed mercy petition on 18.11.1988, in the light of the principles laid down in Triveniben 's case**.
Allowing the appeal, this Court, HELD: 1.
Once a petition for conversion of death sentence into one of life imprisonment is rejected, the plea raised in the petition so 463 rejected, cannot be permitted to be raised by repeated petitions.
But this does not deprive the convict of his right to renew the prayer on fresh circumstances arising later and, therefore, not considered.
[465B C] 2.
In the instant case, the petitioner could not succeed on the basis of the delay prior to October, 1988 as it had been considered in the earlier petition which was dismissed; but the fact that the petitioner had been continuously detained in prison since 1972 was not rendered completely irrelevant and should be considered merely as a circumstance assuming significance as a result of the relevant circumstance, arising subsequent to the judgment rendered in October, 1988.
[465E F, 467C D] 3.
The initial reason for the further delay has been a fresh mercy petition filed by the petitioner.
Althought the stay of the execution was certainly appropriate in the event of not rejecting the prayer at once, yet the matter should have been disposed of expeditiously and not kept in abeyance as was done.
If the concerned officers had bestowed the necessary attention to the matter and devoted the time its urgency needed, undoubtedly, the entire process of the consideration of the questions referred would have been completed within a reasonable period without leaving any yawning or "embarrassing gap".
There had been an avoidable delay considerable in the totality of circumstances, for which the petitioner was in no way responsible.
[466D E; 467A B] 4.
The only relief a convict awaiting execution of death sentence can get from this Court on the ground of delay is conversion of the sentence into that of life imprisonment.
[467F] 5.
In view of all the circumstances of the case, the petitioner 's death sentence is substituted by imprisonment for life and he would be governed and dealt with as a life convict for all purposes.
[476E, G] **Smt.
Tribeniben vs State of Gujarat, [1989] 1 S.C.C. 678, followed.
|
ivil Appeal Nos.
232 233 of 1978.
From the Judgment and Order dated 19.7.1977 of the Patna High Court in C.W.J.C. No. 756 of 1977.
Ashok Sen, Shankar Ghosh, Tapas Ray, Ms. section Janani, Ms. Minakshi, Mrs. Urmila Kapoor, D. Goverdhan, Rakesh K. Khanna, Salman Khurshid, R.P. Singh, D.D. Mishra, Mrs. G.S. Mishra and D.P. Mukherjee for the appearing parties.
The Judgment of the Court was delievered by RAY, J.
These two appeals were filed against the common judgment and order dated 29th July, 1978 made by the Division Bench of the High Court at Patna in C.W.J.C. No. 756 of 1977 whereby the High Court quashed the orders of the government contained in Annexures 8, 9 and 10 to the writ petition.
The facts unfurled from the writ petition are as follows: The respondent Nos. 1 to 5 in these appeals (the petitioners in the writ petition) were directly appointed in the Bihar Engineering Service Class II as Assistant Engineers of the Irrrigation Department on the recommendation of Bihar Public Service Commission and were posted in River Valley Project in 1961.
The respondent Nos. 6 to 23 in C.A. No. 232 of 1978 (who are appellants in C.A. No. 233 of 1978 and respondent Nos. 5 to 22 in the writ petition) were working at that time as overseers in the Bihar Subordinate Engineering Service (Irrigation Department).
On 7th April, 1958 the the Governor took a decision under rule 2 of the Public Works Department Code that 25% of the posts in the Bihar Engineering Service, Class II shall be filled up by promotion, subject to availability of suitable hands.
Thus, out of the total vacancies in Bihar Engineering Service, Class II, 75% of the vacant posts as determined by the Government will be filled up by direct recruitment and 25% of the vacant posts will be filled up by promotion subject to availability of suitable candidates.
By notification dated 413 18th July, 1964/27th August, 1964, respondent Nos.
6 to 13 in C.A. No. 232 of 1978 (appellant Nos. 1 to 8 in C.A. No. 233 of 1978 and respondent Nos.
5 to 12 in the writ petition) who were members of the Bihar Subordinate Engineering Service (Overseers) were promoted to the post of Assistant Engineer in Class II and by another notification dated 21st July, 1969, respondent Nos.
14 to 23 in C.A. No. 232 of 1978 (appellant Nos. 9 to 18 in C.A. No. 233 of 1978 and respondent Nos. 13 to 22 in the writ petition) were also promoted to Bihar Engineering Service, Class II as Assistant Engineers.
On February 25, 1969, a seniority list of Assistant Engineers was published by the Department wherein the names of the respondent Nos. 1 to 5 (the petitioners) were mentioned at Sl.
Nos. 170, 199, 208, 211 and 226 and the names of the respondent Nos. 6 to 23 (respondent Nos. 5 to 22 in writ petition) were mentioned at Sl.
253, 254, 256 to 262, 687 to 695 and 701 respectively The respondent Nos.
6 to 23 were thus shown as juniors to the respondent Nos. 1 to 5 (the petitioners).
The respondent Nos. 6 to 23 feeling aggrieved by the said seniority list made representations claiming seniority over respondent Nos. 1 to 5.
On 3rd May, 1972 the State of Bihar constituted a Committee known as Ramanand Committee by a resolution to consider the inter se seniority of Civil Engineers including the Assistant Engineers.
On April 19, 1973 the Ramanand Committee submitted a report making certain recommendations.
It was alleged that a revised seniority list was prepared wherein the respondent Nos. 1 to 5 were shown juniors to the respondent Nos. 6 to 23.
This, of course, has been denied in affidavit in counter filed on behalf of the Government (appellants in C.A. No. 232 of 1978, respondent Nos.
6 to 9 in C.A. 233 OF 1978, and respondent Nos. 1 to 4 in the writ petition).
On 21st of July, 1975, an order was made whereby the date of promotion of respondent Nos.
6 to 13 was changed from 21st July, 1962 to 27th February, 1961 thereby making the respondent Nos. 1 to 5 juniors to respondent Nos. 6 to 13.
This order is contained in annexure 8 to the writ petition.
In other words, the respondent Nos. 6 to 13 were promoted retrospectively from the State against it but the State government instead of redressing their grievances made another order on January 20, 1976 (annexure 9 to the writ petition) re fixing the seniority of respondent Nos. 6 & 7 promoting them to the Bihar Engineering Service with effect from December 19, 1958.
Again, to the prejudice of the respondent Nos. 1 to 5, an order was passed by the State Government by which the date of promotion of respondent Nos.
14 to 23 was pushed back to February 27, 1961 making them also senior to the respondent Nos. 1 to 5.
This order is contained in annexure 10 to the writ petition.
414 The respondent Nos. 1 to 5, therefore, filed a writ petition in the High Court at Patna being Civil Writ Petition No. 756 of 1977 challenging the seniority conferred on the respondent Nos. 6 to 23 (respondent Nos. 5 to 22 in the writ petition) by annexures 8, 9 and 10 on the ground that these orders were wholly arbitrary illegal, void and inoperative and ineffective and so prayed for appropriate writ for quashing those orders.
A counter affidavit was filed on behalf of the State Government.
In Para 3(iii) of the said affidavit, it has been averred that till 1957, 25% of the vacancies in Bihar Engineering Service, Class II, were being filled up by promotion from the Bihar Subordinate Engineering Service (commonly known as `Overseers ').
Subsequently, in the year 1958, it was decided that 25% of the cadre posts in the Bihar Engineering Service, Class II Both permanent and temporary, shall be reserved for being filled up through promotion from the members of the Bihar Subordinate Engineering Service.
It has been further averred in para 3(iv) that all the posts of temporary Assistant Engineers to which the Overseers were entitled to be promoted on the basis of 25% reservation in the cadre were not filled up by promotion of Overseers, only 3 overseers were given promotion with effect from 19.12.1958 vide order No. A/P1 409 64 1 14294 dated 18.7.64/27.8.64.
In the said affidavit it has also been stated that on a careful examination of the matter it was found that on the basis of total number of posts of Assistant Engineers in the Department, the Overseers were entitled to 60 posts on the basis of 25% reservation till 1958, out of which they were already given 33 posts and 27 more posts of Assistant Engineers were still due to them and accordingly by an order dated 20th January, 1976 the 21 Overseers who had earlier been given promotion as temporary Assistant Engineers from later dates in 1960, 1961 and 1962 by the order dated 18.7.64/27.8.64.
were given promotion, with effect from 19.12.1958.
Due to this correction, respondent Nos. 6 and 7 and one Shri Mithileshwari Sahay (since retired) were promoted as temporary Assistant Engineers with effect from 19.12.1958 in partial modification of the Government order dated 18.7.64/27.8.64 and another order dated July 12, 1975.
It has been further stated that as a result of this modification in the dates of promotion as Assistant Engineer who by the order dated 20th January, 1976 were allowed promotion as temporary Assistant Engineers with effect from 19.12.1958 as against promotions from later dated in 1960, 1961 and 1962 given to them by earlier Government Order dated 27.8.1964 and order dated 21.7.1969.
It has also been stated that the respondent Nos. 6 and 7 were entitled to promotion in 1958 and respondent Nos. 8 to 23 to promotions in 415 1960 and 1961, on the basis of the reservation of 25% of the cadre post in the Bihar engineering Service, Class II, for promotion of Overseers from the Bihar Subordinate Engineering Service.
It has been further averred that as against 21 consequential vacancies, the case of only 17 Overseers was modified accordingly in supersession of the earlier Government order dated 18.7.64/27.8.64 and respondent Nos. 8 to 13 were given promotion as temporary Assistant Engineer with effect from 27.2.1961, from which date the promotion was due to them on the basis of the quota by a Government Order No. 10501 (annexure 8 to the writ petition) dated July 12, 1975 and No. 17328 dated November 8, 1975 respectively.
It has also been stated that the seniority list that was prepared and published in 1969 was tentative.
The High Court, Patna held that no person can be promoted with retrospective effect from a date when he was not born in the cadre so as to adversely effect others.
The respondent Nos. 1 to 5 were recruited to the post of Assistant Engineer, Class II before the respondent Nos. 6 to 23 were promoted to the post of Assistant Engineer, Class II in the Bihar Engineering Service, Class II.
The High Court, therefore, held that the orders contained in Annexure 8, 9 and 10 promoting the respondent Nos. 6 to 23 (respondent Nos. 5 to 22 in the writ petition) with retrospective effect are bad and so quashed those Government orders referred to in the said annexures.
Against this judgment and order made by the High Court, the instant appeals on special leave were filed.
The sole question which falls for decision in these appeals is whether the inter se seniority between the petitioners respondent Nos. 1 to 5 who are direct recruits and the Overseers belonging to the Bihar Subordinate Engineering Service (Irrigation Department) who had been promoted retrospectively in their 25% quota for the year 1958 as revised by the Government orders mentioned in annexures 8, 9 and 10 to the writ petition, is arbitrary, illegal and inoperative as those orders purport to affect prejudicial the seniority of the petitioners respondent Nos. 1 to 5 in the service of Bihar Engineering Service, Class II.
It is not disputed that in 1958 under Rule 2 of the Public Works Department Code, the Government of Bihar took a decision to the effect that 25% of the posts in the Bihar Engineering Service, Class II shall be filled up by promotion, subject to availability of suitable hands.
It also appears from the counter affidavit filed on behalf of the Government that in 1958, the the total number of posts to be filled up by promotion from the Overseers in the Bihar Subordinate Engineering Service 416 (Irrigation Department) to the post of Assistant Engineer, in Bihar Engineering Service, Class II was 60 out of which only 33 posts were filled up by promotion, leaving 27 more posts of Assistant Engineers to be filled up by promotion from the Overseers in the Bihar Subordinate Engineering Service (Irrigation Department).
It is also clear from the averments made in the said counter affidavit that the petitioners respondent Nos. 1 to 5 were appointed in Bihar Engineering Service, Class II on the recommendation of the Bihar Public Service Commission in the year 1961 and the respondent Nos. 6 to 13 who had been working in the Bihar Subordinate Engineering Service (Irrigation Department) as Overseers and having independent charge of the sub division were promoted to the post of Assistant Engineer, Class II by notification dated 18.7.64/27.8.64.
The respondent Nos.
14 to 23 were also promoted by notification dated 21.7.1969.
On the basis of these appointments and promotions in the post of Assistant Engineer in the Bihar Engineering Service, Class II, a seniority list was prepared and published in february, 1969 tentatively wherein the petitioners respondent Nos. 1 to 5 were shown as senior to respondent Nos.
6 to 23.
However, the Government by its order dated 21st July, 1962 changed the date of promotion of respondent Nos. 6 to 13 from 21.7.1962 to 27.21961 (Annexure 8 to the writ petition) thereby making the petitioners respondent Nos. 1 to 5 junior to respondent Nos. 6 to 13.
On January 20, 1976, the Government passed another order re fixing the seniority of respondent Nos. 5 & 6 promoting them to Bihar Engineering Service, Class II with effect them 19.12.1958 (Annexure 9 to the writ petition).
Again an order contained in Annexure 10 to the writ petition was passed by which the date of promotion of respondent Nos.
14 to 23 was pushed back to February 27, 1961, thus making them senior to the petitioners respondent Nos. 1 to 5.
The petitioners respondent Nos. 1 to 5 challenged these three Government orders mainly on the ground that these orders giving promotion to the respondent Nos. 6 to 23 from a date earlier to their date of promotion to the post of Assistant Engineer in Bihar Engineering Service, Class II purport to affect prejudicially the rights of the petitioners respondent Nos. 1 to 5 in as much as they were appointed to the post of Assistant Engineer in the Bihar Engineering Service, Class II earlier to the promotion to the said post of the respondent Nos. 6 to 23.
It has also been submitted in this connection that he seniority has to be reckoned amongst the officials working as Assistant Engineers in the Bihar Engineering Service, Class II from the date of their appointment on promotion to the said Service.
The petitioners respondent Nos. 1 to 5 being appointed earlier directly in the quota of direct recruits than the promoted respondents who were promoted later cannot be given 417 seniority in service to the petitioners respondent Nos. 1 to 5 and it was contended that the impugned orders are wholly illegal and unwarranted and so the High Court has rightly quashed the said orders.
It has been further urged in this connection that the State can promote its employees with retrospective effect provided such retrospective promotion does not affect the right and seniority already earned by others.
The petitioners respondent Nos. 1 to 5 who were senior to the petitioners respondents Nos. 6 to 23 were made junior to them by the said Government orders as contained in Annexure 8, 9 and 10 to the writ petition.
It has, therefore, been contended that the promotion to the respondent Nos. 6 to 23 was illegal and arbitrary as the same had prejudicially affected the petitioners respondent Nos. 1 to 5 in regard to their seniority.
The High Court while rendering its judgment relied on the decision in the case of A.K. Subraman and Ors.
vs Union of India and Ors.
, specially on the observation made therein as under: "Once the Assistant Engineers are regularly appointed to officiate as Executive Engineers within their quota they will be entitled to consideration in their own rights as Class I Officers to further promotions.
Their "birth marks" in their earlier service will be of no relevance once they are regularly officiating in the grade of Executive Engineer within their quota.
" The High Court held that no person can be promoted with retrospective effect from a date when he was not born in the cadre so as to adversely affect others.
It is the admitted position that the respondent Nos. 6 to 23 were working as Overseers in the Bihar Subordinate Engineering Service and were promoted to the post of Assistant Engineer in Bihar Engineering Service, Class II much after the petitioners respondents Nos.
1 to 5 were directly recruited and appointed on the basis of the recommendation of the Bihar Service Commission, to the post of Assistant Engineers in 1961 and as such they have been working in the grade of Assistant Engineers much before the respondent Nos.
6 to 23.
Undoubtedly, on the basis of the order of the Governor in 1958, the posts of Assistant Engineers are to be filled up from two sources i.e. by direct recruitment as well as by promotion from Overseers working in the Bihar Subordinate Engineering Service and the ratio of the vacan 418 cies to be filled up has been fixed as 75% from the direct recruits and 25% from the promotees.
It has been urged on behalf of the respondent Nos. 6 to 23 that in view of the quota rule the respondent Nos. 6 to 23 who were promoted in the quota set out for promotees in respect of the vacancies of 1958 shall be taken to be promoted in 1958 notwithstanding that they have been actually promoted long after 1958 and after the direct recruits i.e. respondent Nos. 1 to 5 were recruited directly to the post of Assistant Engineers.
In other words even though the respondent Nos. 6 to 23 have been promoted after the date of recruitment of respondent Nos. 1 to 5 to the post of Assistant Engineer, still then the promote respondent Nos. 6 to 23 should be deemed to be senior to the direct recruit respondent Nos. 1 to 5 as they were promoted in the vacancies for 1958 quota set up for promotees.
In support of this submission the decision in V.B. Badami etc.
vs State of Mysore and Ors., [1976] 1 SCR 815 as well as Gonal Bihimappa vs State of Kanataka, [1987] Supp.
SCC 207 were cited at the bar.
In both these cases the promotees occupied the quota of direct recruits as direct recruits were not available to fill up the quota meant for them.
It was held that direct recruits who were appointed within their quota subsequently were entitled to the vacancies within their quota which had not been filled up and they would become senior to the promotees The promotees would be pushed down to later years when their appointment could be regularised as a result of absorption in their lawful quota of those years.
The promotees cannot claim any right to hold promotional posts unless the vacancies fall within their quota.
These cases have no application in the instant case in as much as the direct recruits i.e. respondent Nos. 1 to 5 were recruited in their quota i.e. the quota meant for them.
This being so, the decision in these two cases has no application to the instant case.
Moreover, there is nothing to show that the respondent Nos. 6 to 23 who were promoted in 1962 and thereafter i.e. subsequent to the direct recruits i.e. respondent Nos. 1 to 5 could be deemed to be recruited in 1958 quota as there was nothing to show that these vacancies were carried forward.
The Government 's orders as contained in annexures 8, 9 and 10 which purport to give promotion to the respondent Nos. 6 to 23 retrospectively are arbitrary, illegal and inoperative in as much as these seriously affect the respondent Nos. 1 to 5.
The respondent Nos. 6 to 23 were not in the cadre of Assistant Engineers even in officiating capacity at the time when the respondent Nos. 1 to 5 were directly recruited to the post of Assistant Engineer.
As such, the said promotee respondent Nos.
6 to 23 could not be under any circumstances, given seniority over the directly recruited respondent Nos. 1 to 5.
The 419 High Court has rightly quoted the observation made by this Court in the case of A.K. Subraman & Ors.
(supra) as mentioned in the preceding paragraphs.
It is pertinent to mention in this connection, the observation of this Court in the case of D.K. Mitra and Ors.
vs Union of India and Ors., [1985] Supp.
SCC 243.
In this case the petitioners were confirmed as Assistant Medical Officers in 1962 and 1963 and they were placed in the higher scale of Assistant Divisional Medical Officers to the Indian Railways with effect from January 1, 1973.
Thereafter they were appointed as officiating Divisional Medical Officers in 1972, 1973 and 1974 and they had been continuing there uninterrupted.
Respondent Nos. 4 to 64 were given substantive appointments as Divisional Medical Officers later on but they were confirmed earlier than the petitioners because of the zone wise confirmation given by the Railway Administration.
It was held that the petitioners should be considered at par for the purpose of fixing seniority, with those appointed to permanent posts in a substantive capacity.
For the purpose of determining seniority among promotees, the petitioners should be treated as having been appointed to permanent vacancies from the respective dates of their original appointment and the "entire period of officiating service performed by them should be taken into account as if that service was of the same character as that performed by the substantive holders of permanent posts.
" In the instant case, the promotee respondent Nos.
6 to 23 were not born in the cadre of Assistant Engineer in the Bihar Engineering Service, Class II at the time when the respondent Nos. 1 to 5 were directly recruited to the post of Assistant Engineer and as such they cannot be given seniority in the service of Assistant Engineers over the respondent Nos. 1 to 5.
It is well settled that no person can be promoted with retrospective effect from a date when he was not born in the cadre so as to adversely affect others.
It is well settled by several decisions of this Court that amongst members of the same grade seniority is reckoned from the date of their initial entry into the service.
In other words, seniority inter se amongst the Assistant Engineers in Bihar Engineering Service, Class II will be considered from the date of the length of service rendered as Assistant Engineers.
This being the position in law the respondent Nos. 6 to 23 can not be made senior to the respondent Nos. 1 to 5 by the impugned Government orders as they entered into the said Service by promotion after the respondent Nos. 1 to 5 were directly recruited in the quota of 420 direct recruits.
The judgment of the High Court quashing the impugned Government orders made in annexures, 8, 9 and 10 is unexceptionable.
In the premises aforesaid, we confirm the judgment and order rendered by the High Court.
The appeals are, therefore, dismissed.
In the facts and circumstances of the case, there will be no order as to costs.
R.P. Appeals dismissed.
| IN-Abs | Under Rule 2 of the Bihar Public Works Department Code, the Governor of Bihar took a decision on 7.4.1958 providing that 25% of the posts of Assistant Engineers in the Bihar Engineering Service, Class II (the Service) were to be filled by promotion, subject to availability of suitable hands, from Overseers in the Bihar Subordinate Engineering Service (Irrigation Department) and 75% of the posts were to be filled by direct recruitment to the Service.
Respondents No. 1 to 5 in both these appeals were appointed as Assistant Engineers in the Service on the recommendation of the Bihar Public Service Commission in the year 1961; and the appellants (in Civil Appeal No. 233 of 1978(respondents No. 6 to 23 in Civil Appeal No. 232 of 1978), who had been working as Overseers in the Bihar Subordinate Engineering Service (Irrigation Department) were promoted to the posts of Assistant Engineers in the Service in 1962 and thereafter.
However, by orders dated 12.7.1975, 20.1.1976 and 9.4.1977, the Government changed the date of promotion of the appellants to the dates prior to the appointment of respondents No. 1 to 5 in the Service, making the former Senior to the letter.
Respondents No. 1 to 5 filed writ petition before the High Court challenging the seniority conferred on the appellants from the retrospective date and contended that the orders giving promotions to the appellants from a date earlier to date of their promotion in the Service purported to affect prejudicially respondents No. 1 to 5 's right inasmuch as they were appointed to the Service earlier to the promotion of the appellants; and that the seniority had to be reckoned amongst the officials working as Assistant Engineers in the Service from the date of their appointment or promotion to the said Service.
The appellants contended that they were entitled to be promoted retrospectively on the 411 basis of reservation of 25% of the Cadre posts in the Service till 1958.
The High Court.
holding that the orders promoting the appellants with retrospective effect were bad, quashed the same and allowed the writ petition.
Hence the present appeals.
On consideration of the legality and validity of the orders of the Government giving promotions to the appellants from a date earlier to the date of their entry into the Service as Assistant Engineers, and its effect on the inter se seniority amongst the appellants and respondents No. 1 to 5, who were directly appointed as Assistant Enginers in the Service before the appellants entered in the said Service.
Dismissing the appeals, this Court, HELD: 1.
The Government Orders dated 12.7.1975, 20.1.1976 and 9.4.1977 which purported to give promotion to the appellants retrospectively were arbitrary, illegal and inoperative inasmuch as these seriously affected rspondents No. 1 to 5.
The appellants were not borne in the cadre of Assistant Engineers even in officiating capacity at time when rspondents No. 1 to 5 were directly recruited to the post of Assistant Egineer.
As such, the promotee appellants could not be under any circumstance given seniority over the directly recruited respondents No. 1 to 5.
The judgment of the High Court in quashing the impugned Government Orders was, therefore, unexceptionable.
[418F H; 420A] 2.1 No person can be promoted with retrospective effect from a date when he was not borne in the Cadre so as to adversely affect others; and amongst members of the same grade, seniority is reckoned from the date of their initial entry into the service.
[419F] 2.2 Seniority inter se amongst the Assistant Engineers in Bihar Engineering Service, Class II would be considered from the date of the length of service rendered as Assistant Engineers.
Therefore, the appellants could not be made senior to respondents No. 1 to 5 by the impugned Government Orders as they entered into the said Service in 1962 and thereafter by promotion subsequent to respondent No. 1 to 5 who were directly recruited in the quota meant for them.
There was nothing to show that the appellants could be deemed to be recruited in 1958 quota and that these vacancies were carried forward.
[419G; 418E F] A.K. Subraman and Ors.
vs Union of India and Ors., , relied on.
412 V.B. Badami vs State of Mysore and Ors., [1976] 1 SCR 815 and Gonal Bihimappa vs State of Karnataka, [1987] Supp.
SCC 207, held inapplicable.
D.K. Mitra and Ors.
vs Union of India and Ors., [1985] Supp.
SCC 243, referred to.
|
ition No. 259 of 1990.
(Under Article 32 of the Constitution of India).
Yogeshwar Prasad, R.K. Jain, Satish Chandra, A.S. Pundir, Gopal Subramanium, Mrs, S.D. Dikshit, Jitender Sharma, R. Venkataramani, Mrs. Rachna Gupta, M.P. Shorawala, D.K. Garg, Pramod Swarup, R.N. Keshwani, Mrs. Anil Katiyar, Anis Ahmed Khan and A.P. Mohanty for the Appearing parties.
The Judgment of the Court was delivered by KULDIP SINGH, J.
Before us are the members of Uttar Pradesh Higher Judicial Service (hereinafter called the `Service ') Promotees and the direct recruits, as usual, are in the fray.
This is their second round of litigation in this court.
Earlier in P.K. Dixit and Others vs State of U.P. and Others, ; this court directed the preparation of fresh seniority list in accordance with the observation made therein.
The Allahabad High Court thereafter framed and circulated final seniority list of the service of August 25, 1988.
Both promotees and direct recruits are not satisfied with the same.
They have challenged the said seniority list, inter alia on the ground that it is not in conformity with the directions of this court in Dixit 's case.
429 We may briefly state the necessary facts.
The service was initially governed by statutory rules called the Uttar Pradesh Higher Judicial Service Rules, 1953 (hereinafter called `1953 rules ').
Recruitment to the service under the said rules was from two sources, by promotion and the direct recruitment.
In Chandra Mohan vs State of Uttar Pradesh, this court struck down the 1953 rules so far as the said rules provided direct recruitment of the service.
As a consequence there was no direct recruitment to the Service till the year 1975 76.
This members of the service promoted under the 1953 rules were designated as Civil and Sessions Judges.
On May 8, 1974 the Uttar Pradesh Higher Judicial Service (abolition of cadre of the Civil and Sessions Judges) Rules, 1974 (hereinafter called `1974 rules ') came into force.
Under these rules the cadre of Civil and Sessions Judges was abolished.
Rules 2 and 3 of 1974 rules, which are relevant, are reproduced hereafter: 2.
Abolition of the Cadre of Civil and Sessions Judges.
With effect from the date of commencement of these rules, the cadre of Civil and Sessions Judges shall stand abolished and the Uttar Pradesh Higher Judicial service shall, with effect from the said date, consist of the posts of District and Sessions Judges and Additional District and Sessions Judges only.
Creation of posts and confirmation . (1) Upon the abolition of the cadre of Civil and Sessions Judges, permanent and temporary posts of Additional District and Sessions Judges equal in number of the permanent and temporary posts, respectively of Civil and Sessions Judges existing immediately before the date of commencement of these rules shall stand created with effect from the said date, and the officers holding the posts of Civil and Sessions Judges immediately before the said date shall become Additional District and Sessions Judges and be designated accordingly.
(2) An officer who is confirmed on the post of Civil and Sessions Judge before the commencement of these rules shall with effect from the date of such confirmation, be deemed to be confirmed on the post of Additional District and Sessions Judge.
430 It is, thus, obvious that the cadre of Civil and Sessions Judges stood abolished and a new cadre of Additional District and Sessions Judges, consisting of permanent and temporary posts equal in number of the permanent and temporary posts respectively of Civil and Sessions Judges, came into existence under the 1974 rules.
The Civil and Sessions Judges holding permanent or temporary posts in the Service were re designated as Additional District and Sessions Judges with effect from May 8, 1974, the date when the 1974 rules were enforce.
On that date 271 officers were working as Additional District and Sessions Judges against 235 posts (153 permanent and 82 temporary) in the Service.
The Service was reconstituted and given a freshlook by the rules framed under Article 309 read with Article 233 of the Constitution of India called the Uttar Pradesh Higher Judicial Service Rules, 1975 (hereinafter called `the 1975 Rules).
These rules came into force with effect from April 5, 1975.
The relevant rules, 5, 6, 8 and 26 are reproduced hereinafter: 5.
Source of recruitment.
The recruitment of the Service shall be made= (a) by direct recruitment of pleaders and advocate of not less than seven years standing on the first day of January next following the year in which the notice inviting applications is published; (b) by promotion of confirmed members of the Uttar Pradesh Nyayik Sewa (hereinafter referred to as the Nyayik Sewa, who have put in not less than seven years service to be computed on the first day of January next following the year in which the notice inviting applications is published; Provided that for so long as suitable officers are available from out of the dying cadre of the Judicial Magistrates, confirmed officers who have put in not less than seven years service to be computed as aforesaid shall be eligible for appointment as Additional Sessions Judges in the Service.
Explanation.
When a person has been both a pleader and an advocate his total standing in both the capacities shall be taken into account in computing the period of seven years under clause (a).
431 6.
Quota.
Subject to the provisions of Rule 8, the quota for various sources of recruitment shall be (i) direct recruitment from the Bar 15% (ii) Uttar Pradesh Nyayik Sewa 70% of the vacancies.
(iii) Uttar Pradesh Judicial Officers 15% Service (Judicial Magistrates).
Number of appointments to be made. (1) The Court, shall, from time to time, but not later than three years the last recruitment, fix the number of officers to be taken at the recruitment keeping in view the vacancies then existing and likely to occur in the next two years.
If at any selection the number of the selected direct recruits available for appointment is less than the number of recruits decided by the Court to be taken from that source, the Court may increase correspondingly the number of recruits to be taken by promotion from the Nyayik Sewa: Provided that the number of vacancies filled in as aforesaid under this sub rule shall be taken into consideration while fixing the number of vacancies to be allotted to the quota of direct recruits at the next recruitment, and the quota for direct recruits may be raised accordingly; so, however, that the percentage of direct recruits in the Service does not in any case excess 15 per cent of the total permanent strength of the service.
Provided further that all the permanent vacancies existing on May 10, 1974 plus 31 temporary posts existing on that date, if and when they are converted into permanent posts, shall be filled by promotion from amongst the members of the Nyayik Sewa; and only the remaining vacancies shall be shared between the three sources under these rules; Provided also that the number of vacancies equal to 15 per cent of the vacancies referred to in the last preceding proviso shall be worked out for being allocated in future to the Judicial Magistrates in addition to their quota of 15 per 432 cent prescribed in rule 6, and thereupon, future recruitment (after the promotion from amongst the members of the Nyayik Sewa against vacancies referred to in the last preceding proviso) shall be so arranged that for so long as the additional 15 per cent vacancies worked out as above have been filled up from out of the Judicial Magistrates, the allocation of vacancies shall be as follows: (i) 15% by direct recruitment.
(ii) 30% from out of the Judicial Magistrates.
(iii) 55% from out of the members of the Nyayik Sewa.
Seniority. (1) Except as provided in sub rule (1), seniority of members of the service shall be determined as follows.
(a) Seniority of the officers promoted from the Nyayik Sewa vis a vis the officers recruited for the Bar shall be determined from the date of continuous officiation in the service in the case of promoted officers and from the date of their joining the service in the case of direct recruits.
Where the date of continuous officiation in the case of an officer promoted from the Nyayik Sewa and the date of joining the service in the case of a direct recruit is the same, the promoted officer shall be treated as senior: Provided that in the case of a promoted officer the maximum period of continuous officiation in the service shall not, for the purpose of determining seniority exceed three years immediately preceding the date of confirmation . . .
Statement of facts filed by the High Court shows that on April 5, 1975, when the 1975 rules came into force, there were 229 permanent and 7 temporary (total 236) posts in the service.
This total included 31 temporary posts mention in second proviso to rule 8(2) of 1975 rules.
By that date these posts had become permanent.
The statement further shows that 263 officers were working as Additional District and Sessions Judges on the said date.
We take it that it that there were 236 posts in the Service on the commencement of the 1975 rules.
433 P.K. Dixit and 7 other promotee officers filed two writ petitions under Article 32 of the Constitution of India challenging the seniority assigned to them on two grounds.
It was contended that all the posts, existing on April 5, 1975 when the 1975 rules came into force should be deemed to have been filled by the officers holding the designation of Additional District and Sessions Judges on that date.
Secondly, it was contended that the promotees were entitled to the seniority from the date of their actual continuous officiation and not by limiting the said period to three years preceding the date of confirmation.
This court by its judgment dated October 8, 1987 in Dixit 's case (supra) partly allowed the writ petitions and directed the High Court to frame the seniority list afresh keeping in view the observations made in the judgment.
The promotes claim that the judgment in Dixit case is wholly in their favour on the first point.
The direct recruits, however, contest the said claim and assert that the contention of the promotees was rejected and their claim was confined to the number of posts as provided in First Proviso to rule 8(2) of the 1975 Rules.
Pursuant to the judgment in Dixit case the High Court issued a tentative seniority list on February 11, 1988.
The promotees were fully satisfied with the same as according to them the said list was drawn in conformity with the Judgment in Dixit case.
Objections were invited against the tentative seniority list and thereafter the High Court constituted a five Judge committee to finalise the list.
On the basis of the report of the committee final seniority list was issued on August 25, 1988.
O.P. Garg and 4 other promotees have filed writ petition No. 259 of 1989 challenging the final seniority list.
P.K. Dixit and others, petitioners in the original Dixit case have filed Civil Miscellaneous Petition No. 3473 of 1989 seeking clarification of the said judgment and also supporting the case of the promotees.
The direct recruits have filed writ petition No. 1304 of 1988 under Article 32 of the Constitution of India impugning the final seniority list issued by the High Court.
It is interesting that both promotees and the direct recruits are relying on the judgment in Dixit case and are contending that the final seniority list issued by the High Court is contrary to the said judgment.
The promotees, the direct recruits and the High Court have sought support from Dixit case on the basis of their own interpretation of the judgment.
Apparently there are diverse observations in Dixit case which are being stretched by the parties in support of their rival contentions.
The promotees strongly rely on the following paragraphs from Dixit case to show that the First Point argued before the Bench was decided in their favour.
434 "In the written affidavit filed by the High Court, it is not disputed that before these rules were brought into force, all the posts which were available on the date on which these rules came into force have to be filled in by promotion as till that date there was no rule requiring direct recruitment.
But unfortunately, the High Court in their return have not mentioned the exact number of vacancies existing on that date also the number of officers who were officiating on the date as Civil and Sessions Judges or Additional District and Sessions Judges who were entitled to be included in that cadre of higher judicial service under these rules." "It is not disputed that on the date on which these rules (1975 Rules) were brought into force, all the posts available were to go to the promoted officers and the only thing that the High Court is expected to do is to find out how many posts were available on that date and how many persons were officiating in the higher judicial service or equivalent posts on that date and their seniority ought to be fixed on the basis of their promotion to the posts except where an officer was not found fit or where officer concerned was reverted back to the judicial posts.
The documents do not disclose that any one of these judicial officers who were promotees have been reverted.
The documents also do not disclose that at any time the High Court considered the question of their confirmation and any one of them was not found fit for confirmation, or that it was decided to postpone the date of confirmation because the work of the officer was not upto the mark.
The record produced by the High Court only shows the date from which these petitioners were promoted and started officiating as Additional District Judges and the date on which they were ultimately confirmed.
During this period their case was considered at any time does not appear from the record produced in this case nor was the contention of the learned counsel appearing for the High Court.
It, therefore, is not disputed that these petitioners who were promoted before these rules (1975 Rules) were brought into force were never found unfit for confirmation and in this view of the matter, therefore, it is clear that all posts available on the date on which these new rules were brought into force will have to be filled in by these promoted 435 officers who were working in the officiating capacity in the post of higher judicial service on the date on which these rules were brought into force.
So far as the situation before these rules were brought into force is concerned even during the course of argument not much controversy appears to exist as it is clear that the question of direct recruitment and the quota of the direct recruits vis a vis promotees was not in existence.
" Based on the above quoted findings in Dixit case, the promotees plausibly claim that on April 5, 1975 when the 1975 rules came into force all the 236 posts in the Service had already been consumed by the existing members of the service who were working as Additional District and Sessions Judges.
Till that date the recruitment to the service was only by way of promotion and as such there was no question of allocating any post to the direct recruits who had not yet born in the service.
The direct recruits, on the other hand, assert that the Dixit case decides the controversy in their favour.
Reliance in that respect is placed on the following observations in the judgment: "This also appears to be the intention of the rules when they were framed in 1975 as is clear from the proviso to Rule 8.
It reads: "provided further that the permanent vacancies existing on May 10, 1974 plus 31 temporary posts existing on that date, if and when they are converted into permanent posts, shall be filled by promotion from amongst the members of the Nyayik Sewa; and only the remaining vacancies shall be shared between the three sources under these rules: It therefore is clear that even these rules provided that all the posts (permanent) available in the Higher Judicial Service existing on May 10, 1974 plus 31 temporary posts existing on that date which may become permanent later shall be filed by promotion from amongst the members of the Nyayik Sewa.
It is therefore clear that all the posts in the Higher Judicial Service, lying vacant on May 10 1974 plus thirty one will have to be filled in from the officers of the Nyayik Sewa.
May be that some of these posts may be occupied by promotee officers who were given promotions 436 on ad hoc basis and working on those posts or that the posts may be lying vacant.
Whatever may be the situation on the basis of what has been discussed above and also as has been clearly provided in these rules the matter will have to be gone into the High Court afresh and fill in all the posts in the Higher Judicial Service available on May 10, 1974 plus 31 posts from the officers of the Nyayik Sewa." "It has therefore to be accepted that all those who were working as Civil and Sessions Judges on 8th May, 1974 automatically became Additional District and Sessions Judges and what was left was only a consideration of their cases of confirmation and in so doing in view of the conclusions arrived at by us and also as has been provided in the proviso to Rule 8 quoted above all the posts available on 10th May, 1974 plus 31 posts (temporary) on that date will have to be filled in from the cadre of Nyayik Sewa by promotion." "But in view of what we have discussed earlier about the appointments on the posts available before these Rules were brought into force and to fill in temporary posts, we feel that the matter will have to be examined afresh by the High Court.
So far as posts available on 10th May, 1974 plus 31 posts are concerned they will have to be filled in only by promotees as we have discussed earlier and also in view of proviso to Rule 8 and after doing it examine the cases of promotion and direct recruitment after the coming into force of these Rules and the vacancies available and after consideration the cases in according with these Rules the High Court will prepare afresh the seniority list which may be notified so that if any objections are there, they may be placed for determination in according with the Rules and in the light of the discussions above.
" The precise assertion of the direct recruits, therefore,is that this court interpreting the second proviso to Rule 8(2) of the 1975 rules in Dixist case has held that the promotees as on May 10, 1974, are entitled to all the permanent posts available on that date plus 31 temporary posts and apart from that they cannot lay claim exclusively to the posts created thereafter.
The High Court accepted the contention of the direct recruits 437 and gave 153 permanent posts existing on May 10, 1974 plus 31 posts, which became permanent subsequently to the promotees.
Consequently out of the 263 Additional District and Sessions Judges who were holding the posts on April 5, 1975 only 184 (153+31) were taken to be the existing members of the Service and remaining officers were asked to enter the service through the promotion quota under the 1975 rules.
The second point in Dixit case was regarding fixation of seniority of the promotees under the 1975 rules.
Whether whole of the continuous officiation or part of it is to be counted towards seniority was the moot point.
Rule 26(1)(a) of the 1975 rules provides that seniority of the direct recruits is to be determined from the date of their joining the service whereas that of the promotees from the date of continuous officiation in the service.
But the first proviso to the said rule further limits the period of continuous officiation of a promotee for determining seniority to a maximum of three years immediately preceding the date of confirmation.
The promotees contended in Dixit case that they were entitled to the counting of their total period of continuous officiation towards seniority.
This court rejected the contention in the following words: "Having gone through these Rules it appears that the contention advanced by the petitioners in respect of proviso to Rule 26 about seniority does not appear to be justified.
" The High Court while framing the impugned seniority list did not follow the seniority rule.
The High Court determined the seniority of the promotees by giving them benefit of three years continuous officiation immediately preceding the date of availability of permanent vacancy whereas the rule provides three years preceding the date of confirmation.
Mr. Yogeshwar Prasad, learned senior advocate appearing for the promotees.
Mr. Satish Chandra, learned senior advocate for the direct recruits and Mr. Gopal Subramanium, learned advocate appearing for the High Court have addressed elaborate arguments before us.
The learned counsel have read and re read the judgment in Dixit case in support of their respective contentions.
The thrust of Mr. Yogeshwar Prasad 's arugment is twofold.
He contended that the service consisting of Additional District and Sessions Judges was constituted under the 1974 Rules which continued till April 5, 1975 when the Service was reconstituted under the 1975 rules.
According to him all 438 the posts in service, permanent and temporary, available on April 5, 1975 would be deemed to have been filled from amongst the Additional District and Sessions Judges working on that date.
Only the posts created thereafter could be filed from the three sources under the 1975 rules.
The second contention of Mr. Prasad was that the benefit of continuous officiation towards seniority cannot be confined to three years and the promotees are entitled to the fixation of their seniority on the basis of continuous length of Service.
Mr. Satish Chandra on the other hand has argued that second proviso to Rule 8(2) of the 1975 rules which is retrospective in its application, limits the number of vacancies as on May 10, 1974 to be filled by promotion from amongst the members of Nyaik Sewa.
According to him, under the said proviso, all the other posts created after May 10, 1974 are to be filled from the three sources in accordance with the 1975 rules.
Mr. Satish Chandra further argued that the High Court acted illegally and in violation of first proviso to Rule 26(1) (a) of the 1975 rules in determining the seniority of the promotees by giving them the benefit of three years officiation immediately preceding the date of availability of permanent vacancy.
According to him, such period under the above proviso can only be preceding the date of confirmation.
The judgment in Dixit case, by and large, deals with the main points raised by the learned counsel for the parties before us.
But in view of divergent view point taken by the promotees, the direct recruits and the High Court on the interpretation of the said judgment, we are of the view that it is necessary to have a fresh look into the matter to finally settle the long drawn controversy between the parties.
The service is a prestigious and sensitive service consisting of officers who form the back bone of Uttar Pradesh Judiciary.
The service is the feeder cadre for appointment to High Court Judges.
It is necessary to settle their rights in clear and unambiguous terms.
Taking an overall view of the arguments advance by Mr. Yogeshwar Prasad and Mr. Satish Chandra we pose the following three questions for our determination: 1.
What is the scope and interpretation of second proviso to rule 8(2) of the 1975 rules? Whether the Additional District and Sessions Judges, holding the posts on April 5, 1975, can claim that by operation of the 1974 rules they stood appointed to the service and as such consumed all the posts which were available 439 on April 5, 1975 or they were only entitled to vacancies under the second proviso to rule 8(2) of the 1975 rules.
Whether the period of continuous officiation in case of a promotee, for determining seniority, is to be counted in terms of First proviso to rule 26(1)(a0 of the 1975 rules or in accordance with the principle adopted by the High Court.
Isn 't it the requirement of law that a promotee is entitled to seniority in the service from the date when vacancy in his quota became available.
Seniority and appointment in the service being inter linked a further question which necessarily arises for our consideration is whether rules 22(3) and 22(4) of the 1975 rules, which provide appointments to temporary posts in the service from two sources of promotees excluding the direct recruits, can be legally sustained.
We may take up the first point for consideration.
After the decision by this court in Chandra Mohan 's case (supra), the Service consisted of only promotees with the designation of Civil and Sessions Judges.
They were promoted from the lower cadre of U.P. Civil Services (Judicial Branch) called "Nyayik Sewa".
Thereafter under the 1974 rules which came into force on May 8, 1974 the Civil and Sessions Judges, holding permanent or temporary posts, were redesignated as Additional District and Sessions Judges.
By Operation of the 1974 Rules all the newly designated Additional District and Sessions Judges became members of the Service.
Rule 2 of the 1974 Rules specifically provided that with effect from the date of commencement of those Rules "the Uttar Pradesh Higher Judicial Service shall consist of the posts of District and Sessions Judges and Additional District and Sessions Judges".
It is thus obvious that the service was reconstituted under the 1974 Rules and all the Additional District and Sessions Judges, to the extent posts were available, became members of the said service by operation of law.
There were 271 officers working in the Service on May 8, 1974 and there were 235 posts (153 permanent plus 82 temporary) available in the service.
Therefore, 235 officers out of the 271 working on May 8, 1974 for whom the posts were available in the service would be deemed to be members of the service under the 1974 rules.
The Service as constituted under the 1974 Rules continued to operate till April 5, 1975 when the 1975 rules were enforced.
Till that date the only source of recruitment to the service was by way of promotion.
On April 5, 1975 440 the service comprised of 236 posts (229 permanent plus 7 temporary).
They were 263 officers working in the service on that date.
235 posts were already occupied by the officers who had become members of the service under the 1974 rules and the one additional post available would go to the 236th officer holding the post on April 5, 1975.
The 236 posts comprising the service on April 5, 1975 have to be assigned and given to the 236 officers out of 263 who were working a Additional District and Sessions Judges and they are to be treated as existing members of the service as on April 5, 1975.
It is further axiomatic that the 236 officers including those holding temporary posts would en bloc rank senior to all those who were appointed to the service after April 5, 1975 under the 1975 rules.
The view which we have taken is also in conformity with the observations in Dixit case relied upon by the promotees which we approve.
Coming to the second proviso to rule 8(2) of the 1975 rules relied upon by the direct recruits, we are of the view that the interpretation given to the proviso by the High Court is not correct.
A bare reading of the proviso shows that it was not applicable to the Service as reconstituted under the 1974 Rules consisting of Additional District and Sessions Judges.
The proviso states that "all the permanent vacancies existing on May 10, 1974 plus 31 temporary posts existing on that date. . ., shall be filled by promotion from amongst the members of the Nyayik Sewsa; and only the remaining vacancies shall be shares between the three sources under these rules.
" The Additional District and Sessions Judges working on May 10, 1974 were not members of the Nyayik Sewa, they had already become members of the Service on May 8, 1974 under the 1974 Rules.
The proviso talks of "Nyayik Sewa" and "the three sources under the Rules", which obviously means it is visualising a situation which was to exist after the enforcement of the 1975 rules on April 5, 1975.
Rule 8 of the 1975 rules is under the heading "number of appointments to be made" and various parts of the said Rule deal with different situation for making appointments from different sources at different times.
Proviso 2 was enacted to meet a particular situation.
The proviso talks of "existing vacancies" on May 10, 1974.
On that date the posts held by the Additional District and Sessions Judges, who were members of the Service, could not be termed as "existing vacancies".
The "existing vacancies on May 10, 1974" could only be those vacancies which were left over after providing posts to all the officers who were redesignated as Additional district and Sessions Judges under the 1974 Rules.
The proviso was meant to deal with a situation which might have arisen in the event, there had been more posts and less number of officers to occupy 441 the said posts on the reconstitution of the Service under the 1974 Rules.
In that situation the balance vacancies could be the `existing vacancies ' falling within the mischief of the proviso.
Since prior to April 5, 1975 the only source of recruitment to service was by way of promotion the proviso intended to fill all those posts created before that date and available on that as "existing vacancies (surplus posts), from amongst the members of `Nyayik Sewa ' in the first instance and thereafter operate the quota from three sources under the 1975 rules.
The proviso was meant to carry the surplus vacancies as on May 10, 1974 to April 5, 1975 for the benefit of the promotees.
But since the number of officers working in the service as on May 10, 1974 and April 5, 1975 was much more than the posts available in the service the situation envisaged by the proviso did not arise.
The second proviso to rule 8(2) of the 1975 rules could not operate and since it was intended to meet one time eventually it has become redundant.
The interpretation placed on the proviso by the direct recruits and the High Court if accepted would expose the rule to an attack on the grounds of discrimination and arbitrariness.
The Additional District and Sessions Judges had not only the right to be appointed to the service but they were so appointed by the operation of 1974 rules.
The proviso, even though retrospective, could not have taken away the vested rights of the officers who had already become members of the service.
This could not be the intention of the framers of the 1975 rules.
We, therefore, reject the contention of Mr. Satish Chandra.
Third proviso to Rule 8(2) which is dependent on second proviso must obviously meet the same fate.
The net result is that on April, 5, 1975 all the 236 officers working against 236 posts (229 permanent+7 temporary) as Additional District and Sessions Judges in the Service, shall be deemed to be existing members of the Higher Judicial Service as constituted under the 1975 Rules and they shall en bloc rank senior to all other officers appointed to the service thereafter from the three sources in accordance with their quota under the Rules.
We may now take up the second point as to how the seniority of the promotees, who have rendered continuous officiating service, be fixed under the 1975 rules.
Mr. Satish Chandra, learned counsel for the direct recruits has taken us through Rule 3(d) which defines "member of the service", 4(3), 13 and 19(2) of the 1953 Rules and has contended that temporary posts cannot form part of the cadre of the Service.
According to him service rendered in or against a temporary post is outside the pale of the 1975 rules and cannot be counted for seniority.
He has further relied upon clauses (13) and (19) of rule 9 of the U.P. Fundamental Rules which define "lien" and "officiate" and 442 contended that an officiating appointment can only be made against a permanent post and as such the continuous officiation immediately prior to the date of confirmation provided in the first proviso to rule 26(1)(a) of the 1975 rules can only be the officiation against a permanent post.
It is not necessary for us to go into this question because the point is not res integra.
It is not disputed that the service consists of permannt and temporary posts.
This Court in Dixit 's case after taking into consideration the scheme of the 1975 rules held as under: "In Rule 22 of phrase used is "to make appointment to the Service on the occurrence of substantive vacancies" and it was contended on the one side that substantive vacancies does not mean permanent vacancies whereas on the other hand it was contended that if only means permanent vacancies.
The substantive vacancy has not been defined in the Rules but proviso to Rule 8 which has been quoted above speaks of permanent vacancies and temporary posts.
In fact the scheme of the Rules clearly indicates that there are permanent posts and temporary also which are created to meet contigency and it may in due course be made permanent.
It therefore could not be doubted that when appointment under Rule 22 is contemplated in the service of substantive vacancies, it may be both temporary or permanent but the vacancy must be in the cadre.
" We agree with the above findings and accept the position that the Service consists of permanent as well as temporary posts.
The substantive vacancy has not been defined under the 1975 rules but as held by this Court in Dixit case there can also be a substantive vacancy in a temporary post which is part of the cadre.
All temporary posts created under rule 4(4) of the 1975 rules are additions to the permanent strength of the cadre and as such form part of cadre.
Appointments under rule 22 of the 1975 rules can be made to a permanent post as well as to a temporary post.
So long as the temporary post has an independent existence and is a part of the cadre strength the appointment against the said post has to be treated as substantive appointment.
There is no dispute that the seniority of a direct recruit, appointment to the post in service, has to be determined from the date of continuous officiation in the service.
The question for our determination is whether the seniority of a promoted officer is to be counted from the date of countinuous officiation giving him benefit of full 443 period of officiation as claimed by Mr. Yogeshwar Prasad or only for a maximum period of three preceding the date of confirmation as provided by first proviso to Rule 26(1)(a) as agrued by Mr. Satish Chandra.
The High Court has not followed either of the methods and has determined the seniority by giving benefit to a promotee of three years officiation preceding the date of availability of a permanent post.
We have given our thoughtful consideration to the arguments of the parties.
This Court has time and again held that when an incumbent is appointed to a post in accordance with the Service Rules his seniority has to be counted on the basis of continuous length of service and not in reference to the date of confirmation.
Even in present case the promotees have been confirmed long after the availability of permanent vacancies.
This Court in S.B. Patwardhan & Others etc.
vs State of Maharashtra & Others, ; observed that "confirmation is one of the inglorious uncertainties of Government service depending neither on efficiency of the incumbent nor on the availability of substantive vacancies".
A Constitution Bench of this Court in Direct Recruit Class II Engineering Officers ' Association vs State of Maharashtra and Others, ; approved Patwardhan 's case and laid down the following propositions in this respect: (A) Once an incumbent is appointed to a post according to rule, his seniority has to be counted from the date of his appointment and not according to the date of his confirmation.
The Corollary of the above rule is that where the initial appointment is only ad hoc and not according to rules and made as a stop gap arrangement, the officiation in such post cannot be taken into account for considering the seniority.
(B) If the initial appointment is not made by following the procedure laid down by the rules but the appointee continues in the post uninterruptedly till the regularisation of his service in accordance with the rules, the period of officiating service will be counted.
(C) When appointments are made from more than one source, it is permissible to fix the ratio for recruitment from the different sources, and if rules are framed in this regard 444 they must ordinarily be followed strictly.
" Keeping in view the scheme of the 1975 rules, we are of the view that first proviso to rule 26(1)(a) of the 1975 rules which links the seniority with the date of confirmation is on the face of it arbitrary and as such violative of Article 16 of the Constitution of India.
Since the recruitment to the service is from three sources the existence of a vacancy either permanent or temporary is the sine quo non for claiming benefit of continuous length of service towards seniority.
The period of officiation/service which is not against a substantive vacancy (permanent or temporary) cannot be counted towards seniority.
While striking down first proviso to rule 26 (1)(a) of the 1975 rules we hold that the continuous officiation/service by a promotee shall be counted for determining his seniority only from the date when a substantive vacancy against a permanent or temporary post is made available in his quota under the 1975 rules.
Finally we take up the third point.
Recruitment to the service under the 1975 rules is from three sources and is based on quota as provided therein.
The cadre consists of permanent as well as temporary posts.
We have already interpreted the seniority rule to the mean that the seniority of the direct recruit is to be determined from the date of his joining the service and that of promotee on the basis of continuous officiation/service from the date when a vacancy whether permanent or temporary, becomes available in his quota.
With these characteristics of the service it is obligatory that there should be equality of opportunity to enter the service for all the three sources of recruitment.
The seniority in the service is consequential and dependent on appointment.
If the recruitment rule gives unjustifiable preference to one source of recruitment the seniority rule is bound to become unworkable.
The object of having recruitment from different sources is to have a blended service to create healthy competition and in the process achieve efficiency.
If one of the sources of recruitment is dealt with unevenly under the Service Rules the said objective cannot be fulfilled.
The 1975 rules permit appointment to temporary vacancies in the service by promotion and from the judicial service.
No direct recruitment to the temporary vacancies is provided under the said rules.
Rule 18 of the 1975 rules provides procedure for selection of the direct recruits.
Rule 20 lays down the procedure for recruitment by promotion and Rule 22 provides for appointment.
These Rules are reproduced as under: 445 "18.
Procedure of selection (1) The Selection Committee referred to in Rule 16 shall scrutinize the applications received and may thereafter hold such examination, as it may consider necessary for judging the suitability of the candidates.
The Committee may call for interview such of the applicants who in its opinion have qualified for interview after scrutiny and examination.
(2) In assessing the merits of a candidate the Selection Committee shall have due regard to his professional ability, character, personality and health.
(3) The Selection Committee shall make a preliminary selection and submit the record of all candidates to the Chief Justice and recommended the names of the candidates in order of merit who, in its opinion, are suitable for appointment to the service.
(4) The Court shall examine the recommendations of the Selection Committee and, having regard to the number of direct recruits to be taken, prepare a list of selected candidates in order of merit and forward the same to the Governor.
Promotion of members of the Nyayik Sewa.
(1) Recruitment by promotion of the members of the Nyayik Sewa shall be made by selection on the basis of seniority cum merit.
(2) The field of eligibility for recruitment by promotion shall be confined to four times the number of vacancies to be filled by promotion.
The Selection Committee shall prepare a list in order of seniority of the officers eligible under Rule 5(b) of these rules.
(3) The Selection Committee shall, after examining the record of the officers included in the list prepared under sub rule(2) of this rule make a preliminary selection of the officers who in its opinion are fit to be appointed on the basis of seniority cum merit.
In assessing the merits of a candidate, the Selection Committee have due regard to his service record, ability, character and seniority.
The list shall contain the names of officers twice the number of 446 vacancies required to be filled by promotion of the members of the Nyayik Sewa.
(4) The Selection Committee shall forward the list of the candidates chosen at the preliminary selection to the Chief Justice along with the names of the officers who, if any, in the opinion of the Committee have been passed over for promotion to the service.
(5) The Court shall examine the recommendations of the Selection Committee and make a final selection for promotion and prepare a list in order of seniority of the candidates who are considered fit for promotion and forward the same to the Governor.
The list shall remain operative only till the next recruitment.
Appointment.
(1) Subject to the provisions of sub rules (2) and (3), the Governor shall on receipt from the Court of the lists mentioned in Rules 18,30 and 21 make appointments to the service on the occurrence of substantive vacancies by taking candidates from the lists in the order in which they stand in the respective list.
(2) Appointments to the service shall be made on the rotational system, the first vacancy shall be filled from the list of officers of the Nyayik Sewa, the second vacancy shall be filled from the list of direct recruits (and so on), the remaining vacancies shall thereafter be filled by promotion from the list of the officers of the Nyayik Sewa.
Provided that for so long as suitable officers are available from the cadre of the Judicial Magistrates, appointments to the service shall be made in such a way that the second fifth and eighth (and so on), vacancy shall be filled from the list of Judicial Magistrates.
(3) Appointment for temporary vacancies or in officiating capacity shall be made by the Governor in consultation with the Court from amongst the members of the Nyayik Sewa.
Provided that for so long as suitable officers are available from the cadre of the Judicial Magistrate appoit 447 ments on temporary vacancies or in officiating capacity shall be made in consultation with the Court from amongst the Judicial Magistrate according to the quota fixed for that source under these rules: Provided further that for so long as such members of the Judicial Service as are considered suitable for appointments on temporary vacancies or in officiating capacity, are not available in sufficient number, the Governor in consultation with the Court may fill in not more than 50 per cent of such vacancies from amongst the officers of the cadre of Judicial Magistrates.
(4) The appointments shall be made or rotational system the first vacancy shall be filled from the list of officers of the Nyayik Sewa, the second vacancy shall be filled from the list of Judicial Magistrates (and so on).
Is obvious from Rules 22(3) and 22(4) reproduced above that appointments to the temporary vacancies are to be made from amongst the members of the Nyayik Swea and the Judicial Magistrates.
Under Rule 20 the Selection Committee has to prepare a merit list in order of seniority of the officers of Nyayik Sewa twice the number of vacancies and the said list remains operative till the next recruitment.
Similarly, a merit list of eligible officers from the Judicial Magistrates is prepared.
Whenever temporary posts are created, appointments to the said posts under Rule 22(3) and 22(4) are made from out of the lists so prepared.
Rule 18 on the contrary is silent about the preparation of a similar merit list obviously because Rule 22 does not permit any appointment to the temporary posts from amongst the direct recruits.
We see no justification is not applying the quota rule to the temporary posts in the service and confining appointments to said posts to the two sources of promotees.
This Court in A.Ks Subraman vs Union of India, [1975] 2 S.C.R. 979 held as under: "The quota rule will be enforced with reference to vacancies in all posts, whether permanent or temporary included in the sanctioned strength of the cadre (except such vacancies as are purely of a fortuitous of adventitious nature) . . " This court in P.s.
Mahal vs Union of India, ; held as under: 448 "It is therefore obvious that if a vacancy arises on account of an incumbent going on leave or for training or on deputation for a short period, it would be a fortuitous or adventitious vacancy and the quota rule would not be attracted in case of such a vacancy.
But where a vacancy arises on account of in incumbent going on deputation for a reasonably long period and there is no reasonable likelihood of the person promoted to fill such vacancy having to revert, the vacancy would be subject to the quota rule.
" It is, therefore, apparent that what has to be considered for the applicability of the quota rule is a vacancy in a post included in the sanctioned strength of the cadre. ." It is thus clear that the vacancies in the posts of Executive Engineer arising on account of deputation of Executive Engineers to other departments, organisations and public undertakings for a period of one or more years were long term vacancies and they could not be regarded as fortutitous or adventitious in character and hence they were subject to the quota rule".
When temporary posts under rule 4(4) of the 1975 Rule are created as addition to the cadre we see no justification to deny the direct recruits their share of the quota as provided under rule 6 of the said rules.
Rules 5 of the 1975 rules specifically lays down that recruitment to the service shall be made from three sources including the direct recruits.
Rule 6 fixes the quota for various sources of recruitment to the service and allocates 15 per cent of the posts in the service to the direct recruits.
Rules 5 and 6 read with Rule 22(2) provide for appointments to the service in accordance with quota.
These rules have to be read homogeneously and as a part of the same scheme.
The service having comprised of three sources including the direct recruitment there is no justification to deprive the direct recruits of their share in the temporary posts in the service.
Unless the direct recruits are given their due quota in the temporary posts the seniority rule cannot operate equitably.
We see no justification whatsoever in having rule 22(3) and 22(4) of the 1975 rules which deprive one of the sources of recruitment the benefit of appointment to the temporary posts.
The rules on the face of it are discriminatory.
There is no nexus with the object sought to be achieved by framing the abovesaid rules.
We, therefore, strike down rules 22(3) and 22(4) of the 1975 rules being 449 discriminatory and violative of Articles 14 and 16 of the Constitution of India.
We, however, direct that the appointments already made under these rules (22(3) and 22(4) shall not be invalidated on this ground.
We further direct that while selecting candidates under rule 18 the Committee shall prepare a merit list of candidates twice the number of vacancies and the said list shall remain operative till the next recruitment.
We further direct that the appointments under rules 22(1) and 22(2) of the Rules shall be made to permanent as well as temporary posts from all the three sources in accordance with the quota provided under the 1975 rules.
Before parting with the judgment we make it clear that the findings and observations in Dixit case to the extent those are contrary to this judgment, shall be deemed to have been over ruled.
We allow the writ petitions and the Civil Miscelleneous petition, quash the final seniority list dated August 25, 1988 and direct the High Court to prepare, circulate, invite, objections and finalise the seniority list of the service in the light of the findings given and the observations made by us in this judgment.
We reiterate our findings hereunder: 1.
All the 236 promotee officers against 236 posts (229 permanent plus 7 temporary) as Additional District and Sessions Judges on April 5, 1975 shall be deemed to be existing members of the Service as constituted under the 1975 rules and they shall en bloc senior to all other officers appointed to the service thereafter from three sources in accordance with their quota under the 1975 rules.
We strike down (first proviso to rule 26(1) of the 1975 rules and direct that the continuous officiation/service by a promotee appointed under the Rules shall be counted for determining his seniority from the date when a substantive vacancy in permanent or temporary post is made available in his quota under the 1975 rules.) 3.
(We also strike down rules 22(3) and 22(4) of the 1975 rules but the appointments already made under these rules shall not be invalidated.
We further direct that while selecting candidates under rule 18 of the said Rule the committee shall prepare a 450 merit of candidates twice the number of vacancies and the said list shall remain operative till the next recruitment.
We further direct that the appointments under rules 22(1) and 22(2) of the 1975 rules shall be made to permanent as well as temporary posts from all the three sources in accordance with the quota provided under the said rules.) There shall be no order as to costs.
R.S.S. Petition allowed.
| IN-Abs | The appellants as well as the respondents are members of the Uttar Pradesh Higher Judicial Service; while the appellants are the promotees, the respondents have been appointed direct to that service.
This is their second round of litigation in this Court concerning their inter se seniority in the service.
The Higher Judicial Service was initially governed by statutory rules called the Uttar Pradesh Higher Judicial Service Rules, 1953.
Recruitment to the service under the said rules was from sources, by promotion and by direct recruitment.
This Court in Chandra Mohan vs State of Uttar Pradesh, struck down the 1953 Rules in so far as the said Rules provided for direct recruitment of the service.
As a consequence, there was no direct recruitment to the service till 1975 76, and the service consisted of only promotees with the designation of Civil and Sessions Judges.
On May 8, 1974 the Uttar Pradesh Higher Judicial Service (abolition of Cadre of the Civil and Sessions Judges) Rules, 1974 came into force.
Under Rules 2 and 3 of the 1974 Rules, the existing cadre of Civil and Sessions Judges stood abolished and a new cadre of Additional District and Sessions Judges came into existence, the Civil and Sessions Judges holding permanent or temporary posts in the Service were re designated as Additional District and Sessions Judges with effect from the date when the 1974 Rules came into force.
On that date, 271 officers were working as Additional District and Sessions Judges against 235 posts (153 permanent and 82 temporary) in the service.
The Service was reconstituted and given a fresh look by the rules framed under Article 309 read with Article 233 of the Constitution of India, called the Uttar Pradesh Higher Judicial Service Rules, 1975 which came into force on April 5, 1975.
On that date 263 officers were 425 working as Additional District and Sessions Judges, against 236 posts in the service.
Recruitment to the service under the 1975 Rules is from three sources and is based on quota as provided therein.
The three sources of recruitment are (i) direct recruitment from the Bar, (ii) Uttar Pradesh Nyayik Sewa, and (iii) Uttar Pradesh Judicial Service (Judicial Magistrates).
In the first round of litigation P.K. Dixit and other promotee officers filed two writ petitions under Article 32 of the Constitution Challenging the seniority assigned to them under the 1975 Rules.
This Court by its judgment dated October 8, 1987 in P.K. Dixit vs State of U.P., ; partly allowed the writ petitions and directed the High Court to frame the seniority list afresh keeping in view the observations made in that judgment.
In pursuance to the directions of this Court in Dixit case a five Judge committee of the High Court finalised the seniority list on August 25, 1988.
The High Court accepted the contention of direct recruits and gave 153 permanent posts existing on May 10, 1974 plus 31 posts, which became permanent subsequently, to the promotees.
Consequently, out of the 263 Additional District and Sessions Judges who were holding the posts on April 5, 1975 only 84 (153 + 31) were taken to be the existing members of the Service and the remaining officers were asked to enter the service through the promotion quota under the 1975 rules.
In the second round, the promotees have filed writ petition challenging the final seniority list.
P.K. Dixit and others, petitioners in the original Dixit case have filed Civil Miscellaneous Petition seeking clarification of the said judgment.
The direct recruits have filed writ petition under Article 32 impugning the final seniority list issued by the High Court.
Before this Court, the promotees, the direct recruits as well as the High Court have sought support from Dixit case on the basis of their own interpretation of that judgment.
The promotees claim that on April 5, 1975 when the 1975 rules came into force all the 236 posts in the Service had already been consumed by the existing members of the service who were working as Additional District and Sessions Judges; till that date the recruitment to the service was only by way of promotion and as such there was no question of allocating any post to the direct recruits who had not yet been born in the service.
426 On the other, hand, the direct recruits contend that this court interpreting the second proviso to Rule 8(2) of the 1975 rules in Dixit case had held that the promotees as on May 10, 1974 are entitled to all the permanent posts available on that date plus 31 temporary posts, and apart from that they cannot lay claim exclusively to the posts created thereafter.
In this connection it was contended that temporary posts could not form part of the cadre of the Service, and service rendered in or against a temporary post was outside the pale of the 1975 rules and could not be counted for seniority and as much the continuous officiation immediately prior to the date of confirmation provided in the first proviso to rule 26(1)(a) of the 1975 rules could only be the officiation against a permanent post.
Allowing the Writ Petition and the Civil Miscellaneous Petition, quashing the seniority list and directing the High Court to prepare fresh seniority list, this Court, HELD: (1) The interpretation given by the High Court to the second proviso to rule 8(2) of the 1975 Rules is not correct.
The proviso was not applicable to the Service as reconstituted under the 1974 Rules consisting of Additional District and Sessions Judges.
Proviso 2 was enacted to meet a particular situation.
The proviso was meant to deal with a situation which might have arisen in the event there had been more posts and less number of officers to occupy the said posts on the reconstitution of the Service under the 1974 Rules.
But since the number of officers working in the service as on May 10, 1974 and April 5, 1975 was much more than the posts available in the service the situation envisaged by the proviso did not arise.
The second proviso to rule 8(2) of the 1975 rules could not operate and since it was intended to meet one time eventuality it has become redundant.
[440D 441C] (2) The Service as constituted under the 1974 Rules continued to operate till April 5, 1975 when the 1975 rules were enforced.
On April 5, 1975 the Service comprised of 236 posts (229 permanent plus 7 temporary)> There were 263 officers working in the service on that date.
The 236 posts comprising the service on April 5, 1975 have to be assigned and given to the 236 officers out of 263 who were working as Additional District and Sessions Judges and they are to be treated as existing member of the service as no April 5, 1975.
It is further axiomatic that the 236 officers including those holding temporary posts would en bloc rank senior to all those who were appointed to the service after April 5, 1975, under the 1975 rules.
[439H 440C] 427 (3) The Additional District and Sessions Judges had not only the right to be appointed to the service but they were so appointed by the operation of 1974 rules.
The second proviso to Rule 8(2) even though retrospective could not have taken away the vested rights of the officers who had already become members of the service.
This could not be the intention of the farmers of the 1975 rules.
[441D] (4) The substantive vacancy has not been defined under the 1975 rules but there can also be a substantive vacancy in a temporary post which is part of the cadre.
All temporary posts created under rule 4(4) of the 1975 rules are additions to the permanent strength of the cadre and as such form part of the cadre.
[442F] (5) Appointments under rule 22 of the 1975 Rules can be made to a permanent post as well as to a temporary post.
So long as the temporary post has an independent existence and is a part of the cadre strength the appointment.
[442G] (6) Recruitment to the service under the 1975 rules is from three sources and is based on quota as provided therein.
The cadre consists of permanent as well as temporary posts.
The seniority of the direct recruit is to be determined from the date of his joining the service and that of promotee on the basis of continuous officiation/service from the date when a Vacancy whether permanent or temporary, becomes available in his quota.
With these characteristics of the service it is obligatory that there should be equality of opportunity to enter the service for all the three sources of recruitment.
If the recruitment rule gives unjustifiable preference to one source of recruitment the seniority rule is bound to become unworkable.
[444E F] (7) When temporary posts under rule 4(4) of the 1975 rules are created as addition to the cadre there is no justification in not applying the quota rule to the temporary posts in the service and confining appointments to said posts in the service to the two sources of promotees.
[448E] A.K. Subraman vs Union of India, referred to.
(8) There is no justification whatsoever in having rules 22(3) and 22(4) of the 1975 rules which deprive one of the sources of recruitment the benefit of appointment to the temporary posts.
The rules on the face 428 of it are discriminatory.
There is no nexus with the object sought to be achieved by framing these rules.
[448G H] (9) Rules 22(3) and 22(4) of the 1975 rules are discriminatory and violative of Articles 14 and 16 of the Constitution and are accordingly struck down.
However, the appointments already made under these rules 22(3) and 22(4) shall not be invalidated on this ground.
Further, while selecting candidates under rule 18 the Committee shall prepare a merit list of candidates twice the number of vacancies and the said list shall remain operative till the next recruitment.
Further, the appointments under rules 22(1) and 22(2) of the Rules shall be made to permanent as well as temporary posts from all the three sources in accordance with the quota provided under the 1975 rules.
[449H 450B] (10) The findings and observations in Dixit case to the extent those are contrary to this judgment shall be deemed to have been over ruled.
[449C]
|
ivil Appeal No. 8613 of 1983.
From the Judgment and Order dated 21.1.1981 of the Delhi High Court in Civil Writ No. 41 of 1981.
P.K.Goswamy and Kailash Vasudev for the Appellant.
V.C. Mahajan, Ashok Bhan and C.V. Subba Rao for the Respondent.
This appeal was earlier heared by a Division Bench and was referred to a Constitution Bench for examining the question whether a candidate whose name appears in the merit list on the basis of a competitive examination, acquires indefeasible right of appointment as a Government servant if a vacancy exists.
Reference was made to the decision in State of Haryana vs Subhash Chander Marwaha and Others, ; ; Miss Neelima Shangla, Ph.D.v.
State of Haryana and Others, ; and Jitendra Kumar and Others vs State of Punjab and Others.
[1985] 1SCR 899.
570 2.
The appellant was selected in the combined Civil Services Examination held by the Union Public Service Commission for appointment to several services including the Indian Police Service (in short `the IPS ') and the Police Services Group `B '.
The examination had been held in October, 1977 and the result was announced in May 1978.
A combined merit list for the IPS and the Police Services Group `B ' was announced which included the name of the appellant.
Out of the total number of 70 vacancies in the IPS announced to be filled up, 54 were of general category and the remaining 16 reserved for Scheduled Castes/Scheduled Tribes candidates.
The position of the appellant in the merit list was not high enough to be included in the IPS and he was offered appointment to the Delhi Andaman and Nicobar police Service (hereinafter referred to as the `DANIP ')in Police Service Group `B ' which he accepted.
On account of several candidates, allotted to Police Services Group `B 'not Joining, the position of the appellant improved and ultimately he was on the top of the list.
In June, 1979, 14 Vacancies arose in the IPS due to selected candidates not joining the service.
Out of the same, 11 were in the general category and 3 in the reserved category.
Three vacancies in the reserved category were filled up by the candidates who had been earlier appointed in DANIP Service, but no appointments were made to general category vacancies.
The appellant, by a representation, prayed that these vacancies also should be filled up.
The request was turned down, and the appellant moved the Delhi High Court by a writ application under Article 226 of the Constitution, which was dismissed in limine by the impugned order.
The case of the appellant is that since ultimately several vacancies in the general category of the IPS remained unfilled, he was entitled to be appointed in one of them, and the authorities were not right in rejecting his representation.
It has been contended that after calculating the number of vacancies in the IPS, it was announced that appointments would be made in 54 vacancies of general category, and steps for recruitment were accordingly taken.
The appellant along with others appeared at the elaborate test held for the purpose and he was found qualified for the appointment .In that situation the respondent could not refuse to fill up the vacancies and proceed to appoint the appellant in the Police Services Group `B '.
It has been argued that the correct procedure in similar situation was followed with respect to the reserved category and the three vacancies arising in identical situation were filled up from the candidates selected for DANIP Service, and 571 there was no justification to refuse similar benefit to the appellant in the general category.
According to the case of the Union of India, the process for the recruitment in question started in 1977, and the tentative service allocation for IPS was completed before the commencement of the foundational course in July, 1978.
All the candidates selected for IPS, excepting those who were eligible to appear at the examination for the Indian Administrative Service scheduled to be held in October November, 1978, and such other candidates who had not been finally cleared on account of pending medical examination or character verification had to attend the foundational course.
Candidates allocated to Police Services Group `B ' were not required to undergo this course.
By June, 1978, 7 more vacancies arose on account of candidates not joining IPS due to various reasons, and 7 persons in order of merit from the joint list of the IPS and the Police Services Group `B ' were allowed to fill up these vacancies.
The last one in this list of 7 candidates was Shekhar Singh at serial No. 94.
The appellant could not get a chance as his position was 100th.
This process of final service allocation was closed on 24.10.1978 or at the latest by 4.11.1978, in view of the process for recruitment for the year 1978, which had already started.
The additional vacancies arising later,therefore, remained unfilled.
The entire procedure which is followed for recruitment to the Services has been given in several affidavits of the respondent, and detailed information in this regard was supplemented by a further affidavit during the hearing of the hearing of the appeal filed in the light of observations of the Bench.
6.Dealing with the appointments to reserved category,it has been stated in the counter affidavit that the process which was followed in connection with the general category and which was being earlier followed for the reserved category also, was relaxed in pursuance of a policy decision taken after examining all relevant circumstances and materials in regard to this category including the strength of the reserve category in the IPS, the result of the examinations for the year 1975,1976 and 1977.
The procedure which was being followed in the past was not relaxed in regard to the general category on account of vital differences obtaining in the relevant conditions in the two categories and the appellant 's plea of alleged discrimination does not have any merit.
Similarly the case of one Km.
Vandana Srivastava cited by the appellant has also been distinguished and Mr. Goswami, therefore , did not pursue this plea any further in his final reply.
572 7.
It is not correct to say that if a number of vacancies are notified for appointment and adequate number of candidates are found fit, the successful candidates acquire an indefeasible right to be appointed which cannot be legitimately denied.
Ordinarily the notification merely amounts to an invitation to qualified candidates to apply for recruitment and on their selection they do not acquire any right to the post.
Unless the relevant recruitment rules so indicate, the State is under no legal duty to fill up all or any of the vacancies.
However, it does not mean that the State has the licence of acting in an arbitrary manner.
The decision not to fill up the vacancies has to be taken bona fide for appropriate reasons.
And if the vacancies or any of them are filled up, the State is bound to respect the comparative merit of the candidates, as reflected at the recruitment test, and no discrimination can be permitted.
This correct position has been consistently followed by this Court, and we do not find any discordant note in the decisions in State of Haryana vs Subhash Chander Marwaha and Others, ; ; Miss Neelima Shangla vs State of Haryana and Others, ; and Jitendra Kumar and Others vs State of Punjab and Others, 8.
In State of Haryana vs Subhash Chander Marwaha and Others, (supra) 15 vacancies of Subordinate Judges were advertised, and out of the selection list only 7, who had secured more than 55% marks, were appointed, although under the relevant rules the eligibility condition required only 45% marks.
Since the High Court had recommended earlier, to the Punjab Government that only the candidates securing 55% marks or more should be appointed as Subordinate Judges, the other candidates included in the select list were not appointed.
They filed a writ petition before the High Court claiming a right of being appointed on the ground that vacancies existed and they were qualified and were found suitable.
The writ application was allowed.
While reversing the decision of the High Court, it was observed by this Court that it was open to the Government to decide how MANY appointments should be made and although the High Court had appreciated the position correctly, it had ``somehow persuaded itself to spell out a right in the candidates because in fact there were 15 vacancies ' '.
It was expressly ruled that the existence of vacancies does not give a legal right to a selected candidate.
Similarly, the claim of some of the candidates selected for appointment, who were petitioners in Jitendra Kumar and Others vs State of Punjab and Others, was turned down holding that it was open to the Government to decide how many appointments would be made.
The plea of arbitrariness was rejected in view of the facts of the case and it was had that the candi 573 dates did not acquire any right merely by applying for selection or even after selection.
It is true that the claim of the petitioner in the case of Miss Neelima Shangla vs State of Haryana was allowed by this Court but, not on the ground that she had acquired any right by her selection and existence of vacancies.
The fact was that the matter had been referred to the Public Service Commission which sent to the Government only the names of 17 candidates belonging to the general category on the assumption that only 17 posts were to be filled up.
The Government accordingly made only 17 appointments and stated before the Court that they were unable to select and appoint more candidates as the Commission had not recommended any other candidate.
In this background it was observed that it is, of course, open to the Government not to fill up all the vacancies for a valid reason, but the selection cannot be arbitrarily restricted to a few candidates notwithstanding the number of vacancies and the availability of qualified candidates; and there must be a conscious application of mind by the Government and the High Court before the number of persons selected for appointment is restricted.
The fact that it was not for the Public Service Commission to take a decision in this regard was emphasised in this judgment.
None of these decisions, therefore, supports the appellant.
Mr. Goswami appearing in support of the appeal has contended that in view of the relevant statutory rules, the authorities were under a duty to continue with the process of filling up all the vacancies until none remained vacant.
Reference was made to r. 4 of the Indian Police Service (Cadre) Rules, 1954, rr.
3,4,6 and 7 of the Indian Police Service (Recruitment) Rules, 1954 and rr., 2(1)(a), 2(1)(c), 8 and 13 of the Indian Police Service (Appointment by competitive Examination) Regulations, 1965.
We do not think any of these rules comes to the aid of the appellant.
Rule 3 of the Cadre Rules directs constitution of separate cadres for States or group of States, and r. 4 empowers the Central Government to determine the strength in consultation with the State Governments.
The strength has to be re examined at intervals of 3 years.
Rule 3 of Recruitment Rules deals with the constitution of the Service, and r. 4 the method of recruitment.
Rules 6 and 7 give further details in this regard.
The learned counsel could not point out any provision indicating that all the notified vacancies have to be filled up.
Similar is the position with respect to the Competitive Examination Regulations.
Regulation 2(1)(a) defines available vacancies as vacancies determined by the Central Government to be filled on the results of the examination, described in Regulation 2(1)(a).
Regulation 8 prescribes that the candidates would be considered for appointment to the available 574 vacancies subject to provisions 9 to 12 and Regulation 13 clarifies the position that a candidate does not get any right to appointment by mere inclusion of his name in the list.
The final selection is subject to satisfactory report on the character, antecedent and suitability of the candidates.
We, therefore, reject that the claim that the appellant had acquired a right to be appointed against the vacancy arising later on the basis of any of the rules.
The main contention on behalf of the appellant has been, however, that the authorities in keeping the vacancies arising later unfilled, acted arbitrarily.
Mr. Goswami referred to several documents annexed to the special leave petition and affidavits filed on behalf of the parties and contended that although appointments of many candidates in the other services were made in the later vacancies, the vacancy in the Indian Police Service which subsequently became available to the appellant was refused without any just cause, resulting in illegal discrimination.
This was emphatically denied on behalf of the respondent.
Since the matter did not appear to be free from ambiguity on the basis of the affidavits before us, we decided to examine the factual aspects more thoroughly by examining the other available materials on the records of the Union of India, and accordingly the learned counsel for the respondent got the relevant departmental files called.
Two further affidavits were also filed along with photostat copies of a large number of documents, which we examined at some length with the aid of the learned advocates for both sides.
From the materials produced before us it is fully established that there has not been any arbitrariness whatsover on the part of the respondent in filling up the vacancies in question or the other vacancies referred to by the learned counsel for the appellant.
The process of final selection had to be closed at some stage as was actually done.
A decision in this regard was accordingly taken and the process for further allotment to any vacancy arising later was closed.
Mr. Goswami relied upon certain appointments actually made subsequent to this stage and urged that by those dates the further vacancies in the Indian Police Service had arisen to which the appellant and the other successful candidates should have been adjusted.
We do not find any merit in this contention.
It is not material if in pursuance of a decision already taken before closing the process of final selection, the formal appointments were concluded later.
What is relevant is to see as to when the process of final selection was closed.
Mere completing the formalities cannot be of any help to the appellant.
We do not consider it necessary to mention all the details in this connection available from the large number of documents which we closely examined during the hearing at considerable length and do not 575 have any hesitation in rejecting the argument of the learned counsel in this regard based on the factual aspect.
So far the decision to adopt a different policy with respect to filling up of the reserved vacancies is concerned the same is justified on account of the special circumstances mentioned in the respondent 's affidavits.
The decision to depart from the confirmed policy was taken after a consideration by the authorities of the position in regard to unavailability of qualified candidates from year to year adversely affecting the desired strength of the reserved candidates in the services and cannot be condemned on the grounds of arbitrariness and illegal discrimination.
In the result, we do not find any merit in the appeal which is accordingly dismissed, but, in the circumstances, without costs.
N.P.V. Appeal dismissed.
| IN-Abs | On the basis of the results of the combined Civil Services Examination held by the Union Public Service Commission for appointment to several Services and the position in the combined merit list for the Indian Police Service and Police Services, Group `B ' the appellant was appointed to the Delhi Andaman and Nicobar Police Service,also Known as DANIP.
Subsequently when certain vacancies arose in the Indian Police Service, due to selected candidates not joining the Service, and only the reserved category vacancies were filled up by the candidates, who had been earlier appointed in DANIP Service, the appellant who came to occupy top position, represented to the authorities for filling the general vacancies also, but his request was turned down .Hence the appellant filed writ application before the High Court, which was dismissed in limine .
In the appeal before this Court, on behalf of the appellant it was contended that since ultimately several vacancies in the general category of the IPS remained unfilled, he was entitled to be appointed in one of them, that since 54 vacancies were notified for general category and he was found qualified for the appointment, the respondent could not refuse to fill up the vacancies, and there was no justification to refuse to follow the procedure adopted in similar situation with respect to the reserved category, in regard to the general category vacancies also and that in view of the relevant statutory rules, the authorities were under a duty to continue with the process of filling up the vacancies until nonremained vacant, and by keeping the posts unfilled, they had acted arbitrarily.
568 On behalf of the respondent Union of India it was contended that the tentative service allocation for IPS was completed before the commencement of the foundational course for the IPS, and the process of final service allocation was closed after filling up certain vacancies, which had arisen, since the process for recruitment for the next year had already started, and hence the additional vacancies arising later remained unfilled, that the process followed in connection with the reserved category, was not followed in regard to the general category vacancies on account of vital differences obtaining in the relevant conditions in the two categories, and hence there was no discrimination or arbitrariness, in keeping the general category vacancies unfilled.
Dismissing the appeal, this Court HELD: 1.1 Even if vacancies are notified for appointment and adequate number of candidates are found fit, the successful candidates do not acquire an indefeasible right to be appointed.
Ordinarily, the notification merely amounts to an invitation to qualified candidates to apply for recruitment and on their selection they do not acquire any right to the post.
Unless the relevant recruitment rules so indicate, the State is under no legal duty to fill up all or any of the vacancies.
However, it does not mean that the State has the licence of acting in an arbitrary manner.
The decision not to fill up the vacancies has to be taken bona fide for appropriate reasons.
And if the vacancies or any of them are filled up, the State is bound to respect the comparative merit of the candidates, as reflected at the recruitment test, and no discrimination can be permitted.
[572A C] State of Haryana vs Subhash Chander Marwaha and Others,[1974] 1 SCR 165; Miss Neelima Shangla vs State of Haryana and Others, ; and Jitendra Kumar and Others vs State of Punjab and others, , referred to.
1.2 The appellant had not acquired a right to be appointed against the vacancy arising later on the basis of any of the rules, namely, Rule 4 of the Indian Police Service (Cadre) Rules, 1954, Rules 3,4,6 and 7 of the Indian Police Service (Recruitment) Rules, 1954 and Regulations 2(1)(a) and (c), 8 and 13 of the Indian Police Service (Appointment by Competitive Examination) Regulations, 1955.These Provisions do not indicate that all the notified vacancies are to be filled up.[573G,574B] 1.3 From the materials placed before the Court it is fully estab 569 lished that there has not been any arbitrariness whatsoever on the part of the respondent in filling up the vacancies in question or other vacancies.
The process of final selection had to be closed at some stage as was actually done.
A decision in this regard was accordingly taken and the process for further allotment to any vacancy arising later was closed.
It is not material if in pursuance of a decision already taken before closing the process of final selection, the formal appointments were concluded later.
What is relevant is to see as to when the process of final selection was closed.
Mere completing the formalities dose not give any right to appointment.
[574E G] 1.4 The decision to adopt a different policy with respect to filling up of the reserved vacancies is justified on account of the special circumstances.
The decision to depart from the confirmed policy was taken after consideration by the authorities of the position in regard to unavailability of qualified candidates from year to year adversely affecting the desired strength of the reserved candidates in the services and cannot be condemned on the grounds of arbitrariness and illegal discrimination.
[575B]
|
ivil Appeal No. 2123 of 1991.
From the Judgment and Order dated 20.12.1988 of the Bombay High Court in Appeal No. 1649 of 1988.
WITH WRIT PETITION NO.
1287 OF 1989.
(Under Article 32 of the Constitution of India).
Rajinder Sachhar, R.K. Agnihotri and S.C. Paul for the Appellant/Petitioner.
K.N. Bhat, Vineet Kumar, Lalit Bhasin and Ms. Nina Gupta for the Respondents.
The Judgment of the Court was delivered by K. JAGANNATHA SHETTY, J.
Nagaraj Shivarao Karjagi, the petitioner in SLP No. 4415 of 1989 has challenged his compulsory retirement and in Writ Petition No. 1287 of 1989 he has questioned the validity of the direction dated 21 July 1984 issued by the Finance Ministry, Government of India.
Since the questions raised in both the cases are inter looked, we grant special leave in the SLP and proceed to dispose of the same along with the writ petition.
The events leading to these cases may briefly be stated.
In 1982, the petitioner was a Manager of the Syndicate Bank (`the Bank ') at East Patel Nagar Branch at New Delhi.
He discounted a cheque of the sum of Rs. 50,000 drawn on Punjab National Bank, Madras, after obtaining, by phone prior approval of the Regional Divisional Manager of the Bank.
The cheque was sent for realisation to the Punjab National Bank at Madras, but it was returned unpaid.
The petitioner did not take prompt action to recover the amount from the person in whose favour he discounted the cheque.
He kept the cheque 580 with him even without reporting to the higher authorities.
In 1983, the Assistant General Manager of the Bank called upon him to explain why the amount due under the discounted cheque has not been recovered.
The petitioner in his reply explained the circumstances under which the cheque was discounted.
He has stated that the credit was given to the account of one Dr. N. Ramakrishnan who was a Senoir Scientist in Indian `Agricultural Research Institute, New Delhi but the amount was withdrawn by another person called A. Chandrashekhar who is an officer of the Bank.
He has further stated that A. Chandrashekhar has promised to pay the amount and therefore, he has retained the instrument with him hoping that A. Chandrashekhar would keep up his promise.
On 6 July 1984 a sum of Rs.52,167.15 was deposited with the Bank.
A sum of Rs.36,000 towards principal sum and Rs.16,167.15 towards interest.
A suit was filed to recover a sum of Rs.14,000 out of the principal amount.
And later on, this principal amount was also recovered and credited to the Bank.
However, in 1985 there was a departmental inquiry against the petitioner.
The Commissioner for Vigilance Inquiry from the Central Vigilance Commission conducted the inquiry.
The first charge against the petitioner was that when he was functioning as Manager, he discounted under his discretionary jurisdiction a cheque for Rs.50,000 drawn in the name of Dr. N. Ramakrishnan in order to accommodate A. Chandrashekhar an officer of the Bank or others known to him.
The second charge framed against him, related to the retention of the discounted instrument with him from December, 1982 till January 1984 without taking/causing to be taken any action to realise the amount due under the unpaid cheque.
It was also alleged that the petitioner made available undue financial accommodation to A. Chandrashekhar or others to the detriment of the interests of the Bank.
He was charged with lack of the integrity, honesty devotion to duty, diligence and conduct unbecoming of the status of Bank Officer in contravention of Regulation No. 3(1) of the Syndicate Bank Officer Employees ' (Conduct) Regulations, 1976.
The inquiry was held as per the procedure prescribed by Syndicate Bank Officer Employees ' (Discipline & Appeal) Regulations, 1976, (`the Regulations ').
On 16 October 1986, the Inquiry Officer submitted his report holding that the charges were proved against the petitioner.
He has held that the petitioner has failed to take any effective steps for recovery of the amount paid under the discounted instrument.
He has kept the instrument with himself for unduly long period without even surrendering the same to the custody of the Bank.
It was 581 Only after the Additional General Manager reminded him by letter dated 15 December 1983, the petitioner assured him that he would return the cheque which he finally did on 18 January 1984.
The Inquiry Officer has finally concluded that the transaction connected with the unpaid instrument was of an accommodative nature with a view to assist A. Chandrashekhar by using another person as benami and it was in clear violation of the rules of the Bank.
It is said and indeed not disputed that the Bank referred the matter to the Central Vigilance Commission for advice and the Commission has recommended that the petitioner may be compulsorily retired from service by way of punishment.
The disciplinary authority after considering the inquiry report and affording an opportunity to the petitioner passed an order dated 7 October 1987 imposing on the petitioner the penalty of compulsory retirement.
The petitioner appealed to the General Manager challenging the punishment.
On 27 August 1988 the General Manager dismissed the appeal concurring with the findings recorded and the punishment imposed by the disciplinary authority.
The petitioner thereupon moved the Bombay High Court for relief under Article 226 of the Constitution.
The High Court has also dismissed the writ petition.
He has now appealed to this Court.
before us that the punishing authorities did not apply their mind and did not exercise their power in considering the merits of his case.
They have imposed on him the penalty of compulsory retirement in obedience to the advice of the Central Vigilance Commission which has been made binding on them by the direction dated 21 July 1984 issued by the Ministry of Finance, Department of Economic Affairs (Banking Division).
They have blindly followed the advice given by the Central Vigilance Commission without regard to the merits of the matter and contrary to the statutory Regulations governing the departmental inquiries.
The subject matter of inquiry was only regarding irregularities in the banking practice and the action complained of has not affected the interests of the Bank.
The petitioner by his own efforts has recovered the money due under the discounted cheque and credited the same with interest to the Bank.
The findings recorded by the Inquiry Officer on the alleged misdemeanour does not warrant any major penalty like the compulsory retirement.
Reference was also 582 made to certain representations said to have been made by the Bank to the Central Vigilance Commission for approval to impose a lesser punishment.
It is said that the Bank pleaded in the representations that the punishment of compulsory retirement advised by the Commission was too harsh.
SYNDICATE BANK OFFICER EMPLOYEES ' (DISCIPLINE AND APPEAL) REGULATION 1976 These Regulation have been framed under Section 19 of the Banking Companies (Acquisition and Transfer Undertakings) Act, 1970.
They were framed by the Board of Directors of the Syndicate Bank in consultation with the Reserve Bank of India and with the previous sanction of the Central Government.
Regulation 4 prescribes penalties for acts of misconduct.
Regulation 5 specifies the authority to institute disciplinary proceedings and impose penalties.
Regulation 6 lays down procedure for imposing major penalties and Regulation 7 provides for action on the inquiry report.
Regulation 7 confers power to the disciplinary authority either to agree or disagree with the findings of the inquiry authority on any article of charge.
The disciplinary authority may reach its own conclusion on the material on record and impose any penalty prescribed under Regulation 4.
Or if it is of the opinion that no penalty should be imposed on the delinquent officer, it may pass an order exonerating the delinquent officer.
Regulation 17 provides for appeals against the order imposing any of the penalties specified in Regulation 4.
The appellate authority has been given the power to pass any order of penalty or remitting the case to the disciplinary authority or to any other authority for fresh disposal.
Regulation 19 provides for consultation with the Central Vigilance Commission.
It states that "that the Bank shall consult the Central Vigilance Commission wherever necessary, in respect of all disciplinary cases having a vigilance angle.
" There is no other Regulation requiring consultation with Central Vigilance Commission, or providing that the advice given by the Commission is binding on the punishing authorities.
The Central Vigilance Commission, however, appears to have framed guidelines for Banks to consult the Commission in respect of cases where major penalty is prescribed under the Regulation.
Article 22 of the Central Vigilance Commission Manual reads : "The Scheme of consultation with the Commission in respect of major penalty cases pertaining to such officers envisages consultation with the Commission at two stages.
583 The first stage of consultation arises when initiating disciplinary proceedings while the second consultation is taken at the conclusion of the proceedings.
" Article 23.2 of the C.V.C. Manual Chapter 10 reads: "In all cases where C.V.C. advises initiation of major penalty proceedings, it also nominates simultaneously a Commissioner for Departmental Inquiries to whom the inquiry should be entrusted." THE DIRECTION OF THE MINISTRY OF FINANCE, DEPARTMENT OF ECONOMIC AFFAIRS (BANKING DIVISION) On 21 July 1984 Joint Secretary, Ministry of Finance, Department of Economic Affairs (Banking Division) has written a letter to all Banking Institution thus : "Recently a case been reported where a bank has revised the punishment awarded to an officer in a disciplinary case contrary to the advice of the Central Vigilance Commission.
The case has figured in the Annual Report of the CVC as a case of non consultation with the Commission and thus created an embarrassing situation.
You will, perhaps, be aware of the Annual Reports of the CVC, which contain cases where the disciplinary authorities had not accepted its recommendations or had not consulted it, are laid on the Tables of both the Houses of Parliament.
This may, thereafter be discussed in the Parliament also.
You will agree that under no circumstances the advice of the CVC should be modified except with the prior concurrence of the commission and this Ministry.
I may mention here that revision of the penalty imposed on a delinquent officer as a result of an appeal filed by him before the appellate authority against the decision of the original disciplinary authority also amounts to non consultation/non acceptance of the advice of the CVC and is included in CVC 's Annual Report.
Kindly circulate these instructions to the concerned officers in your bank for strict compliance.
The receipt of this D.O. letter may please be acknowledged.
A copy of this D.O. letter is being marked to CVO in your bank separately.
" 584 CIRCULARS OF THE BANK On 27 July 1984, A. Krishna Rao, Chairman and managing Director of the Bank, issued a circular to all branches of the Bank as follows : "I am enclosing herewith a photostat copy of the DO letter No.41/3/84 Vig.
dated 21.7.1984 received by me from Shri Ashok Kumar, joint Secretary, ministry of Finance, Department of Economic Affairs, (Banking Division), Vigilance Cell, New Delhi, in the above connection for strict compliance of the instructions contained therein.
As the advice in vigilance cases received from Central Vigilance commission is communicated to the authorities concerned by the Chief Vigilance Officer, I advise, that the Chief Vigilance Officer 's advice, as explained in my above referred to DO letter, should be complied with.
Even when a revision of the penalty imposed on a delinquent officer at the advice of the Chief Vigilance Officer by of Original Disciplinary Authority were to be considered as a result of an appeal filed by him before the appellate/high authorities, such revision shall be effected only after consulting the Chief Vigilance Officer.
Please acknowledge receipt of this and ensure compliance of the instructions contained herein.
" On 8 September 1986 P.S.V. Mallya, the succeeding Chairman and Managing Director of the bank issued another circular letter to all branches of the bank in the following terms: "All vigilance cases in bank are being investigated/ processed at Vigilance Cell at the HO, under the administrative control of the Chief Vigilance Officer, who is reporting directly to me.
After processing of the reports is concluded, the cases are referred to Central Vigilance Commission as per the existing procedure and the advice received from the commission is being communicated to the Disciplinary/Appellate Authority by the Chief Vigilance Officer.
585 If the advice tendered by the Commission is not accepted/acted upon, it will amount to non acceptance of the advice of the Commission and such instance will figure in the Annual Report of the Central Vigilance Commission placed before the Parliament.
This apart the non acceptance of the advice in vigilance cases is likely to lead to a situation, in which, different types of decisions are possible to be taken in similar cases, which is sure to result in a voidable complications and injustice to certain sections of the Officers/employees community.
Again in such a situation, ensuring uniform stantards in finalising action on vigilance cases will also become a very difficult phenomenon, which is not a desirable trend and does not augur well for the healthy functioning of the vigilance machinery in the Bank.
I therefore, advice all Disciplinary /Appellate Authorities to see that they refer as hitherto all vigilance cases to Chief Vigilance Officer and consult him on such cases and act upon his advice.
xxxxx xxxxx xxxxx xxxxx If for any reasons, the authorities concerned feel that the advice needs to be reconsidered or a departure is called for, they may refer back the matter to Chief Vigilance Officer for reconsideration of the advice, with the reasons for such disagreement and the Chief Vigilance Officer will see whether and to what extent such reconsideration is desirable or feasible and will tender advice again on reconsideration.
If the authority concerned is still not disposed to act on the advice, the disinclination on the part of the authority concerned will have to be brought to my notice and the advice given by me in respect of such cases shall be treated as final.
It is also necessary that the authorities concerned should for obvious reasons keep the advice in strict confidence and see that no reference thereof is made in any of the correspondence communication, whether emanating from their end.
" 586 The petitioner being aware of the directions of the Ministry of Finance and the circulars issued by the Bank has in his memo of appeal before the appellate authority inter alia complained that the system and procedure adopted by the Bank in dealing with vigilance cases, is totally against the principles of natural justice.
The Bank has no control over such cases.
The Disciplinary Authority and Appellate Authority are required to carry into effect the punishment advised by the Central Vigilance commission without change.
He has also pointed out that his appeal could be nothing but an empty formality as the appellate authority would be also bound by the decision of the Central Vigilance commission.
The petitioner has also added post script to his appeal Memo stating thus "This appeal has been filed without prejudice to my contention that this appeal is an exercise in futility as the appellate authority also is not the deciding authority and this appeal also will be decided by the CVO/CVC, who has already decided and whose decision is binding on you.
There is in fact no effective right of appeal.
" Counsel for the Bank however, submits that notwithstanding the advice of the Central Vigilance Commission and the directive dated 21 July 1984 of the Ministry Finance, Department of Economy Affairs (Banking Division), the case of the petitioner has received the fullest consideration from the disciplinary and appellate authorities.
They have independently considered the material on record both on the articles of charges and also on the appropriate punishment of compulsory retirement imposed on the petitioner.
The orders of the authorities do not refer to the circulars of the Bank, nor to the punishment proposed by the Central Vigilance Commission.
It is therefore, illegitimate, to contend that the punishment imposed on the petitioner has been vitiated by extraneous influences.
We are not even remotely impressed by the arguments of counsel for the Bank.
Firstly, the Bank itself seems to have felt as alleged by the petitioner and not denied by the Bank in its counter that the compulsory retirement recommended by the Central Vigilance Commission was too harsh and excessive on the petitioner in view of his excellent performance and unblemished antecedent service.
The Bank appears to have made two representations; one in 1986 and another in 1987 to the Central Vigilance Commission for taking a lenient view of the matter and to advise lesser punishment to the petitioner.
Apparently, those representations were not accepted by the Commission.
The disciplinary authority and the appellate authority therefore have no choice in the matter.
They had to impose the punishment of com 587 puslory retirement as advised by the Central Vigilance Commission.
The advice was binding on the authorities in view of the said directive of the Ministry of Finance, followed by two circulars issued by the successive Chief Executive of the Bank.
The disciplinary and appellate authorities might not have referred to the directive of the Ministry of Finance or the Bank circulars.
They might not have stated in their orders that they were bound by the punishment proposed by the Central Vililance Commission.
But it is reasonably foreseeable and needs no elaboration that they could not have ignored the advice of the Commission.
They could not have imposed a lesser punishment without the concurrence of the Commission.
Indeed, they could have ignored the advice of the Commission and imposed a lesser punishment only at their peril.
The power of the punishing authorities in departmental proceedings is regulated by the statutory Regulations.
Regulation 4 merely prescribes diverse punishment which may be imposed upon delinquent officers.
Regulation 4 does not provide specific punishments for different misdemeanours except classifying the punishments as minor or major.
Regulations leave it to the discretion of the punishing authority to select the appropriate punishment having regard to the gravity of the misconduct proved in the case.
Under Regulation 17, the appellate authority may pass an order confirming, enhancing, reducing or completely setting aside the penalty imposed by the disciplinary authority.
He has also power to express his own views on the merits of the matter and impose any appropriate punishment on the delinquent officer.
It is quasi judicial power and is unrestricted.
But it has been completely fettered by the direction issued by the Ministry of Finance.
The Bank has been told that the punishment advised by the Central Vigilance Commission in every case of disciplinary proceedings should be strictly adhered to and not to be altered without prior concurrence of the Central Vigilance Commission and the Ministry of Finance.
We are indeed surprised to see the impugned directive issued by the Ministry of Finance, Department of Economic Affairs (Banking Division).
Firstly, under the Regulation, the Bank 's consultation with Central Vigilance Commission in every case is not mandatory.
Regulation 20 provides that the Bank shall consult the Central Vigilance Commission wherever necessary, in respect of all disciplinary cases having a vigilance angle.
Even if the Bank has made a self imposed rule to consult the Central Vigilance Commission in every disciplinary matter, it does not make the Commission 's advice binding on the punishing authority.
In this context, reference may be made to Article 588 320(3) of the Constitution.
The Article 320 (3) like Regulation 20 with which we are concerned provides that the Union Public Service Commission or the State Public Commission, as the case may be, shall be consulted on all disciplinary matters affecting a civil servant including memorials or petitions relating to such matters.
This Court in A.N. D 'Silva vs Union of India, [1962] Suppl; 1 SCR 968 has expresed the view that the Commission 's function is purely advisory.
It is not an appellate authority over the inquiry officer or the disciplinary authority.
The advice tendered by the Commission is not binding on the Government.
Similarly, in the present case, the advice tendered by the Central Vigilance Commission is not binding on the Bank or the punishing authority.
It is not obligatory upon the punishing authority to accept the advice of the Central Vigilance Commission.
Secondly, the Ministry of Finance, Government of India has no jurisdiction to issue the impugned directive to Banking institutions.
The government may regulate the Banking institutions within the power located under the banking Companies (Acquisition and Transfer of Undertakings) Act, 1970.
So far as we could see, Section 8 is the only provision which empowers to the Government to issue directions.
Section 8 reads: "Every corresponding new bank shall, in the discharge of its function, be guided by such directions in regard to matters of policy involving public interest as the Central Government may, after consultation with the Governor of the Reserve bank, give." The corresponding new bank referred to in Section 8 has been defined under Section 2(f) of the Act to mean a banking company specified in column 1 of the First Schedule of the Act and includes the Syndicate Bank.
Section 8 empowers the Government to issue direction in regard to matters of policy but there cannot be any uniform policy with regard to different disciplinary matters and much less there could be any policy in awarding punishment to the delinquent officers in different cases.
The punishment to be imposed whether minor or major depends upon the nature of every case and the gravity of the misconduct proved.
the authorities have to exercise their judicial discretion having regard to the facts and circumstances of each case.
They cannot act under the dictation of the Central Vigilance Commission or of the Central Government.
No third party like the Central Vigilance Commission or the Central Government could dictate the disciplinary authority or the appellate authority as to how they should exercise 589 their power and what punishment they should impose on the delinquent officer.
(See: De Smith 's Judicial Review of Administrative Action, Fourth Edition, p. 309).
The impugned directive of the Ministry of Finance, is therefore, wholly without jurisdiction, and plainly contrary to the statutory Regulations governing disciplinary matters.
For the foregoing reasons, we allow the appeal and the writ petition quashing the directive issued by the Finance Ministry, Department of Economic Affairs, (Banking Division) dated 21 July 1984.
We also issue a direction to the Chairman of the Syndicate Bank to withdraw the circular letters dated 27 July 1984 and 8 September 1986.
We further set aside the impugned orders of the disciplinary authority and appellate authority with a direction to the former to dispose of the petitioner 's case in accordance with law and in the light of the observation made.
The petitioner is entitled to costs which we quantify in both the cases at Rs. 15,000 which shall be paid by the Central Government.
G.N. Appeal and petition allowed.
| IN-Abs | The appellant was a Manager in one of the branches of the Respondent Bank.
In 1985, there was a departmental enquiry against him on the charges that he discounted a cheque for Rs.50,000 drawn in the name of some other person to accommodate one of his colleagues and when the cheque returned unpaid, he retained the same for about two months without taking action for realisation of the amount.
An enquiry was conducted by the Commissioner for Vigilance Inquiry from the Central Vigilance Commission, following the procedure prescribed by the Syndicate Bank Officer Employees ' (Disciplinary & Appeal) Regulations.
The Inquiry Officer submitted his report holding that the charges were proved against the appellant.
The Respondent Bank referred the matter to the Central Vigilance Commission for advice and the Commission recommended the punishment of compulsory retirement.
After considering the Inquiry Report and after affording opportunity to the appellant, the Disciplinary Authority imposed on him the 577 penalty of compulsory retirement.
On appeal, the appellate authority concurred with the findings recorded and the punishment imposed.
The appellant filed a Writ Petition before the High Court challenging the order of his compulsory retirement.
The High Court declined to interfere with the order.
Hence the present appeal, by special leave.
The appellant also filed a Writ Petition before this Court challenging the validity of the direction dated 21.7.1984 issued by the Finance Ministry, following which the Respondent Bank has imposed on him the penalty of compulsory retirement.
On behalf of the appellant/petitioner it was contended that the advice given by the Central Vigilance Commission was blindly followed by the Respondent Bank as it was made binding on it by virtue of the directions dated 21.7.84 issued by the Ministry of Finance and in that process the merits of the case and the statutory regulations governing departmental inquiries were ignored.
It was also contended that the subject matter of the inquiry was only regarding irregularities in banking practice and since the interest of the Bank was not affected as he had the money recovered and credited to the Bank with interest thereon, the alleged misdemeanour did not warrant any major penalty like compulsory retirement, which even according to the Respondent Bank, was too harsh.
On behalf of the Respondent Bank it was contended that it had independently considered the material on record notwithstanding the advice given by the Central Vigilance Commission and since the orders did not refer to the circulars or to the advice of Central Vigilance Commission, the punishment imposed on the appellant/petitioner was not vitiated by extraneous influences.
Allowing the matters, this Court HELD: 1.
The Respondent Bank itself felt that the compulsory retirement recommended by the Central Vigilance Commission was too harsh and excessive on the appellant/petitioner in view of his excellent performance and unblemished antecedent service.
The Bank made two representations, one in 1986 and another in 1987 to the Central Vigilance Commission for taking a lenient view of the matter and to advise lesser punishment.
Apparently, those representations were not accepted by the Commission.
The disciplinary authority and the appellate authority therefore had no choice in the matter.
They had to impose the punishment of compulsory retirement as advised by the Central Vigi 578 lance Commission.
The advice was binding on the authorities in view of the directive of the Ministry of Finance issued on 21.7.1984, followed by two circulars issued by the successive Chief Executives of the Bank.
The disciplinary and appellate authorities might not have referred to the directive of the Ministry of Finance or the Bank circulars.
They might not have stated in their orders that they were bound by the punishment proposed by the Central Vigilance Commission.
But it is reasonably foreseeable and needs no elaboration that they could not have ignored the advice of the Commission.
They could not have imposed a lesser punishment without the concurrence of the Commission.
Indeed, they could have ignored the advice of the Commission and imposed a lesser punishment only at their peril.
[586F H; 587 A C] 2.1 But for the Finance Ministry 's directive dated 21.7.1984, the advice tendered by the Central Vigilance Commission is not binding on the Bank or the punishment authority; it is not obligatory upon the punishing authority to accept the advice of the Central Vigilance Commission.
[588C] 2.2 The Ministry of Finance has no jurisdiction to issue such a directive to Banking institutions.
The Government may regulate the Banking institutions within the power located under the .
Even though Section 8 thereof empowers the Government to issue directions in regard to matters of policy, there cannot be any uniform policy with regard to different disciplinary matters and much less there could be any policy in awarding punishment to the delinquent officers in different cases.
The punishment to be imposed depends upon the nature of every case and the gravity of the misconduct proved.
The authorities have to exercise their judicial discretion having regard to the facts and circumstances of each case.
They cannot act under the dictation of the Central Vigilance Commission or of the Central Government in the exercise of their power and the imposition of punishment on the delinquent officer.
Therefore the directive of the Ministry of Finance is wholly without jurisdiction and contrary to the statutory Regulations governing disciplinary matters and is quashed.
[588D H; 589A] A.N.D 'silva vs Union of India, [1962] Suppl.
S.C.R. 968, relied on.
De Smith 's Judicial Review of Administrative Action, 4th Edn.
p. 309, referred to.
579 3.
the Chairman of the Respondent Bank is directed to withdraw the circular letters dated 27.7.1984 and 8.9.1986 issued in furtherance of the Finance Ministry 's directive dated 21.7.1984.
[589C] [Setting aside the orders of the disciplinary authority and the appellate authority, this Court directed the disciplinary authority to dispose of the case in accordance with law and observations made in the judgment.]
|
ivil Appeal Nos.
2486 87 (N) of 1978.
From the Judgment and Order dated 17.3.1978 of the Bombay High Court in Second Appeal Nos. 293 and 361 of 1972.
P.H. Parekh for the Appellant.
section Padumanabhan, Amicus Curiae, R.A. Perumal and G. Narasimhulu for the Respondents.
The Judgment of the Court was delivered by R.M. SAHAI, J.
Litigation, between two sisters, by way of cross suits, one, for permanent injunction by the appellant basing her claim on gift deed executed in 1954 by her mother, a Hindu widow, of the entire estate inherited by her from her husband, and another for declaration and partition by respondent assailing validity of the gift deed and claiming reversioner 's right after death of the mother in 1968, has reached this Court by grant of special leave against judgment of the Bombay High Court in Second Appeal raising a legal issue of seminal importance as to nature of right and title of female donee of Hindu widow 's estate after coming into force of Hidnu Succession Act (hereinafter refferred to as the Act).
Facts are simple.
Stakes, also, are not substantial, but the issue is of far reaching consequence.
Could a Hindu widow alienate by gift the entire estate inherited from the husband, in favour of one of the female reversioners prior to enforcement of Act 20 of 1956.
In case answer to issue is in the affirmative then what was the nature of right that the donee got under law? Did she become an owner of a widow 's 605 estate, a limited owner, an owner with some right or title, so as to acquire rights of absolute ownership under section 14 of Act or a trespasser and if trespasser then whether she acquired rights by adverse possession by perfecting her rights against the donor only or it was essential to prescribe rights against reversioners as well? Shorn of details, and various issues raised in the suits, suffice it to mention that even though the trial court found the gift deed to have been duly attested and executed after obtaining permission from the appropriate authority the claim of appellant, for permanent injunction, was decreed not on Section 14 of the Act as the widow who had executed the gift deed in 1954 was, `incompetent to alienate widow 's estate by gift permanently ' under Hindu Law but on adverse possession and estoppel.
The appellate court while affirming the finding on section 14 of the Act allowed the appeal and dismissed the suit as `adverse possession against the widow is not adverse against reversioners, and the next reversioner is entitled to recover the possession of the property or his share in it within 12 years from the date of the death of the widow '.
It was further held that the appellant could not acquire, any right by, `estoppel under section 41 of the Transfer of Property Act against the reversioners by reason of the widow 's conduct '.
In view of the concurrent findings of two courts below on section 14 of the Act the High Court appears to have been invited to adjudicate, only, on the question if the appellate court was justified in reversing the finding on adverse possession wich it disposed of, treating it as finding of fact, and observing that possession of appellant, `must be deemed to be on behalf of other co sharers in the absence of any evidence before ouster of the other sisters '.
Wheher the High Court was justified in not examining the question of adverse possession is not necessary to be gone into as the appellant can succeed, only, if the finding recorded by the first appellate court that the appellant could not acquire any rights against reversioners during lifetime of the widow is found to be erroneous in law.
But before doing so the claim of the appellant that she became an absolute owner under section 14 of the Act, reiterated, once again, in this Court, may be examined as it is a question of law.
A full bench of the Delhi High Court in Smt.
Chinti vs Smt.
Daultu, AIR 1968 Delhi 264 held that possession of a female donee in pursuance of gift deed executed by her mother could not be characterised as illegal or of trespasser, therefore, she being a female Hindu `possessed ' of the property on the date came into force became an absolute owner under section 14 of the Act.
When more or less similar 606 matter came up before Patna High Court in Sulochana Kuer vs Doomati Kuer, AIR 1970 Patna 352 the court, held that, "a Hindu woman 's estate as such is not capable of transfer either by sale or gift.
The mere concept of such an estate is not transferred on the transfer of properties attaching to the estate".
In Anath Bandhu vs Chanchala Bala, AIR 1976 Calcutta 303 the Calcutta High Court, specifically, dissented from the Delhi decision and held that, "Section 14 wanted to benefit those female Hindus who were limited owners in then existing Hindu Law before the commencement of the Act.
In the present case the limited owner Motibala having transferred the limited interest to Chanchala before the passing of the Act, it cannot be said that Chanchala 's limited interest,if any, ripened into absolute interest in terms of section 14 of the Act".
A full bench of Punjab and Haryana High Court in Parmeshwari vs Santokhi, AIR 1977 Punjab 141 too, did not agree with Delhi High Court.
It went into the background of legislation, the original form of the bill, ambit of the explanation, anomalies that would result if, even, female alienee was deemed to be a limited owner and held, " that section 14 of the Act was not intended to benefit the alienees of a limited Hindu owner".
Similar view was taken by Andhra Pradesh and Madras, High Court in AIR 1957 AP 280 and AIR 1958 Madras, Gaddam Venkayama vs Gaddam Veeryya, and Marudakkal vs Arumugha.
Thus according to Delhi Court a donee of even entire Hindu widow 's estate became absolute owner under section 14 of the Act whereas according to Patna, Calcutta, Punjab, Madras and Andhra Pradesh High Courts, rights of a female donee under Hindu Law, prior to coming into force of the Act did not get enlarged under section 14 of the Act and it did not preclude reversioners from assailing validity of the gift deed.
To ascertain which view accords more to the objective sought to be achieved by the Act it appears necessary to extract section 14 which reads as under: (1) Any property possessed by a female Hindu,whether acquired before or after the commencement of this Act, shall be held by her as full owner thereof and not as a limited owner.
Explanation In this sub section, "property" includes both movable and immovable property acquired by a female Hindu by inheritance or devise, or at a partition, or in lieu of maintenance, or arrears of maintenance, or by gift from any person, whether a relative or not, before, at or after her marriage, or by her own skill or exertion, or by purchase or by prescription, or in any other manner what 607 soever, and also any such property held by her as Stridhana immediately before the commencement of this Act.
(2) Nothing contained in sub section (1) shall apply to any property acquired by way of gift or under a will or any other instrument or under a decree or order of a civil court or under an award where the terms of the gift, will or other instrument or the decree, order or award prescribe a restricted estate in such property.
Needless to emphasise that the section was a step forward towards social amelioration of women who had been subjected to gross dis crimination in matter of inheritance.
Even when the Hindu Women 's Rights to Property Act XVIII of 1937 was enacted it succeeded partially only.
While providing for inheritance and devolution to widow and even widow of predeceased son the Act could not go beyond creating limited interest or a Hindu woman 's estate.
Absolute ownerships or female heir by effacing inequality and putting male an female heirs at par in matter of inheritance was achieved by the Succession Act.
A female Hindu inheriting property under the Act, also, became a stock of descent.
In Eramma vs Verrupana, , this Court observed, "The object of the section is to extinguish the estate called `limited estate ' or `widow 's estate ' in Hindu Law and to make a Hindu woman, who under the old law would have been only a limited owner, a full owner of the property with all powers of disposition and to make the estate heritable by her own heirs and not revertible to the heirs of the last male holder".
But did the legislature intend to extend same benefit, namely, enlarge the estate, held, on the date the Act came into force by any or every female Hindu into full and absolute estate irrespective of whether she was a limited owner or not.
According to learned counsel for appellant the answer should be given in affirmative.
He urged that since the age long traditional limitation on inheritance and disposition by a female was removed and the section was widely worded by using broad and comprehensive expressions such as, `and property, `possessed ', `acquired before or after the commencement of the Act ' and each of these expressions have received expansive of the Act ' and each of these expressions have received expansive interpretations by the Court there was no reason not to give similar interpretation to the word female Hindu.
The learned counsel submitted that there was no warrant to confine scope of the section to limited owners.
He argued that if the argument of the respondent was accepted it shall result in substitution of the word ` female Hindu ' with `limited owner ' which 608 would be contrary to legislative intention, the social philosophy on which the section was founded and the principle of interpretation.
Relying on the explanation, to the section, it was urged that it not only explained meaning of the word `property ' but it left no room for doubt that a female Hindu possessed of any property, which satisfied the extended meaning on the date the Act came into force, became an absolute owner.
It was further argued that the expression `limited owner ' has been used in the section not to whittle down the otherwise simple and plain meaning of the words `female Hindu ' by introducing narrow concept of widows ' estate or limited owner but to put beyond doubt the nature and status of rights of females after the Act.
Support was also drawn from the marginal note of the section and it was urged that the words, `property of a female Hindu to be her absolute property ', was yet another indication to interpret the word `female Hindu ' widely, so as to include in its ambit a donee from a limited owner.
That the section is not very happily worded, does not admit of any doubt.
It was commented upon by this Court in V. Tulsamma vs Shesha Reddy, ; and it was observed that the section was, "a classic instance of statutory provision which, by reason of its inapt draftsmanship has created endless confusion for litigants".
May be so but the answer to the issue must emerge from the section, its background, purpose of its enactment and the reason for use of such wide expression.
Nothing turns on the marginal note as it is usually not restored to for construing meaning of a section, particularly, when the language is plain and simple.
It is well settled that a section has to be read in its entirely as one composite unit without bifurcating it or ignoring any part of it.
Viewed from this perspective the section, undoubtedly, comprises of two parts, one descriptive, specifying the essential requirements for applicability of the section, other consequences arising out of it.
One cannot operate without the other.
Neither can be read in isolation.
Both are integral parts of the section.
Mere provision that any property possessed by a female Hindu on the date the Act came into force shall be held by her would have been incomplete and insufficient to achieve the objective of removing inequality amongst male and female Hindus unless it was provided that the otherwise limited estate of such a female would become enlarged into full or absolute estate.
Any other construction would result in not only ignoring the expression, `and not as a limited owner ' which would be against principle of interpretation but also against the historical background of enactment of the section.
Whereas if it is read in its entirety with one part throwing light on another then the conclusion is irresistible that a limited owner became a full owner provided she was 609 in possession of the property on the date of enactment of the Act.
Property acquired by a female Hindu before the Act came into force comprised, broadly, of inherited property or stridhana property acquired by her from a male or female.
Nature of her right in either class of property, unlike males, depended on the school by which she was governed as well as whether it came to her by devolution or transfer from a male or female.
This invidious discrimination was done away with after coming into force of 1956 Act and the concept of Hindu widows ' estate or limited estate or stridhana ceased to exist by operation of section 14 read with section 4 of the Act which has an overriding effect.
A female Hindu who but for the Act would have been a limited owner become full owner.
But the section being retrospective in operation the meaning of female Hindu prior to 1956 has to be understood in the light of Hindu Law as it prevailed then.
The section enlarged the estate of those female Hindu who otherwise would have been limited owners.
This result follows by reading the first part with the last which uses the expression, 'held by her as full owner thereof and not as a limited owner '.
To put it differently a limited owner become a full owner provided she was a female Hindu who was possessed of any property acquired before the commencement of the Act.
Therefore, mere being female Hindu was not sufficient.
She should have been of that class of female Hindus who could on existence of other circumstances were capable of becoming full owners.
Further the Act being applicable by virtue of section 2 to not only Hindus by religion but also to Buddhists, Jains or Sikhs and to any person who was not a Muslim, Christian, Parsi or Jew it was but necessary to use an expression of such wide connotation as female Hindu because by virtue of sub section (3) of the section the word `Hindu ' in any portion of the Act, which includes section 14, the word had to be understood as including not only a person who was Hindu by religion but even others.
However, the objective being to remove disparity and injustice to which females were subjected under Hindu Law the section limits its operation to such female Hindus who were limited owners.
Reference to the explanation by the learned counsel was also not very apposite.
It was appended to widen the meaning of property by adding to it the inherited property, and the property which came to be possessed by a female Hindu in manner mentioned in it.
Its effect was that a female Hindu became absolute owner not only in respect of inherited property but even of property received by way of gift or on partition or in lieu of maintenance etc.
provided she was a limited owner.
And not that it enlarged the estate of even those who were not limited owner.
Any other construction would militate against the, otherwise, clear meaning of sub section (1).
610 Although this section has come up for interpretation, by this Court, on various occasions in different context but in none of these cases the Court had occasion to examine the ambit of expression female Hindu and whether it extended to females other than limited owner.
Since in every case whether it was decided for or against it was the widow who was alive on the date the Act came into force and she being a limited owner the decision turned on if she was `possessed ' of the property so as to become full owner.
For instance in Gummalapura Taggina Matada Kotturuswami vs Setra Veeravva & Ors., [1959] Supp. 1 SCR 968=AIR the widow was held to have acquired rights as the adoption made by her having been found to be invalid she was deemed to be in constructive possession and thus `possession ' of the property on the date the Act came into force.
Mangal Singh vs Smt.
Rattno, ; was another case where widow 's constructive possession enured to her benefit as she having been dispossession by her collaterals in 1954 and filed a suit for recovery of possession before the Act came into force was held to be `possession ' of the property so as to entitle her to become full owner.
Munna Lal vs Raj Kumar, AIR 1962 SC 1495 was a case where the share of the widow was declared in preliminary decree.
No actual division of share had taken place, yet the court held that it was property `possessed ' by her on the date the Act came into force.
In Sukhram vs Gauri Shankar, ; it was held that a widow was full owner in joint Hindu family property as she became entitled to the interest which her husband had by virtue of Hindu Women Right to Property Act.
The Court ruled that even though a male was subject to restrictions qualienation on his interest in joint Hindu family property, but a widow acquiring an interest by virtue of the Act did not suffer such restriction.
V. Tulsamma vs Shesha Reddy; , and Bai Vijia vs Thakorbhai Chelabhai, were cases where the widow was `possessed ' of the property in lieu of maintenance, and therefore, she was held to be full owner.
In all these cases since the widow was in possession, actual or constructive, on the date the Act came into force she was held to be a female Hindu `possessed ' of the property, and consequently, her limited ownership stood converted into full ownership by operation of law.
Even in Eramma vs Verupana (supra) and Kuldeep Singh vs Surain Singh, [1988] Andhra law Times, where the benefit was denied under section 14 the female Hindu were widows but they were not held to be `possessed ' of the property because their possession was not backed by even the remotest vestige of title.
in Eramma 's case (supra) the benefit was denied as Hindu Women 's Right to Property Act being not applicable on the date the succession opened she could not be held to be possessed of the property.
And in 611 Kuldeep Singh 's case (supra) she had been divested of her interest as a result of transfer made by her.
Contest in all these cases was between reversioner and the widow herself or the person claiming through her.
Review of these decisions indicates that this Court has consistently taken the view as stated in Bai Vijia vs Thakorbhai Chelabhai,: "For the applicability of sub section, two conditions must co exist, namely, (i) The concerned female Hindu must be possessed of property; and (ii) Such property must be possessed by her as a limited owner.
" mention is necessary to be made in this connection about observation in Gulwant Kaur vs Mohinder Singh, ; that the Court in Bai Vijia 's case did not support, to lay down, that, "what was enlarged by sub section (1) of section 14 into a full estate was the Hindu woman 's estate known to Hindu Law.
When the Court uses the word, `limited estate ', the words are used to connote a right in the property to which possession of the female Hindu may be traced, but which is not a full right of ownership".
Gulwant Kaur 's case was concerned with acquisition of right by wife, on entrustment of property in lieu of maintenance, after 1956, when the concept of widows ' estate or limited estate or even stridhana had ceased to exist.
Therefore, what was necessary was being possessed of property, actual or constructive, by female Hindu under some right or title.
Whereas Bai Vijia 's case was concerned with acquisition of right in property held in lieu of maintenance before 1956.
Therefore a female Hindu could become absolute owner only if she was limited owner.
Sub section of section 14 deals with right of female Hindu both before and after the Act came into force.
Female Hindu could become absolute owner of property possessed by her on the date the Act came into force only if she was a limited owner whereas she would become absolute owner after 1956 of the property of which she would otherwise have been a limited owner.
Reference may be made to Maharaja Pallai Lakshmi Ammal vs Maharaja Pillai T. Pilllai, ; where this Court while examining right of wife put in exclusive possession of the property with the right to take the income for her maintenance was held to have become full owner under section 14(1) as she entered into possession after the death of her husband in 1955 and was in possession in 1956.
612 The Court held that the right to utilise income for her maintenance must be "presumed to have resulted in property being given to her in lieu of maintenance".
On this finding the property being possessed on the date the Act came into force as contemplated in the explanation, the widow being a limited owner became a full owner and the gift executed by her in favour of her daughter after 1956 was unexceptionable.
The Court, however, while repelling the submission advanced on superficial conflict in Gulwant Kaur and Bai Vijia reiterated what was observed in Gulwant Kaur 's case.
As already discussed Gulwant Kaur 's case related to acquisition of property after 1956 whereas in Bai Vijia it was acquired before 1956.
The observations made in the two decisions must be understood in that context.
Moreover in Gulwant Kaur 's case the ratio was founded on Jagannathan Pillai vs Kunjithapadam Pillai, ; a decision which shall be adverted to later.
But it too was concerned with acquisition after 1956.
And the bench while discussing scope of section 14(1) observed.
"that the limited estate or limited ownership of a Hindu female would enlarge into an absolute estate or full ownership of the property in question in th following fact situation: `Where she acquired the limited estate in the property before or after the commencement of the Act provided she was in possession of the property at the time of the coming into force of the Act on June 17, 1956 '.
" None of these decisions, namely, Gulwant Kaur (supra) or Maharaja Pillai (supra ) or Jagannathan Pillai purported to lay down that the Section 14(1) contemplated enlargement of estate prior to 1956 of even those females who were not limited owners.
According to Mulla 's Hindu Law (sixteenth edition, paragraph 174) every female who took a limited or restricted estate was known as limited heir.
And according to every school except Bombay every female who succeed as an heir whether to a male or female took a limited estate in the property.
Even in Bombay a female who by marriage entered into Gotra (family) of the deceased male inherited a limited estate only.
And in paragraph 176 it is stated that incident of estate taken by every limited owner was similar to incident of widow 's estate.
Mayne 's Hindu Law, (12th edition, paragraph 671) too brings out the same by stating that the typical form of estate inherited by a woman from a male was compendiously known as the widow 's estate.
And the limitation which applied to such estate applied to all estate derived by a female by 613 descent from a male or female whether she inherited as daughter, mother, grandmother, sister or as any other relation.
Even stridhana property according to Mulla created limited interest in its successors, except in Bombay in certain circumstances and a female inheriting stridhana took a limited interest in it and on her death it passed not to her heirs but to the next stridhan heirs of the female from she inherited.
Thus on plain reading of the Section, and its interpretation by this Court in various decisions a female possessed of the property on the date the Act came into force could become absolute owner only if she was a limited owner.
This being the legal position it may now be seen if a Hindu widow could transfer or alienate widow 's estate by way of gift prior to 1956 and if so to what extent.
And in such alienation what right or interest was created in the alienee.
Did she become a limited owner so as to become a full owner under Section 14 of the Act? A Hindu widow succeeding or inheriting any property from her husband or as widow of predeceased son, held limited interest known as Hindu women 's estate, prior to coming into force of 1956 Act, under the Hindu Women 's Right to Property Act, 1937.
Since such an estate could not be alienated under Hindu Law except in certain circumstances and for specific purpose the holder of the estate was known as limited owner.
The expression `limited owner ' thus could not be understood, except as it was interpreted and understood in Hindu Law.
Could the same be said of a female donee or alienee? The Delhi High Court assumed that a female donee was a limited owner, consequently, of she was possessed of the property on the date the Act came into force and her possession was not `without title ', she became an absolute owner.
Basis for the decision was construction of the word `possessed ' by this Court in Gummalapura Taggina 's case (supra) wherein it was held that the word was used in widest connotation so that a widow, even if in constructive possession, was entitled to absolute ownership under Section 14 of the Act.
Support was also drawn from converse case of Eramma (supra) this Court negatived the claim of widow under Section 14 as her possession on the date the Act came into force was not legal but that of a trespasser.
What the High Court lost sight of was that the claim of widow in Gummalapura 's case (supra) was upheld because the adoption made by her having been found to be invalid she was deemed to be in constructive possession on the date the ACt came into force.
And Eramma 's case (supra) was concerned with a widow, who claimed to have inherited through son in State of Hyderabad where Hindu Women 's Rights to Property Act did not apply on the date the son died.
Consequently, it was held that ``the 614 provisions of Section 14 of the Act cannot be attracted in the case of a Hindu female who is in possession of the property of the last male holder on the date of the commencement of the Act when she is only a trespasser without any right to property ' '.
The High Court overlooked the vital observation made in earlier part of the judgment to the effect.
``In other words, Section 14(1) of the Act contemplates that a Hindu female who in absence of this provision, would have been limited owner of the property, will now become full owner of the same by virtue of this Section. ' ' Limited owner commonly means a person with restricted rights as opposed to full owner with absolute rights.
In relation to property absolute, complete or full ownership comprises various constituents such as the right to posses, actual or constructive, power to enjoy, that is to determine manner of use extending even to destroying, right to alienate, transfer or dispose of etc.
Any restriction or limitation on exercise of these rights may result in limited or qualified ownership.
For instance restriction on enjoyment of property or its alienation.
Such restriction or limitation may arise by operation of law or by deed or instrument.
The limited ownership of female Hindu in Hindu Law arose as a matter of law.
A Hindu widow, according to different schools, Banaras, Bengal or Mithila and even in Bombay inherited or succeeded to property whether of male or female as a limited owner and held a limited estate only.
Nature of such estate was explained by the Privy Council in Janki Ammal vs Narayanaswami, [1916] p. 43 I. A. p. 207 to be, ``her right is of the nature of a right to property, her powers in that character are limited ' '.
In Jaisri vs Raj Diwan Dubey, it was observed by this Court that ``when a widow succeeds as heir to her husband the ownership in the property both legal and beneficial vests in her ' '.
And the restriction on her power to alienate except for legal necessity is imposed, ``not for the benefit of reversioners but is an incident of estate ' '.
Thus a Hindu widow prior to 1956 held the property fully with right to enjoy or even destroy or dispose it of or alienate it but such destruction or alienation should have been impressed with legal or for religious or charitable purposes or for spiritual welfare of the husband.
Necessary consequences that flowed from an alienation for legal necessity was that the property vested in the transferee or alienee, and the reversioners were precluded from assailing its validity.
In Kamala Devi vs Bachu Lal Gupta, this Court after reviewing various authorities extended this principle to female donee.
A gift made within reasonable limits, in favour of daughter even two years after the marriage but in pursuance of promise made at time of the marriage was upheld and 615 the reversioners claim was repelled on permissible alienation under Hindu Law.
But what right or title is acquired by the alienee if transfer is against legal necessity or contrary to law? The authorities appear to be at one that such transfer being not void but voidable could be avoided by reversioners including Govt.
taking by escheat Collector of Masulipatam vs Cavaly Vencata, [1861] 8 M.I.A. 529.
But the widow was held bound by the transfer.
In Natwalal Punjabhai & Anr.
vs Dadubhai Manubhai & Ors., ; , the Court held as under: "The Hindu Law certainly does not countenance the idea of a widow alienating her property without any necessity merely as a mode of enjoyment as was suggested before us by Mr. Ayyangar.
If such a transfer is made by a Hindu widow it is not correct to say that the transferee acquires necessarily and in law an interest commensurate with the period of the natural life of the widow or at any rate with the period of her widowhood.
Such transfer is invalid in Hindu Law, but the widow being the grantor herself, cannot derorate from the grant and the transfer cannot also be impeached so long as a person does not come into existence who can claim a present right to possession of the property." Thus if prior to 1956 any alienation was made by a Hindu widow of widow 's estate prohibited by law or being beyond permissible limits, it stripped the widow of her rights and she could not acquire any rights under section 14.
And so far as alienees were concerned it could utmost create temporary and transitory ownership precarious in nature and vulnerable in character open to challenge if any attempt was made to cloud reversioner 's interest.
Her possession may be good against the world, her right in property may not be impeachable by the widow but her interest qua the reversioner was to continue in possession at the maximum till the lifetime of her donor of transferor.
It was life interest, loosely, as the duration of interest created under invalid transfer came to an end not on death of donee or transferee but donor or transferor.
So far as the male alienees from limited owners, that is female Hindu prior to 1956, are concerned, it was held by this Court in Radhey Krishan Singh & Ors.
vs Shiv Shankar Singh & Ors., that, the alienation could be challenged by the reversioner as there was nothing in the which has taken away such a right.
A female alienee did not enjoy better or different status as the Hindu Law applied universally and uniformaly 616 both to male and female alienees.
She did not become limited owner or holder of a limited estate as understood in Hindu Law.
And the alienation without legal necessity could be assailed by the reversioner.
No change was brought about in this regard by the Act.
If the alienation was valid i.e., it was for legal necessity or permitted by law then the donee became an owner of it and the right and title in the property vested in her.
But if it was contrary to law, as in this case the gift being of entire widow 's estate, then it did not bind the reversioner who could file a suit after the death of the widow.
And the appellant cannot claim to have acquired title to the property under the gift deed.
Nor had she become a limited owner under Hindu Law which could mature into full ownership when the Act came into force.
In fact such possession was not backed any title as against reversioner which could preclude her from bringing the suit for declaration.
Reliance was placed on observations in Jagannathan Pillai vs Kunjithapadam Pillai & Ors., ; that, ``To obviate hair splitting, the legislature has made it abundantly clear that whatever be the property possessed by a Hindu female, it will be of absolute ownership and not of limited ownership notwithstanding the position under the traditional Hindu Law ' ', and it was submitted that the appellant satisfied the criteria to entitle her to claim that her estate irrespective of its nature Hindu Law got enlarged under section 14 of the Act.
An observation without reference to facts discloses neither the law nor the ratio de cedindi which could be taken assistance of.
Factually, the issue was the effect of re transfer by the alienee in favour of the widow after 1956.
And the answer was that, ``When the transaction was reversed and what belonged to her was retransmitted to her, what the concerned Hindu female acquired was a right which she herself once possessed namely, a limited ownership (as it was known prior to the coming into force of the Act) which immediately matures into or enlarges into a full ownership in view of Section 14(1) of the Act on the enforcement of the Act.
The resultant position on the reversal of the transaction would be that the right, title and interest that the alienee had in the property which was under `eclipse ' during the subsistance of the transaction had re emerged on the disappearance of the eclipse ' '.
Truely speaking, the interpretation of sub section (1) of section 14 was no different from the other decisions as is clear from the extracts quoted earlier.
It is thus clear that an alienee from a Hindu widow prior to 1956 did not acquire limited estate or widow 's estate nor she was a limited owner who could get any benefit under section 14 of the Act.
It was not even a life estate except loosely, as the right to continue in possession was not related with her span of life but of the 617 transferor that is the Hindu widow.
The decision of Delhi High Court, therefore, does not lay down the law correctly.
The other view taken by Patna, Calcutta and Punjab and Haryana Courts that sub section (1) of section 14 did not extend the benefit of full ownership to female alienees brings out the objective of the section appropriately and correctly.
Nor is the decision in Badri Pershad vs Smt.
Kanso Devi, ; of any assistance.
It was a case where the widow entitled to the interest of her husband got certain property prior to 1956 as a result of arbitration with specific stipulation and she shall have only life interest.
This was ignored asnd she was held, rightly, to be the absolute owner whose rights were governed by section 14(1) and not 14(2).
Further did not obliterate Hindu Law.
What has ceased to be operative after coming into force of the Act under section 4 is text or rule etc.
for which privision is made in the Act.
And under section 4(2) any law in force immediately before the commencement of the Act ceased to have effect if it was inconsistent with any provision of the Act.
Therefore except to the extent provision has been made in section 14, that is, enlargement of the estate of limited owner, the Hindu Law in other regards remained opearative.
There is no provision in the Act which deprives reversioners of their rights except to the extent mentioned in section 14.
In Radha Rani vs Hanuman Prasad, AIR 1966 SC 216 this Court overruled the decisions of the Allahabad and Patna High Courts that there were no reversioners or reversionary rights after 1956 and held, ``it is open to reversioner to maintain a suit for declaration that an alienation made by a Hindu female limited owner before the coming into force of was without legal necessity and was not binding upon reversioners ' '.
Coming now to the issue of adverse possession the High Court was not justified in concluding that it was a question of fact.
Possession under a gift deed which was found to be invalid, as it was not permitted under Hindu Law was on general principle contrary to law, and as such could be adverse.
When did it become adverse to the donor and what circumstances constitute adverse possession against the donor is an aspect which does not arise for consideration as, even assuming in favour of the appellant, the question is, if adverse possession against donor was sufficient to clothe her with right or title in the property so as to deprive the reversioners of their right to claim the property after the death of the widow? In Radha Rani 's case (supra) this Court held.
618 ``In the case of an alienation by Hindu widow without legal necessity, the reversioners were not bound to institute a declaratory suit during the lifetime of the widow.
They could wait till her death and then sue the alienee for possession of the alienated property trating the alienation as a nullity. ' ' Therefore, it is obvious that the appellant could not acquire any right by adverse possession against reversioner during lifetime of her mother.
Her claim was rightly negatived.
Before parting with this case, we express our thanks to Sri Padmanabhan, Senior Advoacate who, on our request rendered valuable assistance.
We are thankful to Sri Parekh and Sri Narasimhulu also for their assistance.
The result is that this appeal fails and is dismissed.
But there shall be no order as to costs.
R.P. Appeal dismissed.
| IN-Abs | A Hindu widow executed a gift deed in 1954 of the entire estate inherited by her from her husband in favour of the appellant, one of her daughters.
This led to the filling of two cross suits one by the appellant for permanent injunction basing her claim on the gift deed and the other by the respondent, another daughter of the widow 's for declaration and partition assailing the validity of the gift deed and claiming reversioners ' right after death of the mother in 1968.
The trial court decreed appellant 's suit on adverse possession and estoppel, but not on section 14 of the , as in its view the widow who executed the gift deed in 1954, was incompetent to alienate widow 's estate by gift permanently.
The appellate court affirmed the finding of the trial court on section 14 of the Act, but opined that the appellant could not acquire any right by `estoppel under section 41 of Transfer of Property Act, against the reversioners by reasons of the widow 's conduct '.
It allowed the appeal of the respondent and dismissed the suit of the appellant holding that adverse 600 possession against the widow was not adverse against reversioners, and the next reversioner was entitled to recover the possession of the property or his share in it within 12 years from the date of the death of the widow.
In second appeal the High Court, treating the finding of the trial court on adverse possession as a finding of fact, held that possession of the appellant must be deemed to be on behalf of the other co sharers in the absence of any evidence before ouster of the other sister.
Aggrieved, the appellant filed the appeals by special leave to this Court.
On the questions whether: (1) a Hindu widow could alienate by gift the entire estate inherited by her from her husband in favour of one of the female reversioners prior to enforcement of Act 30 of 1956, and if so, what was the nature of right that the donee got under law? and (2) the donee became an owner of the widow 's estate, a limited owner, an owner with some right or title so as to acquire rights of absolute ownership under section 14 of the Act or a trespasser and acquired rights for adverse possession by perfecting her rights against the doner only or it was essential to prescribe rights against reversioners as well? Dismissing the appeals, this Court HELD: 1.1 Prior to the coming into force of Act 30 of 1956 a Hindu widow succeeding or inheriting any property from her husband or as widow of predeceased son, held limited interest known as Hindu women 's estate, under the Hindu Women 's Right to Property Act, 1937.
However, she had the right to enjoy or even destroy or dispose of the property or alienate it but such destruction or alienation should have been impressed with legal necessity or for religious or charitable purposes or for spiritual welfare of the husband.
Necessary consequences that flowed from an alienation for legal necessity was that the property vested in the transferee or alienee, and the reversioners were precluded from assailing its validity.
Since such an estate could not be alienated under Hindu Law except in certain circumstances and for specific purpose, the holder or the estate was known as limited owner.
{613C D;614F G] 1.2 The expression `limited owner ' could not be understood except as it was interpreted and understood in Hindu Law.
The term commonly means, a person with restricted rights as opposed to full owner with absolute rights.
In relation to property, absolute or complete or full ownership comprises various constituents such as the right to 601 possess, actual or constructive, power to enjoy, that is, to determine manner of use extending even to destroying, right to alienate, transfer or dispose of etc.
Any restriction or limitation on exercise of these rights may result in limited or qualified ownership.
For instance restriction on enjoyment of property or its alienation.
Such restriction or limitation may arise by operation of law or by deed or instrument.
The limited ownership of female Hindu in Hindu law arose as a matter of law.
A Hindu widow, according to different schools, Benaras, Bengal or Mithila and even in Bombay inherited or succeeded to property whether of male or female as a limited owner and held a limited estate only.
[613D; 614B D] Janaki Ammal vs Karayanaswami, [1916] p. 43 I.A. p. 207 and Jaisri vs Raj Diwan Dubey,, [1961] 2SCR 559, referred to.
1.3 Prior to 1956, any alienation made by a Hindu widow or widow 's estate prohibited by law or being beyond permissible limits could utmost create in the alienee temporary and transitory ownership precarious in nature and vulnerable in character open to challenge if any attempt was made to cloud reversioners ' interest.
The alienee 's possession may be good against the world and her right in property may not be impeachable by the widow, but her interest qua the reversioner was to continue in possession at the maximum till the lifetime of her donor or transferor.
It was life interest, loosely, as the duration of interest created under invalid transfer came to an end not on death of donee or transferee but donor or transferor.
Such transfer stripped the widow of her rights and she could not acquire any rights under section 14, and being voidable, and not void, could be avoided by reversioners including government taking by escheat; but the widow was bounded by it.
[615A, E F] Kamala Devi vs Bachu Lal Gupta, ; Collector of Masuli Patam vs Cavoly Venoata, [1861] 8 M.I.A. 529; Natwalal Punjabhai & Anr.
vs Dadubhai Manubhai & Ors., ; and Radhey Krishan Singh & Ors.
vs Shiv Shankar Singh & Ors., , referred to.
2.1 An alienee from a Hindu widow prior to 1956 did not acquire limited estate or widow 's estate, nor was she a limited owner who could get any benefit under section 14 of the Act.
It was not even a life estate except loosely, as the right to continue in possession was not related with her span of life but of the transferor that is the Hindu widow.
[616G H;617A] Smt.
Chinti vs Smt.
Daultu, AIR 1968 Delhi 264, disapproved.
602 Sulochana Kuer, vs Doomati Kuer, AIR 1970 Patna 352; Anath Bandhu vs Chanchala Bala, AIR 1976 Calcutta 303; Parmeshwari vs Santokhi, AIR 1977 Punjab 141; Gaddam Vankayama vs Gaddam Veerayya, AIR 1957 AP 230 and Marudakkal vs Arumugha., AIR 1958 Madras, referred to.
Badri Pershad vs Smt.
Kanso Devi, ; held inapplicable.
2.2 In the instant case the alienation by gift of entire widow 's estate being contrary to law did not bind the reversioner who could file a suit after the death of the widow.
The appellant could not claim to have acquired title to the property under the gift deed.
Nor had she become a limited owner under Hindu Law which could mature into full ownership when the Act came into force.
In fact such possession was not backed by any title as against reversioner which could preclude her from bringing the suit for declaration.
[616B] 3.
As regards the adverse possession, the High Court was not justified in concluding that it was a question of fact.
Possession under a gift deed which was found to be invalid as it was not permitted under Hindu Law was on general principle contrary to law and as such could be adverse.
The appellant could not acquire any right by adverse posession against reversioner during life time of her mother.
Her claim was rightly negatived by the first appellate court.
Even assuming that the alienee had perfected adverse possession against the donor, it was not sufficient to clothe her with right or title in the property so as to deprive the reversioners of their right to claim the property after the death of the widow, inasmuch as in the case of an alienation by Hindu widow without legal necessity, the reversioners were not bound to institute a declaratory suit during the lifetime of the widow.
They could wait till her death and then sue the alienee for possession of the alienated property treating the alienation as a nullity.
[617F H;618A B] Radha Rani vs Hanuman Prasad, AIR 1966 SC 216, relied on.
4.1 Being retrospective in operation section 14(1) deals with rights of female Hindus both before and after the Act came into force, and the meaning of female Hindu prior to 1956 has to be understood in the light of Hindu Law as it prevailed then.
The section enlarged the estate of those female Hindus who would otherwise have limited owners.
This result flows by reading the first part with the last which uses the expression `held by her as full owner thereof and not as a limited 603 owner '.
A limited owner became a full owner provided she was a female Hindu who was possessed of any property acquired before the commencement of the Act.
Therefore, mere being female Hindus was not sufficient.
She should have been of that class of female Hindus who could on existence of other circumstances were capable of becoming full owners.
Female Hindu could become absolute owner of property possessed by her on the date the Act came into force only if she was a limited owner whereas she would become absolute owner 1956 of the property of which she would otherwise have been a limited owner.
[609B E;611F] Bai Vijia vs Thakorbhai Chelabhai, ; , relied on.
4.2 On a reading of section 14(1) the conclusion is irrisistible that a limited owner became a full owner provided she was in possession of the property on the date of enactment of the Act.
Effect of Explanation appended to the section was that a female Hindu became absolute owner not only in respect of inherited property but even of property received by way of gift or on partition or in lieu of maintenance etc.
provided she was a limited owner.
And not that it enlarged the estate of even those who were not limited owner.
Any other construction would militate against the otherwise clear meaning of sub section (1).
[608G H;609F H] 5.
did not obliterate Hindu Law.
What has ceased to be operative after coming into force of the Act under section 4 is text or rule etc.
for which provision is the Act.
And under section 4(2) any law in force immediately before the commencement of the Act ceased to have effect if it was inconsistent with any provision of the Act.
Therefore, except to the extent provision has been made in section 14, that is, enlargement of the estate of limited owner, the Hindu Law in other regards remains operative.
There is no provision in the Act which deprives reversioners of their rights except to the extent mentioned in section 14.[617C D] 6.
Marginal note is usually not resorted to for construing meaning of a section, particularly, when the language is plain and simple.
A section has to be read in its entirety as one composite unit without bifurcating or ignoring any part of it.
[608D E] V. Tulsamma vs Shesha Reddy, ; , referred to.
Eramma vs Verrupana, ; Gummalapura Taggina 604 Matada Kotturuswami vs Setra Veeravva & Ors., [1959] Supp ; 1 SCR 968, ; Mangal Singh vs Smt.
Rattno, ; Munna Lal vs Raj Kumar., AIR 1962 SC 1495 Sukhram vs Gauri Shankar, ; ; Kuldeep Singh vs Surain Singh, [1988] Andhra Law Times, Gulwant Kaur vs Mohinder Singh; , ; Maharaja Pillai Lakshmi Ammal vs Maharaja Pillai T. Pillai, ; and Jagannathan Pillai vs Kunjithapadam Pillai.
, ; , referred to.
Mulla 's Hindu Law, 16th Edn.
para 174, and Mayne 's Hindu Law, 12th Edn. para 671, referred to.
|
.A. Nos.
4,5,6 and 7 in Civil Appeal Nos.
1401 & 1402 of 1990.
From the Judgment and Order dated 22.5.1987 of the Delhi High Court in C.W.P No. 2687 of 1986.
Kapil Sibal, V.B. Saharya and R.K. Khanna for the Appellant.
Rajiv Sawhney, Sanjay Anand, Deepak Kumar Thakur, Mrs. Ameeta Rathore, Kapil Chandra for J.B. Dadachanji & Co. and R.K. Maheshwari for the Respondents.
The following Order of the Court was delivered: PUNCHHI, J. These are applications for directions in Civil Appeal Nos. 1401 and 1402 of 1990 decided by us on March 13, 1990.
For facility of fact situation resort be had to our judgment dated March 13, 1990.
Direction given by to the D.D.A was meaningful and clear that it shall grant to the Delhi Cloth Mills conditional approval subject to the removal of the objections enumerated and extracted in the judgment, as raised, or such of them as were valid and tenable in law, after the Delhi Cloth Mills is heard by the Municipal Corporation of Delhi, the author of the objections, and which the D.D.A. had adopted, and the matter to be formalised forthwith by the D.D.A. and the authorities connected therewith within a time frame.
This has reportedly met with hurdles necessitating these applications.
The objections may broadly be divided in three parts: (i) objections which are within the exclusive domain of the Municipal Corporation of Delhi 593 (ii) objections which are exclusively within the domain of the D.D.A.; and (iii) objections which are lendingly common to both, the D.D.A. and the Municipal Corporation of Delhi overseeing and safeguarding the interests of each other.
And these objections can also be divided as surmountable and insurmountable.
The objections, to begin with, as raised by the Municipal Corporation of Delhi and later adopted by the D.D.A., presently requiring smoothening before us relate to those which are within the exclusive domain of the D.D.A. for it is asserted by the applicant Delhi Cloth Mills that the objections relating to the Municipal Corporation of Delhi are not insurmountable and those can for the present, be left alone to be tackled by the applicant without the intervention of the Court.
For this reason neither any direction is asked at this stage nor is one necessary to the Municipal Corporation of Delhi.
The D.D.A. has broadly three objections: (i) To further the resolution of the D.D.A., dated February 1, 1983, the Delhi Cloth Mills should file an amended or modified plan so as to conform to the Master Plan of the year 2001; (ii) Since the matter before the Delhi High Court, as also in this Court, had proceeded on the assumption that the entire 63 acres of land involved in the re development for flatted factories and residential complex was owned by the Delhi Cloth Mills, which assumption was wrong, the Delhi Cloth Mills should confine its plan to about 52 acres of land as owned by it as the balance about 11 acres of land is owned by the D.D.A. which is either on varied termed leases or in trespass with the Delhi Cloth Mills.
The plan would require rectification accordingly; and (iii) The fact of grant of permission vide resolution of 1 2 1983 did not ipso facto mean that the D.D.A. had given up its rights on lease hold lands in accordance with the terms thereof or the tittle to it or to regularize possession of the trespassed upon land with the Delhi Cloth Mills.
594 On that basis it is required of the Delhi Cloth Mills to confine its plans within those 52 acres as owned by it and by a process of reasoning it is hinted that after providing for recreational and other necessary facilities, as required by law, there hardly would remain any land to further the project.
It has been maintained on behalf of the Delhi Cloth Mills that the posture of the D.D.A. is obstructive in nature and a step to flout or undermine the orders of this Court.
It has on the other hand been maintained on behalf of the retrenched workers that since the settlement arrived at by them with the Delhi Cloth Mills was beneficial to them in nature, as a price for closure of the Mill, the posture of the D.D.A. was indirectly against their interests.
They have prayed for suitable directions so that the benefits accruing to them by lapse of time may not go dry.
At the outset, we put it beyond any doubt and re affirm that the D.D.A. stands directed by this Court to grant to the D.C.M. approval, even though conditional, and the D.C.M. stands impliedly directed and is duty bound to remove the objections as were valid and tenable in law as raised by the D.D.A. within its domain.
Having gone thus far there is no retreat of it contemplated.
It is further to be understood that this Court had endorsed by means of this directive the already known views of the Delhi High Court towards restoring resolution of the D.D.A. dated February 1, 1983, whereby the scheme as given by the Delhi Cloth Mills was approved in terms thereof.
And obviously the approval came from the D.D.A. at a time when the Master Plan of the year 1962 was operative and the one of the year 2001 was not existant, and if at all existant in an embryonic stage.
The law governing the object and the rules and regulations then in vogue and applicable were deemingly kept in view and applied by the D.D.A. in the approval of the scheme.
To whittle down the effect of that resolution on the emergence of the new Master Plan of the year 2001, made applicable after the orders of this Court would, at the present stage, if insisted upon be spelled out as a step to undermine the orders of this Court.
Such an objection by the D.D.A. when raised before March 13, 1990, the day when we passed judgment, was untenable in law and the D.D.A. should have known it before putting such an objection to use.
For this reason, we repel the first objection of the D.D.A. and require of it to stick to the position as per Master Plan as existing on February 1, 1983.
This objection is thus surmounted.
The second objection of the D.D.A. with regard to the wrong 595 impression of the ownership of the land appears to us to be valid substantially.
It is the admitted case of the parties that the scheme pertains to 63 acres of land which the Delhi Cloth Mills while applying for sanction claimed to own and one of the considerations in passing the resolution dated February 1, 1983 ex facie was the D.D.A. being impressed by a private entrepreneur coming forward with a scheme with such a large chunk of land.
It is significant that nowhere at that stage, even remotely, or at any stage during the litigation before the Delhi High Court or this Court, was the Delhi Cloth Mill 's claim of owning 63 acres of land been given a serious thought or refuted or put to proof or testing.
One way of looking at it now can be that the Delhi Cloth Mills misled the D.D.A. in that regard and had the D.D.A. known that the Delhi Cloth Mills owned only about 52 acres of land the D.D.A. might have resolved differently.
The other view as suggested by the Delhi Cloth Mills is that the D.D.A. of its own should have counter checked the extent of the ownership of the land of the Delhi Cloth Mills at the time of granting sanction.
Learned counsel on both sides have dwelt upon this matter a great deal.
We cannot assume that by upholding resolution dated February 1,1983, the Delhi High Court, or for that matter this Court, had made or acknowledged Delhi Cloth Mills as the owner of 63 acres of land involved in the scheme or that the right of ownership of the D.D.A. over about 11 acres of land stood extinguished by such exercise.
The D.D.A. when engaged in examining and sanctioning the proposal was justified on proceedings on the supposition of facts given by the Delhi Cloth Mills as true, and in processing the same cannot be said to have surrendered its ownership rights qua land measuring 11 acres.
Thus we are clear in arriving at the view that the said resolution cannot trample the right of D.D.A. as owner over about 11 acres of land when the respective leases reserve to the D.D.A. the right of resumption, and in leases expiring by efflux of time the option not to renew.
The scheme approved must thus of necessity be dented to that effect as the objection of the D.D.A. in that regard and to that extent is valid and tenable.
Reservation in that regard appears also to have been made by the Delhi High Court in its judgment in C.W.P. No. 1281 of 1985 decided on July 22,1988.
While dealing with possibility of a law and order problem, the court relied on the Delhi Cloth Mill 's management 's affidavit towards granting statutory compensation to the workers as well as its undertaking to pay, in some event, additional compensation.
The Delhi Cloth Mills had in the affidavit stated that the additional compensation shall be payable on expiry of two years from the date the Delhi Cloth Mills is allowed by all the concerned authorities 596 including the D.D.A. and Municipal Corporation of Delhi to redevelop its entire 63 acres of land at Bara Hindu Rao and Krishan Ganj, in accordance with the user stipulated therefore under the Master Plan for Delhi dated September 1962.
The High Court in judging the stand taken by the delhi Cloth Mills made the following significant observations: "No assurance is extended by any competent authority to the workmen that the authorities shall not enforce the Master Plan or shall not insist for due compliance of the provisions of the Act and the regulations in the matter of the Mill.
It is also doubtful if any one could opt out of the statutory provisions.
" These observations make it clear that the D.D.A. cannot be said to have abandoned its right either as a statutory body or that of the lessor of land on leases held by the Delhi Cloth Mills by mere passing of the resolution afore mentioned, or correspondingly to have given any right to the workers.
We have been given the break up of those leases numbering 10.
One of them pertains to 36425 sq.
yards(about 7 acres) which is perpetual in nature and is not required to be renewed except that the rent is revisable after every 25 years.
The remaining leases are in comparison short durated, some of which have expired and others are expiring in the year 2001.
The unexpired period of leases is not long enough in the context of the project.
besides there is an area which is said to be trespassed upon by the Delhi Cloth Mills.
this area under durated leases and trespass totals about 4 acres.
the Delhi Cloth Mills cannot be permitted to lay hands on this area as of right to further the scheme.
there a common term in each respective lease reserving right to the lessor to determine the lease at any time if the land is required for public purpose in consideration of the land having been demised free of any premium.
To involve this four acres of land in the scheme the D.C.M may have to work it out under a different shade and premise and not from this Court.
The objection is thus insurmountable on this plain.
So far as the perpetual lease is concerned, its purpose covenants for residential, cultural and recreational purposes of staff and workers of the lessee and purposes ancillary thereto, in accordance with the rules and regulations in force in Delhi under the Municipality Act or any bye laws framed by the lessor.
It is further covenanted that for 597 purposes of construction of building the approval of the lessor in writing is a pre condition before the start of the construction, and further no alteration or addition in the building as approved by the lessor either externally or internally can be made without first obtaining the permission of the lessor in writing.
Besides that if during the period of lease, it is certified by the Central Government that the premises are required for the purposes of the Central Government or any other public purpose, the lessor shall be entitled to take possession of the land together with all building structures etc.
with certain consequences.
It is thus plain and evident that even in the case of perpetual lease enormous residual control is left with the lessor who alone can accord permission to construct building for the specified purpose for residential, cultural and recreational purpose of the staff and workers of the Mill and purposes ancillary thereto, and on frustration of such purpose has the further right to treat the lease to have become void if the land is used for any purpose other than for which the lease was granted, not being the purpose subsequently approved by the lessor.
Thus unless the D.D.A. grants approval to the change of user as asked and reconstruction, the Delhi Cloth Mills has no such deemed right or privilege ignoring the covenants and the terms of the lease.
Thus it cannot be suggested that the resolution afore mentioned has the automatic effect of the D.D.A. having granted change of user, consciously or impliedly, or vesting any right in that regard to the Delhi Cloth Mills.
Here as well the D.C.M. would have to work out its plans with the D.D.A. under the terms of the lease without any further mandate from this Court in this regard.
This objection also is insurmountable in the presence of the void clause.
Yet all is not lost for the Delhi Cloth Mills.
It can still steer through its project in its owned 52 acres, even though in a truncated from and submit an amended plan.
On the other hand its relationship with the D.D.A. being that of a lessee and lessor permits a meaningful dialogue seeking extensions of lease periods, and change of permissive user in respect of 11 acres of land.
It can make attractive suggestions to the D.D.A. for setting up cultural, educational, recreational and other facilities etc.
at the expense of the Delhi Cloth Mills, if the project is to remain of the 63 acre size.
It is the case of Delhi Cloth Mills that if it is allowed to involve the said 11 acres of land, the project would be better and it is prepared to pay any charges as are known to law to keep it as part of the project of the original size.
Be that as it may we are no experts to opine whether a 52 acre project would be more viable or better or a 63 acre one.
But since the project has in terms of our order dated March 13, 1990 to go on, the D.D.A. 598 may if asked examine the suggestions.
That is their field and not ours to decide.
Before concluding this Order, we cannot help remarking that both parties, i.e., the D.C.M. and the D.D.A. have to share mutually the blame for the present situation.
The D.C.M. for its cavalier away in having asserted to own 63 acres of land and the D.D.A. in casually, without consulting its records, passing its Resolution No. 26 dated February 1, 1983 and communicating the same to the D.C.M. on 31 3 1983.
Should the D.C.M. now confine its scheme and project to its owned 52 acres of land, abandoning any effort to have included the remaining D.D.A. owned 11 acres of land by negotiations, and the D.D.A. in not offering on its own, or otherwise, the said land to the D.C.M., the project as originally conceived would have to be spruced.
It is evident from the proceedings of the Resolution that as per Master Plan, 23.14 acres have been earmarked for flatted factories and 43.39 acres as residential, though the sum total goes to more than 63 acres.
Both these areas include areas set apart for facilities and amenities enumerated therein.
The respective areas in that event would have to be reduced keeping in view the ground realities of ownership and the earmarking in the Master plan.
Cuts inevitably may have to be employed in either area or both.
Be that as it may, the scheme in the modified from would have to be brought in, not a new but as a substitute for the original scheme and that scheme would register its birth, legitimacy and binding force as of the original scheme.
The mandate in this regard should be clearly understood by the parties concerned for they are under obligation to responsibly carry out the directions of this Court dated March 13, 1990, in all events, and share the burden of it, indeed as doing the blame.
With these observations, these applications are disposed of.
No Costs.
T.N.A. Applications disposed of.
| IN-Abs | By an order dated 13.3.1990 the Supreme Court directed the Delhi Development Authority (D.D.A.) to grant conditional approval to the respondent Company 's (D.C.M.) scheme pertaining to the development of mills land measuring 63 acres for construction of flatted factories and residential complex subject to removal of objections raised by Municipal Corporation of Delhi and Delhi Development Authority.
The matter could not be finalised by the parties since the DDA took certain objections to the scheme:(a) that the Delhi Cloth Mills should file a modified plan so as to conform to the Master Plan of the year 2001; (b) the legal proceedings before the High Court and the Supreme Court proceeded on the wrong assumption that the entire 63 acres of land was owned by the Delhi Cloth Mills whereas the DCM owns only 52 acres of land while the balance 11 acres was owned by the DDA which is partly on lease and partly in trespass with the Delhi Cloth Mills; and (c) the grant of permission by the DDA vide its resolution No. 26 dated 1.2.83 does not ipso facto mean that it had given up its rights or title to the lease hold lands or that it had regularised the possession of the trespassed upon land with the Delhi Cloth Mills.
The respondent Company filed applications for direction in this Court.
Disposing the applications, this Court, HELD: 1.
The D.D.A. stands directed by this Court to grant to the D.C.M. approval, even though conditional, and the D.C.M. stands impliedly directed and is duty bound to remove the objections raised by the D.D.A.
This Court had endorsed by means of this directive the already known views of the Delhi High Court towards restoring resolu 591 tion of the D.D.A. dated February 1, 1983, whereby the scheme as given by the Delhi Cloth Mills was approved in terms thereof.
The approval came from the D.D.A. at a time when the Master Plan of the year 1962 was operative and the one of the year 2001 was not existent, and if at all existent in an embryonic stage.
The law governing the subject and the rules and regulations then in vogue and applicable were deemingly kept in view and applied by the D.D.A. in the approval of the scheme.
To whittle down the effect of that resolution on the emergence of the new Master Plan of the year 2001, made applicable after the orders of this Court would, at the present stage, if insisted upon be spelled out as a step to undermine the orders of this Court.
Such an objection by the D.D.A. when raised before March 13, 1990, the day when the Supreme Court passed its judgment, was untenable in law and the D.D.A. should have known it before putting such on objection to use.
Therefore, the first objection of the D.D.A. is repelled and it is directed to stick to the position as per Master Plan as existing on February 1. 1983.
[594 D G] 2.
The objection of the D.D.A. with regard to the wrong impression of the ownership of the land is valid substantially.
It is the admitted case of the parties that the scheme pertains to 63 acres of land which the Delhi Cloth Mills while applying for sanction claimed to own and one of the considerations in passing the resolution dated February 1,1983 ex facie was the D.D.A. being impressed by a private entrepreneur coming forward with a scheme with such a large chunk of land.
The D.D.A. when engaged in examining and sanctioning the proposal was justified on proceeding on the supposition of facts given by the Delhi Cloth Mills as true, and in processing the same cannot be said to have surrendered its ownership rights qua land measuring 11 acres.
It cannot be assumed that by upholding the resolution dated February 1, 1983, the Delhi High Court, or Supreme Court, had acknowledged Delhi Cloth Mills as the owner of 63 acress of land involved in the scheme or that the right of ownership of the D.D.A. over about 11 acres of land stood extinguished by such exercise.
Therefore, the said resolution cannot trample the rights of D.D.A. as owner over 11 acres of land when the respective leases reserve to the D.D.A. the right of resumption, and in lease expiring by efflux of time the option not to renew.
The scheme approved must thus of necessity be denoted to that effect as the objection of the D.D.A. in that regard and to that extent is valid and tenable.
But the Delhi Cloth Mills can still steer through its project in its owned 52 acres, even though in a truncated form and submit an amended plan.
The scheme in the modified form would have to be brought in, not a new but as a substitute for the original scheme and that scheme would register its birth, legitimacy and binding force as of the original 592 scheme.[594H, 595 A D, E F, D] 3.
Respondent Company 's relationship with the D.D.A. is that of a lessee and lessor.
Out of 10 leases one is perpetual in nature and the remaining leases are short durated.
Under the terms of the perpetual lease unless the D.D.A. grants approval to the change of user as asked and reconstruction, the Delhi Cloth Mills has no such deemed right or privilege ignoring the covenants and the terms of the lease.
Therefore, it cannot be said that the resolution has the automatic effect of the D.D.A. having granted change of user, consciously or impliedly, or vesting any right in that regard to the Delhi Cloth Mills.
[597 D F, 596 E]
|
ivil Appeal Nos.
931/77 & 200/78.
Appeals by Certificate from the Judgment and Decree dated 1.4.76 and from the Judgment and Decree dated 19.6.1975 of the Andhra Pradesh High Court in A.S. NO. 71/73 and Appeal No. 259 of 1972.
B. Kanta Rao for the Appellants.
C. Sitaramiah, and B. Parthasarthi for the Respondents.
The Judgment of the Court was delivered by: K.RAMASWAMY, J.
Civil Appeal Nos. 931 of 1977 and 200 of 1978 relate to the same dispute though arose from two suits and separate judgements.
The Bench that heard Civil appeal No. 931 of 1977 directed on January 24, 1991 to list Civil Appeal No. 200 of 1978 for common disposal.
Civil Appeal No. 200 of 1978 arose out of O.S. No 118 of 1968 on the file of the Court of Add.
Subordinate Judge.
Guntur and Appeal No. 259 at 1972 dated June 19, 1975 of the A.P. High Court.
The suit for possession and mesne profits was laid by the descendants of Nori Lakshmipathi Somayaajulu of Vatticherukuru, Guntur Taluq and District, for short `N.L.S. '.
The dispute relates to the tank known as `Nori Lakshmipathi Somayajulu 's Western Tank ' ``Vooracheruva ' ' (Village Tank).
It consists of 100 acres of which roughly 30 acres is covered by water spread area marked A ' Schedule `B ' Schedule consists of 70 acres (silted up area).
The tank was dug in Fasli 1190 (1700 A.D.) Zamindar, Raja Mainikya Rao made a grant of the land for digging the tank and its preservation, maintenance and repairs.
It is the descendants ' case that it is a private tank enjoyed by the `grantee ', N.L.S. as owner and thereafter the descendants and perfected the title by prescription.
It was found as a fact by the High Court and the descendants are unable to persuade us from the evidence to differ from the findings that the tank is a ``public tank ' ' dug by 541 the village.
The descendants ' plea and evidence adduced in support thereof that it is their private tank, was negated by both the courts.
The Trial Court found that the tank is a `public trust ', the appellants would be hereditary trustees and could be removed only by taking action under section 77 of the A.P. Hindu Charitable and Religious Institutions and Endowments Act, 1966 for short `the Endowments Act '.
It also held that the descendants acquired title by adverse possession.
Accordingly the suit for possession was decreed relegating to file a separate application for meesne profits.
On appeal the High Court reversed the decree and held that the tank is a public tank and the tank and the lands stood vested in the Gram Panchayat under A.P. Gram Panchayat Act 2 of 1964 for short `the Act '.
Since the Gram panchayat was in possession from July 7, 1965, though dispossessed the descendants forcibly and as the suit is not under section 6 of the but one based on title, it called for no interference.
It dismissed the suit.
This Court granted leave to appeal under Article 136.
Civil Appeal No. 931 of 1977 arose out of the suit for possession in O.S. No. 57 of 1966 on the file of the court of Subordinate Judge at Guntur filed by the Gram Panchayat against the descendants.
The suit was dismissed by the Trial Court and was confirmed by the High Court in A.S. No. 71 of 1973 and the High Court granted leave under article 133 on Dec. 10. 1976.
The pleadings are the same as in the other suit.
In addition the descendants further pleaded in the written statement that the Gram Panchayat unlawfully took possession of the tank on July 7, 1965.
They also acquired title by grant of ryotwari patta under section 3 of the A.P. Inams (Abolition and Conversion into Ryotwari) Act (Act XXXVII of 1956), for short `the Inams Act '.
The Gram Panchayat had no manner of right to interfere with their possession and enjoyment.
They also pleaded and adduced evidence that they were leasing out the fishery rights and grass and trees grown on the land.
The income was being utilized for the repairs of tank.
The Trial Court and the High Court found that the lands were endowed to N.L.S. for the maintenance of the tank and the descendants obtained ryotwari patta under Inams Act and are entitled to remain in possession and enjoyment as owners subject to maintain the tank.
Accordingly the suit was dismissed.
On appeal in A.S. No. 71 of 1973 by judgment dated April 1, 1976 the High Court confirmed the decree on further finding that by operation of section 14 of the Inams Act, Civil Suit was barred.
Thus both the appeals are before this Court.
542 In Civil Appeal No. 200 of 1978, Shri Seetharamaiah learned Senior Counsel for the descendants N.L.S. have no exclusive personal right title or interest in the tank and the appurtenant total land of 100 acres.
In view of the entries of the Inams Fair Register for short `I.F.R., ' it is a public trust and not a public tank.
Unless recourse is had to remove them from trusteeship under section 77 of the Endowments Act, the appellants cannot be dispossessed.
Since admittedly N.L.S. and the descendants were enjoying the property till date of dispossession, presumption of the continuance of the enjoyment anterior thereto as owners could be drawn.
The High Court thereby committed error of law in holding that the lands stood vested in the Gram Panchayat under the Act and that it is a public tank.
In Civil Appeal No. 931 of 1977, it was further contended that since the grant of Ryotwari patta under the Inams Act had became final section 14 thereof bars the jurisdiction of the Civil Court to entertain the suit.
Shri B.Kanta Rao, learned counsel for the Gram Panchayat contended that the finding of the High Court that the tank and the appurtenant land, namely, the plaint schedule property, as `public tank ', is based on evidence that the tank was dug by the villagers and that they have been using for their drinking purposes and the cattle is a finding of fact.
By operation of sections 85 and 64 of the Act, the land and the tank stood vested in the Gram Panchayat.
Entries in the I.F.R. establishes that the grant of the land was for preservation, maintenance and repairs of the tank.
Therefore, the grant should be in favour of the institution, namely, the tank.
The pattas obtained by the descendants should be for the benefit of the tank, though granted in individual names.
By operation of section 85 of the Act, the descendants acquired no personal title to the property.
Ryotwari patta is only for the purpose of land revenue.
The Gram Panchayat acquired absolute right title and interest in the land.
The Civil Suit is not a bar on the facts in this case.
Before appreciating the diverse contentions, the facts emerged from the findings in both the appeals could be gathered thus.
Admittedly the Zamindar.
Raja Manikya Rao granted 100 acres of land in Inam village to dig the tank and the grant was for its preservation and maintenance, the grant was in favour of N.L.S.
In 1700 A.P., i.e. 1190 Fasli, the tank was dug by the villagers and ever since the villagers have been using the fresh water tank for their drinking purposes and of the cattle and perfected their right by prescription.
In course of time the tank was silted up and in and around 30 acres the water spread area, fresh water is existing.
No. repairs were effected by the descendants.
The rest of the land was silted up.
Grass and trees have been 543 grown thereon and was being enjoyed.
On July 7, 1965, the Gram Panchayat took unilateral possession of the tank and ever since was exercising possession, supervision and control over it.
After expiry of three years from the date of dispossession, the descendants filed O.S. No.57 of 1966 for possession based on title.
Earlier thereto the Gram Panchayat field the suit for possession.
Under the Inams Act, Ryotwari patta under section 3 was granted to the descendants in individual capacity and on appeal the Revenue Divisional Officer, Guntur confirmed the same.
It became final as it was not challenged by filing any writ petition.
Both the suits now stood dismissed.
The counsel on other side have taken us through the evidence and we have carefully scanned the evidence.
From these facts the first question emerges is whether the tank and the appurtenant land stood vested in Gram panchayat.
Section 64 of the Act reads thus: ``Vesting of common property or income in Gram Panchayat Any property or income which by custom belongs to or has been administered for the benefit of the villagers is common, or the holders in common of village land generally or of land of a particular description or of lands under a particular source of irrigation, shall vest in the Gram Panchayat and be administered by it for the benefit of the villagers or holders aforesaid ' '.
Section 85 reads thus: ``Vesting of water works in Gram Panchayat (1) All public water courses, springs, reservoirs, tanks, cisterns, fountains, wells, ponds an other water works (including those used by the public to such an extent as to give a prescriptive right to their use) whether existing at the commencement of this Act or afterwards made, laid or erected and whether made, laid or erected at the cost of the Gram Panchayat or otherwise for the use or benefit of the public, and also any adjacent land, not being private property, appertaining thereto shall vest in the Gram Panchayat and be subject to its control ' '.
Provided that nothing in this sub section shall apply to any work which is, or is connected with, a work of irrigation or 544 to any adjacent land appertaining to any such work.
(2) Subject to such restrictions and control as may be prescribed, the Gram Panchayat shall have the fishery rights in any water work vested in it under sub section (1), the right to supply water from any such work for raising seed beds on payment of the prescribed fee, and the right to use the adjacent land appertaining thereto for planting of trees and enjoying the usufruct thereof or for like purpose.
(3) The Government may, by notification in the Andhra Pradesh Gazettee, define or limit such control or may assume the administration of any public source of water supply and public land adjacent and appertaining thereto after consulting the Gram Panchayat and giving due regard to its objections, if any ' '.
(emphasis supplied) A bird 's eye view of the provisions brings out vividly that any property or income which belongs to or has been administered for the benefit of the villagers in common or the holders in any of the village land generally or of land of a particular description or of lands under particular source of irrigation shall vest in the Gram Panchayat and be administered by it for the benefit of the villagers or holders aforesaid.
The lands or income use for communal purpose shall either belong to the GRam Panchayat or has been administered by the Gram Panchayat.
It is not the case of the Gram Panchayat nor any finding recorded by the courts below to the effect.
So section 64 is not attracted, though the villagers acquired prescriptive right to use the water from the tank for their use and of their cattle.
All public water courses, springs, reservoirs, tanks cisterns, etc.
and other water works either existing on the date of the Act or made thereafter by the Gram Panchayat, or otherwise including those use by the public ripened into prescriptive right for the use and benefit of the public and also adjacent or any appurtenant land not being private property shall vest in the gram Panchayat under section 85(1) and be subject to its control.
The proviso is not relevant for the purpose of this case.
Under sub s (2), the Gram Panchayat shall have fishery rights therein subject to any restriction or control prescribed by the Govt.
by rules.
The Gram Panchayat also shall have the right to use the adjacent land appertaining thereto for planting trees and enjoying the usufruct thereof or for like purposes.
Sub section (3) gives over riding power to 545 the Govt., by a notification published in the A.P. Gazettee to define or limit the control or supervision by the Gram Panchayat or the Govt.
may assume administration of any public source of water supply and public land adjacent and appertaining thereto.
The only condition precedent thereto is prior consultation of the Gram Panchayat and to have due regard to any objections.
If raised, by the Gram Panchayat and issue notification published in the Gazette resuming the water sources or the land etc.
The word `vest ' clothes varied colours from the context and situation in which the word came to be used in a statute or rule.
In Chamber 's Mid Century Dictionary at p. 1230 defined ``vesting ' ' in the legal sense `to settle, secure, or put in fixed right of possession; to endow, to descend, devolve or to take effect, as a right '.
In Black 's Law Dictionary, 5th Edition at p. 1401, the word, `vest ', to give an immediate, fixed right of present or future enjoyment, to accure to, to be fixed, to take effect, to clothe with possession, to deliver full possession of land or of an estate, to give seisin to enfeoff.
In Stroud 's Judicial Dictionary, 4th Edition, Vol. 5 at p. 2938, the word `vested ' was defined in several senses.
At p. 2940 in item 12 it is stated thus `as to the interest acquired by public bodies, created for a particular purpose, in works such as embankments which are vested in them by statue, see Port of London Authority vs Canvey Island Commissioners, in which it was held that the statutory vesting was to construct the sea wall against inundation or damages etc.
and did not acquire fee simple.
Item 4 at p. 2939, the word `vest ', in the absence of a context, is usually taken to mean vest in interest rather than vest in possession '.
In item 8 to `vest ',. ``generally means to give the property in ' '.
Thus the word `vest ' bears variable colour taking its content from the context in which it came to be used.
Take for instance, the land acquired under the Land Acquisition Act.
By operation of sections 16 & 17 thereof, the property so acquired shall vest absolutely in the Government free from all encumbrances.
Thereby, absolute right, title and interest is vested in the Government without any limitation divesting the pre existing rights of its owner.
Similarly, under section 56 of the , the estate of the insolvent vests in the receiver only for the purpose of its administration and to pay off the debts to the creditors.
The receiver acquired no personal interest of his own in the property.
The receiver appointed by the court takes possession of the properties in the suit on behalf of the court and administer the property on behalf of the ultimate successful party as an officer of the court and he has no personal interest in the property vested thereunder.
In Fruit and Vegetable Merchants Union vs Delhi 546 Improvement Trust, [1957] SCR p. 1 the question was whether the Delhi Improvement Trust was vested of the Nazul land belonging to the Government with absolute right, when the property was entrusted under the scheme for construction of the markets etc.
It was held by this court that placing the property at the disposal of the trust did not signify that the Government had divested itself of its title to the property and transferred the same to the trust.
The clauses in the agreement show that the Government had created the Trust as its agent not on permanent basis but as a convenient mode of having the scheme of improvement implemented by the Trust subject to the control of the Government.
The word `vesting ' in section 85 would signify that the water courses and tanks, lands etc.
used by the public to such an extent as to give a prescriptive right to their use, are vested in the Gram Panchayat, and placed them under the control and supervision of the Gram Panchayat.
It confers no absolute or full title.
It was open to the Government, even after vesting, to place restrictions upon the Gram Panchayat in the matter or enjoyment and use of such tanks, and appurtenant lands etc.
Sub section (3) of section 85 expressly makes the matter clear.
It empowers the Government to assume the administration of any such tank or lands or to define or limit the control which is vested in the Gram Panchayat.
Gram Panchayat being a statutory body is bound by the restrictions imposed by sub S3 (3) The assumption of management by the Govt.
would be subject to the prescriptive right of the villagers if any.
The Division Bench in Gram Panchayat, mandapaka & Ors.
V. Distt.
Collector Eluru & Ors., AIR 1981 AP 15 considered the meaning of the word `vesting and correctly laid the law in its interpreting section 85 of the Act.
Anna Narasimha Rao & Ors.
V. Kurra Venkata Narasayya & Ors., [1981] 1 AWR p. 325 relied on by Shri Kanta Rao, though supports his contention that the vesting of the tanks etc.
in the Gram panchayat was with absolute eights and the village community rights would over ride against rights of the Government, in our view the law was not correctly laid down.
Under A.P. Land Encroachment Act, 1905; Talengana Area Land Revenue Act, relevant Abolition Act like A.P. Estates (Abolition and Conversion into Ryotwari) Act, 1948, Inams Abolition Act etc.
give absolute rights of vesting in the State over the forest land, tanks, rivers, mines, poramboke, land, etc.
free from all encumbrances and the pre existing rights in the other land stood abolished and will be subject to the grant of Ryotwari patta etc.
It is also settled law that grant of Ryotwari patta is not a title but a right coupled with possession to remain in occupation and enjoyment subject to payment of the land revenue to the State.
Therefore, we 547 agree with the High Court that the tank is public tank and not a public trust and that under section 85(1) and section 64, the vesting of the tanks, the appurtenant land and the common land is only for the purpose of possession, supervision, control and use thereof for the villagers for common use subject to the over riding title by the Government and its assumption of management should be in terms of sub section
(3) of section 85 of the Act and subject to the prescriptive right in the water; water spread tank for common use.
Admittedly, N.S.L. or the descendants used the plaint schedule property till July 7, 1965.
The question then is what rights the descendants acquired therein.
Admittedly within six months from the date of dispossession no suit under section 6 of the was laid.
Therefore, though the Gram Panchayat was not justified to take law into its own hand to take unilateral possession without due course of law, since the suit filed by the descendants was based on title the descendants in Civil Appeal No.200 of 1978 have to establish their better title.
Their claim was based on the Ryotwari patta granted under section 3 of the Inams Act.
Therefore, entries in I.F.R. bear great evidenciary value to ascertain their rights.
In Arunachalam Chetty vs Venkatachalpathi Garu Swamigal, AIR 1919 PC.
p. 62 at 65 the Judicial Committee of the Privy Council considered the effect of the columns in the I.F.R. and held thus : ``It is true that the making of this Register was for the ultimate purpose of determining whether or not the lands were tax free.
But it must not be forgotten that the preparation of this Register was a great act of State, and its preparation and contents were the subject of much consideration under elaborately detailed reports and minutes.
It is to be remembered that the Inam Commissioners through officials made enquiry on the spot, heard evidence and examined documents, and with regard to each individual property, the government was put in possession not only of the conclusion come to as to whether the land was tax free, but of a statement of the history and tenure of the property itself.
While their Lordships do not doubt that such a report would not displace actual and authentic evidence in individual cases, yet the board, when such is not available, cannot fail to attach the utmost importance, as part of the history of the property, to the information set forth in the Inam Register ' '.
548 Construction of the relevant entries in the I.F.R. is a question of law.
Col. 2, the general class to which the land belongs, described as `Dharmadayam ' endowment for a charitable ``institution ' ', Col. 7, description of tenure for the ``preservation and repairs ' ' of Nori Lakshmipathi Somayajulu Western Tanks at Vatticherkuru, Col. 9 tax free, Col. 10, nature of the tenure, permanent, Col. 11, guarantor of the land Raja Manikya Rao in 1190 Fasli (1700 A.D.), Col 13, name of the original grantee `Nori Lakshmipathi Somayajulu ', Col. 21 to be confirmed under usual conditions of service and Col. 22, confirmed.
In the survey and settlement record of the year 1906 of the same columns have been repeated.
The land in the tank were classified as Village `Poramboke ' and the tank as `village tank '.
In the village map also the same remarks were reiterated.
Therefore, the entries in the I.F.R. are great acts of the State and coupled with the entries in the survey and settlement record furnishes unimpeachable evidence.
On construction of these documents, it would clearly emerge that the original grant was made for the preservation and maintenance of the tank and tax free Inam land was granted for that purpose through it was in the name of the individual granted.
We are of the view that the grant was for the preservation and maintenance of the tank.
In K.V. Krishna Rao vs Sub Collector, Ongole, ; this court held under the Inam Act that the tank is a charitable institution.
Thereby we conclude that the grant was for the institution.
Under section 3 of the Inams Act, the enquiry should be whether (1) a particular land is Inam land; (2) Inam land in a Ryotwari, Zamindar or Inam Village; and (3) is held by any institution.
In view of the finding that the grant was for the preservation and maintenance of tank, the Inam, land in an inam village was held by the institution, namely, the tank.
Ryotwari patta shall, therefore, be in favour of the institution.
Undoubtedly the ryotwari patta was granted in favour of the descendants.
In Nori Venkatarama Dikshitulu & Ors.
vs Ravi Venkatappayya & Ors., [1959] 2 A.W.R.357 in respect of the tope dedicated to the public benefits in the same village, namely Vatticherukuru, one of the question that arose was whether the patta granted in the individuals ' names, would be their individual property or for the endowment.
The Division Bench held that though the pattas were obtained in the individuals ' name, the trustees of an institution cannot derive personal advantage from the administration of the trust property.
It was held that the grant of patta was for the maintenance of the trust.
We approve that the law was correctly laid down.
In Krishan Nair Boppudi Punniah & Ors.
vs Sri Lakshmi Narasimhaswamy Varu, by its trustees & Ors.
, [1963] 1 A.W.R. 214 549 relied on by Shri Sitaramaiah, on the basis of the entries in I.F.R., the finding was that the grant was in favour of the individual burdened with service and not to an institution.
Therefore, the ratio therein does not assist us to the facts in this case.
Moreover, in view of the stand taken by Shri Sitaramaiah that the lands are not the private property of N.L.S. or his descendants but held by them as trustees, the grant of Ryotwari patta to the individuals by necessary implication, as a corollary, is of no consequence.
The question then is whether the enjoyment of the usufruct by the descendants would clothe them with any right as owners of the land.
In view of the concurrent finding that descendants did not acquire title by prescription, the passage in Tagore Law Lecture, `Hindu Religious Endowment and Institutions ' at p. 6 relied on by Shri Sitaramaiah to the effect `dedication of tanks and trees ' as private property also renders no assistance to the descendants.
Undoubtedly, a presumption of an origin in lawful title could be drawn, as held in Syed Md. Mazaffaralmusavi vs Bibi Jabeda & Ors., AIR (1930) P.C. 1031 that the court has so often readily made presumption in order to support possessory rights, long and quietly enjoyed, where no actual proof of title is forth coming.
It is not a mere branch of the law of evidence.
It was resorted to because of the failure of actual evidence.
The matter is one of presumption based upon the policy of law.
It was also further held that it is not a presumption to be capriciously made nor is it one which a certain class of possessor is entitled to, de jure.
In a case such as the one in question where it was necessary to indicate what particular kind of lawful title was being presumed, the Court must be satisfied that such a title was in its nature practicable and reasonably capable of being presumed without doing violence to the probabilities of the case.
It is the completion of a right to which circumstances clearly point where time had obliterated any record of the original commencement.
The longer the period within which and the remoter the time when first a grant might be reasonably supposed to have occurred the less force there is an objection that the grant could not have been lawful.
In Bhojraj vs Sita Ram & Ors., AIR (1936) P.C. 60 it was further held that the presumption, not to supplement but to contradict the evidence would be out of place.
A presumption should be allowed to fill in gaps disclosed in the evidence.
But the documentary evidence in the I.F.R. and the survey and settlement records furnish the unerring evidence.
Though the original grant was not produced, the grant was for the institution and not to the individuals.
Therefore, the colour of title though enabled them to enjoy the usufruct for personal use, once the tank and the appurtenant land was found to be public tank, the descendants acquired no personal right over it.
The decision in Bhupathiraju 550 Venkatapathiraju & Ors.
vs The President, Taluq Board, Naraspur & Ors., [1913]19.I.C.727(Mad.) (D.B.) relied by Shri Sitaramaiah the finding was that the grant was to the plaintiffs ' family subject to conditions of service.
Their right to take the usufruct of the trees therein was held to be for the benefit of the grantee.
In that view its ratio cannot be applied to the facts in this case.
In M. Srinivasacharyulu & Ors.
vs Dinawahi Pratyanga Rao & Ors., one of the contentions raised was that since the produce was being enjoyed by the trustees for over many years for personal use, it must be construed that the trust was for personal benefit of archakas.
It was repelled holding that it would be a dangerous proposition to lay down that if the trustees of the religious trusts have for many years being applying the income to their own personal use, the trust deed must be construed in the light of such conduct.
The decree of the trial court that the enjoyment was for the institution was upheld.
The finding in Civil Appeal No. 931 of 1977, that since the endowment was the dashabandam the descendants are entitled to the Ryotwari patta cannot be upheld.
Dashabandam grant of land burdened with the service of a public nature was made at a time when maintenance of water sources and water courses to the benefits of the villagers was left to the villagers.
In Ravipati Kotayya & Anr.v.
Ramansami Subbaraydu & Ors., it was held that in the case of dashabandam inams situated in Ryotwari villages, the government has the right of resumption on default of service.
The lands burdened with dashabandam service which is service of public nature, are inclinable as being against public policy.
We, therefore, hold that the descendants, though enjoyed the income from the properties, did not effect the repairs and neglected the maintenance and upkeep of the tank.
They rendered the tank disused and abandoned.
By operation of s.85 of the Act the lands and tank stood vested in the Gram Panchayat for control, management and supervision.
Undoubtedly, a hereditary trustee is entitled to be the Chairman of a Board of Trustees, if any, constituted under the Endowment Act or else be in exclusive possession and management of the public trust registered thereunder until he is removed as per the procedure provided therein.
Since the tank always remained a public tank and not being a public trust, the Endowment Act does not apply.
therefore, the question of initiating action under section 77 of the Endowment Act for removal of the descendants as trustees does not arise.
In the suit of the descendants the High Court did not consider the effect of grant of ryotwari patta under Inams Act and in the suit of the 551 Gram (Village) Panchayat the effect of vesting under s.85 of the Act on the grant of ryotwari patta was not considered.
Only section 14 i.e. the bar of civil suit was focussed.
Consequently both the suits were dismissed by different division benches.
The question is whether the suit is maintainable.
All communal lands, porambokes, tanks, etc., in inam villages shall vest in the government under s.2A of Inams Act free from all encumbrances.
Section 3 determines the inam lands whether held by the individual or the institution, provides procedure for determination and s.3(4) gives right of appeal.
Section 4 converts those lands into ryotwari lands and accords entitlement to grant of ryotwari patta.
Section 5 gives power to restitute the lands to the tenants in occupation though were ejected between specified dates.
Section 7 gives power to grant ryotwari patta to the tenants to the extent of two thirds share in the land and one third to the land holder.
If it was held by the institution, two third share would be to the institution and one third to the tenants.
Section 3 grants right of permanent occupancy to the tenants in inam lands held by institutions.
Section 9 prescribes procedure for eviction of the tenants having right of permanent occupancy.
Section 10 A provides right to ryotwari patta to tenants in Ryotwari or Zamindari village with the right of permanent occupancy, even in the lands, held under customary right etc.
Section 12 fastens liability on the ryotwari pattadars to pay land assessment.
Section 13 gives exclusive power of jurisdiction to Tehsildar, the Revenue court and the collector to try the suit as per the procedure as of a Civil Court under the Code of Civil Procedure.
Section 14 of the Inams Act reads thus: 14.
" Bar of jurisdiction of Civil Courts: No suit or other proceedings shall be instituted in any Civil Court to set aside or modify any decision of the Tahsildar, the Revenue Court, or the Collector under this Act, except where such decision is obtained by misrepresentation, fraud or collusion of parties.".
Section 14 A and Section 15 provides that: "14 A Revision (1) Notwithstanding anything contained in this Act, the Board of Revenue may, at any time either suo moto or on application made to it, call for and examine the records relating to any proceedings taken by the Tahsildar, the Revenue Court or the Collector under this act for the purpose of satisfying itself as to the regularity of 552 such proceeding or the correctness, legality or propriety of any decision made or order passed therein; and if, in any case, it appears to the Board of revenue that any such decision or order should be modified, annulled, reserved or remitted for consideration, it may pass order accordingly.
(2) No order prejudicial to any person shall be passed under sub section (1) unless such person has been given an opportunity of making his representation.
Act to override other laws: "Unless otherwise expressly provided in this Act the provision of this act and of any orders and Rules made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law".
The Constitution intends to herald an egalitarian social order by implementing the goals of socio economic justice set down in the Preamble of the Constitution.
In that regard the Constitution created positive duties on the State in Part IV towards individuals.
The Parliament and the State legislatures made diverse laws to restructure the social order; created rights in favour of the citizens; conferred power and jurisdiction on the hierarchy of Tribunals or the authorities constituted thereunder and given finality to their orders or decisions and divested the jurisdiction of the established civil courts expressly or by necessary implication.
The Inam Act is a step in that direction as part of Estate Abolition Act.
Therefore, departure in the allocation of the judicial functions would not be viewed with disfavour for creating the new forums and entrusting the duties under the statutes to implement socio economic and fiscal laws.
We have to consider, when questioned, why the legislature made this departure.
The reason is obvious.
The tradition bound civil Courts gripped with rules of pleading and strict rules of evidence and tardy trial, four tier appeals, endless revisions and reviews under C.P.C are not suited to the needed expeditious dispensation.
The adjudicatory system provided in the new forums is cheap and rapid.
The procedure before the Tribunal is simple and not hide bound by the intricate procedure of pleadings, trial, admissibility of the evidence and proof of facts according to law.
Therefore, there is abundant flexibility in the discharge of the functions with greater expedition and inexpensiveness.
In order to find out the purpose in creating the Tribunals under 553 the statutes and the meaning of particular provision in social legislation, the Court would adopt the purposive approach to ascertain the social ends envisaged in the Act, to consider scheme of the Act as an integrated whole and practical means by which it was sought to be effectuated to achieve them.
Meticulous lexographic analysis of words and phrases and sentences should be subordinate to this purposive approach.
The dynamics of the interpretative functioning of the Court is to reflect the contemporary needs and the prevailing values consistent with the constitutional and legislative declaration of the policy envisaged in the statute under consideration.
In Denna vs Union of India, ; this Court held that the "Law is a dynamic science, the social utility of which consists in its ability to keep abreast of emerging trends in social and scientific advance and its willingness to readjust its postulates in order to accommodate those trends.
Law is not static.
The purpose of Law is to serve the needs of life".
The law should, therefore, respond to the clarion call of social imperatives evolve in that process functional approach as means to subserve "social promises" set out in the Preamble, directive principles and the fundamental Rights of the Constitution.
It is seen that the Inam 's Act is an integral part of the scheme of the Andhra Pradesh Estates (Aboilition and Conservation into Ryotwari) Act, 26 of 1984 for short 'Estate Abolition Act ' to cover the left over minor Inams.
It determined the pre existing rights of the Inamdars and the religious institutions; envisages grant of ryotwari patta afresh to the concerned and seeks to confer permanent occupancy rights on the tenants.
It also regulates the relationship between institutions and its tenants.
It created appellate and revisional and forums and declared finality to the orders passed by the tribunals and expressly excluded the jurisdiction of the Civil Court, notwithstanding anything contained in any other law or inconsistent therewith the Inams Act shall prevail.
The exception engrafted was that a suit would lie to challenge the decision obtained by fraud, misrepresentation and collusion by parties.
Section 9 of the Civil Procedure Code, 1908 provides that whenever a question arises before the Civil Court whether its jurisdiction is excluded expressly or by necessary implication, the Court naturally feels inclined to consider whether remedy afforded by an alternative provision prescribed by special statute is sufficient or adequate.
In cases where exclusion of the Civil Court 's jurisdiction is expressly provided for, the consideration as to the scheme of the statute in question 554 and the adequacy or sufficiency of the remedy provided for by it may be relevant, but cannot be decisive.
Where exclusion is pleaded as a matter of necessary implication such consideration would be very important and in conceivable circumstances might become even decisive.
The jurisdiction of a Tribunal created under statute may depend upon the fulfilment of some condition precedent or upon existence of some particular fact.
Such a fact is collateral to the actual matter which the Tribunal has to try and the determination whether it existed or not is logically temporary prior to the determination of the actual question which the tribunal has to consider.
At the inception of an enquiry by a Tribunal of limited jurisdiction, when a challenge is made to its jurisdiction, the Tribunal has to consider as the collateral fact whether it would act or not and for that purpose to arrive at some decision as to whether it has jurisdiction or not.
There may be Tribunal which by virtue of the law constituting it has the power to determine finally, even the preliminary facts on which the further exercise of its jurisdiction depends; but subject to that, the Tribunal cannot by a wrong decision with regard to collateral fact, give itself a jurisdiction which it would not otherwise had.
Except such tribunals of limited jurisdiction when the statute not only empowers to enquire into jurisdictional facts but also the rights and controversy finally it is entitled to enter on the enquiry and reach a decision rightly or wrongly.
If it has jurisdiction to do right, it has jurisdiction to do wrong.
It may be irregular or illegal which could be corrected in appeal or revision subject to that the order would become final.
The questions to be asked, therefore, are whether the Tribunal has jurisdiction under Inam Act to decide for itself finally; whether the institution or the Inamdar or the tenant is entitled to ryotwari patta under sections 3,4 and 7 and whether the Tribunal is of a limited jurisdiction and its decision on the issue of patta is a collateral fact.
The consideration as to exclusion of the jurisdiction of Civil Court is no longer res integra.
This Court in bead roll of decisions considered this question in diverse situations.
In Kamala Mills Ltd. vs State of Bombay; , the questions arose were whether an assessment made in violation of the Bombay Sales Tax Act could claim the status of an assessment made under that Act, and whether the nature of the transactions was a decision of collateral fact.
A Bench of seven Judges of this Court held that if it appears that a statute creates a special right or liability and provides for the determination of the right or liability to be dealt with by tribunals specially constituted in that 555 behalf would be considered whether all questions of said right and liability shall be determined by the tribunals so constituted and it becomes pertinent to enquire whether remedies normally associated with actions in Civil Courts are prescribed by the said statute or not.
It was held that the Court was satisfied that the Act provided all the remedies associated with actions in Civil Courts and the remedy for refund of the tax illegally collected was provided and it was not collateral.
Section 20 prohibits such a claim being made before an ordinary Civil Court and held that the civil suit was not maintainable.
The leading decision of the Privy Council in Secretary of State vs Mask & C0.
, [1940] L.R. 67I.A.222; Raleigh Investment Co. Ltd. vs Governor General in Council, L.R. 74 I.A. 50 and the ratio in Firm and Illuri Subbayya Cheety & Sons vs State of Andhra Pradesh, ; were approved.
In Desika Charyulu vs State of A.P. , AIR 1964 SC 807 a Constitution Bench was to consider whether the jurisdiction of the Settlement Officer and the Tribunal created under the Estates Abolition Act to determine whether Shotrium Village was an inam estate was exclusive and the Civil Court 's jurisdiction to try the dispute was barred.
Despite the fact that no express exclusion of the Civil Court 's jurisdiction was made under the Act it was held that very provision setting up an hierarchy of judicial tribunals for the determination of the questions on which the applicability of the Act depends was sufficient in most cases to infer that the jurisdiction of the Civil Courts to try the same was barred.
Accordingly it was held that the jurisdiction of the Settlement Officer and the Tribunal by necessary implication was exclusive and that the Civil Courts are barred from trying or retrying the question once over.
The decisions of the Settlement Officer and of the Tribunal were held final and conclusive.
In Dhulabhai & Ors.
vs State of M.p. & Anr. ; another Constitution Bench reviewed the entire case law on the question of maintainability of civil suit and laid down seven propositions.
Propositions 1 and 2 are relevant, which read thus: "(1) Where the statute gives a finality to the orders of the special tribunals the Civil Court 's jurisdiction must he held to be excluded if there is adequate remedy to do what the Civil Courts normally do in a suit.
Such provision, however, does not exclude those cases where the provisions of the particular Act have not been complied with or the statutory tribunal has not acted in conformity with the fundamental principles of judicial procedure.
556 (2) Where there is an express bar of the jurisdiction of the Court, an examination of the scheme of the particular Act to find the adequacy or the sufficiency of the remedies provided may be relevant but is not decisive to sustain the jurisdiction of the civil court.
Where there is no express exclusion the examination of the remedies and the scheme of the particular act to find out the intendment becomes necessary and the result of the inquiry may be decisive.
In the latter case it is necessary to see if the statute creates a special right or a liability and provides for the determination of the right or liability and further lays down that all questions about the said right and liability shall be determined by the tribunals so constituted, and whether remedies normally associated with actions in Civil Courts are prescribed by the said statute or not.
" It was held therein that the civil suit was not maintainable to call in question of assessment made under the Madhya Bharat Sales Tax Act.
In hatti vs Sunder Singh, [1971]2 SCR 163 the tenant had a declaratory relief before the authorities under Delhi land Reforms Act that he was Bhoomidar.
When it was challenged in the civil suit as not being binding, this Court held that the civil suit was not maintainable.
In Muddada Chayana vs Karam Narayana and Anr.
; , under section 56(1) (c) of the Estates Abolition Act, the dispute whether who the lawful ryot in respect of any holding is, shall be decided by the Settlement Officer.
Whether it is liable to be questioned in the Civil Court.
Chinnappa Reddy, J., who had intimate knowledge as an Advocate and the Judge on the subject reviewed the law and held that the Act is a self contained code in which provision was also made for the adjudication of various types of disputes arising, after an estate was notified, by specially constituted tribunals.
On the general principles it was held that the special tribunals constituted by the Act must necessarily be held to have exclusive jurisdiction to decide dispute entrusted by the statute to them for their adjudication.
Dealing with the object of the Act it was held at p. 207 C D that the Act intended to protect ryots and not to leave them in wilderness.
When the Act provides machinery in section 56(1)(c) to discover who the lawful ryot of a holding was, it was not for the Court to denude the Act of all meaning and by confining the provision to the bounds of sections 55 and 56(1)(a) and (b) on the ground of contextual interpretation.
Interpretation of a statute, contextual or otherwise must further and 557 not frustrate the object of the statute.
It was held that the civil suit was not maintainable and approved the Full Bench judgment of 5 judges of the High Court of Andhra Pradesh in T. Munuswami Naidu vs R. Venkata Reddy., AIR 1978 A.P. 200.
The same view was reiterated in O. Chenchulakshmamma & Anr.
D. Subramanya Reddy; , and held that the order of the Addl.
Settlement Officer was final in so far as the dispute between the rival claimants to the ryotwari patta was concerned and not liable to be questioned in any court of law.
In A. Bodayya & Anr.
L. Ramaswamy (dead) by Lrs. [1984] (Suppl).
SCC 391 while reiterating the ratio in both the judgments, Desai, J. Speaking for a Bench of 3 Judges held that under Estate Abolition Act, who the lawful ryot was decided.
Self same question directly and substantially raised in the suit cannot be decided by the Civil Court as it had no jurisdiction to decide and deal with the same but Settlement Officer had the exclusive jurisdiction to decide and deal with it.
In Doe vs Bridges, at p. 859 the oft quoted dictum of Lord Tenerden, C.J. reads that: "where an act creates an obligation and enforces the performance in a specified manner, we take it to be a general rule that performance cannot be enforced in any other manner." In Premier Automobiles Ltd. vs Kamlakur Shantaram Wadke and Ors., ; a Bench of three Judges after reviewing the case law held that if a dispute was not industrial dispute, not does it relate to enforcement of any right under the Industrial Dispute Act, the remedy lies only in the civil court.
If the dispute arises out of the right or liability under the general common law and not under the Act, the jurisdiction of the civil court is always alternative, leaving it to the election of the suitor to choose his remedy for the relief which is competent to be granted in a particular remedy.
If the dispute relates to the enforcement of a right or obligation of the Act,the only remedy available to the suitor is to get an application adjudicated under the Act.
In that view, it was held that the civil suit was not maintainable.
In State of Tamil Nadu vs Ramalinga Samigal Madam, ; strongly relied on by Shri Kanta Rao, the question therein was whether the jurisdiction of the civil court was ousted to redetermine the nature of the land rendered by the settlement officer under section II of the Estate Abolition Act, Tulzapurkar, J. speaking for the Division Bench proceeded on three fundamental postulates namely that the decision of the Settlement authorities under section 11 of the Act was for (I) 558 revenue purposes '," that is to say for fastening the liability on him to pay the assessment and other dues and to facilitate the recovery of such revenue from him by the Government; and therefore, any decision impliedly rendered on the aspect of nature and character of the land on that occasion will have to be regarded as incidental to and merely for the purpose of passing the order of granting or refusing to grant the patta and for no other purpose".
(II) only revision against the order and not an appeal; and (III) that by Madras Amendment, section 64 c was deleted.
It was unfortunate that it was not brought to the notice of the court that the purpose of Estate Abolition Act was not solely for the purpose of collecting the revenue to the State.
The Act had its birth from a long drawn struggle carried on by the ryots in Madras Presidency for permanent ryotwari settlement of tenures and grant of permanent occupancy rights and the Indian National Congress espoused their rights and passed resolution at Arvadi Session to make a legislation in that regard.
The recovery of revenue was only secondary.
In Syamala Rao vs
Sri Radhakanthaswami Varu a division Bench of the Andhra Pradesh High Court to which one of us (K.R.S.,J) was a member considered the historical background, the purpose of the Act and the scheme envisaged therein in extenso and held that the preamble of the Estate Abolition Act was to repeal the permanent settlements, the acquisition of the rights of the land holders in the Estates and introduction of the ryotwari settlement therein; under section 1(4) by issuance of the notification the prexisting rights shall cease and determined; shall vest in the State free from all encumbrances and declared that all rights and interests created in particular over the State 'shall cease and determine as against the Government ' protected only dispossession of a person in possession of the ryoti land who was considered prima facie entitled to a ryotwari patta.
Section 11 envisaged to enquire into "the nature of the land" and whether "ryotwari land immediately before the notified dates" to be properly included or ought to have been properly included in the holding of the ryot".
The enquiry under the Act was entrusted to the Revenue Authorities who have intimate knowledge of the nature of the lands and the entries in the revenue records of the holders, etc.
Act created hierarchy of the tribunals, namely Asstt.
Settlement Officer; Settlement Officer; Director of Settlements and Board of Revenue; provided revisional powers to those authorities and ultimately the order is subject to the decision of the High Court under article 226.
In that view it was held that by necessary implication the jurisdiction of the civil court was ousted, the decision of settlement authorities under section 11 was made final and no civil suit was maintainable.
The legislature having made the Act to render economic justice to the ryots and 559 excluded the dispute between land holders and the ryots covered under sections 12 to 15 and the ryots inter se under section 56(1)(c), from the jurisdiction of the Civil Court, it would not be the legislative intention to expose the ryots to costly unequal civil litigation with the state of the dispute under section 11.
It is not necessary in this case to broach further but suffice to state that unfortunately this historical perspective and the real purpose and proper scope and operation of Estate Abolition Act was not focussed to the notice of this court.
In Jyotish Thakur & Ors.
vs Tarakant.
Jha & Ors.
,[1963] Suppl. 1 SCR 13 section 27 of regulation III of 1872 provides that in respect of transfer of ryoti interest in contravention of the regulation revenue courts shall not take cognizance of such a transfer.
It was contended that by necessary implication the civil suit was not maintainable.
In that context this Court held that provisions therein were not intended to be exhaustive to bar the relief in Civil Court.
In Sri Athmanathawami Devasthanam vs K. Gopalaswami Aiyangar, ; the question was whether the civil suit to recover damages and for ejectment of the ryoti lands belonging to the temple was barred.
The findings were that the lands were ryoti lands and that the tenant acquired the occupancy rights, but the lease was granted in excess of 5 years.
It was contended that it was a transfer without permission of the Endowment department.
While upholding that the lands were ryoti lands and the tenant acquired occupancy rights, this Court disagreeing with the High Court, held that there was no transfer and that the tenant is liable to pay the arrears of rent and the suit was maintainable.
In Sri Vedagiri Lakshmi Narasimha Swami Temple vs Induru Pattabhirami Reddy, ; the contention raised was that section 93 of the Madras Hindu Religious and Charitable Endowments Act, 1951 was a bar to maintain suit for rendition of accounts and recovery thereof against the ex trustees.
This Court repelled the contention and held that the suit for rendition of accounts was not expressly or by necessary implication barred the jurisdiction of the civil court under section 93.
In Shree Raja Kandregula Srinivasa Jagannadha Rao Panthulu Bahadur Garu vs State of Andhra Pradesh; , it was conceded that the question whether Kalipathnam village is an Inam estate was to be adjudicated before the tribunals appointed under the Rent Reduction Act.
It was contended that the tribunals have no jurisdiction to decide the validity of the notification reducing the rent by operation of section 8(1) thereof.
It was held that there was no statutory prohibition to determine the nature of the land contemplated by the Rent Reduction Act.
Accordingly the suit was held to be maintainable.
In Dr. Rajendra Prakash Sharma vs Gyan Chandra & Ors.,[1980] 3 SCR 207 it was found that under s, 7 of the , no proceedings were taken to 560 declare the suit house as on evacuee property.
No notification under sub section
(3) of 7 was published in the gazette.
Under those circumstances it was held that section 46 did not bar the civil suit.
In Anne Besant National Girls High School vs Dy.
Director of Public Instruction & Ors.
this Court held that the Civil Court has jurisdiction to examine whether action or decision of an administrative authority was ultra vires the relevant rules of Grant in Aid Code and Rule 9 (vii) was held to be ultra vires.
Accordingly the suit was held to be maintainable.
In Raja Ram Kumar Bhargava(dead) by Lrs.
vs Union of India, [1988] 2 SCR 352 two questions were raised, firstly the validity of the assessment and secondly recovery of the tax paid under Excess Profit Tax Act, 1940.
On the first question it was held that the suit was not maintainable.
On the second question, without going into the technicalities of the maintainability of the suit, this Court granted the relief.
In Pabbojan Tea Co., etc.
vs The dy.
Commissioner Lakhimpur, etc.[1968] 1 SCR 260 the questions were whether the workmen were ordinary unskilled labour or skilled labour; whether the jurisdiction of the authorities under section 20 of the is exclusive and whether the jurisdiction of the Civil Court was barred.
This court held that the authorities did not hold any inquiry nor received any evidence for determining that issue.
No proper hearing was given to the parties to tender evidence.
Section 20 is not a complete Code as there was no provision for appeal or revision against the orders passed under s.20(3).
There was no further scrutiny by any higher authority against the imposition of penalty.
The Act in terms does not bar the employers from instituting a suit.
In those circumstances, it was held that the legislature did not intend to exclude the jurisdiction of the civil court.
The ratio in K. Chintamani Dora & Ors.
vs G. Annamnaidu & ors.
; also does not assist Gram Panchayat for the reason that the decree therein originally granted became final.
Subsequently it was sought to be reopened in a later suit.
Under those circumstances the civil suit was held to be maintainable notwithstanding the provisions contained under the Estate Abolition Act.
Thus we have no hesitation to hold that the ratio in all these case are clearly distinguishable and render little assistance to the Gram Panchayat.
The scope, ambit and operation of the Inams Act was considered by P. Jaganmohan Reddy,J. (as he than was) in D.V. Raju vs B.G. Rao & Anr.
and held that the paramount object of the legislature was to protect the tenant in occupation and is sought to be achieved by making effective orders of eviction made by the Civil Court either in execution or otherwise.
It further prohibits the institution of any suit or proceeding in a Civil 561 Court under section 14 to set aside or modify any decision of the Tehsildar, Collector or Revenue Court except where such decision has been obtained by misrepresentation, fraud or collusion.
Section 15 enjoins that the provisions of the Act and orders made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of absolute jurisdiction on the Tehsilder, Revenue Court or the Collector, as the case may be, notwithstanding any provision of law or any suit or decree of a Civil Court or for that matter even where evictions have taken place in pursuance of such decrees, the evicted tenants can be restored to occupation provided the requirements for the protection of the possession of the tenants are satisfied.
In that case the occupant in possession laid proceeding before the Tehsildar for injunction restraining the writ petitioner from ejecting him from the lands.
The Tehsildar in exercise of the power under Rule 16 of the Rules granted injuction pending consideration of his right to Ryotwari patta.
The order of injunction was challenged firstly on the ground of ultra vires of Rule 16 and secondly on the ground of jurisdiction.
While upholding the order on both the grounds the learned Judge held that Tehsildar, Revenue Court and the Collector have exclusive jurisdiction and the civil suit is barred.
We respectfully approve it as correct law.
The Inams Act did not intend to leave the decisions of the revenue courts under section 3 read with section 7 to retry the issue once over in the Civil Court.
Undoubtedly the decision of the division Bench in P. Pedagovindayy vs Subba Rao, is in favour of the contention that the civil suit is maintainable.
It is not good law.
Thus the glimpse of the object of the Inames Act, scheme, scope and operation thereof clearly manifest that Inames Act is a self contained code, expressly provided rights and liabilities, prescribed procedure; remedies of appeal and revision, excluded the jurisdiction of the civil court, notwithstanding anything contained in any law, given primacy of Inams Act though inconsistent with any law or instrument having force of law.
The jurisdictional findings are an integral scheme to grant or refuse ryotwari patta under section 3, read with s.7 and not collateral findings.
It was subject to appeal and revision and certiorari under article 226.
The decision of the Revenue Tribunal, are final and conclusive between the parties or persons claiming right, title or interest through them.
The trick of pleadings and the camouflage of the reliefs are not decisive but the substance or the effect on the order of the tribunal under the Inams Act are decisive.
The civil suit except on grounds of fraud, misrepresentation or collusion of the parties is not maintainable.
The necessary conclusion would be that the civil suit 562 is not maintainable when the decree directly nullifies the ryotwari patta granted under section 3 of the Inams Act.
Under the Gram Panchayat Act the statutory interposition of vesting the tank and the appurtenant land in the Gram Panchayat made it to retain possession, control and supervision over it, though the Gram Panchayat unlawfully took possession.
The need to grant decree for possession in favour of the Gram Panchayat is thus redundant.
The suit of the descendants normally to be decreed on the finding that ryotwari patta under section 3 of the Inams Act was granted in their favour and that they were unlawfully dispossessed.
Since the grant of ryotwari patta, though in the name of individuals, was to maintain the public tank which stood vested under section 85 of the Act in the Gram Panchayat, the descendants are divested of the right and interest acquired therein.
Thus the suit of the descendants also is liable to be dismissed.
Accordingly, the decrees of dismissal of both the suits are upheld and the appeals dismissed.
But in the circumstances, parties are directed to bear their own costs.
V.P.R. Appeals dismissed.
| IN-Abs | Civil Appeal Nos. 931 of 1977 and 200 of 1978 relate to the same dispute though arose from, two suits and separate judgements.
Civil Appeal No. 931 of 1977 arose out of the suit for possession by the Gram Panchayat against the descendants of the grantee of inam.
The suit was dismissed by the Trial Court and was confirmed by the High Court and the High Court granted leave under Art.133.
Civil Appeal No. 200 of 1978 arose out of the suit for possession and mesne profits which was laid by the descendants of the grantee of inam.
The pleadings are the same in both cases.
A Zamindar granted 100 acres of land inam to dig, preserve 532 and maintain a tank in favour of the predecessors of the respondents of C.A. No. 931/77.
In 1700 A.D.i.e.
, 1190 Fasli, the tank was dug by the villagers and ever since, the villagers were using the tank for their drinking purpose and perfected their right by prescription.
In course of time the tank was silted up and fresh water existed only in and around 30 acres.
The grantee 's descendants respondents did not make any repairs, Grass and trees had been grown in the rest of the area and was being enjoyed.
Under section 3 of the A.P.Inams ( Abolition and Conversion into Ryotwari) Act, ( Act XXXVII of 1956) Ryotwari Patta was granted to the respondents in individuals capacity and on appeal the Revenue Divisional Officer confirmed the same and it became final, as it was not challenged any further.
On 7.7.1965, the Gram panchayat the appellant in C.A. No. 931/77 took unilateral possession of the tank and ever since , it was exercising possession, supervision and control over it.
After the expiry of three year from the date of dispossession, the respoondents filed a suit for possession based on title.
Earlier thereto the appellant Gram Panchayat had filed a suit for possession.
The Trial Court found that the tank was a 'public trust ', the appellants would be hereditary trustees and could be removed only by taking action under section 77 of the A.P. Hindu Charitable and Religious Institutions and Endowments Act, 1966 and that the respondents had acquired title by adverse possession.
Accordingly the suit for possession was decreed relegating the filing of separate application for mesne profit.
On appeal, the High Court reversed the decree and held that the tank was a public tank, and the tank and the lands stood vested in the Gram Panchyat under A.P. Gram Panchayat Act,1964.
Since, the Gram Panchayat was in possession from July 7, 1966, though dispossessed the respondents forcibly and as the suit was not under section 6 of the , but one based on title, it called for interference and dismissed the suit.
This court granted leave to appeal under article 136.
533 The respondents in C.A. No. 931/77 (the appellants in C.A. No. 200/78) contended that in view of the entries of the Inam Fair Register, the tank was a public trust and not a public tank; they could not be dispossessed until recourse made under section 77 of the A.P. Charitable and Religious Institutions and Endowments Act; that under the Gram Panchayat Act, the lands did not vest in the gram Panchayat; and that since the grant of ryotwari patta under the Inams Act had become final, section 14, thereof barred the jurisdiction of the Civil Court to entertain the suit.
The appellant Gram Panchayat in C.A. No. 931/77 (the respondents in C.A. No. 200/78) contended that the tank and the appurtenant land was correctly held as public tank by the High Court that by operation of sections 85 and 64 of the Gram Panchayat Act, the land and the tank stood vested in the Panchayat, that the entries in the Inam Fair Register established that the grant of land was for preservation, maintenance and repairs of the tank and therefore, the grant should be in favour of the institution, i. e., the tank and the respondents thereby did not acquire any title, that ryotwari patta was only for the purpose of land revenue; that the Gram Panchayat acquired absolute right, title and interest in the land; and the suit was not a bar in the facts of the case.
Dismissing both appeals, this Court HELD: 1.01.
Any property or income, which belongs to or has been administered for the benefit of the villagers in common or the holders in any of the village land generally or of land of a particular description or of lands under particular source of irrigation shall vest in Gram Panchayat and be administered by it for the benefit of the villagers or holders.
The lands or income used for communal purpose shall either belong to the Gram Panchayat or has been administered by the Gram Panchayat.
It is not the case of the Gram Panchayat nor any finding recorded by the courts below to that effect.
section 64 is not attracted though the villagers acquired prescriptive right to use the water from the tank for their use and of their cattle.
[554D F] 1.02.
All public water courses, springs, reservoirs, tanks, cisterns, etc.
and other water works either existing on the date of the Act or made thereafter by the Gram Panchayat, or otherwise including those used by the public ripened into prescriptive right for the use and benefit of the public and also adjacent or any appurtenant land not being private property shall vest in the Gram Panchayat under section 85(1) and be subject to its control.
[554F G] 534 2.01.
The word`vesting ' in section 85 would signify that the water courses and tanks, lands etc.
used by the public to such an extent as to give a prescripvtive right to their use, are vested in the Gram Panchayat, and placed them under the control and supervision of the Gram Panchayat.
It confers no absolute or full title.
It was open to the Government, even after vesting, to place restriction upon the Gram Panchayat in the matter of enjoyment and use of such tanks, and appurtenant lands etc.
The assumption of management by the Government would be subject to the prescriptive right of the villagers, if any.
The vesting of the tanks etc.
in the Gram Panchayat was with absolute rights and the village community rights would over ride against rights of the Government.
[546C F] 2.02.
The tank is a public tank and not a public trust and that under section 85(1) and section 64, the vesting of the tanks, the appurtenant land and the common land is only for the purpose of possession, supervision, control and use thereof for the villagers for common use subject to the over riding title by the Government and its assumption of management should be in terms of sub section
(3) of section 85 of the Act and subject to the prescriptive right in the water, water spread tank for common use.
[547A B] Gram Panchayat, Mandapaka & Ors.
V. Distt.
Collecctor, Eluru & Ors. , approved.
Anna Narasimha Rao & Ors.
vs Kurra Venkata Narasayya & Ors., , OVER RULED. 3.01.
Under A.P. Land Encroachment Act, 1905; Talengana Area Land Revenue Act, relevant Abolition Acts like A.P. Estates (Abolition and Conversion into Ryotwari) Act, 1948, Inams Abolition Act etc.
give absolute rights or vesting in the State over the forest land, tanks, rivers, mines, poramboke, land, etc.
free from all encumbrances and the preexisting rights in the other land stood abolished and will be subject to the grant of Ryotwari Patta etc.
[546F H] 3.02 Grant of Ryotwari patta is not a title but a right coupled with possession to remain in occupation and enjoyment, subject to payment of the land revenue to the State.
[546H] 3.03.
The entries in the Inam Fair Register are great acts of the State and coupled with the entries in the survey and settlement record 535 furnishes unimpeachable evidence.
On construction of these documents, it would clearly emerge that the original grant was made for the preservation and maintenance of the tank and tax free Inam land was granted for that purpose, though it was in the name of the individual grantee.
The grant was for the preservation and maintenance of the tank.
[548C D] 3.04.
The grant was for the institution.
Under section 3 of the Inams Act, the enquiry should be, whether (1) a particular land is Inam land; (2) Inam land in a Ryotwari, Zamindar or Inam Village; and (3) is held by any institution.
In view of the finding that the grant was for the preservation and maintenance of tank, the Inam land in an inam village was held by the institution, namely, the tank.
Ryotwari patta shall, therefore, be in favour of the institution.
Undoubtedly the ryotwari patta was granted in favour of the descendants.
[548D F] 3.05.
The pattas were obtained in the individuals name, the trustees of an institution cannot derive personal advantage from the administration of the trust property.
The grant of patta was for the maintenance of the trust.
[548G] 3.06.
The descendants, though enjoyed the income from the properties, did not effect the repairs and neglected the maintenance and upkeep of the tank.
They rendered the tank disused and abandoned.
By operation of section 85 of the Act the lands and tank stood vested in the Gram Panchayat for control, management and supervision.
[550E F] 3.07.
A hereditary trustee is entitled to be the Chairman of a Board of Trustees, if any, constituted under the Endowment Act or else be in exclusive possession and management of the public trust registered thereunder until he is removed as per the procedure provided therein.
Since the tank always remained a public tank and not being a public trust, the Endowment Act does not apply.
Therefore, the question of initiating action under section 77 of the Endowment Act for removal of the descendants as trustees does not arise.
[550F G] Arunachalam Chetty vs Venkatachalpathi Garu Swamigal, AIR 1919 P.C. 62 at P. 65; Syed Md. Mazaffaral Musavi vs Bibi Jabeda & Ors., AIR 1930 Pc 1031; Bhojraj vs Sita Ram & Ors, AIR 1936 P.C. 60; M. Srinivasacharyulu & Ors.
V. Dinawahi Pratyanga Rao & Ors., ; Ravipati Kotayya & Anr.
vs Ramaswamy Subbaraydu & Ors., , referred to.
536 K.V. Krishna Rao vs Sub Colletor, Ongole, ; , followed.
Nori Venkatarama Dikshitulu & Ors.
vs Ravi Venkatappayya & Ors., , approved.
Krishan Nair Boppudu Punniah & Ors.
vs Sri Lakshmi Narasimhaswamy Varu, ; Bhupathiraju Venkatapathiraju & Ors.
V. The President Taluq Board, Narsapur & Ors.; [1913] 19 1.C. 727 (Mad.) (D.B.), distinguished.
Tagore Law Lecture, ``Hindu Religious Endowments and Institutions at p. 6, distinguished.
In the laws made to restructure the social order creating rights in favour of the citizens and conferring power and jurisdiction on the hierarchy of Tribunals or the authorities constituted thereunder and giving finality to their orders or decisions and divested the jurisdiction of the established civil courts expressly or by necessary implication Departure in the allocation of the judicial functions would not be viewed with disfavor for creating the new forums and entrusting the duties under the statutes to implement socio economic and fiscal laws.
Courts have to consider, when questioned, why the legislature made the departure.
The reason is obvious.
The tradition bound civil courts gripped with rules of pleading and strict rules of evidence and tardy trial, four tier appeals, endless revisions and reviews under C.P.C. are not suited to the needed expeditious dispensation.
The adjudicatory system provided in the new forums is cheap and rapid,.
The procedure before the Tribunal is simple and not hide bound by the intricate procedure of pleadings, trial, admissibility of the evidence and proof of facts according to law.
Therefore, there is abundant flexibility in the discharge of the functions with greater expedition and inexpensiveness.
{552D H] 4.02.
In order to find out the purpose in creating the Tribunals under the statues and the meaning of particular provisions in social legislation, the Court would adopt the purposive approach to ascertain the socials ends envisaged in the Act, to consider scheme of the Act as an integrated whole and practical means by which it was sought to be effectuated to achieve them.
Meticulous lexographic analysis of words and phrases and sentences should be subordinate to this purposive approach.
The dynamics of the interpretative functioning of the Court is to reflect the contemporary needs and the prevailing values consistent with the constitutional and legislative declaration of the policy envisa 537 ged in the statute under consideration.
[552H 553B] 4.03.
The law should, therefore, respond to the clarion call of social imperatives evolve in that process functional approach as means to subserve ``social promises ' ' set out in the Preamble, Directive Principles and the Fundamental Rights of the Constitution.
[553d] 4.04.
Section 9 of the Civil Procedure Code, 1908 provides that whenever a question arises before the Civil Court whether its jurisdiction is excluded expressly or by necessary implication, the court naturally feels inclined to consider whether remedy afforded by an alternative provision prescribed by special statute is sufficient or adequate.
In cases where exclusion of the civil court 's jurisdiction is expressly provided for, the consideration as to the scheme of the statue in question and the adequacy of sufficiency of the remedy provided for by it may be relevant, but cannot be decisive.
Where exclusion is pleaded as a matter of necessary implication such consideration would be very important and inconceivable circumstances might become even decisive.
[553G 554B] 4.05.
The jurisdiction of a Tribunal created under statute may depend upon the fulfilment of some condition precedent or upon existence of some particular fact.
Such a fact is collateral to the actual matter which the Tribunal has to try and the determination whether it existed or not is logically temporary prior to the determination of the actual question which the Tribunal has to consider.
At the inception of an enquiry by a Tribunal of limited jurisdiction, when a challenge is made to its jurisdiction, the Tribunal has to consider as the collateral fact whether it would act or not and for that purpose to arrive at some decision as to whether it has jurisdiction or not.
There may be Tribunal which by virtue of the law constituting it has the power to determine finally, even the preliminary facts on which the further exercise of its jurisdiction depends; but subject to that, the Tribunal cannot by a wrong decision with regard to collateral fact, give itself a jurisdiction which it would not otherwise have except such tribunals of limited jurisdiction when the statue not only empowers to enquire into jurisdictional facts but also the rights and controversy finally it is entitled to enter on the enquiry and reach a decision rightly or wrongly.
If it has jurisdiction to do right, it has jurisdiction to do wrong.
It may be irregular or illegal which could be corrected in appeal or revision subject to that the order would become final.
[554B F] 4.06.
The Inams Act did not intend to leave the decisions of the revenue courts under section 3 read with section 7 to retry the issue once over in the civil court.
[561D E] 538 4.07.
The glimpse of the object of the Inams Act, scheme, scope and operation thereof clearly manifest that Inams Act is a self contained code, expressly provided rights and liabilities; prescribed procedure; remedies; of appeal and revision, excluded the jurisdiction of the civil court, notwithstanding anything contained in any law, given primacy of Inams Act though inconsistent with any law or instrument having force of law.
The jurisdictional findings are an integral scheme to grant or refuse ryotwari pattta under section 3, read with section 7 and not collateral findings.
It was subject to appeal and revision and certiorari under Art 226.
The decision of the Revenue Tribunal, are final and conclusive between the parties or persons claiming right, title or interest through them.
The trick of pleadings and the camouflage of the reliefs are not decisive but the substance or the effect on the order of the tribunal under the Inams Act are decisive.
The civil suit except on grounds of fraud, misrepresentation or collusion of the parties is not maintainable.
The necessary conclusion would be that the civil suit is not maintainable when the decree directly nullifies the ryotwari patta granted under section 3 of the Inams Act.
[561E 562A] Deena vs Union of India, [1984] ISCR, referred to.
Kamala Mills Ltd. vs State of Bombay, ; ; Secretary of State vs Mask & Co., [1940] L.R. 67 I.A. 222; Raleigh Investment Co. Ltd. V. Governor General in Council, L.R. 74 I.A. 50; Firm and Illuri Subbayya Chetty & Sons vs State of Andhra Pradesh; , ; Deesika Charyulu vs State of A.p., AIR 1964 SC 807; Dhulabhai & Ors vs State of M.P. & Anr., ; ; Hati vs Sunder Singh, ; ; Muddada Chayana vs Karam Narayana and Anr.
; , ; T. Munuswami Naidu vs R. Venkata Reddy, AIR 1978 A.P. 200; O. Chenchulakshmamma & Anr.
vs D. Subramanya Reddy; , ; A. Bodayya & Anr.
V. L. Ramaswamy(dead) by Lrs., ; Doe vs Bridges, at p. 359; Premier Automobiles Ltd. vs Kamlakar Shantaram Wadke and Ors., ; ; State of Tamil Nadu vs Ramalinga Samigal Madam, ; ; Syamala Rao vs Sri Radhakanthaswami Varu, ; Jyotish Tahakur & Ors.
vs Tarakant Jha & Ors., [1963] Suppl.
1 SCR 13; Sri Athmanathaswami Devasthanam vs K. Gopalaswami Aiyangar, {1964] 3 SCR 763; Sri VEdagiri Lakshmi Narasimha Swami Temple vs Induru Pattabhirami Reddy, ; ; Shree Raja Kandragula Srinivasa Jagannadha Rao Panthulu Bahadur Garu vs State of Andhra Pradesh, ; ; Dr. Rajendra Prakash Sharma vs Gyan Chandra & Ors., ; ; Anne Basant National Girls High School vs Dy.
539 Director of Public Instruction & Ors., ; Raja Ram Kumar Bhargava (dead) by Lrs.
vs Union of India, [1988] 2 SCR 352; Pabbojan Tea Co., Ltd., etc.
vs the Dy.
Commissioner, Lakhimpur, etc.
; , and K. Chintamani Dora & Ors.
vs G. Annamnaidu & Ors., ; , distinguished.
D.V. Raju vs B.G. Rao & Anr., , approved.
P.pedagovindayy vs Subba Rao, , over ruled.
The word `vest ' clothes varied colours from the context and situation in which the word came to be used in a statue of rule.
[545B C] 5.02.
The word [vest '], means, to give an immediate, fixed right of present or future enjoyment, to accrue to, to be fixed, to take effect, to clothe with possession, to deliver full possession of land or of an estate, to give seisin to enfeoff.
[545C D] 5.03.
The word, `vest ', in the absence of a context, is usually taken to mean, `vest ' in interest rather than vest in possesion '.[545E F] 5.04.
`Vest '.
``generally means to give the property in ' '.
[545E F] 5.05.
The word, `vested ' was defined, `as to the interest acquired by public bodies, created for a particular purpose, in works, such as embankments, whcih are `vested ' in them by statute. ' {545D E] 5.06.
``Vesting ' ' in the legal sense means, to settle, secure, or put in fixed right of possession; to endow, to descend, devolve or to take effect, as a right '.
[545C] Chamber 's Mid Century Dictionary at P. 1230; Blacks Law Dictionary, 5th Edition at P. 1401; Stroud 's Judicial Dictionary, 4th Edition Vol, 5 at P. 2938, Item 12, at P 2940, Item 4 at P. 2939; Port of London Authority vs Canvey Island Commissioners, {1932] 1 Ch.
446; Fruit and Vegetable Merchants Union vs Delhi Improvement Trust, ; , referred to.
Under the Gram Panchayat Act the statutory interposition of vesting the tank and the appurtenant land in the Gram Panchayat made it to retain possession, control and supervision over it, though the Gram Panchayat unlawfully took possession.
The need to grant decree for possession in favour of the Gram Panchayat is thus redundant.
The suit 540 of the descendants normally to be decreed on the finding that ryotwari patta under section 3 of the Inams Act was granted in their favour and that they were unlawfully dispossessed.
Since the grant of ryotwari patta, though in the name of individuals, was to maintain the public tank whcih stood vested under section 85 of the Act in the Gram panchayat, the descendants are divested of the right and interest acquired therein.
Thus the suit of the descendants also is liable to be dismissed.
[562A C]
|
Appeal No. 288 of 1958.
Appeal by Special Leave from the judgment and order dated December 3, 1956, of the Punjab High Court (Circuit Bench) at Delhi in Letters Patent Appeal No. 25 D of 1956, arising out of the judgment and order dated April 9, 1956, of the said High Court (Circuit Bench) at Delhi in Civil Writ No. 8 D of 1955.
N. C. Chatterjee and R. section Narula, for the appellant.
M. C. Setalvad, Attorney General for India, B. Sen and T. M. Sen, for the respondent 1958.
December 12.
The Judgment of the Court was delivered by section K. DAS, J.
This is an appeal by special leave and the only question for decision is if the order of the President dated October 1, 1954, removing the appellant from service with effect from that date is invalid, as claimed by the appellant, by reason of a contravention of the provisions of article 311(2) of the Constitution.
The short facts are these.
The appellant stated that he joined permanent Government service on April 4, 1924.
In 1947, before partition, he was employed as Assistant Secretary, Frontier Corps of Militia and Scouts in the then North Western Frontier Province, under the administrative control of the External Affairs Department of the Government of India.
The appellant stated that the post which be held then was a post in the Central Service, Class 11.
After partition, the appellant opted for service in India and was posted to an office under the Ministry of Commerce in the Government of India in October, 1947.
In December, 1949, he was transferred to the office of the Chief Controller of Imports, New Delhi, to clear off certain arrears of work.
In August, 1951, he was posted as 894 and Deputy Chief Controller of imports, Calcutta, and continued to work in that post till September, 1952.
He then took four months ' leave on average pay and on the expiry of his leave on January 24, 1953, he was transferred as Section officer in the Development Wing of the Ministry of Commerce.
The appellant thought that the order amounted to a reduction of his rank and lie made certain representations.
As these representations bore no fruit, he applied for leave preparatory to retirement on February 6, 1953.
In that application the appellant stated: Normally I am due to retire in April 1956 but I find it difficult to reconcile myself to the new conditions of service under which I am now placed to work.
I find that I would not be wasting only myself but I would also not be doing full justice to the ' interest of my Government and country in my present environment.
Under the circumstances, I pray that I may be permitted to retire from the 1st May, 1953.
" On February 14, 1953, the appellant amended his leave application and said that he had been informed by the I Administrative Branch of the Development Wing that the question of permission to retire was under consideration, because of some difficulty with regard to the inclusion in the service of the appellant the period during which he held the, post of Assistant Secretary, Frontier Corps; therefore be said that he might be granted leave on full average pay for four months with effect from February 15, 1953, if the decision to give him permission to retire was likely to be postponed beyond May 1, 1953.
He amended his leave application by making the following prayer: " Leave may be sanctioned for four months from.
the 15th February, 1953, or up to the date from which I am permitted to retire whichever may be earlier ".
On March 10, 1953, the appellant was informed that he could not be allowed to retire at that stage, but the Ministry had agreed to grant him leave from February 16, 19 3, to April 30, 1953.
The appellant then went on leave and on February 25, 1953, he 895 wrote to Government to say that he was contemplating to join the service of Messrs. Albert David & Co. Ltd., Calcutta, and for that purpose he was accepting a course of training in that Company for two months.
In April, 1953, the appellant accepted service under Messrs. Albert David & Co. Ltd., and he wrote to Government to that effect on April 6, 1953.
On June 16, 1953, the appellant was charged with hav ing violated r. 15 of the Government Servants ' Conduct Rules and Fundamental Rule 11.
Rule 15 of the Government Servants ' Conduct Rules states, inter alia, that a Government servant may not without the previous sanction of Government engage in any trade or undertake any employment other than his public duties.
Fundamental Rule 11 says in effect that unless in any case it be otherwise distinctly provided, the whole time of a Government servant is at the disposal of the Government which pays him.
A. P. Mathur, Joint Chief Controller of Imports, was asked to hold an enquiry against the appellant on the charge mentioned above.
The appellant submitted an explanation and an enquiry was held by A. P. Mathur in due course.
The Enquiring Officer submitted his report on September 12, 1953, in which he found that the appellant had, contrary to the rules governing the conditions of his service, accepted private employment without previous sanction of Government during the period when he was still in Government service.
On April 14, 1954, the appellant was asked to show cause in accordance with the provisions of article 311(2) of the Constitution.
As the whole of the argument in this case centres round this show cause notice, it is necessary to set it out in full Sir, I am directed to say that the Enquiry Officer appointed to enquire into certain charges framed against you has submitted his report ; a copy of the report is enclosed for your information.
On a careful consideration of the report, and in particular of the conclusions reached by the Enquiry Officer in respect of the charges framed against you the President is provisionally of opinion that a 896 major penalty, viz., dismissal, removal or reduction should be enforced on you.
Before he takes that action, he desires to give you an opportunity of showing cause against the action proposed to be taken.
Any representation which you may make in that connection will be considered by him before taking the proposed action.
Such representation, if any, should be made, in writing, and submitted so as to reach the undersigned not later than 14 days from the receipt of this letter by you.
Please acknowledge receipt of this letter.
Yours faithfully, Sd.
section Bhoothalingam, Joint Secretary to the Government of India.
" The appellant then showed cause and on October 1, 1954, the President passed an order in which it was stated that after taking into consideration the report of the Enquiring Officer and in consultation with the Public Service Commission, the President found that the charge had been proved against the appellant and the appellant was accordingly removed from service with effect from that date.
The appellant then moved the Punjab High Court by a petition under article 226 of the Constitution in which his main contentions were (a) that he had no opportunity of showing cause against the action proposed to be taken in regard to him within the meaning of article 311 (2) of the Constitution and (b) that he had asked for leave preparatory to retirement and accepted service under Albert David & Co. Ltd. in the bona fide belief that Government had no objection to his accepting such private employment.
Dulat, J., who dealt with the petition in the first instance, held against the appellant on both points.
He found that there was no contravention of the provisions of article 311 (2) of the Constitution and on the second point, he held that on the facts admitted in the case there was no doubt that the appellant had accepted private employment in contravention of the rules governing the conditions of his service and there was little substance 897 in the suggestion of the appellant that he had no sufficient opportunity to produce evidence.
The second point no longer survives, and the only substantial point for our consideration is the alleged contravention of article 311(2) of the Constitution.
Mr. N. C. Chatterjee, who has appeared on behalf of the appellant, has submitted before us that the show cause notice dated April 14, 1954, stated all the three punishments mentioned in article 311 (2) and inasmuch as it did not particularise the actual or exact punishment proposed to be imposed on the appellant, the notice did not comply with the essential requirements of article 311 (2) of the Constitution; therefore, the final order of removal passed on October 1, 1954, was not a valid order.
In the recent decision of Khem Chand vs Union of India (1) this Court explained the true scope and effect of article 311 (2) of the Constitution.
It was stated in that decision that the reasonable opportunity envisaged by article 311 (2) of the Constitution included (a) an opportunity to the Government servant to deny his guilt and establish his innocence, (b) an opportunity to defend himself, and finally (c) an opportunity to make his representation as to why the proposed punishment should not be inflicted on him, which he can only do if the competent authority after the enquiry is over and after applying its mind to the gravity or otherwise of the charges proved against the Government servant tentatively proposes to inflict one of the three punishments and communicates the same to the Government servant.
It is no longer in dispute that the appellant did have opportunities (a) and (b) referred to above.
The question before us is whether the show cause notice dated April 14, 1954, gave the appellant a reasonable opportunity of showing cause against the action proposed to be taken in regard to him.
Mr. N. C. Chatterjee has emphasised two observations made by this Court in Khem Chand 's case (1).
He points out that in connection with opportunity (c) aforesaid, this Court observed that a Government (1) ; 113 898 servant can only make his representation if the competent authority after the enquiry is over and after applying its mind to the gravity or otherwise of the charges proved against the Government servant tentatively proposes to inflict one of the three punishments and communicates the same to the Government servant.
Mr. Chatterjee emphasises the observation " one of the three punishments ".
Secondly, he has drawn our attention to the observations made in the judgment of the Judicial Committee in High Commissioner for India and High Commissioner for Pakistan vs I. M. Lall (1), which observations were quoted with approval in Khem Chand 's case (2).
One of the observations made was: " In the opinion of their Lordships no action is proposed within the meaning of the sub section " (their Lordships were dealing with sub section (3) of section 240 of the Government of India Act, 1935) " until a definite conclusion has been come to on the charges, and the actual punishment to follow is provisionally determined on." Mr. Chatterjee emphasises the expression " actual punishment " occurring in the said observations.
It is to be remembered, however, that both in I. M. Lall 's case, (1) and Khem Chand 's case (1) the real point of the decision was that no second notice had been given to the Government servant concerned after the enquiry was over to show cause against the action proposed to be taken in regard to him.
In I. M. Lall 's case (1) a notice was given at the same time as the charges were made which directed the Government servant concerned to show cause " why he should not be dismissed, removed or reduced or subjected to such other disciplinary action as the competent authority may think fit to enforce, etc.
" In other words, the notice was what is usually called a combined notice embodying the charges as well as the punishments proposed.
Such a notice, it was held, did not comply with the requirements of sub section
(3) of section 240.
In Khem Chand 's case (2) also the report of the Enquiring Officer was approved by the Deputy Commissioner, Delhi, who imposed the (1) (1948) L.R. 75 I.A. 225,242.
(2) ; 899 penalty of dismissal without giving the Government servant concerned an opportunity to show cause against the action proposed to be taken in regard to him.
In Khem Chand 's case (1) the learned SolicitorGeneral appearing for the Union of India sought to distinguish the decision in I. M. Lall 's case (2) on the ground that the notice there asked the Government servant concerned to show cause why he should not be dismissed, removed or reduced or subjected to any other disciplinary action, whereas in Khem Chand 's case(1) the notice issued to the Government servant before the enquiry mentioned only one punishment, namely, the punishment of dismissal.
Dealing with this argument of the learned Solicitor General this Court said (at p. 1100): " A close perusal of the judgment of the Judicial Committee in I. M. Lall 's case will, however, show that the decision in that case did not proceed on the ground that an opportunity had not been given to 1.
M. Lall against the proposed punishment merely because in the notice several punishments were included, but the decision proceeded really on the ground that this opportunity should have been given after a stage bad been reached where the charges had been established and the competent authority had applied its mind to the gravity or otherwise of the proved charge tentatively and proposed a particular punishment.
" Therefore, the real point of the decision both in I. M. Lall 's case (2) and Khem Chand 's case (1) was that no opportunity had been given to the Government servant concerned to show cause after a stage had been reached when the charges had been established and the competent authority bad applied its mind to the gravity or otherwise of the charges proved and tentatively proposed the punishment to be given to the Government servant for the charges so proved.
It is true that in some of the observations made in those two decisions the words " actual punishment " or particular punishment " have been used, but those (1) ; (2) (1948) L.R. 75 I.A. 225, 242.
900 observations must, however, be taken with reference to the context in which they were made.
Let us examine a little more carefully what consequences will follow if article 311(2) requires in every case that the " exact " or " actual " punishment to be inflicted on the Government servant concerned must be mentioned in the show cause notice issued at the second stage.
It is obvious, and article 311 (2) expressly says so, that the purpose of the issue of a show cause notice at the second stage is to give the Government servant concerned a reasonable opportunity of showing cause why the proposed punishment should not be inflicted on him; for example, if the proposed punishment is dismissal, it is open to the Government servant concerned to say in his representation that even though the charges have been proved against him, he does not merit the extreme penalty of dismissal, but merits a lesser punishment, such as removal or reduction in rank.
If it is obligatory on the punishing authority to state in the show cause notice at the second stage the " exact " or " particular " punishment which is to be inflicted, then a third notice will be necessary if the State Government accepts the representation of the Government servant concerned.
This will be against the very purpose for which the second show cause notice was issued.
Then, there is another aspect of the matter which has been pointedly emphasised by dulat, J.
If in the present case the show cause notice had merely stated the punishment of dismissal without mentioning the other two punishments, it would still be open to the punishing authority to impose any of the two lesser punishments of removal or reduction in rank and no grievance could have been made either about the show cause notice or the actual punishment imposed.
Can it be said that the enumeration of the other two punishments in the show cause notice invalidated the notice ? It appears to us that the show cause notice in the present case by mentioning the three punishments gave a better and fuller opportunity to the appellant to show cause why none of the three punishments should be inflicted on him.
We desire to 901 emphasise here that the case before us is not one in which the show cause notice is vague or of such a character as to lead to the inference that the punishing authority did not apply its mind to the question of punishment to be imposed on the Government servant.
The show cause notice dated April 14, 1954, stated in clear terms that " the President is provisionally of opinion that a major penalty, namely, dismissal, removal or reduction, should be enforced on you.
" Therefore, the President had come to a tentative conclusion that the charge proved against the appellant merited any one of the three penalties mentioned therein and asked the appellant to show cause why any one of the aforesaid three penalties should not be imposed on him.
We see nothing wrong in principle in the punishing authority tentatively forming the opinion that the charges proved merit any one of the three major penalties and on that footing asking the Government servant concerned to show cause against the punishment proposed to be taken in the alternative in regard to him.
To specify more than one punishment in the alternative does not necessarily make the proposed action any the less definite; on the contrary, it gives the Government servant better opportunity to show cause against each of those punishments being inflicted on him, which he would not have had if only the severest punishment had been mentioned and a lesser punishment not mentioned in the notice had been inflicted on him.
We turn now to certain other decisions on which learned counsel for the appellant has relied.
They are: Jatindra Nath Biswas vs R. Gupta (1), Dayanidhi Rath vs B. section Mohanty (2) and Lakshmi Narain Gupta vs A. N. Puri (3).
In the case of Jatindra Nath Biswas (1) no second show cause notice was given and the decision proceeded on that footing.
Sinha, J., observed, however: "Where there is an enquiry, not only must he have an opportunity of contesting his case before the (1) (2) A.I.R. 1955 Orissa 33.
(3) A.I.R. 1954 Cal.
3.35 902 enquiry, but, before the punishment is imposed upon him, he must be told about the result of the enquiry and the exact punishment which is proposed to be inflicted." Mr. Chatterjee has emphasised the use of the word " exact ".
As we have pointed out, the decision proceeded on a different footing and was not rested on the ground that only one punishment must be mentioned in the second show cause notice.
The decision in Dayanidhi Rath 's case (1) proceeded on the footing that if the punishment that is tenatively proposed against a civil servant is of a graver kind, he can be awarded punishment of a lesser kind; but if the punishment that is tentatively proposed is of a lesser kind, there will be prejudice in awarding a graver form of punish ment.
What happened in that case was that the show cause notice stated that in view of the Enquiring Officer 's findings contained in the report with which the Secretary agreed and in consideration of the past record of the Government servant concerned, it was proposed to remove him from Government service; in another part of the same notice, however, the Government servant concerned was directed to show cause why the penalty of dismissal should not be inflicted for the charges proved against him.
Thus, in the same notice two punishments were juxtaposed in such a way that it was difficult to say that the punishing authority had applied its mind and tentatively come to a conclusion as to what punishment should be given.
It was not a case where the punishing authority said that either of the two punishments might be imposed in the alternative; on the contrary, in one part of the notice the punishing authority said that it was proposed to remove the Government servant concerned and in another part of the notice it said that the proposed punishment was dismissal.
In Lakshmi Narain Gupta 's case (2) the notice called upon the petitioner to show cause why disciplinary action, such as reduction in rank, withholding of increments, etc., should not be taken against him.
The learned Judge pointed out (1) A.I.R. 1955 Orissa 33.
(2) A.I.R. 1954 Cal 335.
903 that there were seven items of penalties under r. 49 of the Civil Service (Classification, Control and Appeal) Rules, and the notice did not indicate that the punishing authority had applied its mind and come to any tentative conclusion as to the imposition of any of the punishments mentioned in that rule.
On that footing it was held that there was no compliance with the provisions in article 311(2) of the Constitution.
We do not, therefore, take these decisions as laying down that whenever more than one punishment is mentioned in the second show cause notice, the notice must be held to be bad.
If these decisions lay down any such rule, we must hold them to be incorrect.
We have come to the conclusion that the three decisions on which learned counsel for the appellant has placed his reliance do not really support the extreme contention canvassed for by him, and we are further of the view that the show cause notice dated April 14, 1954, in the present case did not contravene the provisions of article 311 (2) of the Constitution.
The appellant had a reasonable opportunity of showing cause against the action proposed to be taken in regard to him.
This disposes of the principal point in controversy before us.
Mr. Chatterjee referred to certain mistakes of reference in the order of the President dated October 1, 1954.
Instead of referring to r. 15 of the Government Servants ' Conduct Rules, r. 13 was referred to.
There was also a reference to para.
5 of a particular Government order which prohibited Government servants from taking up commercial employment within two years of retirement.
Mr. Chatterjee submitted that this particular order did not apply to Government servants in Class 11.
We do not think that the inaccurate references were of any vital importance.
In effect and substance the order of removal dated October 1, 1954, was based on the ground that the appellant violated r. 15 of the Government Servants ' Conduct Rules and r. II of the Fundamental Rules; he accepted private employment without sanction of Government while he was still in Government service.
That was the basis for the enquiry against 904 the appellant and that was the basis for the order of removal passed against him.
For these reasons we hold that there is no merit in the appeal which must accordingly be dismissed with costs.
Appeal dismissed.
| IN-Abs | The appellant, a Government servant, was charged with having, contrary to the rules governing the conditions of his service, accepted private employment without sanction of Government while he was still in Government service.
The Officer who held an enquiry against him found the charge to be true and submitted a report.
On April 14, 1954, a notice was issued to the appellant asking him to show cause in accordance with the provisions of article 3II(2) of the Constitution in the following terms:. . .
On a careful consideration of the report, and in particular of the conclusions reached by the Enquiring Officer in respect of the charges framed against you, the President is provisionally of opinion that a major penalty, viz., dismissal, removal or reduction should be enforced on you.
Before he takes that action, he desires to give you an opportunity of showing cause against the action proposed to be taken. .
The appellant then showed cause and on October 1, 1954, the President passed an order removing the appellant from service with effect from that date.
It was contended for the appellant, inter alia, that the show cause notice dated April 14, 1954, stated all the three punishments mentioned in article 311(2) and that inasmuch as it did not particularise the actual or exact punishment proposed to be imposed on the appellant, the notice did not comply with the essential requirements of article 311(2) and, therefore, the final order of removal passed on October, 1`954, was not a valid order.
Held, that the show cause notice dated April 14, 1954, did not contravene the provisions of article 311(2) of the Constitution.
There is nothing wrong in principle in the punishing authority tentatively forming the opinion that the charges proved merit any one of the three major penalties and on that footing asking the Government servant concerned to show cause against the punishment proposed to be taken in the alternative in regard to him, because it gives the Government servant better opportunity to show cause against each of those punishments being inflicted on him, which he would not have had if only the severest punishment had been mentioned and a lesser punishment not mentioned in the notice had been inflicted on him.
893 High Commissioner for India and High Commissioner for Pakistan vs I. M. Lall, (1948) L.R. 75 I.A. 225 and Khem Chand vs Union of India, ; , explained.
Jatindra Nath Biswas vs R. Gupta, ; Dayanidhi Rath vs B. section Mohanty, A.I.R. 1955 Orissa 33 and Lakshmi Narain Gupta vs A. N. Puri, A.I.R. 1954 Cal.
335, distinguished.
|
ivil Appeal Nos.
1454 63 & 1642 45 of 1981.
From the Judgment and Order dated 10.4.1981 of the Andhra Pradesh High Court in Writ Petition No. 3720 of 1979.
G. Ramaswamy, M.S Ganesh, section Murlidhar, Sanjeev Ahuja and B. Parthasarthy for the Appellants.
C. Sitaramaiya, T.V.S.N. Chari and Mrs. B. Sunita Rao for the Respondents.
The Judgment of the Court was delivered by OJHA, J.
These appeal are directed against the judgment of the Andhra Pradesh High Court dated 10th April, 1981 rendered in a batch of writ petitions, reported in M/s. Poddar Projects Ltd. (Multi Steels) vs A.P.S.E. Board, AIR 1982 Andhra Pradesh 189.
For the sake of convenience, these appeals are being decided by a common judgment.
In order to appreciate the respective submissions made by learned counsel for the parties necessary facts may be stated in brief.
The appellants are some of the mini steel plants of Andhra Pradesh.
Revised terms and conditions of electricity supply were notified by the Andhra Pradesh State Electricity Board (for short the Electricity Board) in B.P. Ms. No.690 (Coml.) on 17.9.75 to be effec 628 tive from 20 October, 1975, Subsequently, G.O. Ms. No. 832 dated 2nd November, 1977 was issued by the State Government whereby concessional tariff of 0.11 p. per unit for the period of three years commencing from 1st November, 1977 and endings with 31st October, 1980 was applied in respect of the following five consumers: 1.
Andhra Pradesh State Corporation Limited 2.
Poddar Projects Limited 3.
A.K. Corporation Limited 4.
Andhra Steels, Vishakapatnam 5.
A.K. Corporation, Vishakapatnam.
This concessional tariff was subsequently enhanced to 12.5 p. by the State Government vide G.O. Ms. No. 876 dated 26th November, 1977.
The concessional tariff referred to above, however, was not extended to M/s. Andhra Steel Corporation by the Electricity Board by passing a resolution in its meeting held on 26th November, 1977 inasmuch as the Andhra Steel Corporation had already filed a writ petition inter alia claiming that the agreement which it had entered into with the Electricity Board for availing high tension electric supply was no longer in force.
In respect of the remaining four steel plants referred to above the Electricity Board extended the concessional tariff of 12.2 p. subject to escalations and other terms and conditions of supply and fixed minimum consumption of 403.325 units/KVA.
This was done by issuing B.P. Ms. No. 78 dated 20th January, 1978.
These four mini steel plants were, however, subsequently directed by the Electricity Board vide B.P. Ms. No. 436/Coml.
dated 3rd May, 1978 to be charged at a tariff rate of 16 p. per unit instead of 12.2 p. without reference to the maximum demand charges from 1st March, 1978.
The Electricity Board also sought clarification from the State Government vide its letter No. DE (Coml.) 1205 1/76 32 dated 27 November, 1978 with regard to fixation of minimum consumption of 403.325 units/KVA and fixation of concessional tariff at 0.16 p. per unit in view of the new levy of central excise duty and in view of the increased cost of generation.
The State Government vide G.O. Ms. No. 697 dated 5th December, 1978 issued a clarification that the aforesaid G.O. Ms.
Nos. 832 and 876 did not preclude the Electricity Board from applying the normal terms and conditions of supply and prescribing the monthly minimum charges and the working out of the escalated rate from time of time.
Subsequently the State Government vide G.O. Ms. No. 146 dated 12th March, 1979 withdrew the concessional tariff contemplated by G.O. Ms. Nos. 832 and 876 referred to above.
This was done on the representation of the Electricity Board which in its turn through its B.P. Ms. No. 830 dated 2nd April, 1979 cancelled B.P.Ms.
Nos. 78 and 436 with effect from 12th March, 1979.
The State Government 629 subsequently also issued G.O. Ms. No. 10 dated 16th January., 1980 whereby it was clarified that its intention in issuing the earlier G.O. Ms. No. 697 dated 5th December, 1978 was to allow the concessional tariff rate notified in G.O. Ms. no 876 without limiting the concession by imposition of minimum consumption charges till the end of March, 1979.
The Electricity Board felt aggreived by this G.O. and requested the Government to cancel it for the reasons set out in its letter dated 28th January, 1980.
One of the grievances of the Andhra Steel Corporation in its writ petition before the High Court was that the Electricity Board while applying the concessional tariff to the other mini steel plants was not justified in refusing the said concession to it merely because it had filed a writ petition.
The action of the Electricity Board is singling it out was, according to the Andhra Steel Corporation, discriminatory and mala fide.
This plea has been reiterated before us also and is confined to the appeal preferred by the Andhra Steel Corporation.
The pleas common to all the appellants which were raise before the High Court as also before us may now be enumerated.
It has been asserted that in view of the direction issued by the State Government fixing concessional tariff for the appellants it was not open to the Electricity Board to have levied minimum charges and it was bound to supply electricity to the appellants on the concessional tariff alone as fixed by the state Government.
As regards the order of the State Government dated 5th December, 1978 which clarified that its earlier orders fixing concessional tariff did not preclude the Electricity Board from levying inter alia minimum charges it has been asserted that the said order is illegal.
In the alternative, it is asserted that if clarificatory orders could be issued by the State Government with regard to its orders fixing concessional tariff the subsequent clarification made by order dated 16th January, 1980 had to prevail over the earlier clarification dated 5th December, 1978.
The order of the State Government dated 12th March, 1979 withdrawing the concessional tariff with effect from that date had also been assailed on the ground that it was passed on the representation of the Electricity Board without giving any opportunity to the appellants to show cause against the said representation and consequently the said order was in violation of principles of natural justice.
Pleas of promissory estoppel and right based on the doctrine of legitimate expectation have also been raised.
630 As regards the submission made on behalf of the Andhra Steel Corporation about singling it out in the matter of grant of concessional tariff on the basis of the order issued by the State Government for the period ending 12th March, 1979 Shri Shanti Bhushan, learned counsel for the Electricity Board has very fairly stated that the Electricity Board would extend to the Andhra Steel Corporation also the same benefit which was extended to the other four mini steel plants in the matter of grant of concessional tariff for the said period ending 12th March, 1979.
In this view of the matter it is not now necessary to deal with this plea.
As regard the plea that in view of the direction issued by the State Government fixing concessional tariff for the appellants it was not open to the Electricity Board to have levied minimum charges as it was bound to supply electricity to the appellants on the concessional tariff alone as fixed by the State Government it was submitted by learned counsel for the appellants that not only it was specifically stated in the G.O. dated 26th November, 1977 that the directions contend there were issued under section 78A of the Act, it was accepted even by the Electricity Board to be a direction under Section 78A of the Act as is apparent from its proceedings dated 20th January, 1978.
According to learned counsel for the appellants a direction issued under Section 78A of the Act was of a compulsive nature and was binding on the Electricity Board.
The only dispute which the Electricity Board could raise was as envisaged and in the manner provided by Sections 78A(2) of the Act about the direction being a matter of policy.
The Electricity Board according to learned counsel not having taken raucous to the procedure contained in Section 78A(2) of the Act was precluded from asserting before the High Court that the Government orders granting concessional tariff to the appellants did not fall within the purview of Section 78A of the Act.
The contention of the learned counsel for the Electricity Board on the other hand has been that a direction under Section 78A of the Act can be only with regard to a matter of policy vis a vis the consumers generally or of a particular class or category as distinguished from individual consumers and even such a direction does not have a binding force and is calculated only to guide the Electricity Board in the discharge of its statutory functions.
Learned counsel for the parties were at variance even on the question as to whether the power of fixing tariff under Section 49 of the Act could be regulated by a direction under Section 78A thereof.
In support of the submission that a direction issued by the Government is compulsive in nature learned counsel appearing for the appellants and the State of Andhra Pradesh drew or attention to 631 certain decisions and principles of administrative laws laying down the scope of a direction.
Having considered the respective submissions of learned counsel for the parties on this point we are of the opinion thaton the facts of the instant appeals it is not necessary to go into the rival contentions referred to above on this point.
Here, the Electricity Board as is apparent from its proceedings dated 20th January, 1978 proceeded to implement the directions with regard to fixation of concessional tariff issued by the State Government and resolved to realise electricity charges from the appellants only at the concessional tariff of 12.2 p. as fixed in the Government Order dated 26th November, 1977.
It, however, took the further view in the said proceedings that the directions issued by the Government did not have any bearing on the obligation of the appellants to pay minimum charges which they were bound to pay under the agreements executed by them even though such minimum charges were to be calculated at the rate of 12.2 p. per unit subject to escalation as indicated in the Government Orders in question.
Such minimum charges were payable even if no electricity was consumed by the appellants for any reason whatsoever.
It is in this context that we are of the opinion that the question with regard to the nature of a direction issued under section 78A of the Act is only of academic value in these appeals.
The basic question which falls for our consideration, however, is as to whether the obligation of the appellants to pay minimum charges under the agreement executed by them ceased to be operative on account of the directions issued by the State Government fixing concessional tariff as has been asserted by learned counsel for the appellants.
As indicated earlier the case of the electricity Board in this behalf has been that the directions in question did not have any bearing on the obligation of the appellants to continue to pay minimum charges, of course, to be calculated on the basis of the concessional tariff of 12.2 p. per unit.
A plain reading of the Government Orders dated 2nd Movement, 1977 and 26th November, 1977 makes it clear that there is no specific direction contained therein that the appellants would not be bound to pay minimum charges or that the obligation to pay minimum charges under the agreements executed by them would remain suspended during the period when the concession tariff would be operative.
What was, however, urged by learned counsel for the appellants was that the very purpose of fixing concessional tariff by the State Government would be frustrated if the appellants are held to be bound to continue to pay minimum charges in pursuance of the agreements entered into by them.
With regard to this submission it is at the outset necessary to appreciate the genesis of 632 prescription of minimum charges.
To put it succinctly the purpose of prescribing minimum charges is to ensure that no undue loss is caused to the Electricity Board because the absence of minimum charges is likely to create a tendency in a prospective consumer to have connection for an inflated requirement and having agreed to meet such requirement the Electricity Board would be under an obligation to maintain the supply upto that requirement even if no or very little energy is consumed.
In Amalgamated electricity Co. vs Jalgaon Borough Municipality, [1975] 2 SCC Page 508 it was held in paragraph 9 of the Report: "Moreover it is obvious that if the plaintiff company was to give bulk supply of electricity at a concessional rate of 0.5 anna per unit it had to lay down lines and to keep the power ready for being supplied as and when required.
The consumers could put their switches on whenever they liked and therefore the plaintiff had to keep everything ready so that power is supplied the moment the switch was put on.
In these circumstances it was absolutely essential that the plaintiff should have been ensured the payment of the minimum charges for the supply of electrical energy whether consumed or not so that it may be able to meet the bare maintenance expenses.
" In Bihar State Electricity Boara vs Green Rubber Industries, [1990] 1 S.C.C. Page 731 while dealing with the question whether the stipulation to pay minimum guarantee charges irrespective of whether energy was consumed or not is reasonable and valid it was inter alia held that considered by the test of reasonableness it cannot be said to be unreasonable inasmuch as the supply of electricity to consumer involves incurring of overhead installation expenses by the Board which do not very with the quantity of electricity consumed and the installation has to be continued irrespective of whether the energy is consumed or not.
The purpose of prescribing minimum charges being, as stated above, can it be said that while issuing the direction to the Electricity Board to supply electricity to the five mini steel plants at concessional rate the State Government was oblivious of the said purpose and required the Electricity Board not only to supply electricity on the concessional rate but also incur undue loss in maintaining the required bulk of energy stipulated in the various agreements even if the concerned mini plants either used no energy or used very little energy.
633 In our opinion, on the material placed before us it is not possible to take the view that such was the intention of the State Government in directing supply to be made to the appellants on concessional tariff.
That it was not the intention of the State Government to do so was subsequently clarified by the State Government itself vide Government Order dated 5th December, 1978.
In this view of the matter the submission made on behalf of the appellants that with the grant of concessional tariff the agreements in so far as they required the appellants to pay minimum charges ceased to be operative or that the purpose of granting concessional tariff was likely to be frustrated if they were required to continue to pay minimum charges cannot, therefore, by accepted.
In granting concessional tariff obviously it does not appear to be the purpose to compel the Electricity Board to maintain the supply of the contracted load of electricity to the appellants by incurring losses in the manner stated above.
The only purpose in directing supply of energy at concessional rates was reduce the charges of actual energy consumed by the appellants and this purpose could not be frustrated till the Electricity Board complied with the direction of supplying electricity to them at the concessional rate.
In this view of the matter it is apparent that the direction of the State Government to the Electricity Board to supply electricity to the appellants at concessional rate did not either expressly or by necessary implication grant immunity to the appellants from payment of of minimum charges.
In support of the plea that the order of the State Government dated 5th December, 1978 which clarified that its earlier orders fixing concessional tariff did not preclude the Electricity Board from levying minimum charges and the subsequent order dated 12th March, 1979 withdrawing the concessional tariff were invalid it was submitted by learned counsel for the appellants that those orders were in violation of principles of natural justice as also the doctrine of promissory estoppel.
In so far as this submission is concerned what is of significance is that by the Government Order dated 2nd November, 1977 and 26th November, 1977 concession was granted to the appellants.
This is manifest from the aforesaid Government Orders themselves which expressly used the expression "concessional power tariff" or "concessional tariff.
At no stage, does it appear to have been disputed by the appellants that what was extended to them by the said Government Orders was by way of concession.
In the context of granting exemption from sales tax certain observations were made by this Court in Shri Bakul Oil Industries vs State of Gujarat, [1987] 1 S.C.C. Page 31 which would, keeping in view the principle laid down therein with regard to 634 the grant of concession, be, in our opinion, useful in considering the above stated submission made by the learned counsel for the appellants.
It was held: "Viewed from another perspective, it may be noticed that the State Government was under no obligation to grant exemption from sales tax.
The appellants could not, therefore, have insisted on the State Government granting exemption to them from payment of sales tax, What consequently follows is that the exemption granted by the government was only by way of concession.
Once this position emerges it goes without saying that a concession can be withdrawn at any time and no time limit can be insisted upon before the concession is withdrawn.
The notifications of the government clearly manifest that the State Government had earlier granted the exemption only by way of concession and subsequently by means of the revised notification issued on July 17, 1971, the concession had been withdrawn.
As the State Government was under no obligation, in any manner known to law, to grant exemption it was fully within its powers to revoke the exemption by means of a subsequent notification.
This is an additional factor militating against the contentions of the appellants.
" It was further held: "The exemption granted by the government as already stated, was only by way of concession for encouraging entrepreneurs to start industries in rural and undeveloped areas and as such it was always open to the State Government to withdraw or revoke the concession.
We must, however, observe that the power of revocation or withdrawal would be subject to one limitation viz. the power cannot be exercised in violation of the rule of promissory estoppel.
In other words, the government can withdrawn an exemption granted by it earlier if such withdrawal could be done without offending the rule of promissory estoppel and depriving an industry entitled to claim exemption from payment of tax under the said rule.
If the government grants exemption to a new industry and if on the basis of the representation made by the government an industry is established in order to avail the benefit to exemption, it may then follow that the new industry can legitimately raise a grievance that 635 The exemption could not be withdrawn except by means of legislation having regard to the fact that promissory estoppel cannot be claimed against a statute.
" This being the law with regard to grant of concession we are of the opinion that neither of the two orders mentioned above can be said to be illegal on the ground that they were passed in violation of principles of natural justice.
Who only question in this connection which survives is that of promissory estoppel.
With regard to this plea it would be seen that it is not the case of the appellants that they established their mini plants after the grant of concessional tariff by the two Government Orders referred to above and but for the grant of such concessional tariff they would not have established their mini plants.
The necessary facts so as to sustain the plea of promissory estoppel are not, in our opinion, to be found to have been either pleaded or established by the appellants.
To take it by way of an illustration reference may be made to the special leave petition giving rise to Civil Appeal Nos.
1454 1463 of 1981 filed by M/s. Andhra Steel Corporation Ltd. The plea with regard to promissory estoppel is to be found in ground no.(i) which reads : "Whether in view of the fact that the Petitioner had acted upon the Government orders dated 2.11.1977 and 26.11.1977 and thus altered its position (as without the concessions being granted to the Petitioner they would not have possibly run the industry, since it was bound to suffer huge (losses) is the State Government stopped from revoking, or modifying the same before the full period of concession had run out of efflux of time that is, by 31 10 1980?" (emphasis supplied) Almost identical is ground no.(i) in the special leave petition giving rise to Civil Appeal Nos. 1642 1645 of 1981.
The use of the word "possible" is obviously indicative of lack of specific averment with regard to principle of estoppel.
Even such an averment has not been made qua the Electricity Board.
With regard to the plea based on the doctrine of legitimate expectation suffice if to say that except invoking the said doctrine nothing substantial was brought to our notice on the basis of which the appellants could be held entitled to any relief.
In so far as the Government Order dated 16th January, 1980 on which reliance has been placed by learned counsel for the appellants in 636 The alternative is concerned it may be pointed out that the said order even though in substance amounts to a clarification of the earlier order of clarification dated 5th December, 1978, states nothing as to why the clarification contained in the order dated 5th December, 1978 in categorical terms did not express the real intention of the State Government in issuing the earlier Government Orders granting concessional tariff.
As already indicated above, the orders granting concessional tariff, in our opinion, did not either expressly or by necessary implication grant immunity to the mini steel plants from their obligation to pay minimum charges and this having been categorically stated by the State Government in its clarificatory order dated 5th December, 1978 there was apparently no basis for issuing the second clarificatory order dated 16th January, 1980.
Further, the said order dated 16th January, 1980 had been issued on some representation made on behalf of the mini steel plants at a point of time when writ petitions on their behalf had already been filed in the High Court and the matter was subjudice.
In such a situation , apart from the propriety of issuing the second clarificatory order datd 16th January, 1980 it is obvious that what was contained in this order is analogous to an averment made by the State Government in replay to the writ petitions filed on behalf of the appellants.
In our opinion, in the circumstances poinited out above the order dated 16th January, 1980 has no bearing in finding out the true import of the orders of the State Government granting concessional tariff.
In view of the foregoing discussion, we do not find any substance in these appeals.
They are accordingly dismissed.
No. costs.
| IN-Abs | The appellants owning mini steel plants have been getting supply of electricity from the Respondent Board.
The Board revised its terms and conditions for supply of electricity, and concessional tariff of 11 paise per unit for 3 years from 1.11.1977 was applied to five steel plants.
This tariff was subsequently enhanced to 12.5 paise per unit.
However, the concessional tariff was not extended to one of the appellants viz. M/s. Andhra Steel Corporation since a Writ Petition had been filed by it claiming that the agreement entered into with the Respondent Board for availing high tension electric supply was no longer in force.
In respect of the other steel plants, the Bard extended the concessional tariff subject to escalations and other terms and conditions and fixed a certain minimum consumption.
However, the tariff was revised to 16 paise without reference to the maximum demand charges from 1.3.1978.
In reply to a clarification sought by the Respondent Board, the State Government clarified that the Government order did not preclude the Board from applying the normal terms and conditions of supply and prescribing the monthly minimum charges and the working out of the escalated rate from time to time.
Subsequently the State Government withdrew the concessional tariff.
The State Government made a further clarification that its intention was to allow the concessional tariff without limiting the concession by imposition of minimum 625 consumption charges till the end of March, 1979.
Aggreived by the withdrawal of the concessional tariff, the mini steel plants filed Writ Petitions before the High Court contending that it was not open to the Electricity Board to have levied minimum charges and it was bound to supply electricity to them at the concessional tariff fixed by the State Government.
It was also contended that State Government 's subsequent clarification should prevail over the earlier one.
Violation of principales of natural justice, doctrine of promissory estoppel and right based on doctrine of legitimate expectation were also contended.
It was further contended that the directions were issued under section 78A of the Electricity Supply Act and hence they were of a compulsory nature and binding on the Board.
The Andhra Steel Corporation contended that while applying the concessional tariff to other mini steel plants, the Electricity Board was not justified in refusing the same to it thereby singling it out and hence its action was discriminatory and male fide.
The High Court rejected the various contentions and dismissed the Writ Petitions.
Aggrieved by the dismissal of their Writ Petitions, the mini steel plants filed appeal before this Court, raising the same contentions as were advanced before the High Court.
Dismissing the appeals, this Court, HELD: 1.
In granting concessional tariff obviously it does not appear to be the purpose to compel the Electricity Board to maintain the supply of the contracted load of electricity to the appellants by incurring loses.
The only purpose in directing supply of energy at concessional rates was to reduce the charges of actual energy consumed by the appellants and this purpose could not be frustrated till the Electricity Board complied with the direction of supplying electricity to them at the concessional rate.
Though the order dated 16.1.80 in substance amounts to a clarification of the earlier order of clarification dated 5th December,1978, it states nothing as to why the clarification contained in the order dated 5th December, 1978 in categorical terms did not express the real intention of the State Government in issuing the earlier Government orders granting concessional tariff.
The orders 626 granting concessional tariff, did not either expressly or by necessary implication grant immunity to the mini steel plants from their obligation to pay minimum charges and this having been categorically stated by the State Government in its clarificatory order dated 5th December, 1978 there was apparently no basis for issuing the second clarificatory order dated 16th January, 1980.
It was issued on some representation made by the mini steel plants at a point of time when Writ Petition on their behalf had already been filed in the High Court and matter was sub judice.
In such a situation, apart from the propriety of issuing the second clarificatory order on 16th January, 1980 it is obvious that what was contained in this order is analogous to an averment made by the State Government in reply to the Writ Petitions filed on behalf of the appellants and it has no bearing in finding out the true import of the orders of the State Government granting concessional tariff.
[633C D;636A E] Amalgamated Electricity Co. vs Jalgaon Borough Municipality, ; and Bihar State Electricity Board vs Green Rubber Industries, [1990] 1 SCC 731, referred to.
By the Government Orders dated 2nd November, 1977 and 26th November, 1977 concession was granted to the appellants.
This is manifest from the government Orders themselves which expressly used the expression "concessional power tariff" or "concessional tariff".
At no stage, the appellants disputed that what was extended to them by the said Government Order was by way of concession.
In view of the settled law.
Neither of the two orders viz., order dated 5.12.78 and 12.3.79 can be said to be illegal on the ground that they were passed in violation of principles of natural justice.[633F H] Shri Bakul Oil Industries vs State of Gujarat, ; ; relied on.
With regard to the plea of promissory estoppel, it is not the case of the appellants that they established their mini plants after the grant of concessional Tariff by the said two Government Orders and but for the grant of such concessional tariff they would not have established their mini steel plants.
The necessary facts so as to sustain the plea of promissory estoppel are not pleaded or established by the appellants.
[635B D] 4.
There is nothing on record to substantiate the plea of doctrine of legitimate expectation on the basis of which the appellants could be held entitled to any relief.[635G] 627 5.
On the facts of the present appeals it is not necessary to go into the question whether the power of fixing tariff under section 49 of the Electricity Supply Act could be regulated by a direction under section 78A thereof.
The electricity Board proceded to implement the directions with regard to fixation of concessional tariff issued by the State Government and resolved to realise electricity charges from the appellants only at the concessional tariff of 12.2 p. as fixed in the Government Order dated 26th November, 1977.
It, however, took the further view that the directions issued by the Government did not have any bearing on the obligation of the appellants to pay minimum charges which they were bound to pay under the agreements executed by them even though such minimum charges were to be calculated at the rate of 12.2 p. per unit subject to escalation as indicated in the Government Orders in question.
Such minimum charges were payable even if no electricity was consumed by the appellants for any reason whatsoever.
[631B D]
|
Civil Appeal Nos.
1450 1458 of 1990.
From the Judgment and Order dated 21.11.1988 of the Madras High Court in W.A. Nos. 864 to 870 of 1988 and W.P. Nos. 1600 and 1601 of 1986.
Narayanswamy, N. Balasubramaniam and A.T.M. Sampath for the Appellant.
M. Ramamurthy, Mrs. C. Ramamurthy, M.A. Krishnamoorthy, 639 for the Respondents.
R.C. Paul appeared in person.
These are appeals by special leave and are directed against a common judgment of the Madras High Court delivered in a group of writ appeals and a writ petition.
E.I.D. Parry (India) Ltd. (hereinafter referred to as `the employer ') has one of its units located at Ranipet in Tamil Nadu State where sanitary ware, super phosphate and insecticides are manufactured.
Some of its retiring employees filed applications under section 33 C(2) of the (`1947 Act ' for short) before the Labour Court at Madras claiming pension by alleging that payability of pension was a condition of service and the employer had stopped it without any justification and without giving notice under section 9 A of the .
The President Officer of the 2nd Additional Labour Court, Madras, allowed the same by his order dated 30th May, 1983, after computing the amounts.
The employer preferred six writ petitions.
In the meantime the same dispute had been referred to the Industrial Tribunal and it answered the reference against the employees by award dated 13th February, 1985.
The award was assailed before the High Court by the Union by filing of the seventh writ petition.
All the seven writ petitions were heard by a learned Single Judge who allowed the writ petitions of the management against the order of the Labour Court and dismissed the writ petition preferred by the labour union challenging the award of the Industrial Tribunal.
Writ appeals were carried against the Single Judge 's decision.
The main controversy before the Division Bench was as to whether pension, or as is referred to by the parties, "retiring allowance" was payable to the employees.
This dispute has a historical backdrop to which we may now advert.
Under General Office Order No. 26 dated Ist December, 1943 "retiring allowances" were provided for.
The Office Order provided that normally only employees with thirty years ' service or more would be eligible to receive "Retiring Allowance".
The Board reserved the right to alter the scale of "retiring allowance".
either generally or in respect of individual employees and had the authority to sanction `retiring allowance ' when first granted and subsequent payment became a routine matter subject to annual review.
640 Gratuities were also provided under the Office Order by saying that all permanent employees (other than workers who qualify for gratuities as per Factory Certified Standing Order) who were in the Company 's service prior to 1.1.1947 and who do not qualify for Retiring Allowance on retirement, will be eligible for gratuity on finally leaving the Company 's service subject to one or other of the prescribed conditions being fulfilled.
In all four alternatives were provided.
Clause (4) indicated that employees recruited on or after 1.1.1947 would not be entitled to any gratuity.
There was a Memorandum of Settlement between the parties which may be referred to as the settlement of 1956.
Clause (6) thereof related to gratuity and provided: "Gratuity shall in future be payable by the company in accordance with the following rules: (a)(i) Where, irrespective of the length of his past service, an employee dies in service, or is retired on a medical certificate acceptable to the company, or is retired by the company on reaching the age of superannuation, he shall be entitled to gratuity calculated at the rate of one month 's basic salary for each completed year of service, and pro rata for any partly completed year of his service ,subject to a maximum of 15 months ' basic salary if his service is less than 30 years, together with half of one month 's basic salary for each completed year of service in excess of 30 years and pro rata for any partly completed year of service in excess of 30 years. . . (d) Employees in service prior to Ist January, 1947 may opt, at the time of leaving service, either for: (i) Gratuity calculated in accordance with these rules or in accordance with the current provisions of General Office Order No. 26, whichever he prefers, or (ii) in lieu of gratuity, a retiring allowance calculated in accordance with the current provisions of General Office Order No. 26.
" This settlement as a fact incorporated the relevant part of the Office Order.
641 The came into force with effect from September, 1972 and payment of gratuity became statutory.
When that Act came into force, the Employer and the Employees ' Union jointly applied to the Government for exemption from the provisions of the statute.
The exemption was, however, not granted.
Payability of gratuity is no longer in dispute.
What is challenged is the claim of the workmen to retiring allowance (pension) under Office order No. 26.
The stand of the employees has been that the retiring allowance under General Office Order No. 26 has not been substituted by the 1956 settlement and they are, subject to being qualified, entitled to the benefit of pension and the statutory advantage of gratuity.
It is a fact that the settlement does not provide for payment of pension except to pre 1947 employees and making the benefit liable to exercise of option under clause 6(d) above.
It is not in dispute that the retiral benefit (pension) was payable to all qualified employees as a matter of practice.
If under the settlement that was not done away with, the benefit arising out of General Office Order No. 26 would still be available and gratuity contemplated under the settlement would not be a substitute of the retiral benefit of pension.
The Appellate Bench of the High Court has found that gratuity provided under the settlement was not a substitute of pension.
Mr. Narayanaswamy, learned senior counsel appearing in support of the appeals took us through the various documents and placed the matter at considerable length and with lucidity.
He even relied on what he described as the prevailing practice between 1956 and 1972 the settlement and the Gratuity Act when no retiral benefit was either claimed or paid.
We have, however, not been able to see any defect in the reasoning of the Division Bench decision of the High Court where it has ultimately come to the conclusion that the settlement had not substituted gratuity for pension.
We find that by way of an interim measure this Court by an order dated 5th May, 1989 had directed the employer to pay the pension to the employees in accordance with the order of the High Court with effect from Ist May, 1989 and that from the record appears to have been paid.
A petition had been filed in this Court on 23rd April, 1990 by the employer for modification of the condition indicated in the order granting special leave and we had heard counsel for both the sides on the said petition.
We had made it clear at the hearing of the petition for modification of the order granting special leave that the question as to payability of retirement benefit after the 1956 settlement would be examined.
The total number of employees involved in this dispute was 642 about 347.
Many of them had not only retired but had also died and in respect of those who were dead it would be a question of the benefits up to the date of death of the respective employees to be paid to their legal representatives.
Mr. Narayanaswamy had emphatically contended that what was being decided was not a claim of 347 employees but it had its repercussion on the industrial peace between the employer and the employee at other places.
We would like to make it clear that we have gone into the question confined to the claim to the employees of the Ranipet factory and not the liability of the employer generally, Besides, Mr. Narayanaswamy had also told us at the hearing that there are special features in the arrangement in regard to employees elsewhere.
We are satisfied that the Appellate Bench of the High Court was right in holding that the entitlement to pension had not been substituted by the settlement of 1956 and, therefore, the claim to pension subject to qualification being satisfied was available to be maintained notwithstanding the settlement of 1956, The High Court rightly came to the conclusion that the Labour Court had justifiably worked out the dues and the claim petitions under section 33 C(2) of the .
We uphold the judgment of the High Court and dismiss these appeals.
The employees had asked for award of interest on their dues.
The challenge of the employer was not groundless and we do not think in the facts of these cases the employees or their legal representatives would be entitled to interest.
We hope and trust that the employer would not liquidate its liability without delay by satisfying the orders of the Labour Court and the claims of the workmen or their legal representatives as and when made.
A sum of Rs. 10,000 had been given by the employer to Sri Pant for the Union to contest these matters and he has been paid the amount under this Court 's order.
No order for further courts.
T.N.A. Appeals dismissed.
| IN-Abs | The General Office Order No. 26 dated 1.12.1943 of the Appellant Company provided that employees with 30 years ' service or more would be eligible to receive "Retiring Allowance" (pension).
The said office order also provided that all permanent employees who were in the Company 's service prior to 1.1.1947 and who do not qualify for retiring allowance on retirement, will be eligible for gratuity on finally leaving the Company 's service subject to the prescribed conditions being fulfiled.
In 1956 a memorandum of settlement was signed by the appellant company and the Employees ' Union under which the employees in service prior to 1.1.47 were required to opt at the time of leaving service either for gratuity or in lieu of the gratuity the retiring allowance.
Later the came into force and the payment of gratuity became statuory.
The employer and the Employees ' Union jointly applied to the Government for exemption from the provisions the statue which was refused.
Some of the retiring employees of company filed applications under Section 33 C(2) of the before the Labour Court claiming pension by alleging that payability of pension was a condtion of service and the employer had stopped it without any Justification.
The Labour Court allowed the applications.
Against the 638 order of the Labour Court the employer preferred six writ petitions.
In the meantime the same dispute was referred to the Industrial Tribunal and by an award the Tribunal answered the reference against the employees.
The Employees ' Union challenged the award by filling a writ petition in the High Court.
All the writ petitions were heard by a learned single judge of the High Court who allowed the writ petitions of the management against the order of the Labour Court and dismissed the writ petition preferred by the Labour Union challenging the award of the Tribunal.
Writ appeals were carried against the single Judges ' decision.
The Appellate Bench of the High Court held that gratuity provided under the settlement was not a substitute of pension and the claim of pension was available to employees notwithstanding the settlement.
Hence this appeal by the employer company.
Dismissing the appeals, this Court, HELD: The 1956 settlement between the parties does not provide for payment of pension except to pre 1947 employees and making the benefit liable to exercise of option under clause 6(d) of the settlement.
The retiral benefit (pension) was payable to all qualfied employees as a matter of practice.
If under the settlement that was not done away with, the benefit arising out of General Office order No. 26 would still be available and gratuity contemplated under the settlement would not be a substitute of the retiral benefit of pension.
The Appellate Bench of the High Court was right in holding that the entitlement to pension had not been substituted by the settlement of 1956 and, therefore, the claim to pension subject to qualification being satisfied was available to be maintained notwithstanding the settlement of 1956.
The High Court rigtly came to the conclusion that the Labour Court had justifiably worked out the dues and the claim petition under section 33 C(2) of the 1947 Act.
[641C D, 642C D]
|
ivil Appeal No. 2225 of 1991.
From the Judgment and Order dated 12.10.1990 of the Himachal Pradesh High Court in R.S.A. No. 134 of 1979.
692 C.K. Mahajan and Ashok Grover for the Appellants.
J. Special leave is granted.
The appeal is directed against the judgment of the High Court setting aside the decree passed by the trial court and the first appellate court in favour of the plaintiffs appellants, and dismissing their suit, on the ground of being barred by limitation.
The subject matter of the present case is agricultural land in Himachal Pradesh belonging to one Sham Sunder, the original plaintiff since dead, who was the father of the appellant No. 1 and the grand father of the appellants No.2 and 3.
The defendant respondent, Moti, alleging to be a sub tenant cultivating the land, claimed the benefits under Section 27(4) of the Himachal Pradesh Abolition of Big Landed Estates and Land Reforms Act, 1953, hereinafter referred to as the Act.
Notice was issued to Sham Sunder which according to his case was not served on him.
The claim of Moti was accepted, amount of compensation payable under Section 27(4) of the Act was determined by the Compensation Officer and consequential orders were passed in his favour.
The present suit was filed by Sham Sunder challenging the aforesaid orders on the allegation that Moti was merely a labourer employed by him and he never cultivated the disputed land and he, therefore, was not entitled to the acquisition of the proprietory right under Section 27 (4) of the Act.
The Suit was resisted by the defendant.
Both the trial court and the appellate court, accepted the plaintiff 's case and concurrently held that Moti was not a sub tenant and hence, the order passed by the Revenue Officer in his favour under Section 27(4) of the Act was without jurisdiction.
The plea of limitation was rejected and the suit was decreed holding that Sham Sunder being the tenant in possession was entitled to the right under Section 27(4) of the Act.
In a further appeal under Section 100 of the Code of Civil Procedure, the defendant contended before the High Court that the suit having been filed after a period of more than three years from the day of the order under Section 27(4) of the Act, was barred by limitation.
The Court agreed with him and dismissed the suit by the impugned judgment.
The High Court did not deal with any other aspect in the case, stating that the defendant had not urged any other point in support of the second appeal.
693 4.
In the impugned judgment the High Court has held that "as a consequence of the Order of the Compensation Officer under Section 27(4), the title in the land stood vested in the appellant", and merely because a longer period of limitation is provided for recovery of possession under Article 65 of the , the suit can not be said to be within the period of limitation.
Accordingly either one year period under Article 100 or in the alternative the three years ' rule under Article 113 has been held applicable.
We do not think that the High Court is right.
The principle for deciding the question of limitation in a suit filed after an adverse order under a Special Act is well settled.
If the order impugned in the suit is such that it has to be set aside before any relief can be granted to the plaintiff the provisions of Article 100 will be attracted if no particular Article of the is applicable the suit must be governed by the residuary Article 113, prescribing a period of three years.
Therefore, in a suit for title to an immovable property which has been the subject matter of a proceeding under a Special Act if an adverse order comes in the way of the success of the plaintiff, he must get it cleared before proceeding further.
On the other hand if the order has been passed without jurisdiction, the same can be ignored as nullity, that is, non existent in the eye of law and it is not necessary to set it aside; and such a suit will be covered by Article 65.
In the present case the controversial facts have been decided in favour of the plaintiff appellant and the findings were not challenged before the High Court.
The position, thus, is that the plaintiff was the owner in cultivating possession of the land and the defendant Moti was merely a labourer without any right of a tenant or sub tenant.
The question is as to whether in this background it is necessary to set aside the order passed in favour of the respondent under Section 27(4) of the Act before the suit can be decreed or whether the plaintiff can get a decree ignoring the said order as void, in which case the suit undoubtedly will be governed by Article 65. 6.
The provisions of Section 27(4) of the Act as also the other provisions are limited in their scope.
The preamble indicates that the object of the Act is to provide for the abolition of the big landed estates and to reform the law relating to tenancies in the Himachal Pradesh.
The expressions 'tenant ', 'sub tenant ' as also other similar expressions have to be understood in the sense they have been used in the other statutes dealing with the relationship of landlord and tenant in agricultural lands.
Section 27 of the Act provides for a transfer by the law of the right title and interest of the land owner to the State 694 Government under sub section (1) Sub section (2) is by way of an exception with respect to land under the personal cultivation of the land owner.
Sub section (4) directs that the right, title and interest of the land owner thus acquired, shall be transferred by the State, On payment of compensation, to the tenant who cultivates such land.
Under this provision, the order in the present case was passed in favour of Moti.
If Moti was not a tenant or sub tenant he was not entitled to the benefits under the sub section.
If the land was in cultivating possession of the plaintiffs, as held in the present suit, the Compensation Officer did not have the jurisdiction to pass any order in defiance of sub Section (2) and the land did not vest in the State at all.
Further, for the additional reason that Moti was not a tenant of the land the order passed in his favour under Section 27(4) was again without jurisdiction.
In absence of the conditions necessary for the exercise of power under Section 27(4) the Officer lacked jurisdiction to act and it was not necessary for the civil court to formally set aside his order before passing a decree.
What necessitated the plaintiff to come to the civil court was the challenge to his title, and the suit must be held to be covered by Article 65, and, therefore, not barred by shorter periods of limitation either under Article 100 or Article 113. 7.
The cases relied upon by the High Court do not support the impugned judgment.
In State vs Sadh Ram, I.L.R. (Himachal Pradesh) 1973 (2) 235, the Compensation Officer had passed an order under Section 27(4) of the Act, transferring the proprietory right to the cultivating tenants of the land, excluding the trees standing thereon.
The transferee tenants filed a suit in respect of the trees, and the High Court held that the suit was barred by limitation either under Article 100 or Article 113.
The grievance of the tenant was not against the exercise of the power of the Compensation Officer under Section 27 (4) of the Act, rather he relied upon the same.
The observations, mentioned below, from the judgment of Pathak, C.J. (as he then was) are enlightening and supporting the view expressed by us.
"This is not a case where the order made by the Compensation Officer is a nullity.
If the Compensation Officer had ab initio no jurisdiction to take the proceeding and make an order therein, he would have no jurisdiction to make any order at all.
In that event, the entire order made by him, including that part of it which is in favour of the plaintiffs, would be a nullity.
" In the full Bench judgment of the Lahore High Court in Gangu and 695 Others vs Mahanraj Chand and Others, A.I.R. 1934 Lahore 384 the decision on the question of limitation went against the plaintiff on account of the special facts an circumstances of the case, as is clear from the enunciation of the proposition (at page 389, column 2) to the effect that if it is necessary for a plaintiff to get rid of an order made by an Officer of the Government, which stands in his way before he can obtain a certain relief and in order to obtain that relief he does not specifically ask for the setting aside of the order but merely for a declaratory decree still the suit should be deemed to be one to set aside an order falling within the ambit of Article 14.
It is material to note that in that case, it was essential for the plaintiff to have got the order of the Collector set aside, before asking for a decree.
Two cases of this Court, although not identical in facts nor governed by the present Act, support the view which we are taking.
In Sheo Lal and Ors.
vs Sultan & Ors.
, ; the plaintiff filed a suit for a decree for redemption after unsuccessfully moving the Assistant Collector for similar relief under the Redemption of Mortgages (Punjab Act 2 of 1913) 1913, and a plea of limitation by virtue of Article 14 of the Limitation Act, 1908, was raised.
Agreeing with the High Court this Court rejected the defence argument based on Article 14 on the ground that in the facts of the case it was not necessary to set aside the order of the Assistant collector before granting a redemption decree.
The other decision in Mohd. Murtiza Khan vs state of M.P. and Others, [1966] M.P.L.J. 933 arose out of a suit in which the interpretation of the provisions of the Bhopal Land Revenue Act was involved.
In similar situation as in the present appeal before us, this Court held that Article 14 of the Limitation Act, 1908, had no application to the suit as the order under the Bhopal Land Revenue Act had been passed without jurisdiction and could be ignored without getting it set aside.
Article 142 of the Limitation Act was applied.
For the reasons mentioned above we set aside the impugned judgment of the High Court and restore the decree passed by the first appellate court.
the appeal is accordingly allowed with costs through out.
T.N.A. Appeal allowed.
| IN-Abs | The respondent defendant claimed the benefits under Section 27(4) of the Himachal Pradesh Abolition of Big Landed Estates and Land Reforms Act, 1953 alleging that he was a sub tenant cultivating the disputed land.
The Compensation Officer accepted his claim and passedan order in his favour under Section 27(4).
The appellants ' father, Plaintiff, challenged the order of Compensation Officer contending that the defendant was not entitled to the acquisition of the proprietary right under section 27(4) because he was merely a labourer employed by him and he had never cultivated the disputed land.
Both the Trial and the Appellate court accepted the plaintiff 's case and concurrently held that the defendant was not a sub tenant and consequently the order passed in his favour under Section 27(4) was without jurisdiction.
The plea of Limitation was rejected and the plaintiff 's suit was decreed by holding that he being the tenant in possession was entitled to the right under section 27(4) of the Act.
On further appeal the High Court dismissed the plaintiff suit on the ground that the suit having been filed after a period of more than three years from the date of the order under section 27(4) it was barred by limitation.
Hence this appeal against the decision of the High Court.
Allowing the appeal and setting aside the judgment of the High court, this Court, HELD: 1.
The principle for deciding the question of limitation in 691 a suit filed after an adverse order under a Special Act is well settled.
If the order impugned in the suit is such that it has to be set aside before any relief can be granted to the plaintiff the provisions of Article 100 will be attracted and if no particular Article of the is applicable the suit must be governed by the residuary Article 113, prescribing a period of three years.
therefore, in a suit for title to an immoveable property which has been the subject matter of a proceeding under a Special Act if an adverse order comes in the way of the success of the plaintiff, he must get it cleared before proceeding further.
On the other hand if the order has been passed without jurisdiction, the same can be ignored as nullity, that is, non existent in the eye of law and it is not necessary to set it aside; and such a suit will be covered by Article 65 [693C D] 1.1 In the instant case the concurrent findings were that the plaintiff was the owner in cultivating possession of the land and the defendant was merely a labourer without any right of the tenant or a sub tenant.
If the land was in cultivating possesion of the plaintiff, the compensation Officer did not have the jurisdiction to pass any order in defiance of section 27(2) and the land did not vest in the State at all.
Further, for the additional reason that defendant was not a tenant of the land the order passed in his favour under Section 27(4) was again without jurisdiction.
Therefore, in absence of the conditions necessary for the exercise of power under Section 27(4) of Officer lacked jurisdiction to act and it was not necessary for the Civil Court to formally set aside his order before passing a decree.
What necessitated the plaintiff to come to the civil court was the challenge to his title, and the suit must be held to be covered by Article 65, and, therefore, not barred by shorter period of limitation either Article 100 or Article 113.
[693E, 694B C D] Sheo Lal and Ors.
vs Sultan & Ors.
, ; and Mohd. Murtiza Khan vs State of M P. and Ors., [1966] M.P.L.J., referred to.
State vs Sadh Ram, I.L.R. (HP) 1973 (2) 235 and Gangu and Ors.
vs Mahanraj Chand and Ors., A.I.R. 1934 Lahore 384, held inapplicable.
|
: Criminal Appeal No. 67 of 1991.
From the Judgement and Order dated 27.11.1987 of the Delhi High Court in Crl.
W. No. 527 of 1987.
N.N. Gupta and Rajiv Dutta for the Appellant.
J.D. Jain, Maninder Singh and Ms. Sushma Suri for the Respondents.
The Judgement of the Court was delivered by K. JAYACHANDRA REDDY, J.
This appeal, pursuant to the special leave granted, is directed against the order of the High Court of Delhi dismissing the writ petition filed by the appellant summarily.
The appellant was serving as a Jawan in the Indian Army.
On 17th September, 1985, he applied for leave and it was granted.
He was going to his home town, a village in Rajasthan.
He purchased 11 bottles of sealed rum and one bottle of brandy from his Unit Canteen as he required the same to celebrate the marriage of one of his close relations at his home town.
Admittedly, the appellant was entitled to carry 4 bottles of rum and one bottle of brandy as per the Unit Regulations/leave certificate when he was proceeding on leave.
According to the appellant, the remaining 7 bottles of rum he was able to purchase from the Unit Canteen over and above his entitlement on the orders of its Company Commander and Commanding Officer on compassionate grounds and that there was a written order to that effect which was retained by the Salesman of the Unit Canteen at the time of delivery of the extra 7 bottles of rum.
Enroute to his home 679 town he had to pass through Surendra Nagar which was under prohibition.
The local Civil Police at Surendra Nagar intercepted him and confiscated the bottles of liquor and handed over the appellant alongwith the liquor bottles to the City Police Station, Surendra Nagar.
The City Police in turn handed over him to his Unit authorities for action.
The 6th respondent, the Officer Commanding, 98 Field Regiment, ordered a summary court martial during which the witnesses including the Civil, Police Officer of Surendra Nagar were examined.
Ultimately the summary court martial sentenced the appellant to three months ' R.I. and dismissed him from service with effect from 9th October, 1985 by which time the appellant had already put in 10 years of service.
His plea throughout has been that he had purchased the liquor for the marriage of his brother in law on the basis of the permit issued to him and the chits issued by his superiors enabling him to draw the extra 7 bottles of rum and that he had no other bad intention in carrying the liquor bottles.
He preferred an appeal to the Army Commander mentioning several irregularities in the summary trial.
He also pleaded that he was having unblemished record of service in the Army, but his appeal was rejected.
Thereafter he filed a writ petition in the Delhi High Court which was summarily rejected.
In this appeal the learned counsel for the appellant submitted that several irregularities have been committed in conducting the summary trial.
But from the records we find that the evidence has been duly recorded and further it is an admitted fact that the appellant was carrying extra 7 bottles of rum without the necessary permit.
Therefore we are unable to agree with the counsel that the trial is vitiated and we are of the view that no prejudice has been caused.
The main submission and perhaps the only submission, if we may say so, in this appeal is that the sentence awarded to the appellant is wholly disproportionate to the offence committed by him.
According to the learned counsel the extreme punishment of imprisonment for 3 months and dismissal from the service under the circumstances is uncalled for.
We find considerable force in this submission.
Admittedly the appellant was granted leave when he was proceeding to his home town and unfortunately enroute to his home town he had to pass through Surendra Nagar where there was prohibition in force.
However, he had a valid permit to carry 5 bottles, the extra 7 bottles of rum, according to the appellant, were purchased from the Army Canteen itself and there is no dispute about the same.
Unless he had some permits or chits given by some higher authorities permitting him to purchase these bottles, he could not have purchased the same from the Canteen 680 over and above the bottles for which he had a valid permit.
He was taking this liquor to his home town to celebrate his brother in law 's marriage, but to his bad luck, the Civil Police of Surendra Nagar checked his baggage and confiscated the bottles as he had no valid permit to carry the extra bottles.
Under these circumstances the question is whether such a severe penalty is called for.
In the chargesheet it is merely stated that the action of the appellant in carrying 11 bottles of sealed rum and one bottle of sealed brandy when he was proceeding to his home town is "contrary to the existing orders on the subject".
In the counter affidavit it is stated that such an act of the appellant comes within the meaning of Section 63 of Chapter VI of the (`Act ' for short) which enumerates various types of offences.
Section 63 lays down as under: "63.
Violation of good order and discipline Any person subject to this who is guilty of any act or omission which, though not specified in this , is prejudicial to good order and military discipline shall, on conviction by court martial, be liable to suffer imprisonment for a term which may extend to seven years or such less punishment as is in this act mentioned".
The Section may cover various types of misconducts committed by a person by way of an act or omission.
This Section also provides for awarding any other lesser punishment mentioned in the .
Therefore such depends on the nature of the act or omission of which the person is found guilty.
The provisions in Chapter VII enumerate various punishments that can be awarded.
Section 71 of the deals with punishments awardable by court martial and reads as under: "71.
Punishments awardable by courts martial Punishments may be inflicted in respect of offences committed by persons subject to this and convicted by courts martial, according to the scale following, that is to say (a) death; (b) transportation for life or for any period not less than seven years; (c) imprisonment, either rigorous or simple, for any period not exceeding fourteen years; 681 (d) cashiering, in case of officers; (e) dismissal from the service; (f) reduction to the ranks or to a lower rank or grade or place in the list of their rank, in the case of warrant officers.
; and reduction to the ranks or to a lower rank or grade, in the case of non commissioned officers; Provided that a warrant officer reduced to the ranks shall not be required to serve in the ranks as a sepoy; (g) forfeiture of seniority of rank, in the case of officers, junior commissioned officers, warrant officers and non commissioned officers; and forfeiture of all or any part of their service for the purpose of promotion, in the case of any of them whose promotion depends upon length of service; (h) forfeiture of service for the purpose of increased pay, pension or any other prescribed purpose; (i) severe reprimand or reprimand, in the case of officers, junior commissioned officer, warrant officers and non commissioned officers; (j) forfeiture of pay and allowances for a period not exceedind three months for an offence committed on active service; (k) forfeiture in the case of a person sentenced to cashiering or dismissal from the service of all arrears of pay and allowances and other public money due to him at the time of such cashiering or dismissal; (l) stoppage of pay and allowances until any proved loss or damage occasioned by the offence of which he is convicted is made good.
" It can be seen that Sections 71(a) to 71(e) and Section 71(k) provide for extreme punishments and are severe in nature.
Sections 71(f) to 71(j) and Section 71(l) provide for comparatively lesser punishments.
Section 72 of the is the next relevant Section which reads as under: 682 "72.
Alternative punishments awardable by court martial Subject to the provisions of this , a Court Martial may, on convicting a person subject to this to any of the offences specified in Sections 34 to 68 inclusive, award either the particular punishment with which the offence is stated in the said sections to be punishable, or, in lieu thereof, any one of the punishments lower in the scale set set out in Section 71, regard being had to the nature and degree of the Offence." (emphasis supplied) Section 73 of the deals with combination of punishments and it reads as under: "73.
Combination of punishments A sentence of a court martial may award in addition to, or without any one other punishment, the punishment specified in clause (d) or clause (e) of Section 71 and any one or more of the Punishments specified in clauses (f) to (l) of that section.
" It can be seen that under Section 73 of the , the court martial may award more than one punishments as mentioned therein.
In the instant case Section 63 also is not mentioned in the chargesheet.
Assuming that the offence committed by the appellant is covered by the residuary Section 63 but in awarding the punishment the court martial has to keep in view the spirit behind Section 72 of the and it has to give due regard to the nature and degree of the offence.
It can be seen that Section 63 provides for awarding any of the lesser punishments enumerated in Section 71 of the .
In view of these provisions of law and having regard to the nature and degree of the offence, we are firmly of the view that the punishments awarded to the appellant namely, three months ' R.I. and dismissal from service are severe and are also violative of Section 72.
In Council of Civil Service Unions vs Minister for the Civil Service, ; , 950 Lord Diplock said: "Judicial review has I think developed to a stage today when, without reiterating any analysis of the steps by which the development has come about, one can conveniently classify under three heads the grounds on which administrative action is subject to control by judicial review.
The first ground I would call `illegality ', the second `irrationa 683 lity ' and the third 'procedural impropriety ! This is not to say that further development on a case by case basis may not in course of time add further grounds.
I have in mind particularly the possible adoption in the future of the principle of 'proportionality ' which is recognised in the administrative law of several of our fellow members of the Eurpoean Economic community,. ." This principle was followed in Ranjit Thakur vs Union of India and Others, where this Court considered the question of doctrine of proportionality in the matter of awarding punishment under the and it was observed thus: "The question of the choice and quantum of punishment is within the jurisdiction and discretion of the court martial.
but the sentence has to suit the offence and the offender.
It should not be vindictive or unduly harsh.
It should not be so disproportionate to the offence as to shock the conscience and amount in itself to conclusive evidence of bias.
The doctrine of proportionality, as part of the concept of judicial review, would ensure that even on an aspect which is, otherwise, within the exclusive province of the court martial, if the decision of the court even as to sentence is an outrageous defiance of logic, then the sentence would not be immune from correction.
Irrationality and perversity are recognised grounds of judicial review.
" In Bhagat Ram vs State of Himachal Pradesh, [1983] 2 SCC 442 this Court held as under: "It is equally true that the penalty imposed must be commensurate with the gravity of the misconduct, and that any penalty disproportionate to the gravity of the misconduct would be violative of Article 14 of the Constitution.
" Applying these principles to the instant case, We are also constrained to say that there is an element of arbitrariness in awarding these severe punishments to the appellant.
We have heard both the learned counsel on this aspect elaborately and we are satisfied that an interference is called for and the matter has to be remanded on the question of awarding any of the lesser punishments.
Having given our earnest consideration to the 684 facts and circumstances of this case and in view of the submissions made by both the counsel, we feel that ends of justice will sufficiently be met if a lesser punishment as provided under Section 71(f) is awarded to the appellant.
Accordingly, we set aside the punishments of three months ' R.I. and dismissal from service and remand the matter to the court martial which shall award any of the lesser punishments having due regard to the nature and circumstances of the case and in the light of the above observations made by us.
Since we are setting aside the sentence of three months ' R.I. any detention suffered by the appellant after the orders of the court martial shall not be treated as a disqualification for being reinstated into service which shall, however, be subject to any of the minor punishments to be awarded by the court martial.
Already much time has lapsed, therefore, we hope the court martial would dispose of the matter as expeditiously as possible preferably within three months.
The appeal is thus disposed of subject to the above directions.
N.P.V. Appeal disposed of.
| IN-Abs | The appellant, who had put in 10 years of service as Jawan in the Army, was sentenced to 3 months ' R.I. and dismissed from service by the Summary Court Martial, on the charge that his action in carrying 12 bottles of liquor while proceeding on leave to his home town was contrary to the orders on the subject.
The appeal preferred by the appellant, pointing out the irregularities committed in the summary trial, and pleading that he had unblemished record of service, was also rejected by the higher authority.
The writ Petition filed by the appellant was also summarily rejected by the High Court.
In the appeal before this Court, on behalf of the appellant it was contended that the summary trial was vitiated on account of several irregularities committed in conducting the trial, and the sentence awarded to him was wholly disproportionate to the offence committed by him.
Disposing of the appeal, and remanding the case to the Summary Court Martial on the question of sentence, this Court HELD 1.
The trial is not vitiated and no prejudice has been caused to the appellant, inasmuch as from the records it is found that the evidence has been duly recorded and, admittedly, the appellant was carrying extra seven bottles of liquor without the necessary permit.
However, there is an element of arbitrariness in awarding severe punishments and, therefore, an interference is called for and the matter has to be remanded on the question of awarding any of the lesser punishments provided in the .
[679E. 683G H] 677 2.1 Section 72 of the provides that the court martial may, on convicting a person subject to the Act, of any offences specified in Sections 34 to 68 inclusive, award either the particular punishment with which the offence is stated in the said sections to be punishable, or, in lieu thereof, any one of the punishments lower in the scale set out in Section 71, regard being had to the nature and degree of offence.
[680C D] 2.2 In the instant case, in the charge sheet it is merely stated that the action of the appellant in carrying 12 bottles of liquor when he was proceeding to home town was against the orders on the subject.
But in the counter affidavit it is stated that such an act of the appellant came within the meaning of Section 63 of the Act.
This Section may cover various types of misconducts committed by way of an act or omission.
It also provides for awarding any other lesser punishment mentioned in the Act.
Therefore, much depends on the nature of the act or omission of which the person is found guilty.
[680B,E] 2.3 Admittedly, the appellant was granted leave when he was proceeding to his home town.
Enroute he had to pass through a place where prohibition was in force.
He had a valid permit to carry 5 bottles of liquor and the extra 7 bottles were purchased from the Army Canteen itself.
Unless he had some permits or chits given by some higher authorities, he could not have purchased these extra bottles from the Canteen.
He was taking this liquor to his home town to celebrate his brother in law 's marriage, but the local Civil Police checked his baggage and confiscated the bottles as he had no valid permit to carry the extra bottles.
[679G H, 680A] 2.4 Assuming that the offence committed by the appellant is covered by the residuary Section 63, but in awarding the punishment, court martial has to keep in view the spirit behind Section 72 and it has to give due regard to the nature and degree of the offence.
Section 63 provides for awarding of any of the lesser punishments enumerated in Section 71.
In view of these provisions of law and having regard to the nature and degree of the offence, the punishments awarded to the appellant, namely, three months ' R.I. and dismissal from service are severe and are also violative of Section 72.
Ends of justice will be sufficiently met if a lesser punishment as provided under Section 71(f) is awarded to the appellant.
[682E F, 684F] 2.5 Accordingly, the punishments are set aside and the matter remanded to the court martial which shall award any of the lesser 678 punishments having due regard to the nature and circumstances of the case.
Any detention suffered by the appellant after the orders of the court martial will not be treated as a disqualification for being rein stated into service.
[648B] Ranjit Thakur vs Union of India and Others, and Bhagat Ram vs State of Himachal Pradesh, [1983] 2 SCC 442, relied on.
Council of Civil Service Unions vs Minister for the Civil Service, [1984]3 AII ER 935, 950, referred to
|
ivil Appeal No. 2272 of 1991.
From the Judgment and Order dated 12.11.1990 of the Allahabad High Court in C.M.W.P. No. 11192 of 1990.
Sunil Gupta and S.Sukumaran for the Appellant.
Dr. Anand Prakash, B.K. Prasad and S.N. Sikka for the Respondents.
698 The Judgment of the Court was delivered by SHARMA, J.
Special Leave is granted.
In response to a notice inviting tenders by the Diesel Locomotive Works.
Indian Railways, in connection with disposal of one lot of Ferrous Scrap, a number of tenders were submitted by the appellant, the respondent No. 1 and other intending purchasers.
The tenders of the respondent No. 1 and some other bidders were rejected as defective and the appellant 's offer being the highest was accepted, and accordingly the appellant deposited a sum of about Rs.15 lacs.
The respondent no .1 challenged the decision by a writ petition before the Allahabad High Court contending that there was no defect in its tender and that the tender of the appellant could not have been validly accepted as the necessary condition of payment of Rs. 50,000 as earnest money with the tender had not been complied with.
The application was resisted on the grounds (i) that the respondent No. 1 having not deposited the earnest money at all was not entitled to a consideration of its tender and has no locus standi in the present matter; and (ii) that the appellant had substantially complied with the requirement by sending with its tender a Banker 's Cheque marked and certified by the Union Bank of India as good for payment.
The High Court accepted the appellant 's first ground, holding that the tender of the respondent had been rightly rejected for failure to deposit the earnest money, but allowed the writ petition on the finding that the appellant also did not satisfy the condition no.6 of the tender notice as the earnest money was offered by the Banker 's Cheque of a bank other than the State Bank of India mentioned in the said clause.
The High Court directed the authorities to consider the other valid tenders and further observed that should the other tenders be found to be unacceptable it would be open to the authorities to invite fresh tenders.
the present appeal is directed against this judgment.
The case of the appellant has been that its tender mentioned the highest amount of one and a half crores rupees for the 2000 M.T. of Ferrous Scrap which was a very fair price, and the authorities were absolutely right in accepting the same.
With respect to the alleged deficiency in the matter of deposit of the earnest amount, the stand is that a Banker 's Cheque is as good as cash and especially so when a verification from the bank in question about its authenticity was made and the Bank 's assurance to honour the same was obtained.
Admittedly, the Tender Committee had taken the precaution of getting the matter confirmed from the appellant 's bank before deciding to accept his tender.
699 4.
The relevant clause 6 of the notice required the tender to be accompanied by earnest money calculated at 5% of the offer under the tender subject to a maximum of Rs 50,000 and in terms permitted the deposit by cash or by demand draft drawn on the State Bank of India.
the defect pointed out by the respondent No. 1 and accepted by the High Court is in the appellant sending the cheque of the Union Bank of India drawn on its own branch and not on the State Bank.
By the impugned judgment it has been held that in view of this defect the authorities had no power to accept the appellant 's tender.
the learned counsel for the appellant has contended that having regard to the circumstances in the case it must be held that the Tender Committee had the power to accept the appellant 's tender.
Referring to the books "Bills of Exchange" by Byles, and "Cheques in Law and Practice" by M.S. Parthasarathy, it has been argued that certified cheques are as good as cash and the irregularity relied upon in the appellant 's submitting his tender could be validly waived by the Diesel Locomotive Works.
Reliance was also placed on M/s B.D. Yadav and M.R. Meshram vs Administrator of the City of Nagpur, and T.V Subhadra Amma vs Kerala Board of Revenue and Others, 6.
It is true that in submitting its tender accompanied by a cheque of the Union Bank of India and not of the State Bank the clause No. 6 of the tender notice was not obeyed literally, but the question is as to whether the said non compliance deprived the Diesel Locomotive Works of the authority to accept the bid.
As a matter of general proposition it cannot be held that an authority inviting tenders is bound to give effect to every term mentioned in the notice in meticulous detail, and is not entitled to waive even a technical irregularity of little or no significance.
The requirements in a tender notice can be classified into two categories those which lay down the essential conditions of eligibility and the others which are merely ancillary or subsidiary with the main object to be achieved by the condition.
In the first case the authority issuing the tender may be required to enforce them rigidly.
In the other cases it must be open to the authority to deviate from and not to insist upon the strict literal compliance of the condition in appropriate cases.
This aspect was examined by this Court in GJ Fernandez vs State of Karnataka 7 Ors.
; , a case dealing with tenders.
Although not in an entirely identical situation as the present one, the observations in the judgment support our view.
The High Court has, in the impugned decision, relied upon Ramana Dayaram Shetty vs International Airport Authority of India & 700 Ors.; , but has failed to appreciate that the reported case belonged to the first category where the strict compliance of the condition could be insisted upon.
The authority in that case, by not insisting upon the requirement in the tender notice which was an essential condition of eligibility, bestowed a favour on one of the bidders, which amounted to illegal discrimination.
The judgment indicates that the Court closely examined the nature of the condition which had been relaxed and its impact before answering the question whether it could have validly condoned the shortcoming in the tender in question.
This part of the judgment demonstrates the difference between the two categories of the conditions discussed above.
However it remains to be seen as to which of the two clauses, the present case belongs.
The nature of payment by a certified cheque was considered by this Court in Sita Ram Jhunjhunwala vs Bombay Bullion Association Ltd. & Anr., Several objections were taken there in support of the plea that the necessary condition in regard to payment was not satisfied and in that context this Court quoted the observations from the judgment in an English decision (vide Spargo 's case: 1873 L.R. & Ch.
407) that it is a general rule of law that in every case where a transaction resolves itself into paying money by A to B and then handing it back again by B to A, if the parties meet together and agree to set one demand against the other, they need not go through the form and ceremony of handing the money backwards and forwards.
This Court applied that the observations to a transaction requiring payment by one to another.
The High Court 's decisions in B.D. Yadav 's case and T.V. Subhadra Amma 's case are also illustrations where literal compliance of every term of the tender notice was not insisted upon.
In the instant case the certified cheque of the Union Bank of India drawn on is own branch must be treated as sufficient for the purpose of achieving the object of the condition and the Tender Committee took the abundant caution by a further verification from the bank.
In this situation it is not correct to hold that the Diesel Locomotive Works had no authority to waive the technical literal compliance of clause 6, specially when it was in its interest of not to reject the said bid which was the highest.
We, therefore, set aside the impugned judgment and dismiss the writ petition of the respondent No. 1 filed before the High Court.
The appeal is accordingly allowed with costs through out.
R.P. Appeal allowed.
| IN-Abs | The Diesel Locomotive Works, Indian Railway, invited tenders for disposal of one lot of Ferrous scrap.
One of the conditions mentioned in the tender notice was that the earnest money should be deposited by cash or by demand draft drawn of the State Bank of India.
The appellant, one of the intending purchasers, submitted his tender accompanied by a cheque of Union Bank of India drawn on its own branch.
The tender of the appellant, being the highest, was accepted and tenders of respondent No. 1 and some others were rejected.
The Tender Committee had verified from Union Bank of India the bona fide of appellant 's cheque and then only decided to accept its tender.
Respondent No. 1 filed writ petition in the High Court challenging the rejection of its tender, and acceptance of appellant 's tender on the ground that the latter did not comply with the necessary condition for payment of earnest money with the tender.
The appellant contended that it had substantially complied with the requirement by sending with its tender a banker 's cheque marked and certified by the Union Bank of India as good for payment.
The High Court opined that respondent 's tender was rightly for failure to deposit the earnest money, but allowed the writ petition holding that the appellant also did not satisfy the condition regarding payment of the earnest money since the cheque sent was from a bank other than the State Bank of India as stipulated, and as such the authorities had no power to accept appellant 's tender.
Aggrieved, the appellant preferred the appeal by special leave to this Court.
Allowing the appeal, this Court 697 HELD: 1.
As a matter of general proposition it cannot be laid down that an authority inviting tenders in bound to give effect to every term mentioned in the notice in meticulous detail, and is not entitled to waive even a technical irregularity of little or no significance.
The requirement in a tender notice can be classified into two categories those which lay down the essential conditions of eligibility, and the other which are merely ancilliary or subsidiary with the main object to be achieved by the condition.
In the first case the authority issuing the tender may be required to enforce them rigidly.
In the other case it must be open to the authority to deviate from and not to insist upon the strict literal compliance of the condition in appropriate case.
[699E G] 2.
In the instant case, in submitting the cheque drawn on the Union Bank of India and not on the State Bank of India, the relevant condition of the tender notice was not obeyed literally; but the said cheque must be treated as sufficient for the purpose of achieving the object of the condition and the Tender Committee took the abundant caution by a further verification from the bank.
In the situation it could not be said that the Diesel Locomotive Works had no authority to waive the technical literal compliance of the clause, regarding manner of payment of earnest money especially when it was in its interest not to reject the said bid which was the highest.
[699D E; 700F G] GJ Fernandez vs State of Karnataka & Ors., ; and Sita Ram Jhunjhunwala vs Bombay bullion Association Ltd. & Anr., , relied on.
Ramana Dayaram Shetty vs International Airport Authority of India & Ors., ; ; Spargo 's Case, ; M/s B.D Yadav and M.R. Meshram vs Administrator of the City of Nagpur, and T.V. Subharda Amma vs Kerala Board of Revenue and Others, , referred to.
|
Special Leave Petition No. 13560 of 1983.
From the Judgment and Order dated 27.6.1983 of the Himachal Pradesh High Court in C. W. P. No. 86 of 1983.
P.P. Rao and H. J. Zaviri for the Petitioner.
V.K. Kanth and C.P. Pandey for the Respondents.
The following Order of the Court was delivered by K. JAYACHANDRA REDDY, J.
The petitioner was directly appointed as an Accountant in the Himachal Pradesh Tourism Development Corporation Ltd. ( 'Corporation ' for short) on 28.8.78 He was on probation in the Transport Wing of the Corporation.
After 704 training he was transferred to the Office of the Area Manager, Simla and was posted as an Accountant.
His conditions of service were governed by the Regulations made by the Board of Directors of the Corporation.
The petitioner detected certain irregularities in the Transport Wing and wrote a letter dated 19.6.1980 to the Transport Officer pointing out the financial irregularities and embezzlements committed by the then Cashier.
The employees ' Union took up the matter and demanded the Management to take necessary action and also made some demands on behalf of the Union.
The petitioner was the General Secretary of the Union.
In April 1980, the respondent No. 2 was posted as the new Managing Director.
According to the petitioner he was annoyed with the petitioner because of his union activities.
It is stated that the petitioner actively participated in highlighting the demands.
On 13.5.1981 an order transferring the petitioner to Dalhousie was passed, even though the petitioner had been earlier granted permission on 23.7.79 to do his 3 years Law course as an evening student.
the petitioner made a representation for cancellation of the transfer on the ground that he was already half way through his legal study and that the transfer was mala fide.
Respondent No. 2 got more annoyed.
The petitioner submitted a study leave application for one year.
But he was granted only 90 days leave in the first instance with full pay and allowances and later on half pay and subsequently without pay he was granted extra ordinary leave.
Meanwhile, a chargesheet was issued on 21st August, 1981 framing certain charges.
The gravamen of the charges is that while working in the Transport Wing of the Corporation the petitioner facilitated and abetted the embezziment of Rs. 100 by notensuring that the amount found was in excess and that he failed to serve the Corporation honestly and faithfully.
The other charge is that he made some fictitious entries in the Cash Book and the fourth charge is that he made certain information public without the permission of the Managing Director.
To this the petitioner submitted a reply stating that all the charges are fake and false.
It is stated that the petitioner 's leave was cancelled and the petitioner challenged the same in the High Court of Himachal Pradesh but the case was adjourned.
Meanwhile the petitioner 's services were terminated with effect from 8th January, 1982 stating that they are no longer required and one month 's pay in lieu of notice would be paid in terms and conditions of his appointment letter and provisions of Staff Regulations of the Corporation.
The petitioner challenged the same before the High Court, but the Writ Petition was dismissed in limine.
In this Court it is urged that the termination is only a camouflage and that though the petitioner was still a temporary servant yet the termination amounted to punishment because of the manner in which it was 705 passed and the background behind it.
It is not in dispute that the Corporation has power to terminate the services by giving one month 's notice or pay in lieu thereof, in the case of a temporary employee who have completed one month 's service.
Regulation 19(3) reads thus: Termination of service by notice "19(3) The Corporation may terminate the services of any employee by giving him: (a) xx xx xx (b) one month 's notice, or pay in lieu thereof, in the case of temporary employees who have completed one months service and one day 's notice or pay in lieu thereof in the case of temporary employees in the first month of their service.
" Regulation 39 prescribes various penalties that can be awarded and termination of service is one of them.
Now the only question that arises for consideration in this case is whether the termination of the petitioner 's services is simply one as per the Regulation 19(3) or in the nature of a camouflage and, therefore, amounts to punishment as contended by the petitioner.
In Anoop Jaiswal vs Government of India & Anr., p[1984] 2 SCR 453, it is held as under: "Where the form of the order is merely a camouflage for an order of dismissal for misconduct it is always open to the Court before which the order is challenged to go behind the form and ascertain the true character of the order.
If the Court holds that the order though in the form is merely a determination of employment is in reality a clock for an order of punishment, the Court would not be debarred, merely because of the form of the order, in giving effect to the rights conferred by law upon the employee.
" In Nepal Singh vs State of U.P. & Ors., [1985] 2 SCR it is held as under: 706 "Where allegations of misconduct are levelled against a Government Servant, and it is a case where the provisions of Article 31(2) of the Constitution should be applied, it is not open to the competent authority to take the view that holding the enquiry contemplated by the clause would be a bother or a nuisance and that therefore it is entitled to avoid the mandate of that provision and resort to the guise of an ex facie innocuous termination order.
The Court will view with great disfavour any attempt to circumvent the constitutional provision of article 311(2) in a case where that provision comes into play." In Jarnail Singh & Ors., etc.
vs State of Punjab & Ors.
, ; it is, held thus: "When an allegation is made by the employee assailing the order of termination as one based on misconduct though conched in innocuous terms, it is incumbent on the court to lift the veil and to see the real circumstances as well as the basis and foundation of the order complained of.
In other words, the Court, in such a case, will lift the veil and will see whether the order was made on the ground of misconduct, inefficiency or not." From the above decisions it can be seen that it is well settled that in a case of an order of termination even that of a temporary employee the Court has to see whether the order was made on the ground of misconduct if such a complaint was made and in that process the Court would examine the real circumstances as well as the basis and foundation of the order complained of and if the Court is satisfied that the termination of services is not so innocuous as claimed to be and if the circumstances further disclose that it is only a camouflage with a view to avoided an enquiry as warranted by Article 311(2) of the Constitution, then such a termination is liable to be quashed.
In the above mentioned decisions, the impugned termination order was accordingly quashed.
It is not in dispute that a regular chargesheet was served on the petitioner, as mentioned above, on 21st August, 1981 and to the said chargesheet a list of documents also was appended on the basis of which the articles of charge were framed.
The petitioner replied to these charges on 7th September, 1981.
Without reference to any of the charges or the reply the order of termination was passed on 8th 707 January, 1982 as already mentioned.
In the counter affidavit at more than one place it is admitted about the framing of the charges etc.
regarding the news item which refers to the information given out by the petitioner.
It is stated in the counter affidavit that services of the petitioner were terminated as a probationer and not on the basis of the enquiry report which came after the services of the petitioner had been terminated.
It can therefore be seen that an enquiry, in fact, was contemplated and was held but the report came into light after termination of the services of the petitioner.
It is also submitted on behalf of the petitioner that the audit report would show many irregularities as pointed out by the petitioner and that the petitioner acted honestly in pointing out the irregularities.
It is not necessary for us to go into this question.
Having gone through the various records and also the admissions made in he counter affidavit, we are satisfied that the termination order, though appears to be innocuous, was only intended to punish the petitioner for the misconduct, in respect of the allegations which are mentioned in the charges that were served on him.
After serving the chargesheet, as a matter of fact, the enquiry was conducted.
But before the conclusion of the enquiry the termination order was passed.
Therefore it is not difficult to see that the form of the termination order is only a cloak for an order of punishment.
In this context, the learned counsel also questioned the termination order from another angle.
In that order it is mentioned that the services of the petitioner are no longer required, therefore they are terminated.
But from the record it is clear that juniors to the petitioner are retained and they are continuing in service.
In the affidavit it is clearly mentioned that juniors whose names are given there are retained in service in violation of Article 14 and 16 of the Constitution.
In the counter affidavit only a vague reply is given simply stating that the averments made by the petitioner are not correct.
In K.C. Joshi vs Union of India and Ors., It is observed that 'If it is discharge simpliciter, it would be violative of Article 16, because a number of store keepers junior to the appellant are shown to have been retained in the service '.
Likewise in Jarnail Singh 's case it was observed as under: "In the instant case, ad hoc services of the appellants have been arbitrarily terminated as no longer required while the respondents have retained other surveyors who are juniors to the appellants.
Therefore, on this ground also, the impugned order of termination of the services of the appellants are illegal and bad being in contravention of the 708 fundamental rights guarantee under Article 14 and 16 of the Constitution of India." After a careful perusal of the record we are satisfied that the juniors to the petitioners are retained.
Therefore on this ground also the termination order is liable to be quashed.
Admittedly the petitioner has been practising as a lawyer ever since his services were terminated.
In the rejoinder filed by him he merely stated that he was not earning much in that profession and that he has incurred debts.
The learned counsel for the Corporation, however, submitted that since the petitioner was admittedly practising as a lawyer the question of granting him back wages is any event does not arise and that even otherwise there cannot be a roving enquiry to the earning he has made as a lawyer at this distance of time.
The petitioner, however, at this juncture filed a further affidavit that his total income from 1985 onwards uptilnow was only Rs.15,550 and that he has not received any other income during all these years.
It is also submitted on his behalf that in similar circumstances this Court awarded back wages even in a case of an employee who practised as a lawyer from the date of dismissal till his reinstatement.
In section M. Saiyad vs Baroda Municipal Corporation, the employee was directed to be reinstated in service by the labour court.
Then ultimately on the question of back wages it was urged before this Court that though the appellant was practising as a lawyer after enrolment during that period still he was entitled for back wages.
This Court accepted this plea and observed as under: "The appellant seeks back wages for the period December 12, 1969 to October 26, 1976.
This period according to the respondent has to be divided in two parts; (1) from December 12, 1969 to Jan. 20, 1972 when the appellant was enrolled as an advocate, and (2) for the period Jan. 21, 1976 to October 26, 1976 from which date he has already been awarded back wages, it was submitted on behalf of the respondent that the appellant himself has admitted that since his being enrolled as an advocate he was earning Rs. 150 per month which aspect must be borne in mind while considering the submission of the appellant for the award of back wages.
" Partly accepting this plea this Court ultimately observed that the appellant therein must have atleast stated earning after a lapse of one 709 year from the date on which he was enrolled as an advocate.
Ultimately this court directed that: "We, accordingly, allow this appeal and set aside the decision of the High Court refusing the back wages for the period December 12, 1969 to October 26, 1976 and directed that the appellant shall be entitled to back wages including salary and allowances and other benefits to which he would be entitled as if the has continued the service.
While making the payment of back wages as per this order the respondent is entitled to deduct the amount of Rs. 150 p.m. from January 20, 1973 to October 26, 1976 from the amount which becomes payable to the appellant.
The respondent must compute the amount payable as herein directed and pay what becomes payable to the appellant within a period of two months from today.
" It can therefore be seen that this Court did not refuse to grant back wages on the simple ground that the employee was a practicing lawyer during the relevant period.
But on the other hand it took into account the probable income and after deducting the same the balance of back wages was directed to be computed.
In the instant case in the affidavit filed by the petitioner it is stated that he was practising as an income tax advocate ever since his enrolment in October, 1982.
But, however, he asserted that he got his first brief in the year 1985.
These averments are contradicted by the other side.
Under these circumstance we cannot make a roving enquiry nor would it be possible for the corporation to unearth the income which the petitioner would have derived as a practising advocate.
There are many imponderables and conjectures too.
Under these circumstances we asked both the counsels to suggest a solution.
We have heard both the sides on this aspect elaborately.
Shri P. P. Rao, learned counsel for the petitioner submitted that if the relevant period is to be treated as one of suspension pending enquiry the petitioner would have been entitled to the subsistence allowance till his reinstatement.
That atleast should be the criteria in granting the back wages in a situation like this.
We think this is a reasonable and fair suggestion.
In the result the termination order is quashed and consequently the petitioner shall be reinstated in service.
However, he shall be entitled to the full back wages upto the date of his enrolment as a 710 lawyer which was in the month of October, 1982.
From the date of his enrolment upto the date of reinstatement he shall be entitled to the back wages at the rate of half of the subsistence allowance per month and the total amount shall be computed on that basis.
Out of that the income of Rs.15,550 admittedly earned by him as a practising lawyer shall be deducted and the balance amount shall be paid to the petitioner.
The amount so paid to him shall for the purpose of income tax, be spread over as if derived during those financial years from the date of his dismissal till the date of reinstatement.
However, we would like to make it clear that it is open to the Corporation to proceed with the disciplinary enquiry if it so chooses.
The special leave petition is accordingly disposed of.
In the circumstances of the case there will be no order as to costs.
N.P.V SLP disposed of.
| IN-Abs | A charge sheet was issued to the petitioner, a directly recruited Accountant in the respondent Corporation alleging that while working in the Transport Wing of the Corporation, he facilitated and abetted the embezzlement of Rs.100 by not ensuring that the amount found was in excess, and thus he failed to serve the Corporation honestly and faithfully, that he made some fictitious entries in the Cash Book and that he made certain information public without the permission of the Managing Director.
The petitioner replied that all the charges were fake and false.
the leave sanctioned to the petitioner earlier for prosecuting legal study was canceled and the petitioner challenged the same in the High Court but the case was adjourned.
Meanwhile, the petitioner 's services were terminated on the ground that he was no longer required and that one month 's pay in lieu of notice would be paid in terms and conditions of his appointment letter and provisions of Staff Regulations of the Corporation.
The petitioner challenged the same before the High Court, but the Writ Petition was dismissed in limine.
702 In the appeal before this Court it was contended that the termination was only a camouflage and that though the petitioner was still a temporary servant, yet the termination amounted to punishment, because of the manner in which it was passed and the background behind it.
It was also contended that though the termination order stated that the petitioner 's services were no longer required, his juniors were retained and were continuing in service, in violation of Articles 14 and 16 of the Constitution.
Disposing of the Special Leave Petition, this Court HELD: 1.1 In a case of an order of termination, even that of a temporary employee, the Court has to see whether the order was made on the ground of misconduct if such a complaint was made and in that process the Court would examine the real circumstances, as well as the basis and foundation of the order complained of and if the Court is satisfied that the termination of services is not so innocuous as claimed to be and if the circumstances further disclose that it is only a camouflage with a view to avoid an enquiry as warranted by Article 311(2) of the Constitution, then such a termination is liable to be quashed.
[706E F] Annop Jaiswal vs Government of India & Anr., ; ; Nepal Singh vs State of U.P. & Ors., ; and Jarnail Singh & Ors.
vs State of Punjab & Ors.
, ; , relied on. 1.2 In the instant case, the termination order, though appears to be innocuous was only intended to punish the petitioner for the misconduct, in respect of the allegations which are mentioned in the charges that were served on him.
As a matter of fact, the enquiry was conducted, but before the conclusion of the enquiry, the termination order was passed.
Therefore, it is not difficult to see that the form of the termination order is only a clock for an order of punishment.
[707C D] 1.3 Besides, the termination is also liable to be quashed on the ground that it is violative of Articles 14 and 16 of the Constitution, as it is clear from the records that while the petitioner 's juniors are retained in service, the petitioner 's services are terminated as no longer required.
[708F, 709A B] Jarnail Singh & Ors.
vs State of Punjab & Ors., [1986]2 SCR 1022 and K.C. Joshi vs Union of India and Ors., [1985]3 SCR 869, relied on.
703 1.4 In the circumstances, the termination order is quashed and the petitioner is directed to be reinstated in service.
However, it shall be open to the respondent Corporation to proceed with the disciplinary enquiry if it so chooses.
[709H] 1.5 As regards the backwages, admittedly the petitioner has been practising as a lawyer since his termination.
But this Court has not refused to grant background that the employee has been practicing as lawyer during the relevant period, but has taken into consideration the probable income that would have been earned him, while granting backwages.
However, a roving enquiry cannot be made by this Court nor would it be possible for the respondent Corporation to unearth the income which the petitioner would have derived as practising advocate.
Undoubtedly, the petitioner would have been entitled to subsistence allowance till his reinstatement, even if the relevant period is treated as one of suspension pending enquiry.
Therefore, the petitioner shall be entitled to the full back wages upto the date of his enrollment as a lawyer and from that date upto the date of reinstatement at the rate of half of the subsistence allowance per month.
Out of the total income, the income admittedly earned by him as a practising lawyer shall be deducted and the balance paid to the petitioner.
The amount so paid shall, for the purpose of income tax, be spread over as if derived during those financial years from the date of his dismissal till date of reinstatement.
[708B, 709D G, 710A B] S.M. Saiyad vs Baroda Municipal Corporation, relied on.
|
N: Criminal Appeal No. 194 of 1979.
From the Judgment and Order dated 4.7.1978 of the Andhra Pradesh High Court in Crl.
A. No. 576 of 1977.
K. Madhava Reddy, and G. Narasimhulu for the Appellants.
B. Parthasarthi for the Respondent.
The Judgment of the Court was delivered by FATHIMA BEEVI, J.
The appellants are Bollavaram Pedda Narsi Reddy (A 1), Bollavaram Chinna Narsi Reddy (A 2), Kavalakuntla Rama Subba Reddy (A 3), Duddula Venkata Subba Reddy (A 5) and Mala Prakasam (A 6) before this Court.
These appellants along with accused No. 4 Duddela Ramana Reddy, were tried for the 726 murder of one Chandrasekhara Reddy on the night of August 15, 1974.
The trial court acquitted all the accused.
On appeal by the State, the High Court convicted these appellants under sections 302 read with 149, I.P.C., and sentenced them to undergo imprisonment for life and also imposed short term imprisonment for minor offence to run concurrently.
Chandrasekhara Reddy, the deceased, and the accused were residents of village Jeereddy Kotharpallai.
In 1970, Accused No. 3 was elected as a Sarpanch of the village with active support of the deceased.
However, differences arose between them as they supported rival groups in the election in the neighbouring village.
10 days before the incident, the deceased is stated to have openly declared that he would get Accused 3 removed by moving a no confidence motion.
This according to the prosecution is the motive for the crime.
On the date of occurrence, Chandrasekhara Reddy met PW 1 (Guddeti Balaveera Reddy) and PW 2 (Donthireddi Subba Reddy) in the hotel of Subbamma (PW 8) in the neighbouring village Proddatur.
The deceased along with the two witnesses attended a cinema show at Anwar Talkies.
They came out of the theatre 10 minutes earlier around 9.30 P.M. and were walking along the road towards the bus stand.
When they reached near the old telephone exchange about 50 metres away from Anwar Talkies, there was an explosion of crackers.
The accused persons suddenly surrounded the deceased.
They were armed with daggers.
They attacked him after one of them pushing aside PW 1.
PW 1 fell on the barbed wire fence of the transformer and received scratches on his thigh.
The deceased was stabbed indiscriminately and simultaneously by all the assailants who retreated in two different directions and the deceased died on the spot instantaneously.
Besides PWs 1 and 2, who witnessed the occurrence, PW 3 Donthireddi Narayana Reddy, and PW 4 Poreddi Subba Reddy.
had also seen the attack.
These witnesses were passing along the road.
PW 5, Mekkamalla Balireddi, reached the scene attracted by the crowd and had seen the accused persons running away.
The street light besides the electric light at a petrol bunk and the light in the bunk on the side of the road were burning at the time of the occurrence.
The assailants had been identified by the witnesses in that light.
The assailants were strangers to the PWs 1 and 2 but A 2, 3 and 5 were known to PWs 3 and 4 and 5 who had also acquaintance with the deceased PW 5 informed PW 7 (Polagiri Siva Reddy), the brother of the deceased, about the occurrence, while PWs 3 and 4 left the place after seeing the deceased lying at the scene.
This in short is the prosecution case.
727 The Town Police Station is situated about two furlongs away from the place of occurrence.
PW 1 along with PW 2 went to the police station and lodged the first information report.
A crime ws registered against six unidentified persons.
PW 16 (Sri section Khasim Sab, Sub Inspector of Police), recorded the statement exhibit P 1.
The Circle Inspector visited the scene.
PW 2 was referred to the Medical Officer at 4 A.M.
The inquest on the dead body was held on the next morning.
The post mortem examination revealed that deceased had sustained 54 injuries all except one being incised wounds.
At the time of the inquest, the statements of PWs 2 and 7 were recorded.
PW 7 suspected the involvement of Accused 2, 3 and 5.
On 17.8.1974, the police dogs were pressed into service.
It is stated that the sniffer went to the village of the deceased and thereafter to the houses of Accused 2 and 3.
Statements of PWs 3, 4 and 5 were recorded on 18.8.1974.
Accused No. 6 was arrested on 25.9.1974.
A test identification parade was conducted by PW 9 (Sri G.V. Raghavaiah, Judicial Second Class Magistrate) on 31.10.1974.
A 6 was identified by PWs 1, 2, 3 and 4 at the parade as recorded in exhibit P 2 proceeding.
The other accused persons were arrested on 1.11.1974.
PW 10 (Sri D. Sreeramulu, Judicial Second Class Magistrate), conducted the test identification parade in which as per exhibit P 3 proceeding, PWs 1,and 2 identified accused 1, 2, 3 and 5.
The investigation was completed and the charge was laid against the six persons.
The learned sessions judge analysed the prosecution evidence meticulously and discarded the testimony of PWs 1 to 5.
He considered PWs 3, 4 and 5 as chance witnesses, found their conduct in not disclosing the involvement of the accused persons known to them until their statements were recorded on 18.8.1974 as suspicious and strange when they had acquaintance with the deceased.
PWs 3 and 4 when examined by PWs 9 and 10 for the purpose of test identification parade had given statement which vary with their earlier statement and their evidence before court was contradictory to their prior statements.
It was, doubtful whether they could have seen the occurrence or identified any of the assailants.
Their evidence was, therefore, rejected as untrustworthy.
The testimony of the two eye witnesses PWs 1 and 2 who claimed that they were in the company of the deceased at the time of the occurrence was also not accepted by the trial court for various reasons.
They were strangers to the accused persons.
Their evidence regarding the identification of the assailants as the accused did not impress the trial court which pointed out that the prosecution had no consistent case regarding the source of light at the scene that these witnesses even if present at the scene when the assailants mounted the 728 attack on the deceased could not have remained there to observe and memorize the features of the assailants and identify them after a long lapse of time.
PW 1 rushed to the police station in utter confusion even without his dhoti.
The witnesses were frightened and ran away.
In this situation in the meagre light available, they could not have identified the assailants as the accused.
The learned judge on a consideration of the medical evidence was also of the view that the occurrence could not have happened at the time mentioned by these witnesses and, said there were several suspicious features which render their version doubtful.
The learned judge also pointed out that the identification parade was perfunctory and was of no assistance to the prosecution.
The learned sessions judge analysed the entire evidence and considered it unsafe to accept the testimony of the two witnesses to record a conviction.
In that view of the matter, he acquitted all the accused persons.
The High Court considered the reasoning as perverse and on a reappraisal of the evidence, took a contrary view.
In the opinion of the High Court, PWs 1 to 4 are truthful witnesses and their evidence could be accepted.
In its view, there was no serious infirmity in the prosecution evidence.
Accordingly, the High Court accepted the testimony of PWs 1 and 2, corroborated by the evidence of test identification parade and the testimony of PWs 3 and 4 to find the appellants guilty.
Since accused No.4 was not identified by PWs 1 to 4, he was given the benefit of doubt and his acquittal was confirmed.
The learned counsel for the appellants has taken us through the entire evidence in the case.
The appeal is one under Section 2 of the .
It is, no doubt, open to this Court to re examine the evidence for the purpose of satisfying itself whether the High Court was justified in reversing the order of acquittal in the facts and circumstances of the case.
It is well settled proposition of law that in an appeal against acquittal, the Appellate Court is empowered to evaluate the evidence and arrive at its own conclusion.
It is equally settled law that where the view taken by the trial court or an appreciation of the evidence is also a plausible view, the Appellate Court shall be slow to interfere with it even when a different view is possible on a reappraisal of the evidence.
The learned counsel for the appellants pointed out that the High Court in reversing the order of acquittal in this case had departed from these established principles and had thus erred grievously in convicting the appellants.
It was submitted that the conviction recorded by the High Court essentially rests on the testimony of PWs 1 and 2.
When the 729 serious infirmities in the evidence of the other two eye witnesses PWs 3 and 4 had been brought to the notice of the High Court, it has eschewed that evidence and has placed reliance only on the testimony of PWs 1 and 2 in arriving at the conclusion that the appellants are guilty of the offence.
The appellants ' learned counsel, therefore, contended that if the view taken by the trial court on the testimony of PWs 1 and 2 cannot be characterised as perverse or wholly unreasonable, there is no justification for the High Court to accept that evidence as the basis of a conviction even if in its opinion the evidence of these two witnesses could have been relied on.
The main plank of the argument of the learned counsel is that the witnesses being strangers to the assailants when there are circumstances to show that they did not have the opportunity to identify the assailants, their evidence involving these appellants is not free from doubt and, therefore the trial court had taken the reasonable view that it is unsafe for the court to accept that evidence to convict the accused persons.
We see considerable force in the contention of the learned counsel for the appellants.
The evidence given by the witnesses before the court is the substantive evidence.
In a case where the witness is a stranger to the accused and he identifies the accused person before the court for the first time, the court will not ordinarily accept that identification as conclusive.
It is to lend assurance to the testimony of the witnesses that evidence in the form of an earlier identification is tendered.
If the accused persons are got identified by the witness soon after their arrest and such identification does not suffer from any infirmity that circumstance lends corroboration to the evidence given by the witness before the court.
But in a case where the evidence before the court is itself shaky, the identification before the magistrate would be of no assistance to the prosecution In the present case, the appellants are admittedly persons with whom the two witnesses had no previous acquaintance.
The occurrence happened on a dark night.
When the crime was committed during the hours of darkness and the assailants are utter strangers to the witnesses, the identification of the accused persons assumes great importance.
The prevailing light is a matter of crucial significance.
The necessity to have the suspects identified by the witnesses soonafter their arrest also arises.
According to the prosecution, the attack on the deceased was sudden and simultaneous and the assailants slipped away in no time.
Both PWs 1 and 2 had deposed that they were attracted by the explosion and when they turned back, the assailants surrounded the deceased and inflicted the stab injuries.
PW 1 was pushed aside.
730 He fell on the fence of the barbed wire of the transformer, received scratches.
His dhoti stuck to the wire.
He left it there and ran to the police station in utter confusion.
His P 1 does not disclose that PW 2 accompanied him, though PWs 1 and 2 stated before court that they went together.
The possibility of the companions of the deceased having been scattered and gone in different directions cannot be ruled out.
Even in Ex.
P 1 statement what PW 1 said is that six persons attacked the deceased; they were villagers; they were wearing dhoti and kurta.
One was about 45 years of age and of dark complexion, another was 30 years of age lean and yet another was also a lean person.
These may be the vague impression the witness had on seeing the assailants suddenly.
It is not however in evidence that the description given by PW 1 in exhibit p 1 fits in with the description of any one of the appellants.
When the magistrates recorded the statements of the witnesses, they could not give any characteristic feature of any one of the assailants.
The entire case depends on the identification of the appellants and the identification is founded solely on the test identification parades.
Therefore, in the absence of cogent evidence that PWs 1 and 2 by reason of the visibility of the light at the place of occurrence and proximity to the assailants had a clear vision of the action of each one of the accused persons in order that their features could get impressed in their mind to enable them to recollect the same and identify the assailants even after a long lapse of time, it would be hazardous to draw the inference that the appellants are the real assailants.
There is no whisper in exhibit P 1 that there was some source of light at the scene.
The omission cannot be ignored as insignificant.
When the Investigating Officer has visited the scene, he made reference to the street lights, petrol bunk light etc.
Whether the street lights and the petrol bunk/ light had been burning at the time of the occurence and the spot where the incidence happened was so located as to receive the light emanating from these sources are required to be made out by the prosecution.
When this significant fact is left out in the earliest record, the improvement in the course of the investigation and trial could be of no avail.
The fact that there had been no proof regarding the identity of the assailants until 18.8.1974 would suggest that even persons who collected at the scene in the course of the incidence or soon thereafter were not in a position to identify any one of the assailants.
Since the Investigating Officer arrived at the scene the same night and the inquest ws held in the next morning, it would have been possible for the investigating agency to collect information regarding the identity of the assailants earlier to 18.8.1974, if they had been really identified by any one of the witnesses examined in the case.
When no natural 731 light was available and the street light was at a distance it is unlikely that the eye witnesses by momentary glance of the assailants who surrounded the victim had a lasting impression and the chance of identifying the assailants without mistake.
The credibility of the evidence relating to the identification depends largely on the opportunity the witness had to observe the assailants when the crime was committed and memorize the impression.
This aspect of the matter had been stressed by the trial court in appreciating the evidence of PWs 1 and 2.
The High Court has ignored the inherent infirmity and failed to deal effectively with every important circumstance in the evidence which weighed with the trial court to disbelieve the prosecution case.
We have noticed that the magistrates in conducting the test identification parade have committed a grave error.
In the case of Accused No.6 PW 9 had mixed up along with PWs 1 and 2 a person, Gulati who knew the accused.
Similarly, in the identification of the other accused, PW 4 who claimed acquaintance with Accused Nos.2, 3 and 5 was mixed up with PWs 1 and 2.
When persons who have already known the accused persons to be identified are mixed up with the witnesses, the test identification is clearly vitiated and is futile.
Value of identification parade depends on the effectiveness and the precautions taken against the identifying witness having and opportunity of seeing the persons to be identified before they are paraded with others and also against the identifying witness being provided by the investigating authority with other unfair aid or assistance so as to facilitate the identification of the accused concerned.
Therefore, the evidence of the earlier identification in this case is unacceptable.
The testimony of PWs 1 and 2 before court is also unsafe to be acted upon.
Thus we do not consider that the view taken by the learned sessions judge on the whole was erroneous.
The overall view of the evidence taken by the learned sessions judge is reasonable and plausible, while it is true that some of the reasons given if taken individually do not appear to be substantial.
Even when two evenly balanced views of the evidence are possible one must necessarily concede the existence of a reasonable doubt.
Thus on a careful and anxious consideration of the evidence in the light of the reasoning adopted by the trial court as well as the High Court, we are of the opinion that the High Court was not justified in interfering with the order of acquittal when the identity and involvement of the appellants had not been established beyond reasonable doubt.
We accordingly allow the appeal, set aside the conviction and sentence and maintain the order of acquittal.
The bail bonds of the appellants shall stand cancelled.
TNA Appeal allowed 731 light was available and the street light was distance it is unlikely that the eye witnesses by monetary glance of the assailants who surrounded the victim had a lasting impression and the chance of identifying the assailants without mistake.
The credibility of the evidence relating to the identification depends largely on the opportunity the witness had to observe the assailants when the crime was committed and memorize the impression.
This aspect of the matter had been stressed by the trial court in appreciating the evidence of PWs 1 and 2.
The High Court has ignored the inherent infirmity and failed to deal effectively with the important circumstance in the evidence which weighted with the trial court to disbelieve the prosecution case.
We have noticed that the magistrates in conducting the test identification parade have committed a grave error.
In the case of Accused No. 6 PW 9 had mixed up along with PWs 1 and 2 a person, Gulati who knew the accused.
Similarly, in the identification of the other accused, PW 4 who claimed acquaintance with Accused Nos. 2, 3 and 5 was mixed up with PWs 1 and 2.
When persons who have already known the accused persons to be identified are mixed up with the witnesses, the test identification is clearly vitiated and is futile.
Value of identification parade depends on the the effectiveness and the precautions taken against the identifying witness having an opportunity of seeing the persons to be identified before they are paraded with others and also against the identifying witness being provided by the investigating authority with other unfair aid or assistance so as to facilitate the identification of the accused concerned.
Therefore, the evidence of the earlier identification in this case is unacceptable.
The testimony of PWs 1 and 2 before court is also unsafe to be acted upon.
Thus we do not consider that the view taken by the learned sessions judge on the whole was erroneous.
The overall view of the evidence taken by the learned sessions judge is reasonable and plausible, while it is true that some of the reasons given if taken individually do not appear to be substantial.
Even when two evenly balanced views of the evidence are possible one must necessarily concede the existence of a reasonable doubt.
Thus on a careful and anxious consideration of the evidence in the light of the reasoning adopted by the trial court as well as the High Court, we are of the opinion that the High Court was not justified in interfering with the order of acquittal when the identity and involvement of the appellants had not been established beyond reasonable doubt.
We accordingly allow the appeal, set aside the conviction and sentence and maintain the order or acquittal.
The bail bonds of the appellants shall stand cancelled.
TNA Appeal allowed.
| IN-Abs | The appellants (A 1 to A 3 and A 5 6), along with Co accused (A 4), were prosecuted under sections 302/149 of the Indian Penal Code.
Test identification parades were conducted by the Magistrates in which A 6 was identified by PWs 1, 2, 3 and 4 and A 1, 2,3,and 5 were identified by PWs 1 and 2.
The trial court held that the identification parade was perfunctory and was of no assistance to the prosecution.
It also rejected the testimony of PWs 1 to 5 by holding that the evidence of PWs 3, 4, and 5 was untrust worthy and that it was unsafe to accept the testimony of other two eye witnesses, PWs 1 and 2 for recording a conviction.
Accordingly the trial court acquitted all the accused persons.
Against the order of acquittal, the State preferred an appeal before the High Court.
The High Court accepted the testimony of PWs 1 and 2, corroborated by the evidence of test identification parade and the testimony of PWs 3 and 4 to find the appellants guilty.
Accordingly the High Court reversed the order of acquittal and convicted the appellants.
Since A 4 was not identified by the PWs 1 to 4, he was given the benefit of doubt and the High Court confirmed his acquittal.
724 In appeal to this court under section 2 of the , it was contended on behalf of the appellants that PWs (1 and 2) were strangers to the assailants and in the circumstances of the case they did not have the opportunity to identify the assailants and consequently their testimony was not free from doubt; the trial court was right in rejecting the testimony of these witnesses but the High Court erred in reversing the order of acquittal and convicting the appellants by accepting the testimony of these witnesses.
Allowing the appeal and setting aside the order of conviction and sentence, this Court, HELD: 1.It is open to Supreme Court to re examine the evidence for the purpose of satisfying itself whether the High Court was justified in reversing the order of acquittal in the facts and circumstances of the case.
In an appeal against acquittal, the Appellate Court is empowered to evaluate the evidence and arrive at its own conclusion.
But where the view taken by the trial court on an appreciation of the evidence is also a plausible view, the Appellate Court shall be slow to interfere with it even when a different view is possible on a reappraisal of the evidence.
[728F G] 1.1 Even when two evenly balanced views of the evidence are possible one must necessarily concede the existence of a reasonable doubt.
[731F] 2.The evidence given by the witnesses before the Court is the substantive evidence.
In a case where the witness is a stranger to the accused and he identifies the accused person before the court for the first time, the court will not ordinarily accept that identification as conclusive.
It is to lend assurance to the testimony of the witnesses that evidence in the form of an earlier identification is tendered.
If the accused persons are got identified by the witness soon after their arrest and such identification does not suffer from any infirmity that circumstance lends corroboration to the evidence give by the witness before the Court.
But in a case where the evidence before the court is itself shaky, the identification before the magistrate would be of no assistance to the prosecution.
[729D E] 2.1 The credibility of the evidence relating to the identification depends largely on the opportunity the witness had to observe the assailants when the crime was committed and memorize the impression.
725 In the instant case at the scene of the crime when no natural light was available and the street light was at a distance it is unlikely that the eye witnesses by momentary glance of the assailants who surrounded the victim had a lasting impression and the chance of identifying the assailants without mistake.
Therefore the testimony of PWs 1 and 2 is unsafe to be acted upon.
The overall view of the evidence taken by the Trial Court is reasonable and plausible.
The High Court was not justified in interfering with the order of acquittal when the identity and involvement of the appellant was not established beyond reasonable doubt.[731A B, E F G, 730H] 3.
Value of identification parade depends on the effectiveness and the precautions taken against the identifying witness having an opportunity of seeing the persons to be identified before they are paraded with others and also against the identifying witness being provided by the investigating authority with other unfair aid or assistance so as to facilitate the identification of the accused concerned.
When persons who have already known the accused persons to be identified are mixed up with the witnesses the test identification is clearly vitiated and is futile.
In the instant case the magistrates in conducting the test identification parade have committed a grave error because in the case of Accused No. 6 he had mixed up along with PWs 1 and 2 a person known to the accused.
Similarly, in the identification of the other accused, PW 4 who claimed acquitance with Accused Nos. 2, 3 and 5 was mixed up with PWs 1 and 2.
[731C E]
|
ivil Appeal Nos.
2567 70 of 1985.
From the Judgment and Order dated 3.4.1985 of the Hyderabad High Court in Writ Petition No. 9403 of 1984.
Kapil Sibal, Additional Solicitor General, G.L. Sanghi, Anil B. Diwan, G. Ramaswamy, P.A. Choudhary, Kailash Vasudev, Naunit Lal, M.J. Paul, C.S. Vaidyanathan, U.K. Khaitan, Praveen Kumar, section Murlidhar, Vineet Kumar, Vinod Bhagat and Mukul Mudgal for the Appellants.
Shanti Bhushan, V.R. Reddy, Rajendra Choudhary, section Thananjayan, K. Ram Kumar for the Respondents.
V.B. Sharya for the Intervenor.
The Judgement of the Court was delivered by VERMA, J.
These appeals by special leave are by several industrial concerns against the Andhra Pradesh State Electricity Board (hereinafter called 'the Board ') challenging the common judgment of the Andhra Pradesh High Court in writ petitions filed by these concerns challenging the revision of the electricity tariffs by the Board by its proceedings contained in B.P. Ms. No. 1014 (Commercial) dated 649 13.12.1983 which came in to force on 15.1.1984.
Prior to this revision, the tariffs were governed by B.P. Ms. No. 418 (Commercial) dated 12.1.1981.
On 13.12.1983, two separate orders were issued by the Board revising the various tariffs.
By one of them, namely, B.P. Ms. No. 1014, the tariffs for various categories of consumers including H.T. categories I and II were revised.
By the other order of the same date, namely, Memo No. DE/COML/IV/2250/83/I, the tariffs for highly power intensive industries were also revised upwards.
Out of the appellants it was applicable to five units, namely, (1) Nav Bharat Ferro Alloys Ltd., (2) Andhra Sugars Ltd., (3) Ferro Alloys Corporation Ltd., (4) Grindwell Norton Ltd., and (5) A.P. Carbides Ltd. This upward revision of tariffs made by the Board by its two orders dated 13.12.1983 which were made effective from 15.1.1984, was challenged by the appellants in writ petitions filed in the Andhra Pradesh High Court on various grounds.
The High court rejected all the grounds and dismissed the writ petitions by its common judgment now reported in A.I.R. 1985 A.P. 299.
These appeals by special leave are against the High Court Judgment.
The appellants are all H.T. power consumers of one category or other.
The tariffs consist of three parts: Part A, Part B and Part C. Part A provides for H.T. tariffs; Part B for L.T. supply; and Part C provides, inter alia, for miscellaneous and general charges.
H.T. consumers in Part A are broadly classified into three categories: H. T. Category I (Industrial); H.T. Category II (Non Industrial); and H.T. Category III comprising of power intensive consumers and some others.
The Board retained the power to decide in accordance with the guidelines as to which industries were power intensive and which were not.
This was the position in the tariffs of 1975.
Subsequently, the Board began to deal with the power intensive industries by notifying tariffs for them separately from time to time.
In effect, there were four classes of consumers availing H.T. supply; (1) H.T. consumers falling under H.T. Category I (Industrial); (2) H.T. consumers falling under H.T. Category II (Non Industrial); (3) H.T. consumers falling under the category 'power intensive industries '; and (4) H.T. consumers availing supply of electricity for irrigation and agricultural purposes included in Part B.
The tariffs for these different categories of H.T. consumers were enhanced from time to time.
For H.T. Category I (Industrial), it was 21 paise in 1975, increased to 30 paise in 1979, 33 paise in 1980, 40 paise in 1981 and 48 paise in 1984.
Likewise, there was corresponding increase in the energy rates for H.T. Category II (Non Industrial), being 28 paise, 37 paise, 40 paise, 47 paise and 56 paise.
The tariffs for power intensive industries were, however, 650 increased by separate notifications issued by the Board from time to time.
It was 11 paise prior to 1975, raised to 12.2 paise in 1977, 16 paise in 1978, 18.5 paise in September 1979, 21 paise in November 1979, 25 paise in 1980, 32 paise in 1981 and 45 paise in 1984.
The H.T. consumers grouped in Part B were required to pay 15 paise under the 1975 tariffs and 16 paise thereafter.
Besides the energy charges as stated above, the H.T. consumers were also required to pay at different rates effective from 1.9.1982 an additional charge levied as 'fuel cost adjustment charges '.
The H.T. consumers were also required to pay some amount as 'voltage surcharge ' in accordance with the terms of the agreement entered into by the individual consumers with the Board.
The comparison of the aforesaid tariffs shows that the tariffs for power intensive industries to begin with were much less than the tariffs for H.T. Category I (Industrial) and H.T. Category II (Non Industrial).
In course of time, the concession in tariffs for the power intensive industries was progressively withdrawn.
The concessions were, however, continued in respect of consumers availing H.T. or L.T. supply for purposes of irrigation and agriculture or L.T. supply for domestic, cottage industries, public lighting and small poultry farming units.
It is the admitted position that the power generation in the State of Andhra Pradesh is both hydro and thermal, each source contributing almost equally to the total power generation in the State.
The H.T. categories have been consuming more than one half of the total power generated in the State against the much larger number of individual L.T. consumers availing the remaining power.
The main attacks to the upward revision of the tariffs for H.T. consumers in the writ petitions before the High Court were: (1) The Board, as a public utility undertaking, is expected to function in the most efficient and economical manner; (2) It cannot plan its activities with a view to drive any sizeable profits on its undertaking except in accordance with Section 59 of the (hereinafter referred to as 'the Supply Act '); (3) The Board Could not generate a surplus in excess of that specified under Section 59 of the Supply Act which it had been doing; (4) The Board was preparing its financial statement incorrectly in a manner contray to section 59 of the Supply Act by improperly taking into account expenses chargeable to capital by showing such expenses as charged to revenues; (5) The steep upward revision to tariffs from 1980 made by the Board is invalid, being arbitrary and in contravention of Section 49 and 59 of the Supply Act; and (6) There was no justification for the Board to have revised the tariffs either in 1981 or in 1984 or to have levied any 651 fuel surcharge in terms of Section 49 and 59 of the Supply Act.
It was also contended that the tariffs revision was made without prior consultation with the State Electricity Consultative Council as required by Section 16(5) of the Supply Act which also rendered it invalid.
Prior to 30.7.1982, it was usual for the Board to take into account various escalation charges such as pay revisions and increases in the cost of fuel and revise its tariffs from time to time.
This was done in 1975 and 1981.
Thereafter, the Board took the view that to avoid making frequent tariff revisions necessitated by frequent escalations in the cost of fuels like coal and diesel oil, the formula known as "fuel cost adjustment" be evolved.
Accordingly, the Board in its proceedings contained in B.P. Ms. No. 589 dated 30.7.1982, set out the formula known as "fuel cost adjustment".
This formula was introduced as condition No. 11 in H.T. tariffs Part A.
Ever since September 1982, all categories of H.T. consumers in Part A including the power intensive consumers are subject to this condition.
Immediately after 30.7.1982, the fuel cost adjustment was fixed as 2.74 paise per unit, which was increased gradually to 2.95 paise, 3.79 paise and 11.68 paise.
Thereafter, 3.79 paise was absorbed as part of the tariffs applicable to these H.T. consumers and the remaining increase of 7.89 paise alone was indicated as the fuel cost adjustment charges.
The grievance made by all H.T. consumers before the High Court was that: (1) the fuel cost adjustment could not be recovered as part of the tariffs; (2) there is discrimination in recovering the entire fuel cost adjustment from H.T. consumers alone; (3) fairness demands that a reasonable proportion of the burden should be shared also by Part B consumers; and (4) that fuel cost adjustment charge is excessively computed.
The High Court rejected all these contentions.
It held that this was a matter of policy which could be changed from time to time and it was permissible to gradually withdraw the pre existing concessional tariffs given to the power intensive industries for which the tariffs earlier were much lower as compared to the other consumers and even after the increase , they were not excessive.
It was held that electricity was a raw material for power intensive industries and no grievance could be made against the increase of its cost just as such a grievance was untenable against increase in the cost of any other raw material.
The challenge on the ground of discrimination was rejected on the ground that H.T. consumers including power intensive industries formed a separate class and the reason which justified grant of concession to them earlier also justified the gradual withdrawal of that 652 concession.
It held that prior consultation with the State Electricity Consultative Council according to Section 16(5) of the Supply Act was not obligatory before revising the tariffs.
The High Court held that the Board was justified in adjusting its tariffs to ensure progressive minimizing of losses and the failure of the State Government to specify the surplus it could generate in accordance with Section 59 of the Supply Act, did not detract from the Board 's power to adjust its tariffs and generate a surplus on principles of commercial expediency applicable to a public utility undertaking.
Fixation of tariffs was held to be a matter of major policy in respect of which the Government can effectively issue directions under Section 78 A of the Act.
It was held that the H.T. consumers including power intensive industries were bound to pay according to the revised higher tariffs fixed from time to time under the agreement as contemplated by Section 49 of the Supply Act.
The condition of fuel cost adjustment, introduced as condition No. 11 in H.T. tariffs Part A, was held applicable to power intensive consumers also.
An additional argument that this added burden became unbearable for the power intensive consumers was rejected on the ground that such inability of the industry to survive is not a compelling consideration for deciding the Board 's power in adjusting it tariffs.
Accordingly, the High Court dismissed the writ petitions and upheld the revision of tariffs made by the Board by the impugned B.P. Ms. No. 1014 (Commercial) dated 13.12.1983 w.e.f. 15.1.1984.
The High Court having refused to grant a certificate of fitness to appeal to this Court, the appellants have preferred these appeals by special leave.
It may be mentioned at this stage that the controversy raised in these appeals was also the controversy in another bunch of civil appeals arising out of a judgment of the Kerala High Court wherein a similar challenge had been upheld and the Kerala State Electricity Board had come in an appeal to this Court.
In those matters, the contention of the Kerala State Electricity Board which would be the same as that of the Andhra Pradesh State Electricity Board before us, was accepted and the judgment of the Kerala High Court taking the view contrary to that of the Andhra Pradesh High Court was reversed (Kerala State Electricity Board vs M/s. S.N. Govinda Prabhu and Bros. and Others.
, [1986] 4 S.C.C. 198.) All the hearing before us, it was contended by Shri Shanti Bhushan, learned counsel for the Andhra Pradesh State Electricity Board that the Kerala decision concludes these points against the present appellants.
On the other hand, Shri G. Ramaswamy and other learned counsel, appearing for the appellants, made an attempt to 653 distinguish the decision in the Kerala case.
The question, therefore, is: Whether any ground has been made out by the present appellants to persuade us to take a view different from the one taken by this Court in the Kerala case? Before considering the arguments in these appeals, we would refer to the controversies in the Kerala case and the view taken therein.
The decision in Kerala State Electricity Board vs M/s. Govinda Prabhu and Bros. and Others, ; arose out of the decision of the Kerala High Court in a similar situation.
The Kerala High Court struck down the upward revision of tariffs made by the Kerala State Electricity Board unlike the Andhra Pradesh High Court which has upheld the upward revision of tariffs in the present appeals.
The main question in the Kerala case also related to the extent of authority of the Kerala Board to increase the electricity tariffs under the .
The principal ground of challenge which was accepted by the Kerala High Court was that the Kerala State Electricity Board acted outside its statutory authority by formulating a price structure intended to yield substantial revenue to offset not merely the expenditure properly chargeable to the revenue account for the year as contemplated by Section 59 of the Supply Act but also expenditure not so properly chargeable.
The Kerala High Court had held that in the absence of a specification by the Government, the Board was not entitled to generate a surplus at all and it acted entirely outside its authority in generating a surplus to be adjusted against items of expenditure not authorised to be met from revenue receipts.
this view of the Kerala High Court was based primarily on the construction made of section 59 of the .
Accordingly, the Kerala High Court struck down the upward revision of tariffs made by the Kerala State .
Accordingly, the Kerala High Court struck down the upward revision of tariffs made by the Kerala State Electricity Board in the years 1980, 1982 and 1984.
It may here be mentioned that Section 59 of the Supply Act, as it stood prior to 1978, was amended by Act No. 23 of 1978 and thereafter, by Act No. 16 of 1983, which came into effect from April 1, 1985 only.
The Kerala case also was decided on the basis of Section 59 as it stood amended by the 1978 (Amendment) Act, prior to its amendment w.e.f.
April 1, 1985 by Act No. 16 of 1983.
For our purposes also, Section 59 as it stood amended by the 1978 Act, prior to the 1983 amendment, is relevant.
This Court expressly rejected the submission which had found favour with the Kerala High Court that in the absence of a specification by the State Government, the position would be as it was before the 1978 amendment, that is, the Board was to carry on its affairs and 654 adjust the tariffs in such a manner as not to incur a loss and no more.
While rejecting the submission, this Court held as under: "We are of the view that the failure of the government to specify the surplus which may be generated by the Board cannot prevent the Board from generating a surplus after meeting the expenses required to be met.
Perhaps, the quantum of surplus may not exceed that a prudent public service undertaking may be expected to generate without sacrificing the interests it is expected to serve and without being obsessed by the pure profit motive of the private entrepreneur.
The Board may not allow its character as a public utility undertaking to be changed into that of a profit motivated private trading or manufacturing house.
Neither the tariffs nor the resulting surplus may reach such heights as to lead to the inevitable conclusion that the Board has shed its public utility character.
When that happens the court may strike down the revision of tariffs as plainly arbitrary.
But not until then.
Not, merely because a surplus has been generated, a surplus which can by no means be said to be extravagant.
The court will then refrain from touching the tariffs.
After all, as has been said by this Court often enough 'price fixation ' is neither the forte nor the function of the court.
" Further, it said: "Turning back to Section 59 and reading it along with Section 49, 67, 67 A etc.
We notice that the Electricity Supply Act requires the Electricity Board to follow a particular method of accounting and it is on the basis of that method of accounting that the Board is required to generate a surplus.
Broadly, Section 59 requires that a surplus should be left from the total revenues, in any year of account, after meeting all expenses properly chargeable to revenues.
It has to be remembered that apart from subventions which may be received from the State Government, which depend entirely on the bounty of the government, the only revenues available to the Board are the charges leviable by it from consumers.
Bearing this in mind, we may now consider what expenses are properly chargeable to revenues under the Electricity Supply Act.
For this purpose, we may not be justified in having recourse to the principles of corporate 655 accounting or the rules which determine what is revenue expenditure under the Income Tax Act.
It appears to us that the Electricity Supply Act prescribes its own special principles of accounting to be followed by the Board. " This Court also held that the prescribing of different tariffs for high and low tension consumers and for different classes of consumers, such as industrial, commercial, agricultural and domestic, appears to be reasonable and far from arbitrary and is based on an intelligent and intelligible differentia.
Accordingly, the judgment of the Kerala High Court upholding challenge to the validity of the upward revision of tariffs was set aside.
Broadly speaking, the substance of the main arguments advanced before us in these matters was repelled by this Court in the Kerala case.
However, learned counsel for the appellants attempted to distinguish the Kerala decision and also tried to advance some additional arguments.
We shall refer to those arguments presently.
It would be appropriate at this stage to quote the relevant provisions of the , with reference to which the arguments advanced have to be considered.
Section 2 of the act relates to interpretation and give the meaning of the expressions defined therein.
Section 3 deals with the constitution of the Central Electricity Authority.
Section 4 B contains the rule making power of the Central Government.
Section 5 provides for the constitution and composition of State Electricity Boards.
Section 12 provides for the incorporation of the Board.
Section 12 A relates to the capital structure of the Board.
Section 78 contains the rule making power of the State Government.
Section 79 contains the power of the Board to make regulations.
Some of the provisions of the Act which may be quoted in extenso are as under: "4A. Directions by Central Government to the Authority.
(1) In the discharge of its functions, the Authority shall be guided by such directions in matter of policy involving public interest as the Central Government may give to it in writing.
(2) If any question arises as to whether any such direction relates to a matter of policy involving public interest, the decision of the Central Government thereon shall be final." xxx xxx xxx 656 "16.
State Electricity Consultative Council.
(1) The State Government shall constitute a State Electricity Consultative Council for the State, and in cases to which Section 6 and 7 apply, the State Government concerned shall constitute such one or more State Electricity Cousultative Council or Councils and for such areas as they may by agreement determine.
(2) The State Electricity Consultative Council shall consist of the members of the Board and, if there are any Generating Company or Generating Companies operating in the State, one representative of the Generating Company or each of the Generating Companies, to be nominated by the Generating Company concerned, and such other persons being not less than eight and not more than fifteen as the State Government or the State Governments concerned may appoint after consultation with such representatives or bodies of representative of the following interests as the State Government or the State Governments concerned thinks or think fit, that is to say, local self government, electricity supply industry, commerce, industry, transport, agriculture, labour employed in the electricity supply industry and consumers of electricity, but so that there shall be at least one member representing each such interest in the Council.
(3) The Chairman of the Board shall be ex officio Chairman of the State Electricity Consultative Council.
(4) The State Electricity Consultative Council shall meet at least once in every three months.
(5) The functions of the State Electricity Consultative Council shall be as follows: (i) To advise the Board and the Generating Company or Generating Companies, if any, operating in the State on major questions of policy and major schemes; (ii) to review the progress and the work of the Board and the Generating Company or Generating Companies, if any, operating in the State from time to time; 657 (iii) To consider such other matters as the Board or the Generating Company or Generating Companies, if any, operating in the State may place before it; and (iv) To consider such matters as the State Government may by rules prescribe.
(6) The Board shall place before the State Electricity Consultative Council the annual financial statement and supplementary statement, if any, and shall take into consideration any comments made on such statement in the said Council before submitting the same to the State Government under Section 61." xxx xxx xxx "49.
Provision for the sale of electricity by the Board to persons other than licensees.
(1) Subject to the provisions of this Act and of regulations, if any, made in this behalf, the Board may supply electricity to any person not being a licensee upon such terms and conditions as the Board thinks fit and may for the purposes of such supply frame uniform tariffs.
(2)In fixing the uniform tariffs, the Board shall have regard to all or any of the following factors, namely: (a) The nature of the supply and the purposes for which it is required; (b) The co ordinated development of the Supply and distribution of electricity within the State in the most efficient and economical manner, with particular reference to such development in areas not for the time being served or adequately served by the licensee; (c) the simplification and standardisation of methods and rates of charges for such supplies; (d) The extension and cheapening of supplies of electricity to sparsely developed areas.
658 (3) Nothing in the foregoing provisions of this section shall derogate from the power of the Board, if it considers it necessary or expedient to fix different tariffs for the supply of electricity to any person not being a licensee, having regard to the geographical position of any area, the nature of the supply and purpose for which supply is required and any other relevant factors.
(4) In fixing the tariff and terms and conditions for the supply of electricity, the Board shall not show undue preference to any person." xxx xxx xxx Section 59 prior to 1978 "General principles for Board 's finance.
The Board shall not, as far as practicable and after taking credit for any subventions from the State Government under Section 63, carry on its operations under this Act at a loss, and shall adjust its charges accordingly from time to time: Provided that where necessary any amounts due for meeting the operating, maintenance and management expenses of the Board or for the purposes of clauses (i) and (ii) of Section 67 may, to such extent as may be sanctioned by the State Government, be paid out of capital.
" Section 59 as amended by Act No. 23 of 1978 "General principles for Board 's finance.
(1) The Board shall, after taking credit for any subvention from the State Government under Section 63, carry on its operations under this Act and adjust its tariffs so as to ensure that the total revenues in any year of account shall, after meeting all expenses properly chargeable to revenues, including operating, maintenance and management expenses, taxes (if any) on income and profits, depreciation and interest payable on all debentures, bonds and loans, leave such surplus, as the State Government may, from time to time, specify.
(2) In specifying the surplus under sub section (1), 659 the State Government shall have due regard to the availability of amounts accrued by way of depreciation and the liability for loan amortization and leave.
(a) a reasonable sum to contribute towards the cost of capital works; and (b) where in respect of the Board, a notification has been issued under sub section (1) of Section 12 A, a reasonable sum by way of return on the capital provided by the State Government under sub section (3) of that section and the amount of the loans (if any) converted by the State Government into capital under sub section (1) of Section 66A." Section 59 as further amended by Act No. 16 of 1983 "General principles for Board 's finance.
(1) The Board shall, after taking credit for any subvention from the State Government under Section 63, carry on its operations under this Act and adjust its tariffs so as to ensure that the total revenues in any year of account shall, after meeting all expenses properly chargeable to revenues, including operating, maintenance and management expenses, taxes (if any) on income and profits, depreciation and interest payable on all debentures, bonds and loans, leave such surplus as is not less than three per cent, or such higher percentage, as the State Government may, by notification in the Official Gazette, specify in this behalf, of the value of the fixed assets of the Board in service at the beginning of such year.
Explanation.
For the purposes of this sub section, "value of the fixed assets of the Board in service at the beginning of the year" means the original cost of such fixed assets as reduced by the aggregate of the cumulative depreciation in respect of such assets calculated in accordance with the provisions of this Act and consumers ' contribution for service lines.
(2) In specifying any higher percentage under sub section (1), the State Government shall have due regard to 660 the availability of amounts accrued by way of depreciation and the liability for loan amortization and leave (a) a reasonable sum to contribute towards the cost of capital works; and (b) where in respect of the Board, a notification has been issued under sub section (1) of Section 12 A, a reasonable sum by way of return on the capital provided by the State Government under sub section (3) of that section and the amount of the loans (if any) converted by the State Government into capital under sub section (1) of Section 66 A." xxx xxx xxx "61.
Annual financial statement.
(1) In February of each year the Board shall submit to the State Government a statement in the prescribed form of the estimated capital and revenue receipts and expenditure for the ensuing year.
(2) The said statement shall include a statement of the salaries of members and officers and other employees of the Board and of such other particulars as may be prescribed.
(3) The State Government shall as soon as may be after the receipt of the said statement cause it to be laid on the table of the House, or as the case may be, Houses of the State Legislature; and the said statement shall be open to discussion therein, but shall not be subject to vote.
(4) The Board shall take into consideration any comments made on the said statement in the State Legislature.
(5) The Board may at any time during the year in respect of which a statement under sub section (1) has been submitted, submit, to the State Government a supplementary statement, and all the provisions of this section shall apply to such statement as they apply to the statement under the said sub section.
" xxx xxx xxx 661 "63.
Subventions to the Board.
The State Government may, with the approval of the State Legislature, from time to time make subventions to the Board for the purposes of this Act on such terms and conditions as the State Government may determine." XXX XXX XXX "65.
Power of Board to borrow. (1) The Board may, from time to time, with the previous sanction of the State Government and subject to the provisions of this Act and to such conditions, as may be prescribed in this behalf, borrow any sum required for the purposes of this Act.
(2) Rules made by the State Government for the purposes of this section may empower the Board to borrow by the issue of debentures or bonds or otherwise and to make arrangements with bankers, and may apply to the Board with such modifications as may be necessary to be consistent with this Act, the provisions of the (9 of 1914), and the rules made thereunder as if the Board were a local authority.
(3) The maximum amount which the Board may at any time have on loan under sub section (1) shall be ten crores of rupees, unless the State Government, with the approval of the State Legislative Assembly, fixes a higher, maximum amount.
(4) Debentures or bonds issued by the Board under this section shall be issued, transferred, dealt with and redeemed in such manner as may be prescribed." XXX XX XXX "67.
Priority of liabilities of the Board.
The Board shall distribute the surplus referred to in sub section (1) of section 59 to the extent available in a particular year in the following order, namely: (i) repayment of principal of any loan raised (including redemption of debentures or bonds issued) under Section 65 which becomes due for payment in the 662 year or which became due for payment in any previous year and has remained unpaid; (ii) repayment of principal of any loan advanced to the Board by the State Government under Section 64 which becomes due for payment in the year or which became due for payment in any previous year and has remained unpaid; (iii) payment for purposes specified in sub section (2) of Section 59 in such manner as the Board may decide.
67 A. Interest on loans advanced by State Government to be paid only after other expenses.
Any interest which is payable on loans advanced under Section 64 or deemed to have been advanced under Section 60 to the Board by the State Government and which is charged to revenues in any year may be paid only out of the balance of the revenues, if any, of that year which is left after meeting all the other expenses referred to in sub section (1) of Section 59 and so much of such interest as is not paid in any year by reason of the provisions of this section shall be deemed to be deferred liability and shall be discharged it, accordance with the provisions of this section in the subsequent year or year, as the case may be.
Charging of depreciation by Board (1) The Board shall provide each year for depreciation such sum calculated in accordance with such principles as the Central Government may, after consultation with the Authority, by notification in the Official Gazette, lay down from time to time.
(2) Omitted (3) The provisions of this section shall apply to the charging of depreciation for the year in which the Electricity (Supply) Amendment Act, 1978, comes into force." XXX XXX XXX "68 A. Directions by the State Government. (1) In 663 the discharge of its functions, the Board shall be guided by such directions on questions of policy as may be given to it by the State Government.
(2) If any dispute arises between the Board and the State Government as to whether a question is or is not a question of policy, it shall be referred to the Authority whose decision thereon shall be final. ' ' We shall first consider the common arguments advanced by the learned counsel for the appellants in all these matters before taking up some additional arguments advanced in some of these matters.
The first argument is that the requirement of consultation with the State Electricity Consultative Council before the revision of tariffs in accordance with Section 16 of the , not having been made, the upward revision of tariffs is invalid on account of non compliance of Section 16 of the Supply Act.
It was urged that revision of tariffs being a major question of policy as envisaged by clause (i) of Sub section (5) of Section 16, it is one of the functions of the Consultative Council to advise the Board on this question and without such advice of the Consultative Council, the revision in tariffs could not be made.
It was argued that the consumers ' interest is also represented on the Consultative Council as indicated by Sub section (2) of Section 16 providing for its constitution, and therefore, it was necessary to know the viewpoint of the consumers through their representative in the Consultative Council before deciding upon an upward revision of the tariffs for H.T. consumers.
Though the Board may not be bound by the advice of the Consultative Council, yet it was urged, such consultation with the Council was a condition precedent.
It was suggested that Section 16 must be read with Section 61 of the Supply Act which requires the Board to submit to the State Government the annual financial statement in February each year.
It is unnecessary in the present case to decide whether the revision of tariffs falls within the ambit of `major questions of policy ' occurring in Section 16(5)(i) of the Supply Act since the arguments from both sides proceeded on the basis that revision of tariffs for the purpose of this case may be treated as a `question of policy ' which expression finds place also in Section 78 A of the Supply Act.
The question, therefore, reduces itself to this: Whether the failure of the Board to place the matter before and seek the advice of the Consultative Council on this question renders the revision of tariffs made by it 664 invalid? The common premise for the purpose of this case that revision of tariffs by the Board is a question of policy may indicate that it would be open to the Consultative Council to advise the Board also on the question of revision of tariffs, and if such advice is given, then the Board must consider the same before taking the final decision.
That, however, does not necessarily mean that where no such advice was taken from the Consultative Council or was rendered on account of the absence of any meeting of the Consultative Council during the relevant period, it would necessarily render invalid the revision of tariffs made by the Board.
The consequence of non compliance of Section 16 is not provided and the nature of function of the Consultative Council and the force of its advice being at the best only persuasive.
it cannot be said that revision of tariffs without seeking the advice of the Consultative Council renders the revision of tariffs invalid.
It is also significant that the annual financial statement containing all particulars relating to revision of tariffs is required to be submitted to the State Government in February each year and the State Government is required after receipt of such statement to cause it to be laid on the table of the House or Houses of the State Legislature and the said statement is open to discussion therein.
The Board is bound to take into consideration any comments made on the said statement in the State Legislature.
Thus, there is ample provision for discussion on the revised tariffs in the State Legislature with the Board being bound to take into consideration any comments made thereon.
Shri Shanti Bhushan sought to make a distinction between the provisions of sub section (5) of section 16 pertaining to the functions of the `Consultative Council ' empowering or enabling the Council to advice the Board on `major questions of policy ' and the provision in sub section (6) as to the obligation of the Board to place certain matters before the `Council ' to emphasise his point that sub section (6) does not envisage any obligation on the part of the `Board ' to place before the Council the proposal for revision of tariffs.
He sought to distinguish between the functions of the `Council ' to tender advice and the obligation of the Board to specifically seek and invite such advice.
Shri Shanti Bhushan said that the very concept of consultation does imply mandatory obligation or duty attaching the pain of nullity to the transaction.
Provisions of the Electricity Act 1947 in England contain certain express statutory stipulations as to the scope of the Consultative Council 's functions which do not, in terms, obtain in the Indian statute.
For instance, Section 7 of the English Act which contemplates 665 the establishment of `Consultative Council ' specifically provides in Section 7(4) : ``(4) Each of the said Councils shall be charged with the duties (a) of considering any matter affecting the distribution of electricity in the area, including the variation of tariffs and the provision of new or improved services and facilities within the area, . . . (b) xxx xxx xxx (c) of considering any matter affecting the variation of any tariff regulating the charges for the provision of bulk supplies of electricity by the Generating Board for distribution in the area, being a matter which is either the subject of a representation made to them by consumers or other persons requiring supplies of electricity in the area, or which appears to them to be a matter to which consideration ought to be given apart from any such representation, and, where after consultation with the Area Board action appears to them to be requisite as to any such matter, of notifying their conclusions to the Generating Board; (d) xxx xxx xxx (rest of the Section omitted as unnecessary) Section 37(1) of the English statute again provides: ``37 Fixing and variation tariffs (1) The prices to be charged by the Generating Board for the supply of electricity by them to Area Boards shall be in accordance with such tariffs as may be fixed from time to time by the Generating Board after consultation with the Electricity Council; the different tariffs may be fixed for different Area Boards. ' ' (rest of the Section omitted as unnecessary) The pattern of the provisions in the Indian statute is quite different.
666 The `laying procedure ' before the legislature effectively controls the exercise of the delegated power of the Board.
We are of the opinion that though advisable yet failure to seek advice of the Consultative Council before revision of the tariffs does not result in invalidation of the revised tariffs.
This consequence appears to us to be the logical and reasonable view to take of the requirement of Section 16 along with other provisions of the Supply Act.
One of the arguments addressed at length before us relates to Section 78 A of the Supply Act.
It was urged on behalf of the appellant that any direction of the State Government relating to tariffs was on a question of policy within the meaning of Sub section (1), and, therefore, the Board is bound by such direction subject only to the adjudication, if any, in accordance with Sub section (2), if any dispute is raised by the Board in that behalf.
It was urged that in the present case the Board was, therefore, bound by the directions of the State Government granting the concession to the power intensive consumers since no dispute was raised by the Board in accordance with Sub section (2), of Section 78 A. Learned counsel for the Board did not for the purpose of this case, dispute this position, but contended that all directions of the State Government were obeyed by the Board and, therefore, the question does not really arise.
The Board 's contention is that it has acted according to the directions of the State Government and, therefore, the question of non compliance with any such directions giving rise to the argument based on Section 78 A does not arise.
For consideration of the main controversy, it is advisable at this stage to deal with Sections 49 and 59 of the Supply Act.
Section 49 makes provision for the sale of electricity by the Board to persons other than licensees.
Sub section (1) starts with the words `Subject to the provisions of this Act and of regulations, if any, made in this behalf '.
This means that the provision made therein is subject to other provisions of the Supply Act and the regulations.
It then proceeds to say that the Board may supply electricity to any person not being a licensee upon `such terms and conditions as the Board thinks fit ' and may for the purposes of such supply supply frame `uniform tariffs '.
Sub section (2) then enumerates several factors which the Board is required to `have regard to ' in fixing the uniform tariffs.
The meaning of the expression `have regard to ' is well settled.
It means that the factors specifically enumerated shall be taken into account while performing the exercise which in this case is the fixation of uniform tariffs.
Ordinarily, therefore, uniform tariffs are required to be framed by the Board for making such supply.
Sub section (3) then proceeds to 667 say that nothing in the earlier enacted provisions shall derogate from the power of the Board, `if it considers it necessary or expedient to fix different tariffs for the supply of electricity to any person ', having regard to the geographical position of any area, the nature of the supply and purpose for which supply is required and `any other relevant factors '.
Sub section (4) then says that in fixing the tariffs and terms and conditions for the supply of electricity, `the Board shall not show undue preference to any person '.
In other words, Sub section (4) provides against any unreasonable discrimination in fixing the tariffs and terms and conditions for supply of electricity.
The power of fixation of tariffs in the Board is provided in this manner by Section 49 of the Supply Act which requires the fixation of uniform tariffs ordinarily having regard particularly to the specified factors and enables fixation of such tariffs for any person having regard to the factors expressly stated and any other relevant factors, providing further that no unreasonable or undue preference shall be shown to any person by the Board in exercise of its powers of fixing the tariffs.
The next important provision is Section 59 of the Supply Act.
For appreciating the argument based on Section 59, it is necessary to bear in mind the distinction in Section 59 as it stood prior to 1978, as amended by Act No. 23 of 1978 and finally as amended by Act No. 16 of 1983, quoted earlier.
Prior to 1978, Section 59 required the Board, as far as practicable and after taking credit for any subventions from the State Government under Section 63, not to carry on its operations under this ACt at a loss and for this purpose, it was empowered to adjust its charges accordingly from time to time.
Under the provision as it then existed, the main thrust was to avoid the Board incurring any loss and for that purpose, it could adjust its charges accordingly from time to time.
Section 59 as amended by Act No. 23 of 1978 required the Board, after taking credit for any subventions from the State Government under Section 63, to carry on its operations under this Act and to adjust its tariffs so as to ensure that the total revenues in any year meeting all expenses properly chargeable to revenue including those specified, left such surplus as the State Government specified from time to time.
The shift was, therefore, towards having a surplus as the State Government specified from time to time.
Sub section (2) then provided guidelines for the State Government in specifying the surplus under Sub section (1) and mentioned the factors to which regard was to be had for this purpose.
The effect of the amendment made in Section 59 by Act No. 16 of 1983, which came into effect from 1.4.1985, was to provide for a 668 minimum surplus of three per cent or such higher percentage as the State Government is to specify in this behalf.
In other words, prior to 1978 amendment, the requirement from the Board was to avoid incurring any loss, after the 1978 amendment the shift was towards ensuring a surplus as specified by the State Government, and after the 1983 amendment the Board is required to ensure a surplus of at least three per cent unless the State Government specifies a higher surplus.
This is the scheme of Section 59 and it is Section 59 as amended by 1978 Act but prior to its amendment by the 1983 Act, with which we are concerned in the present case.
It cannot be doubted that Section 59 requiring the Board to adjust its tariffs for the purpose of Board 's finance is to be read along with Section 49 which provides specifically for fixation of tariffs and the manner in which that exercise has to be performed while dealing with any question relating to the revision of tariffs.
It was argued on behalf of the appellants that Section 59 as amended by the 1978 Act did not empower the Board to adjust its tariffs to generate any surplus unless the surplus had been specified by the State Government and when specified, the surplus generated could not exceed the specified surplus.
In other words, it was argued that when the State Government did not specify any surplus, the Board had no power to adjust its tariffs in a manner which resulted in generating any surplus.
We are unable to construe Section 59 in this manner.
The general principle for the Board 's finance indicated by Section 59 is that prior to the 1978 amendment, tariffs could be adjusted to avoid any loss, but as a result of the shift made by the 1978 amendment, the power could be exercised to generate a surplus and when the State Government specified the amount of surplus then the Board was bound to adjust the tariffs to ensure generation of the specified surplus.
However, generation of a reasonable surplus in any year of account without specification of the surplus amount by the State Government was not contra indicated in the provision inasmuch as the duty to generate a surplus was implicit with the added obligation to ensure generating surplus to the extent specified by the State Government when it was so specified by the State Government.
It cannot be accepted as a reasonable view that in the absence of specification of the surplus by the State Government, the Board could not adjust its tariffs to generate even a reasonable surplus in any year of account.
The effect of 1983 amendment, which came into force from 1.4.1985, is that the Board is entitled to adjust its tariffs to ensure generating a surplus of not less than three per cent even without such specification 669 by the State Government and when the State Government specifies a higher surplus, then the Board must ensure generating the higher specified surplus.
This is, of course, subject to the accepted norm of the Board acting in consonance with its public utility character and not entirely with a profit motive like that of a private trader.
The pre 1978 concept of the Board 's functioning to merely avoid any loss is replaced by the shift after 1978 amendment towards the positive approach of requiring a surplus to be generated, the quantum of surplus being specified by the State Government, with a minimum of three per cent surplus in the absence of the specification by the Government of a higher surplus, after the 1983 amendment.
This construction made of Section 59, as it stood at different times in Govinda Prabhu 's case (supra) indicated earlier, cannot be faulted in any manner.
In Govinda Prabhu 's case (supra) the same argument which is advanced before us was expressly rejected.
We are of the same view.
It is , therefore, obvious that mere generation of surplus by the Board as a result of adjusting its tariffs when the quantum of surplus has not been specified by the State Government after the 1978 amendment of Section 59 of the Supply Act, cannot invite any criticism unless it is further shown that the surplus generated as a result of the adjustment of tariffs by the Board has resulted in the Board acting as a private trader shedding off its public utility character.
In other words, if the profit is made not merely for the sake of profit, but for the purpose of better discharge of its obligations by the Board, it cannot be said that the public enterprise has acted beyond it authority.
The Board in the present case has shown that the surplus resulting from upward revision of tariffs applicable to the H.T. consumers made in the present case, was for the purpose of better discharge of its other obligations under the Supply Act and in effect, it has merely resulted in a gradual withdrawal of the concessional tariffs provided earlier to the power intensive consumers which do not in its opinion require continuance of the concessional tariffs any longer.
In fact, no material has been placed before us to indicate that this assertion of the Board is incorrect or there is any reasonable basis to hold that the upward revision of tariffs applicable to H.T. consumers is merely with a desire to earn more profits like a private trader and not to generate surplus for utilisation of the funds to discharge other obligations of the Board towards more needy consumers, such as agriculturists or to meet the need of expansion of the supply to deserving areas.
The argument with reference to statistics that the upward revision of tariffs for the H.T. consumers results in earning amounts in excess of the cost of generation does not, therefore, merit a more detailed consideration.
670 It was also contended on behalf of the appellants that the generation of electricity by the Andhra Pradesh Electricity Board is both thermal as well as hydro, the quantity from each source being nearly equal and the entire electricity generated is fed into a common grid, from which is supplied to all categories of consumers.
On this basis, it was argued that the rise in the fuel cost which led to the fuel cost adjustment applicable only to the H.T. consumers was unreasonable and discriminatory since the burden of rise in fuel cost was placed only on the H.T. consumers.
In our opinion, this argument has no merit.
The H.T. consumers, including the power intensive consumers, are known power guzzlers and in power intensive industries, electricity is really a raw material.
This category of consumers, therefore, forms a distinct class separate from other consumers like L.T. consumers who are much smaller consumers.
There is also a rational nexus of this classification with the object sought to be achieved.
Moreover, the power intensive consumers have been enjoying the benefit of a concessional tariff for quite some time, which too is a relevant factor to justify this classification.
Placing the burden of fuel cost adjustment on these power guzzlers, who had the benefit of concessional tariff for quite some time and have also a better capacity to pay, cannot, therefore, be faulted since the consumption in the power intensive industries accounts for a large quantity.
Shri Sibal submitted that the prescription and imposition of disparate tariffs, unrelated to the production cost, on a particular section of consumers would be a case of misplaced philanthrophy on the part of the statutory authority.
The Board, Shri Sibal says, cannot use its powers in order to confer "social or economic benefits on particular sections of the community" at the cost of the other sections.
Shri Sibal contended that while it may be permissible for the Board to supply electricity to the weaker and under privileged sections of the society at prices which may even be lower than the costs of generation and distribution, however subsidies for such social objectives must come from subventions from Government and should not be made good by unjustifiable higher charges on other sections of electricity consumers.
Shri Sibal read to us the following passage in Wade 's Administrative Law (6th Edn.): "Statutory authorities have sometimes made use of their wide general powers in order to confer social or economic benefits on particular sections of the community.
In several such cases they have gone beyond the true limits of their powers.
The policy of the courts is in general hostile to the 671 use of public funds, such as rates, for new social experiments.
Local authorities are subject to a fiduciary duty to use their revenues with due restraint.
" (at p. 424) After referring to decided cases on the point, the learned author says: ".
The idea that runs through these cases is that public money must be administered with responsibility and without extravagance.
This appears to mean it is not available for charity.
The generosity of local authorities, in particular, is restrained by the doctrine that they owe a fiduciary duty to their ratepayers analogous to that of trustees.
This means that, in deciding upon their expenditure, they must hold a balance fairly between the recipients of the benefit and the ratepayers who have to bear the cost." (at p.426) Shri Sibal contends that in the case of class of consumers respecting which the tariff is enhanced, the enhancement is not justified on the ground of making good the loss on supply to others at cheaper rates.
The increase is attributable to higher costs of generation of thermal power.
It is not unreasonable to take the view that the thermal power has become costlier on account of the increase in fuel cost and could nationally be allocated to the consumption by H.T. and power intensive consumers, and, therefore, the fuel cost adjustment is made applicable to them alone.
In our opinion, the argument on behalf of the Board in this behalf is not unreasonable.
It was argued on behalf of the appellants with considerable force that the upward hike of tariff for the H.T. consumers including power intensive was arbitrary and discriminatory inasmuch as it was not related to the cost of generation and was based on irrelevant factors.
It was argued that the L.T. tariffs and agricultural tariffs were relieved of this burden and the liabilities of the Board even of a capital nature were taken into account for increasing the tariff applicable to power intensive units.
The contention is that these factors are irrelevant and do not permit exercise of the power to increase the tariffs.
This arguments was considered at length in Govinda Prabhu 's case before it was 672 negatived.
We agree with the reasons given in that decision to repel this contention.
In Govinda Prabhu, it was pointed out that the Court would not strike down the revision of tariff as arbitrary unless the resulting surplus reaches such a height as to lead to the inevitable decision that the Board has shed its public utility character and is obsessed by the profit motive of private entrepreneur in order to generate a surplus which is extravagant.
The limited power of judicial review in the field of price fixation was also indicated.
This limited scope of judicial review in striking down revision of tariffs resulting in generation of surplus applied in Govinda Prabhu cannot be faulted in view of the long line of decisions of this Court on the point and reiteration of the same principle by a Constitution Bench in Shri Sitaram Sugar Company Limited and Another.
vs Union of India and Others, ; The surplus generated by the Board as a result of revision of tariffs during the relevant period cannot be called extravagant by any standard to render it arbitrary permitting the striking down of the revision of tariffs on the ground of arbitrariness.
We have already indicated that it is not also discriminatory as was the view taken in Govinda Prabhu.
It has been pointed out on behalf of the Board that the Board 's action is based on the opinion of Rajadhyaksha Committee 's Report submitted in 1980 and the formula of fuel cost adjustment is on a scientific basis linked to the increase in the fuel cost.
This is a possible view to take and, therefore, the revision of tariffs by the Board does not fall within the available scope of judicial review.
One of the contentions of Shri G. Ramaswamy, on behalf of the appellant was that the G.Os. issued in respect of the power intensive units amounted to a special tariff for them resulting in their exclusion from the category of H.T. consumers and, therefore, the clause relating to fuel cost adjustment inserted by amendment to the H.T. tariffs did not apply to the power intensive consumers without insertion of a similar clause in the special tariff applicable to them.
It was urged that for this reason the power intensive consumers could not be governed by the clause of fuel cost adjustment made applicable to H.T. tariffs.
Shri Ramaswamy advanced elaborate arguments to distinguish "terms and conditions of supply" from "terms and conditions of tariff".
According to the learned counsel, B.P. Ms. No. 778 dated 18.10.1975 excluded the power intensive units from applicability of the Notification date 17.9.1975 to it.
It is unnecessary to repeat the history of the H.T. tariffs by which power intensive tariffs were separated.
It would be sufficient in this context to quote the relevant portion of Memo.
dated 18.11.1975 which, in our opinion, negatives this argument.
It was provided in this Memo.
, inter alia as under: 673 "With regard to other charges, such as Miscellaneous charges, terms and conditions of supply, not mentioned specifically herein, those applicable to normal H.T. consumers will apply".
The expression "other charges" is wide enough to include within its ambit the fuel cost adjustment admittedly made applicable to all H. T.consumers as a result of the escalation in fuel prices.
The method adopted was to prescribe a formula linking it to the increase in fuel cost so that it was not necessary to revise the tariffs each time as a result of increase in fuel prices, the same being taken care of by the relevant factors in the formula for fuel cost adjustment.
It was in this context that Shri Ramaswamy contended that the `terms and conditions of supply ' are different from the `terms and conditions of tariff ' and fuel cost adjustment being a term or condition of tariff and not a term or condition of supply, the above provision in the Memo dated 18.11.1975 did not have the effect of applying the term relating to fuel cost adjustment to the power intensive tariff.
It is sufficient to state that the Memo dated 18.11.1975 did not merely extend the non specified `terms and conditions of supply ' applicable to normal H.T. consumers to the power intensive consumers but also "other charges" which were merely illustrated by the words following, namely, "such as Misc.
charges, terms and conditions of supply not mentioned herein".
In other words, this express provision in the Memo, dated 18.11.1975 clearly provided that except for the provisions specifically made for power intensive consumers, in respect of all other provisions the power intensive consumers were to be governed by the provisions, by whatever name called, applicable to the normal H.T. consumers.
A further discussion of this distinction sought to be made by Shri G. Ramaswamy of the `terms and conditions of supply ' and `terms and conditions of tariff ' is, therefore, unnecessary.
Shri Ramaswamy also urged that there was no communication to the appellant of the applicability of the term relating to fuel cost adjustment during the relevant period which also relieves the power intensive consumers of this liability.
On the view we have already taken about the applicability of the term relating to fuel cost adjustment to the power intensive tariffs this point is not material.
However, it has also been shown that in the bills issued to the power intensive consumers the same was specifically indicated.
If any communication was needed, this indication in the bills issued to the power intensive consumers satisfied that requirement.
We are, therefore, unable to accept the contention that the term relating to fuel cost adjustment made applicable to H.T. consumers 674 had no application to the power intensive consumers during the relevant period.
Shri Kapil Sibal appearing on behalf of some of the appellants confined the challenge to the mode of exercise of power by the Board.
He laid great emphasis on the effect of absence of consultation with the Consultative Committee under Section 16 of the .
He also claimed that the quantum of increase could at best be justified only to the extent of one half and no more.
Shri Sibal claimed that certain extraneous factors had been taken into account for the purpose of revising the tariffs.
The irrelevant considerations, according to Shri Sibal, taken into account are the capital sums owed by the Board and the overall losses incurred by the Board which according to him is impermissible under Section 59 of the .
He also argued that the upward revision of H.T. tariffs is intended to subsidise another class of consumers which is not permissible.
His arguments are already covered by our earlier discussion.
Similarly, the arguments of Shri K.N. Bhat, for the appellant in C.A. No. 5379 of 1985 to the same effect, need to further discussion.
The details of the several factors taken into account for the revision in tariffs, to the limited extent they can be gone into within the permissible scope of judicial review in such a matter also do not require any further consideration.
Shri Anil Divan, on behalf of the appellant in C.A No. 2569 of 1985, submitted that the increase in tariffs for the power intensive unit in his case was 47 per cent as against 15 per cent for ordinary H.T. consumers.
According to him, even ignoring the FCA, the increase is 40 per cent from 32 paise to 45 paise.
This is disputed on behalf of the Board.
In our opinion, it is unnecessary to go into this question any further for the reasons already given by us.
Shri Divan also contended that the Electricity Board 's stand has been conflicting at different stages.
In our opinion, any detailed decision on this aspect also is unnecessary on the view taken by us about the Board 's power to revise tariffs, no case for striking down the same as arbitrary and discriminatory having been made out.
In view of the earlier decision of this Court in Govinda Prabhu, with the conclusion as well as reasoning of which we respectfully concur and reiteration of the Court 's limited power of judicial review in Shri Sitaram Sugar Company Limited recently decided by a Constitution Bench, we do not find any reason to accept any of the arguments advanced on behalf of the appellants by their learned counsel.
In fact, the decision in Govinda Prabhu con 675 cludes the controversy against the appellants and some detailed discussion by us has become necessary only on account of an attempt on behalf of the appellants to distinguish the decision and the emphasis placed on the requirements of Sections 16, 49 and 59 of the .
We find no merit in these appeals/special leave petition and the same are dismissed.
All interim orders in favour of the appellants/petitioner stand vacated.
No costs.
R.P. Appeals dismissed.
| IN-Abs | The appellants are H.T. electricity consumers of various categories in the State of Andhra Pradesh.
The respondent State Electricity Board (the Board), by its orders B.P. Ms. No. 1014 dated 13.12.1983 revised upwards the tariffs for various categories of consumers including H.T. categories 1 (Industrial) and II (Non Industrial); and by Memo No. DE/COML/IV/2250/83/I of the same date it revised upwards the electricity tariffs for highly power intensive industries falling under 644 H.T. Category III.
Tariffs consisted of three parts.
The said three categories of H.T. consumers fell in Part A. H.T. consumers availing supply of electricity for irrigation and agricultural purposes were included in part B. provided for miscellaneous and general charges.
Tariffs were not revised for consumers availing H.T. supply for purposes of irrigation and agriculture falling in part B or L.T. supply for domestic cottage industries, public lighting and small poultry farms units.
Besides the energy charges, the H.T. consumers included in Part A were also required to pay at different rates effective from 1.9.1982 an additional charge levied as `fuel adjustment charges '; and some amount as `voltage surcharged ' in accordance with the terms of the agreement entered into by the individual consumers with the Board.
The writ petitions filed by the appellants challenging the said upward revision of the Electricity Tariffs were dismissed by the High Court upholding the revision of tariffs made by the respondent Board.
Aggrieved the appellants preferred appeals by special leave to this Court.
It was contended on behalf of the appellants that: (1) the upward revision of tariffs by the State Electricity Board was invalid being made without prior consultation with the State Electricity Consultative Council as envisaged by section 16 of the ; (2) without specification of any surplus by the State Government the Board had no power to adjust its tariffs in a manner which resulted in generating any surplus; (3) there is discrimination in recovery of the entire full cost adjustment from the H.T. consumers alone; (4) the upward hike of the tariffs for the H.T. consumers including power intensive consumers was arbitrary and discriminatory inasmuch as it was not related to the cost of generation and was based on irrelevant factors; and (5) and the Board had acted with profit motive losing its public utility character.
Learned counsel representing the power intensive consumers also contended that in the absence of a clause relating to fuel cost adjustment in the G.Os.
issued in respect of the power intensive units, they could not be governed by the clause of fuel cost adjustment made applicable to the H.T.tariffs.
Dismissing the appeals, this Court, HELD: 1.1 The power of fixation of tariffs in the Board is provided by section 49 of this Supply Act which requires the fixation of uniform 645 tariffs ordinarily having regard particularly to the specified factors and enables fixation of such tariffs for any person having regard to the factors expressly stated and any other relevant factors providing further that no unreasonable or undue preference shall be shown to any person by the Board in exercise of its powers of fixing the tariffs.
section 59, requiring the Board to adjust the tariffs for the purpose of its finance is to be read along with section 49.
[667B C; 668B C] 1.2.
The common premise for the purpose of the instant case that the revision of tariffs by the State Electricity Board is a question of policy may indicate that it would be open to the Consultative Council to advise the Board also on the question of revision of tariffs, and if such advice is given, then the Board must consider the same before taking the final decision.
That, however, does not necessarily mean that where no such advice was taken from the Consultative Council or was rendered on account of the absence of any meeting during the relevant period, it would necessarily render invalid the revision of tariffs made by the Board.
[664A B] Though it is advisable to seek advice of the Consultative Council before revision of the tariffs yet failure to do so does not result in invalidation of the revised tariffs.
This consequence appears to be the logical and reasonable view to take of the requirement of section 16 alongwith other provisions of the Act.
[666A B] 1.3 The consequence of non compliance of section 16 is not provided, and the nature of function of the Consultative Council and the force of its advice being at the best only persuasive, it cannot be said that revision of tariffs without seeking the advice of the Consultative Council renders the revisions of tariffs invalid.
[664B C] 1.4 It is also significant that the annual financial statement containing all particulars relating to revision of tariffs is required to be submitted to the State Government in February each year and the State Government is required after receipt of such statement to cause it to be laid on the table of the House or Houses of the State Legislature and the said statement is open to discussion therein.
The Board is bound to take into consideration any comments made on the said statement in the State Legislature.
The 'laying procedure ' before the legislature effectively controls the exercise of the delegated power of the Board.
Thus there is ample provision for discussion on the revised tariffs in the State Legislature with the Board being bound to take into consideration any comments made thereon.
[664C D; 666A] 646 Kerala State Electricity Board vs M/s. S.N. Govinda Prabhu & Bros. & Ors.
, ; , relied on.
2.1 Mere generation of surplus by the Board as a result of adjusting its tariffs when the quantum of surplus has not been specified by the State Government after the 1978 amendment of section 59 of the Act, cannot invite any criticism unless it is further shown that the surplus generated as a result of the adjustment of tariffs by the Board has resulted in the Board acting as a private trader shedding off its public utility character.
If the profit is made not merely for the sake of profit, but for the purpose of better discharge of its obligations by the Board, it cannot be said that the public enterprise has acted beyond its authority.
[669C E] 2.2 The general principle for the Boards finance indicated by section 59 is that prior to the 1978 amendment, tariffs could be adjusted to avoid any loss, but as a result of the shift made by the 1978 amendment the power could be exercised to generate a surplus and when the State Government specified the amount of surplus then the Board was bound to adjust the tariffs to ensure generation of the specified surplus.
However, generation of a reasonable surplus in any year of account without specification of the surplus amount by the State Government was not contra indicated in the provision inasmuch as the duty to generate a surplus was implicit with the added obligation to ensure generating surplus to the extent specified by the State Government when it was so specified by it.
It cannot be accepted as a reasonable view that in the absence of specification of the surplus by the State Government, the Board could not adjust its tariffs to generate even a reasonable surplus in any year of account.
[668E G] 2.3 In the instant case the Board showed that the surplus resulting from upward revision of tariffs applicable to the H.T. consumers was for the purpose of better discharge of its other obligations under the Supply Act and in effect the same has merely resulted in a gradual withdrawal of the concessional tariffs provided earlier to the power intensive consumers which did not in its opinion require continuance of the concessional tariffs any longer.
It was not proved that this assertion of the Board was incorrect or there was any reasonable basis to hold that the upward revision of tariffs applicable to H.T. consumers was merely with a desire to earn more profits like a private trader and not to generate surplus for utiliasation of the funds to discharge other obligations of the Board towards more needy consumers, such as agriculturists, or to meet the needs of expansion of the supply to deserving areas.
[669E G] 647 3.1 The H.T. consumers, including the power intensive consumers, are known power guzzlers and in power intensive industries, electricity is really a raw material.
This category of consumers, therefore, forms a distinct class separate from other consumers like L.T. consumers who are much smaller consumers.
There is also a rational nexus of this classification with the object sought to be achieved.
Moreover, the power intensive consumers have been enjoying the benefit of a concessional tariff for quite some time, which too is a relevant factor to justify this classification.
Placing the burden of fuel cost adjustment on these power guzzlers, who had the benefit of concessional tariffs, for quite some time and have also a better capacity to pay, cannot, therefore, be faulted since the consumption in the power intensive industries accounts for a large quantity.
[670B C] 3.2 It is not unreasonable to take the view that the thermal power has become costlier on account of the increase in fuel cost and could notionally be allocated to the consumption by H.T. and power intensive consumers and, therefore, the fuel cost adjustment is made applicable to them alone.
[671E F] 4.1 The Court would not strike down the revision of tariffs as arbitrary unless the resulting surplus reaches such a height as to lead to the inevitable decision that the Board has shed its public utility character and is obsessed by the profit motive of private entrepreneur in order to generate a surplus which is extravagant.
[672A B] 4.2 The surplus generated by the Board as a result of revision of tariffs during the relevant period cannot be called extravagant by any standard to render it arbitrary permitting the striking down of the revision of tariffs on the ground of arbitrariness nor is it discriminatory.
It was pointed out on behalf of the Board that its action was based on the opinion of Rajadhyaksha Committee 's report submitted in 1980 and the formula of fuel cost adjustment was on a scientific basis linked to the increase in the fuel cost.
This is a possible view to take and, therefore, the revision of tariffs by the Board does not fall within the available scope of judicial review.
[672C D] Kerala State Electricity Board vs M/s. S.N. Govinda Prabhu and Bros. & Ors., ; , relied on.
Shri Sitaram Sugar Company Limited & Anr.
vs Union of India & Ors.
, ; , followed.
648 5.
It cannot be said that the term relating to fuel cost adjustment had no application to the power intensive consumers during the relevant period.
The Memo dated 18.11.1975 did not merely extend the non specified 'terms and conditions of supply ' applicable to normal H.T. consumers to the power intensive consumers but also "other charges" which were merely illustrated by the words, "such as Misc.
charges, terms and conditions of supply not mention herein".
This express provision in the said Memo clearly provided that except for the provision specifically made for power intensive consumers, in respect of all other provisions the power intensive consumers were to be governed by the provisions, by whatever name called, applicable to the normal H.T. consumers.
However in the bills issued to the power intensive consumers the terms relating to fuel cost adjustment was specifically indicated.
[673D H; 674A] Nav Bharat Ferro Alloys Ltd. vs A.P.S.E. Board Hyderabad, AIR 1985 A.P. 299, approved.
|
N: Criminal Appeal Nos.
345 346 of 1991.
From the Judgement and Order dated 14.6.1990 of the Madras High Court in Referred Trial Nos. 4/89 and 5/89 and Crl.
Appeal Nos.
593/89 and 594 of 1989.
715 Raju Ramachandran, Jaga Rao, Alok Agarwal, Ms. Malini Bhat and section Ravindra Bhatt for the appellants.
V.R. Karthikeyan and V. Krishnamurthy for the respondent.
The Judgment of the Court was delivered by K. RAMASAWAMY, J.
Special leave to appeals granted.
Heard the learned counsel, Sri Raju Ramachandran amicus curiae for the appellants and Sri V. Krishnamurthy, the learned Standing Counsel for the State.
The appellants Sevaka Perumal and Isakkimuthu for short 'A 1 ' and 'A 2 ' in Appeal arising out of S.L.P. (Crl.) No. 1842/90 are accused in Sessions Case No. 283 of 1986 on the file of the Addl.
Sessions Judge, Tirunelveli Sessions Division and appellants in Criminal Appeal No. 594 of 1989 and R.T. No. 4 of 1989 by judgment, dated June 14, 1990 of the High Court of Madras.
Criminal Appeal arise out of S.L.P. (Crl.) No. 1841/90; Sessions Case No. 284 of 1986 of the same Sessions Division and Criminal Appeal No. 593 and R.T. No. 5 of 1989 dated June 14, 1990 of the Madras High Court respectively, A 1 is the appellant.
In each case the Sessions Court convicted them under sections 120B, 364, 392 read with section 397; section 302 read with section 34 I.P.C. and sentenced to death.
In Crl.
Appeal No. 594 of 1989 and R.T. No. 4 of 1989, the High Court confirmed the conviction and sentence of death of both the appellants.
In Crl.
Appeal No. 593 of 1989 and R.T. No. 5 of 1989, the High Court confirmed the conviction and sentenced of death of the A 1 and acquitted A 2 of all the charges.
The case of the prosecution in brief is that the appellants and PW 1, the approver belonged to kidarakulam village and became friends.
A 1 used to bring money form the timber shop of his brother in law (PW 4) in Sessions Case No. 284/86 in whose shop A 1 had worked.
They used to go to various places.
A 1 used to purchase ganja from chenglapatai and other places and A 1 and A 2 used to sell them.
Yet they did not have enough money to spend lavishly.
They attempted to commit theft in the localities but became impracticable.
Therefore, they conspired to entice boys from affluent families to bring cash and jewellery from their houses; take them to far away places; take their money or jewellery and to murder them for gain.
Pursuant thereto in 1978 they murdered one Athippan; in 1981 one Chelladurai; in March, 1982 one Hariramachandran and in 1983 one Christodas.
In Sessions Case No. 283/86, the deceased boy is Athiappan.
In 716 Sessions Case No. 284/86, the deceased boy is Hariramachandran.
Sessions Case No. 282/86 on the file of the Sessions Court.
Madurai Division relates to deceased Chelladurai.
Therein also we are informed that the appellants were convicted but on appeal they were acquitted.
In sessions Case relating to the death of Christodas, it also ended in conviction and sentence of death was imposed on the appellants and is pending confirmation in the High Court.
It is sufficient to set out the material fact leaving out the minor details in Sessions Case No. 284/86 to meet the points raised by the counsel for the appellants.
A 1 enticed the deceased, Hariramachandran, his nephew (elder sister PW 2 ' son) to bring jewellery from the house of PW 2 and PW 4.
The appellants and PW 1 took him to Madurai.
On the way the deceased went to the house of PW 3 and handed over one chain to be delivered to his mother and took M.O. 1 chain with him.
A 1 had taken a room in the lodge at Madurai run by PW 16.
On coming to know that they were staying in Madurai, PW 2, PW 4, her husband and PW 3 went to the lodge and the deceased was found threat.
He informed them that the chain was with A 1 and he would come in the evening at 8.00 p.m. After waiting for some time and when it was getting dark, the ladies went away asking PW 4 to get the chain and the deceased after A 1 's arrival.
While PW 4 was waiting the deceased went down stairs and after A 1 's arrival told him of his mother 's coming etc.
and from there they went away to Madras, and having come to know that they left the place PW 4 left to his village.
On the next day they returned to Madurai.
From there they went to Usilampatti and A 1 then purchased a knife at the Bus Stand without the knowledge of the deceased and proceeded to Peraiyar road.
They sat near a jungle stream.
While A 1 and the deceased Harirmachandran were sitting near a stone on the southern side of the road, A 2 and PW 1 were standing at a distance, A 1 stabbed Harirmachandran in his stomach with a knife and the deceased collapsed on the stone.
A 1 threw away the knife in the river.
He threw the deceased in the nearby well and washed his hands and legs in the stream.
They returned to Usilampatti Bus Stand.
From there they came to Madurai.
A 1 sold M.O. 1 chain to PW 24 and gave one hundred rupees each to PW 1 and A 2.
This evidence of PW 1 received sufficient corroboration from the evidence of prosecution witnesses.
Sri Raju Ramachandran contended that the dead body was admittedly found in a highly decomposed condition.
There is no proper identification of the dead body to be of the deceased.
The 717 mother PW 2 identified only with reference to the photograph taken of the dead body.
There is evidence that the deceased wrote a letter of leaving to unknown destination.
Unless there is proof that the dead body belongs to Hariramachandran, it is not safe to convict to A 1 to a capital punishment of death sentence.
We find no force in the contention.
In a trial for murder it is not an absolute necessity or an essential ingredient to establish corpus delicti.
The fact of death of the deceased must be established like any other fact.
Corpus delicti in some cases may not be possible to be traced or recovered.
Take for instance that a murder was committed and the dead body was thrown into flowing tidal river or steam or burnt out.
It is unlikely that the dead body may be recovered.
If recovery of the dead body, therefore, is an absolute necessity to convict an accused, in many a case the accused would manage to see that the dead body is destroyed etc.
and would afford a complete immunity to the guilty from being punished and would escape even when the offence of murder is proved.
What, therefore, is required to base a conviction for an offence of murder is that there should be reliable and acceptable evidence that the offence of murder, like any other factum, of death was committed and it must be proved by direct or circumstantial evidence, although the dead body may not be traced.
In this case the evidence of PWs. 7 to 10 would establish that they have seen the dead body of the deceased Hariramachandran in the well and brought it out and the photograph was taken at the time of inquest.
It was identified to be that of the deceased by no other than his mother, PW 2.
Thus we have no hesitation to hold that there is no doubt as regards the identity of the dead body and that the medical evidence establishers that the deceased died due to stabbing with sharp edged weapon like knife.
It is next contended that PW 1 being an approver, his evidence must be reliable and must receive corroboration on all material particulars from independent evidence.
PW 1 is neither a reliable witness nor did his evidence receive such corroboration.
Therefore, his evidence cannot form the basis to convict the appellants.
It is his contention that in Hariramachandran 's death case the evidence of PW 1 was not accepted as regards the complicity of A 2 and he was acquitted.
Therefore, PW 1 is not a reliable witness.
This contention too is devoid of any force.
PW 1 had given wealth of details of commission of the crimes.
Under section 133 of the Evidence Act 1 of 1872, an accomplice shall be a competent witness against an accused person; and a conviction is not illegal merely because it proceeds upon the uncorroborated testimony of an accomplice.
Section 114 illustration (b) postulates that an accomplice is unworthy of credit, unless he is corroborated in mate 718 rial particulars.
In King vs Baskervilli, Lord Reading, CJ, laid the test that the corroboration need not be direct evidence that the accused committed the crime.
It is merely circumstantial evidence of his connection with the crime.
The nature of the corroboration will depend and vary according to the particular circumstances of each case.
What is required is some additional evidence rendering it probable that the story of the accomplice is true and that it is reasonably safe to act upon.
In Mahadeo vs The King AIR 1936 P. C. 242 the judicial committee held that the evidence of an accesory must be corroborated in some material particulars not only bearing upon the facts of the crime but upon the accused 's implication in it.
This Court in Rameshwar vs The State of Rajasthan, ; held that it is not necessary that there should be independent confirmation of every material circumstance in the sense that the independent evidence of the case, apart from the testimony of the complainant or its accomplice should in itself be sufficient to sustain conviction.
All that is necessary is that there should be independent evidence which will make it reasonably safe to believe that the witness 's story that the accused was the one that committed the offence could be acceptable.
The corroboration need not be direct evidence that the accused committed the crime.
It is sufficient if it is merely circumstantial evidence of his connection with the crime.
In section Swaminathan vs State of Madras, AIR 1957 SC 340 this Court held that corroboration of approver 's evidence need not be of a kind which prove the offence against the accused.
It is sufficient if it connects the accused with the crime when the accused had been charged for the offences of conspiracy and of cheating, a specific instance of cheating proved beyond doubt against one of the accused would furnish the best corroboration of the offence of the conspiracy.
In Sarwan Singh vs The State of Punjab, ; relied by Shri Raju Ramachandran, this Court held that the approver must be a reliable witness and the evidence must receive sufficient corroboration.
In that case the corroboration of minor particulars was accepted to be sufficient to hold the approver to be reliable witness.
In B.D. Patil vs State of Maharashtra, this Court held that the conviction of an accused on the testimony of an accomplice cannot be said to be illegal, yet the courts will, as a matter of practice do not accept the evidence of such a witness without corroboration in material particulars.
There should be corroboration of the approver in material particulars and must be qua each accused.
In Md. Hussain Umar Kochra etc.
vs K.S. Dalipsinghji & Anr., [1970] 1 S.C.R. 130 it was held that the combined effect of sections 133 and 114(b) is that though a conviction based upon accomplice evidence is legal the court will not accept such evidence unless it is 719 Corroborated in material particulars.
The corroboration must be from an independent source.
If several accomplices simultaneously and without previous concert giving consistent account of the crime implicating accused, the court may accept the several statements as corroborating each other.
In Ram Narain vs State of Rajasthan, ; this Court held that section 114(b) strikes a note of warning, cautioning the court that an accomplice does not generally deserve to be believed unless corroborated in material particulars.
In other words, the rule is that the necessity of corroboration is as matter of prudence except when it is safe to dispense with such corroboration must be clearly present to the mind of the Judge.
In Abdul Sattar vs Union Territory, Chandigarh, [1985] (Suppl.) S.C.C. 599 this Court further held that it is not safe to convict an accused on the charges like murder upon the evidence of uncorroborated testimony of the approver.
Thus the settled law is that an approver is a competent witness against the accused person.
But the court, to satisfy its conscience, insists as caution and prudence to seek, as a rule, corroboration to the evidence of the approver, a particips criminis from independent evidence occular or circumstantial, of general particulars regarding the story spoken off by the approver of the commission of the crime and the part played by the accused therein to find whether it is true and worthy of acceptance.
The reliability of the evidence of an approver should be considered from totality of the facts and circumstances.
In the trial of Athiappan murder there is no dispute that such a corroborative evidence connecting both the appellants is available which was minutely considered by the trial court and the High Court and was accepted.
We find no infirmity in that regard.
In the trial of the death of Hariramachandran, A. 2 was acquitted on the ground that his extra judicial confession made to P.W. 23, the only corroborative evidence,was disbelieved by the High Court.
Both the courts below gave categorical finding that P.W. 1 is a reliable witness.
the evidence of the approver received corroboration from independent evidence on general prosecution case, namely, P.W. 16 spoke that the deceased was brought by the accused and stayed in the lodge.
P.Ws 2 to 4 spoke of A 1 working in their shop, previous theft by A 1 and M.O. 1 being missing, their attempt to take back the deceased and M.O, 1, the deed body was found in the well and was taken out as spoke to by P. Ws.
7to 10.
The medical evidence establishes the stabbing with the knife and death was due to it.
P.W. 24 corroborates A. 1 of selling M.O. 1 chain and taking the money.
The canopy of the material evidence from independent sources sufficiently corroborates the approver ' evidence.
720 PW 1 is a reliable witness.
No infirmity has been pointed out to disbelieve his evidence.
It is next contended that the courts below were not justified in imposing the extreme penalty of death sentence under section 302, I.P.C. and strongly relied upon the judgment of Bachan Singh 's case.
It is contended that the acquittal of A. 2 giving the benefit of doubt in Hariramachandran 's death trial introduces an element of doubt which should be extended to convert the death sentence of A. 1 to life imprisonment.
We find no susbstance in the contention.
The doctrine of benefit of doubt only would operate in proof of the commission of the offence.
If there is any reasonable doubt, not the doubt of vacillating mind of a Judge, the accused is entitled to the benefit and acquitted.
The benefit of doubt again does not enter in the area of consideration of imposing sentence.
The law regulates social interest, arbitrates conflicting claims and demands.
Security of persons and property of the people is an essential function of the State.
It could be achieved through instrumentality of criminal law.
Undoubtedly, there is a cross cultural conflict where living law must find answer to the new challenges and the courts are required to mould the sentencing system to meet the challenges.
The contagion of lawlessenss would undermine social order and lay it in ruins.
Protection of society and stamping out criminal proclivity must be the object of law which must be achieved by imposing appropriate sentence.
Therefore, law as a corner stone of the edifice of order should meet the challenges confronting the society.
Friedman in his "Law in Changing Society" stated that, "State of criminal law continues to be as it should be a decisive reflection of social consciousness of society".
Therefore, in operating the sentencing system, law should adopt the corrective machinery or the deterrence based on factual matrix.
By deft modulation of sentencing process be stern where it should be, and tempered with mercy where it warrants to be.
The facts and given circumstances in each case, the nature of the crime, the manner in which it was planned and committed, the motive for commission of the crime, the conduct of the accused and all other attending circumstances are relevant facts which would enter into the area of consideration.
For instance a murder committed due to deep seated personal rivalry may not call for penalty of death.
But an organised crime or mass murders of innocent people would call for imposition of death sentence as deterrence.
In Mahesh vs State of M.P., this Court while refusing to reduce that death sentence observed thus: 721 `It will be a mockery of justice to permit the accused to escape the extreme penalty of law when faced with such evidence and such cruel acts.
To give the lesser punishment for the accused would be to render the justicing system of the country suspect.
The common man will lose faith in courts.
In such cases, he understands and appreciates the language of deterrence more than the reformative jargon '.
Therefore, undue sympathy to impose inadequate sentence would do more harm to the justice system to undermine to public confidence in the efficacy of law and society could not long endure under serious threats.
If the courts did not protect the injured, the injured would then resort to private vengeance.
It is, therefore, the duty of every court to award proper sentence having regard to the nature of the offence and the manner in which it was executed or committed etc.
It is clear from the evidence that the accused indulged in illegal business of purchase and sale of ganja.
They conspired to entice innocent boys from affluent families took them to far flung places where the dead body could not be identified.
The letters were written to the parents purporting to be by the deceased to delude the parents that the missing boy would one day come home alive and that they would not give any report to the police and the crime would go undetected.
Four murders in a span of five years were committed for gain in cold blooded , pre meditated and planned way.
It is undoubted that if the trial relating to Athiappan murder had taken place and concluded earlier to the trial and conviction of other three murders, the subsequent murders are not relevant facts to be considered.
But in this case the trial of the murder relating to Athiappan and Hariramachandran practically took place simultaneously by which date the appellants were convicted for the murder of Chelladurai and Christodas.
Therefore ,the reference of conviction and sentence by the Sessions Court to those two cases also are relevant facts.
The deceased Hariramachandran is no other than the nephew (elder sister 's son) of A 1.
This would establish his depravity and hardened criminality.
No regard for precious lives of innocent young boys was shown.
They adopted the crime of murder for gain as a means to living.
Undoubtedly under section 235(2) of Code of Criminal Procedure, the accused is entitled to an opportunity to adduce evidence and if need be the case is to be adjourned to another date.
It is illegal to convict, an accused and to impose sentence on the same day.
It is true 722 as contended for the State that under section 309, third proviso brought by Amendment Act, 1978 that no adjournment should be granted for the purpose only of enabling the accused person to show cause against sentence to be imposed upon him.
Under section 235(2) when the accused has been given right to be heard on the question of sentence it is a valuable right.
To make that right meaningful the procedure adopted should be suitably moulded and the accused given an opportunity to adduce evidence on the nature of the sentence.
The hearing may be on the same day if the parties are ready or be adjourned to a next date but once the court after giving opportunity propose to impose appropriate sentence again there is no need to adjourn the case any further thereon.
No doubt the Sessions Judge needed to adjourn the case under section 235(2) to next date but in the High Court the counsel was directed to show any additional grounds on the question of sentence .
The High Court observed that the counsel was unable to give any additional ground.
It is Further contended that the appellants are young men.
They are the bread winners of their family each consisting of a young wife.
minor child and aged parents and that, therefore, the death sentence may be converted into life.
We find no force.
These compassionate grounds would always be present in most cases and are not relevant for interference.
Thus we find no infirmity in the sentence awarded by the Sessions Court and confirmed by the High Court warranting interference.
The appeals are accordingly dismissed.
G.N. Appeal dismissed.
| IN-Abs | According to the Prosecution, appellants 1 and 2 have been friends and were in the habit of selling ganja and spending money lavishly.
They attempted to commit theft in their locality, but were no successful.
Therefore, they hatched a conspiracy to entice boys from affluent families to bring cash and jewellery and murder them after taking away the cash and jewellary.
Likewise, they killed 4 boys, in a span of about 5 years.
Both of them were charged with offences under section 120B read with section 34 IPC, section 364 and 392 read with section 397 IPC in all the four cases filed against them, and were convicted by the Sessions Court.
However, in one case, on appeal, they were acquitted by the High Court.
In another case, the death sentence imposed by the Sessions Court is pending confirmation by the High Court.
In the other two cases, both the appellants were sentenced to 712 death by the Sessions Court and on appeal the High Court confirmed the sentence in one case and in the other, the High Court confirmed the death sentence passed against appellant No. 1 and acquitted appellants No. 2 of all the charges.
The appellants preferred the present appeals challenging the said order of the High Court confirming the sentences against them by contending that there was no proper identification of the dead body and that the approver was not a reliable witness and since his evidence did not receive corroboration, it cannot form the basis for convicting the appellants.
It was also contended that the extreme penalty of death sentence imposed was not justified.
Dismissing the appeals, this Court, HELD: 1.1 In a trial for murder it is not an absolute necessity or an essential ingredient to establish corpus delicti.
The fact of death of the deceased must be established like any other fact.
Corpus delicti in some cases may not be possible to be traced or recovered.
If a murder was committed and the dead body was thrown into flowing tidal river or stream or burnt out, it is unlikely that the dead body may be recovered.
If recovery of the dead body, therefore, is an absolute necessity to convict an accused, in many a case the accused would manage to see that the dead body is destroyed etc.
and that would afford a complete immunity to the guilty from being punished and the accused would escape even when the offence of murder is proved.
What, therefore, is required to base a conviction for an offence of murder is that there should be reliable and acceptable evidence that the offence of murder, like any other factum, of death was committed and it must be proved by direct or circumstantial evidence, although the dead body may not be traced.
[717A D] 1.2 In the instant case, the evidence of PWs.
7 to 10 would establish that they have seen the dead body of the deceased in the well and brought it out and the photograph was taken at the time of inquest.
It was identified to be that of the deceased by no other than the mother of the deceased.
Thus there is no doubt as regards the identity of the dead body.
Also the medical evidence establishes that the deceased died due to stabbing with sharp edged weapon like knife.
[717E] 2.
Law is settled that an approver is a competent witness against the accused person.
But the court, to satisfy its conscience, insists as caution and prudence to seek, as a rule, corroboration to the evidence 713 of the approver, a particips criminis from independent evidence occular or circumstantial, of general particulars regarding the story spoken of by the approver of the commission of the crime and the part played by the accused therein to find whether it is true and worthy of acceptance.
The reliability of the evidence of an approver should be considered from totality of the facts and circumstances.
In one of the two trials there is no dispute that such a corroborative evidence connecting both the appellant is available which was minutely considered by the trial court and the High Court and was accepted.
There is infirmity in that regard.
In the other trial appellant No. 2 was acquitted on the ground that his extra judicial confession made to PW 23, the only corroborative evidence, was disbelieved by the High Court.
Both the Courts below gave categorical finding that PW 1 is a reliable witness.
The evidence of the approver received corroboration from independent evidence.
The canopy of the material evidence from independent sources sufficiently corroborates the approver 's evidence.
He is a reliable witness.
No infirmity has been pointed out to disbelieve his evidence.
[719D H; 720A] Rameshwar vs The State of Rajasthan, ; ; section Swaminathan vs State of Madras, AIR 1957 SC 340; Sarwan Singh vs The State of Punjab, , ; ; B.D. Patil vs State of Maharashtra, ; Md. Hussan Umar Kochra etc.
vs K.S. Dalipsinghji & Anr., [1970] 1 SCR 130; Ram Narain vs State of Rajasthan, ; and Abdul Sattar vs Union Territory, Chandigarh, [1985] (Suppl.) SCC 599, relied on.
King vs Baskervilli, and Mahadeo vs The King, AIR 1936 P.C. 242, referred to.
In the instant case, it is clear from the evidence that the accused indulged in illegal business of purchase and sale of ganja.
They conspired to entice innocent boys from affluent families, took them to far flung places where the dead body could not be identified.
The letters were written to the parents purporting to be by the deceased to delude the parents that the missing boy would one day come home alive and that they would not give any report to the police and the crime would go undetected.
Four murders in a span of five years were committed for gain in cold blooded, premeditated and planned way.
In this case the trial of the murder relating to the two deceased practically took place simultaneously by which date the appellants were convicted for the murder of two other boys.
Therefore, the reference of conviction and sentence by the Sessions Court to those two cases also are relevant facts.
One of the deceased is no other than the nephew of appellants No. 1.
This 714 would establish his depravity and hardened criminality.
No regard for precious lives of innocent young boys was shown.
They adopted the crime of murder for gain as a means to living.
As such there is no infirmity in the sentence awarded by the Sessions Court and confirmed by the High Court.
[721D G] 4.
The doctrine of benefit of doubt only would operate in proof of the commission of the offence.
If there is any reasonable doubt, not the doubt of vacillating mind of a Judge, the accused is entitled to that benefit and be acquitted.
The benefit of doubt again does not enter in the area of consideration of imposing sentence.
[720C] 5.1.
Undue sympathy to impose inadequate sentence would do harm to the justice system to undermine the public confidence in the efficacy of law and society could not long endure under serious threats.
If the courts did not protect the injured the injured would then resort to private vengeance.
It is, therefore, the duty of every court to award proper sentence having regard to the nature of the offence and the manner in which it was executed or committed etc.
[721C] 5.2.
The compassionate grounds such as the accused being young bread winners of the family etc.
would always be present in most casts and are not relevant for interference with the sentence.
[722D] 6.
Under section 235(2) when the accused has been given right to be heard on the question of sentence it is a valuable right.
To make that right meaningful the procedure adopted would be suitably moulded and the accused given an opportunity to adduce evidence on the nature of the sentence.
The hearing may be on the same day if the parties are ready or to a next date but once the court after giving opportunity, proposes to impose appropriate sentence again there is no need to adjourn the case under section 235(2) to next date.
In the present matters the counsel was directed by the High Court to show any additional grounds on the question of sentence, but the counsel was unable to give any additional ground.
[722B C]
|
ivil Appeal No. 2279 of 1991.
From the Judgment and Order dated 27.9.1989 of the Bombay High Court in C.R.A. No. 500 of 1985.
S.C. Birla for the Appellant.
V.N. Ganpule, S.V. Deshpande and Ms. Priya Gupta for the Respondent.
The Judgment of the Court was delivered by RAY, J.
We have heard learned counsel for the parties and we grant special leave.
This appeal on special leave is directed against the judgment and order passed in Civil Revision Application No. 500 of 1985 by the High Court of Judicature at Bombay, Aurangabad Bench allowing the Revision, setting aside the judgment and decree passed by the District Judge in Rent Appeal No. 5 of 1984 confirming and allowing the judgment and order of the Additional Rent Controller, Aurangabad in R.C. No. ARC/71/3.
The matrix of the case is as follows: The appellant landlord, Chandmal, S/o Sumermal Surana as plaintiff filed a suit for eviction of the respondent defendent Firm Ram Chandra & Vishwanath, a commission agent firm from his shop bearing Municipal No. 4 16 101 situated a Mondha, Taluka, District Aurangabad (maharashtra) under section 15(3)(a)(iii) of the Hyderabad House (Rent, Eviction and Lease) Control Act, 1954 to be hereinafter to be referred to as the said Act on the ground inter alia that the respondent was the tenant of the said shop attached to the said house of the appellant landlord on the monthly rent of Rs.50 per month and the tenancy commences from the Ist day of every month according to the English calendar, that the landlord appellant required the suit shop for his own personal use as he intended to start commission agency and other business in the said shop, that he terminated the tenancy of the respondency of the respondent by serving the two notices dated 28.3.1969 and 8.12.1970 and that the respondent did not vacate the suit premises, hence the suit has been filed for eviction of the tenant respondent from the said premises.
Shankarrao Marutirao Sonawane, 735 one of the partners of respondent firm filed his written statement before the Additional Rent Controller accepting the ownership of the appellant and tenancy of the respondent at the rate of Rs. 50 per month.
He, however, denied the appellant 's allegation that he required the suit premises for his personal use.
According to the respondent, the appellant is a member of Hindu joint family comprising of his father, Sumermal, his real brothers and appellant and as one of the partners of registered firm runs a kirana of commission agency shop under the name and style of M/s Rajmal Sumermal Surana.
It has been further submitted that the appellant owns many houses and shops at Aurangabad and also runs a very big shop at Bhaji Bazar, Aurangabad and is not entitled to evict.
In the additional written statement it has been further stated that the appellant purchased the house from Balkrishna and brothers, the firm Ramchandra and Vishwanath is a partnership firm registered under the Partnership Act, one of the partners of the firm Ramchandra and Vishwanath is occupying the house as a permanent tenant since Samwat 2002.
It has also been contended that the partners of the firm are not made parties to the eviction proceedings and hence the suit was not tenable.
An additional issue was framed at the request of the appellant which was to the following effect: "Do defendant prove that he is permanent tenant and his claim is bona fide.
" The trial court considering the evidences adduced on behalf of the defendant respondent held that the defendant failed to prove the claim of permanent tenancy of Ramchandra Madhavrao since Samvat 2002 over the suit premises and that the claim of permanent tenancy is not bona fide.
This issue was thus answered in the negative.
The Additional Rent Controller, therefore, held that the appellant is entitled to evict the respondent from the suit premises in view of the provisions of Section 15(2) (vi) of the said Act and, therefore, Made an order directing the tenant respondent to hand over vacant and peaceful possession of the said shop to the landlord appellant within a period of 30 days of the order though he negatived the plea of bona fide requirement of suit premises for his own occupation.
The order was made on February 14, 1984.
Against this judgment and order, the tenant respondent filed an appeal being Rent Appeal No. 5 of 1984 under section 25 of the said Act in the court of 736 District Judge at Aurangabad.
The learned District Judge confirmed the judgment and order of the Additional Rent Controller holding that the landlord failed to prove that he bona fide required the premises for personal use, for starting new business.
It was further held that so far as the claim of permanent tenancy, there was no iota of evidence to support the tenant respondent 's claim of permanent tenancy.
It also held that the tenant respondent has put forth the claim of permanent tenancy to defeat the landlord appellant 's right to claim possession of the premises and had there been any substance in the claim, the tenant respondent would have produced evidence in support of it.
Complete absence of evidence indicated that the claim is fake and not put forth bona fide.
The learned District Judge, therefore, held that the tenant 's claim of permanent tenancy was not bona fide and so upheld the finding of the Additional Rent Controller and granted three months ' time to the tenant respondent to deliver possession of the suit premises to the landlord appellant.
The tenant respondent feeling aggrieved filed an application for Revision under Section 26 of the said Act in the High Court at Bombay (Aurangabad Bench) being Civil Revision Application No. 500 of 1985.
The said Revision Application was allowed by the learned Single Judge setting aside the concurrent finding of the courts below holding inter alia that in the reply of the tenant to the notices sent by the landlord, there was no semblance of a claim for permanent tenancy.
It was further held that in the written submission there was no whisper about the claim of permanent tenancy.
It is for the first time that in the additional written statement filed on behalf of the tenant the claim of permanent tenancy by one of the partners, Ramchandra Madhavrao since Samwat 2002 was made.
It has also been held that during the trial, Shankarrao Marutirao Sonawane, one of the partners of the respondent firm who has signed the written statement has not uttered a word in his examination in chief with regard to the question of permanent tenancy.
It was, therefore, held that in these circumstances "it is the duty of the Court in the interest of justice to interfere even with a concurrent finding of fact because on the record, I find that there is not a single factor to come to the conclusion that the claim was mala fide or was not bona fide as is required by the statute.
" The learned Single Judge, therefore, set aside the judgments of the courts below and allowed the Revision Application with costs throughout.
It is against this judgment and order, the instant appeal on 737 special leave has been filed by the landlord.
It is convenient to set out hereinbelow the relevant provisions of Section 15(2)(vi) of the said Act before proceeding to consider whether the High Court was justified in setting aside the judgment and order of the courts below: Section 15(2)(vi): A tenant shall not be evicted, whether in execution of a decree or otherwise except in accordance with the provisions of this section (vi) that the tenant has denied the title of the landlord or claimed a right of permanent tenancy and that such denial or claim was not bona fide the Controller shall make an order directing the tenant to put the landlord in possession of the house, and if the Controller is not so satisfied he shall make an order, rejecting, rejecting the application.
" It is also pertinent to set out in this connection the provisions of Section 26 of the said Act: Section 26: "Notwithstanding anything contained in this Act or any other law for the time being in force, an application for revision shall lie to the High Court from any final order passed on appeal by an appellate authority on the following grounds: (a) that the original or appellate authority exercised a jurisdiction not vested in it by law, or (b) that the original or appellate authority failed to exercise a jurisdiction so vested, or (c) in following the procedure or passing the order, the original or appellate authority acted illegally or with material irregularity.
" There is no dispute regarding the submission made in para 9 of the additional written statement which is a part of the same written statement, filed on behalf of the respondent by one of its partners, Shankarrao Marutirao Sonawane to the effect that one of the partners 738 of the said firm, Ramachandra Madhavrao is occupying the house as a permanent tenant since Samvat 2002.
Admittedly, on the basis of this additional written statement, an additional issue No. 1 was framed at the request of the landlord appellant whether the claim of permanent tenancy of Ramchandra Madhavrao was bona fide.
It is evident from the provisions of Section 15(2)(vi) as set out hereinbefore that if the tenant has claimed a right of permanent tenancy and that such claim was not bona fide the Controller shall make an order directing the tenant to put the landlord in possession of the house.
The Additional Rent Controller as well as the District Judge considered carefully and minutely the evidences adduced on behalf of the tenant respondent and found that claim of permanent tenancy was not bona fide.
Accordingly, the courts below held that the tenant respondent was liable to be evicted from the suit premises on this ground alone and passed order for eviction from the suit premises.
The jurisdiction of the High Court in revision against the order passed on appeal by the District Judge is a limited one and it is almost pari materia with the provisions of Section 115 of the Code Procedure.
The High Court while exercising the revisional jurisdiction can interfere with the order passed on appeal by the appellate authority only on three grounds i.e. (i) where the original or appellate authority exercised a jurisdiction not vested in it by law, or (ii) where the original or appellate authority failed to exercise a jurisdiction so vested, or (iii) where in following the procedure or passing the order, the original or appellate authority acted illegally or with material irregularity.
It is evident from the averments made in para 9 of the additional written statement that one of the partners of the respondent firm, Ramchandra Madhavrao occupied the said premises as a permanent tenant since Samvat 2002.
This claim of permanent tenancy was held to be not bona fide by the original court as well as by the appellate authority on a consideration and appraisement of the evidences adduced on behalf of the tenant respondent and as such both the courts below passed order of eviction of the tenant respondent from the suit premises.
These are admittedly concurrent findings of fact arrived at by the original and the appellate authority.
Moreover, these findings in any view of the matter whatsoever, cannot be held to be either without jurisdiction nor it can amount to a failure to exercise jurisdiction vested with them, nor it can be held to be made by the original or appellate authority illegally or with material irregularity.
The revisional jurisdiction of the High Court under Section 26 of the said Act is confined strictly to the jurisdictional error or illegal exercise of jurisdiction.
The finding of the High Court to the effect 739 that it was the duty of the Court in the interest of justice to interfere even with the concurrent finding of facts because on the records, High Court found that there was not a single factor to come to the conclusion that the claim was mala fide or was not bona fide as required by the statute, is entirely baseless and not in accordance with the provisions of Section 26 of the said Act which confers revisional jurisdiction on the High Court.
It is pertinent to mention in this connection the decision in J. Pandu vs R. Narsubai, It is a case under the A.P. Buildings (lease, Rent and Eviction) Act, 1960.
Sub section 2(vi) of Section 10 of A.P. Buildings (Lease, Rent and Eviction) which is similar to Section 15(2)(vi) of the Hyderabad Houses (Rent, Eviction and Lease) Control Act, 1954 sets out two grounds of eviction viz. (1) denial of title of the landlord without bona fides and (2) claim of permanent tenancy rights without bona fides.
It was held that "consequently, either denial of title or claim of permanent tenancy without bona fides will itself be enough to attract Section 10(2)(vi).
The order of eviction on this ground, has therefore, to be sustained.
By reason of this conclusion alone the appeal can be dismissed.
" In the case of Majati Subbarao vs P.V.K.Krishna Rao (deceased) by Lrs., it has been observed that the denial of title of the landlord by the tenant must be made in clear and in unequivocal terms.
It was further observed that it is well settled that the court hearing a suit or appeal can take into account events which are subsequent to the filing of the suit in order to give appropriate relief or mould the relief appropriately.
As we have stated hereinbefore that the claim of permanent tenancy by one of the partners, Ramchandra Madhavrao has been clearly and unequivocally made in the additional written statement filed on behalf of the respondent.
In such circumstances, the provisions of Section 15(2)(vi) of the said Act are applicable and an order of eviction can very well be passed on this ground alone.
In the premises aforesaid, the judgment and order passed in revision by the High Court is contrary to law as the High Court in exercise of its revisional jurisdiction interfered with the concurrent finding of fact arrived at by the original court as well as the appellate authority.
The High Court should not have reversed the same in excise of its revisional jurisdiction under Section 26 of the said Act.
We, therefore, set aside the judgment and order of the High Court and uphold the orders of the court below.
The respondent is given three 740 months ' time to vacate the suit premises on filing the usual undertaking that they will not induct anybody or transfer the same to any other person and they will go on paying the rent of the premises at the usual rate and will deliver vacant and peaceful possession of the suit premises on or before the expiry of the said period to the landlord appellant.
In the facts and circumstances of the case, the parties will bear their own costs.
V.P.R. Appeal allowed.
| IN-Abs | The appellant landlord filed a suit for eviction of the respondent firm defendant commission agent firm, from his shop under section 15(3)(a)(iii) of the Hyderabad House (Rent, Eviction and Lease) Control Act, 1954 on the ground that the appellant required the suit shop for his own personal use as he intended to start commission agency and other business; and that the respondent did not vacate the premise inspite of his two notices, terminating the tenancy.
The respondent filed written statement before the Additional Rent Controller accepting the ownership of the appellant and tenancy of the respondent and denied the appellant 's allegation that he required the premises for his personal use, as the appellant was a member of Hindu Joint family comprising of his father, and his brothers, and his brothers and appellant; the appellant as one of the partners of registered firm runs a kirana of commission agency shop under the name and style of M/s Rajmal Sumermal Surana and the appellant owned many houses and shops and as such was not entitled to an order of eviction.
In the additional written statement it was further stated that the appellant purchased the house from one registered partnership firm and one of the partners of the firm was occupying the house as a permanent tenant since Samwat 2002.
It was also contended that the partners of the firm were not made parties to the eviction proceedings and hence the suit was not tenable.
The Trial Court considering the evidence allowed the suit holding that the appellant was entitled to evict the respondent in view of the provisions of Section 15(2)(vi) of the Act, though the plea of bona fide requirement was negatived.
The tenant respondent filed an appeal under section 25 before the 733 District Judge, which was dismissed though it was held that the landlord failed to prove that he required the premises for personal use.
The tenant respondent 's revision petition under section 26 to the High Court, was allowed by a Single Judge.
Allowing the landlord 's appeal, this Court HELD: 1.
The jurisdiction of the High Court in revision against the order passed on appeal by the District Judge is a limited one and it is almost pari materia with the provisions of Section 115 of the Code of Civil Procedure.
The High Court while exercising the revisional jurisdiction can interfere with the order passed on appeal by the appellate authority only on three grounds, i.e. (i) where the original or appellate authority exercised a jurisdiction not vested in it by law, or (ii) where the original or appellate authority failed to exercise a jurisdiction so vested, or (iii) where in following the procedure or passing the order, the original or appellate authority acted illegally or with material irregularity.
[738C E] 2.
The findings in any view of the matter whatsoever cannot be held to be either without jurisdiction vested with them, nor it can be held to be made by the original or appellate authority illegally or with material irregularity.
[738G] 3.
The revisional jurisdiction of the High Court under Section 26 of the said Act is confined strictly to the jurisdictional error or illegal exercise of jurisdiction.
The finding of the High Court to the effect that it was the duty of the Court in the interest of justice to interfere even with the concurrent finding of facts because on the record, High Court found that there was not a single factor to come to the conclusion that the claim was mala fide or was not bona fide as required by the statute, is entirely baseless and not in accordance with the provisions of Section 26 of said Act which confers revisional Jurisdiction on the High Court.
[738H 739B] 4.
The claim of permanent tenancy by one of the partners has been clearly and unequivocally made in the additional written statement filed on behalf of the respondent.
In such circumstances, the provisions of Section 15(2) (vi) of the said Act are applicable and an order of eviction can very well be passed on this ground alone.
[739F] 734
|
Appeal No. 695 of 1957.
Appeal by special leave from the judgment and order dated September 17, 1957, of the Andhra 1113 Pradesh High Court in Civil Revision Petition No. 1112 of 1957 arising out of the order dated July 6, 1957, of the Court of the Second Additional Judge, City Civil Court, Hyderabad (Decan), made on the application under 0. 1, r. 10, (C. P. C. in Original Suit No. 43/1 of 1957.
M.C. Setalvad, Attorney General for India, C. K. Daphtary, Solicitor General of India, H. N. Sanyal, Additional Solicitor General of India, N. C. Chatterjee, Syed Mohasim, Akbar Ali Mosavi, H. J. Umrigar, 0.
N. Srivastava, J. B. Dadachanji, section N. Andley, Rameshwar Nath and P. L. Vohra, for the appellant.
Purshottam Tricumdas, Anwarull Pusha and G. Gopalakrishnan, for respondent No. 1.
Sir Sultan Ahmed, A. Ramaswami Iyengr C. Chakravarthy, section Ranganathan and G. Gopalakrishan, for respondent No. 2.
G.S. Pathak, A. V. Viswanatha sastri, Mohd. Yunus Saleem, Ghulam Ahmed Khan, Choudhary Akhtar Hussain, Shaukat Hussain and Sardar Bahadur, for respondent No. 3. 1958.
May 23.
The judgment of B. P. Sinha and J. L. Kapur JJ. was delivered by Sinha J. Jafer Imam J. delivered a separate judgment.
SINHA J.
This appeal by special leave is directed against the concurring judgments and orders of the courts below, allowing the intervention of respondents I and 2 and adding them as defendants 2 and 3 in the suit instituted by the appellant against her alleged husband, now respondent 3, who was the sole defendant in the suit as originally framed.
The main question in controversy in this appeal is the true construction of sub r.
(2) of r. 10 of 0. 1 of the Code of Civil Procedure, and its application to the facts of this case which are given below: On April 12, 1957, the plaintiff appellant in this Court instituted the suit out of which this appeal arises against the third respondent who is the second son of His Exalted Highness the Nizam of Hyderabad, and who will, hereinafter, be referred to as the Prince.
1114 In the plaint she alleged that she is the lawfully married wife of the Prince, the marriage ceremony (Nikah) having been solemnized in accordance with the Shia Law by a Shia Mujtahid on October 19, 1948.
The plaintiff also averred that the issue of the marriage were three daughters aged 8, 7 and 5 years; that the fact of the marriage was known to all persons acquainted with the Prince; that there was a prenuptial agreement, whereby the Prince agreed to pay Rs. 2,000 per month to the plaintiff as Kharch e pandan; that the Prince stopped the payment of the allowance aforesaid of Rs. 2,000 per month, since January, 1953, without any reasons and in contravention of the said agreement.
On these allegations, she asked for the following two declarations: (1)That the plaintiff be declared to be the legally wedded wife (Mankuha) of the defendant, (2)That a decree be passed in favour of this plaintiff against the defendant declaring her to be entitled to receive from the defendant 1.
G. Its. 2,000 per month as Kharch e pandan.
" It may be noted that she did not make any claim for arrears of the allowance aforesaid since the date the Prince is alleged to have stopped payment of the same.
Only ten days later, on April 22, 1957, the Prince filed his written statement, admitting the entire claim of the plaintiff for the two declarations aforesaid.
On that very date, an application under 0. 1, r. 10, of the Code of Civil Procedure, on behalf of (1) Saliebzadi Anwar Begum, and (2) Prince Shahainat Ali Khan, minor, under the Guardianship of his mother, the said Sahebzadi, was made.
They are respondents I and 2 respectively in this Court.
The Sahebzadi, respondent 1, claimed to be the " lawful and legally wedded wife" of the Prince, and respondent 2, the son of the Prince by the first respondent.
In their petition they stated inter alia: " The plaintiff herself has stated in the plaint that the defendant is trying to suppress the facts of his marriage with the plaintiff so that the members of his family should conclude that the plaintiff is not his Nikah wife, and the defendant is interested in denying the rights and status of the plaintiff.
1115 The petitioners on being joined as parties to the suit will be equally interested in denying the marriage of the plaintiff and her rights and status. .
The peti tioners have reasons to believe that the above suit is a result of collusion.
The object and motive of the plaintiff in instituting the above suit is to adversely affect the relationship of the petitioners and the defendant and also to deprive the rights and interests of the petitioners in the defendant 's estate.
" On June 15, 1957, the plaintiff made an answer to the petition for intervention, filed by respondents I and 2 aforesaid.
She denied the right of the interveners to be impleaded in that suit, and asserted that the " possibility of the rights of the petitioners being infringed are very remote, contingent upon their or plaintiff surviving the defendant or other circumstances which may or may not arise." She also founded her objection on the ground that, having regard to the admission of the defendant in his written statement, " there is no serious controversy in the suit.
" She also added a number of legal objections which need not be specifically noticed as they have not been pressed in this Court.
She further asserted that the petitioners (meaning thereby, respondents I and 2) are neither necessary nor proper parties to the suit.
She anticipated the ground most hotly contested in this Court, by asserting that the " judgment of this Hon 'ble Court in this suit will not be conclusive as against petitioners as they allege collusion and they will not be prejudiced by not being made parties.
" She ends her statement by making the following significant allegation: " The alleged collusion and motive attributed to the plaintiff for instituting this suit are denied.
On the other hand, the application to be added as defendants is mala fide and malicious and is evidently inspired by some strong force behind them interested in harassing the plaintiff and exposing her to the risk of a vexatious and protracted litigation.
" The Prince, in his own answer to the application for intervention, stated that he admitted that the first 142 1116 respondent is his wife and that the second respondent is his son, and repeated his admission by saying that lie married the plaintiff in October, 1948, and the first respondent in December 1952.
He added further that when he married the first respondent, he had already three daughters by the plaintiff, which fact was known to the first respondent at the time of her marriage with him.
He supported the plaintiff in her objection to the intervention by asserting that the rights of respondents 1 and 2 will not be affected in any way, and by insisting upon his Muslim right of having four wives living at the same time.
He also supported the plaintiff in her denial of the allegation of collusion and " that the suit is intended to adversely affect the relationship of the petitioners and the defendant respondent and to deprive the rights and interests of the petitioners in the defendant respondent 's estate.
" He, in his turn, added the following equally significant penultmate para: " That the petitioners ' application has been filed in order to prolong the litigation and that the defen.
dant responaent 's father His Exalted Highness the Nizam, appears to be more interested than petitioner No. 1 herself, in creating unnecessary complications in the suit.
" On these allegations and counter allegations, after hearing the parties, the trial court, by its judgment and order dated July 6, 1957, allowed the application for intervention, and directed respondents 1 and 2 to be added as defendants.
The court, after discussing all the contentions raised on behalf of the parties, observed that there were indications in the record of a possible collusion between the plaintiff and the defendant; that the relief claimed under section 42 of the Specific Relief Act, being discretionary, could not be granted as of right ; that the presence of the interveners would help the court in unravelling the mysteries of the litigation, and that there was force in the contention put forward on behalf of the interveners that under section 43 of the Specific Relief Act, any declaration given in favour of the plaintiff will be binding upon the interveners.
It also held that in order effectually and completely to 1117 adjudicate upon and settle the present controversy, the presence of the interveners was necessary.
The plaintiff moved the High Court of Judicature of Andhra Pradesh, at Hyderabad, under section 115 of the Code of Civil Procedure, to revise the aforesaid order of the learned trial judge.
The High Court, in a wellconsidered judgment, after discussing the points raised for and against the addition of the parties, and noticing almost all the authorities quoted before us, refused to interfere with the discretion exercised by the trial court, and dismissed the revisional application.
It came to the conclusion that the first respondent, the admitted wife of the defendant, and the second respondent, the admitted son by her, are interested in denying the status claimed by the plaintiff, and " have some rights against the estate of the 3rd respondent.
The learned Judge of the High Court further observed When so much sanctity is attached to the status of marriage, it would indeed be strange that persons who are so intimately related to the 3rd respondent as wife and son, should be denied the opportunity of contesting the status of the petitioner as his lawfully married wife. .
It cannot be that the petitioner is seeking any empty relief carrying with it the stamp of futility and it is difficult to assume that she is fighting a vain or purposeless litigation.
If what she is seeking is a relief which will carry with it certain legal incidents, are not persons interested in denying her status proper parties to the litigation ? " The Court also observed that it was with a view to avoiding multiplicity of suits that r. 10(2) of 0. 1, had made provision foradding parties.
The Court noticed the argument under section 43 of the Specific Relief Act, but did not express any final opinion, because, in its view, it had already reached the " conclusion that the proposed parties are persons whose presence before the court is necessary within the meaning of 0. 1, r. 10 (2), so as to ensure that the dispute should be finally determined once for all in the presence of all the parties interested.
" Against the judgment of the High Court, refusing to set aside the order passed by the learned trial judge, 1118 the plaintiff moved this Court and obtained special leave to appeal.
In the forefront of his arguments in support of the appeal, the learned Attorney General submitted that the court had no jurisdiction to add the first two respondents as defendants in the suit.
He relied upon the words of the relevant portion of sub rule (2) of r. 10 of O. I of the Code, which are as follows: " (2). . . and that the name of any person who ought to have been joined, whether as plaintiff or defendant, or whose presence before the Court may be necessary in order to enable the Court effectually and completely to adjudicate upon and settle all the questions involved in the suit, be added.
He rightly pointed out, and there was no controversy between the parties before us, that the added defendants do not come within the purview of the words " who ought to have been joined ", which apparently have reference to necessary parties in the sense that the suit cannot be effectively disposed of without their presence on the record.
The learned Attorney General strenuously argued that it cannot be asserted in this case that the presence of the added defendantsrespondents 1 and 2 before the court was necessary in order to enable the court effectually and completely to adjudicate upon and settle all the questions involved in the suit.
He founded this argument on the legal position that the wife and the son of the Princerespondents I and 2 have no present interest in his estate.
Their expectancy of succession to the estate of the Prince does not clothe them with any right vested or contingent to intervene in this action.
In this connection, he pointed out that r. 10 of 0. 1 of the Code of Civil Procedure, which corresponds to portions of 0. 16, r. 11, of the Rules of the Supreme Court in England, has been the subject matter of judicial interpretation in many cases.
Both, in this country and in England, there have been two currents of judicial opinion, one taking what may be called the narrower view, and the other, the wider view.
As illustrations of the former, that is to say, the narrower 1119 view, may be cited the cases of Moser vs Marsden (1) and McCheane vs Gyles (No. 2) (2).
In India, this view is represented by the decision in the case of Sri Mahant Prayaga Doss Jee Varyu vs The Board of Commissioners for Hindu Religious Endowments, Madras (3).
On the other side of the line, representing the wider view, may be cited the case of Dollfus Mieg Et Compagnie section A. vs Bank of England (4).
In India, the decisions of the Madras High Court, in the cases of Vydianadayyan vs Sitaramayyan (5) and Secy. of State vs M. Murugesa Mudaliar (6), were cited as illustrations.
But it was contended on behalf of the appellants that whether the narrower or the wider view of the interpretation of sub r.
(2) of r. 10 of 0.
I of the Code of Civil Procedure is taken, the result, so far as the present controversy is concerned, would be the same.
In the leading case of Moser vs Marsden (1), Lindley L. J. has held that a party who is not directly interested in the issues between the plaintiff and the defendant, but is only indirectly or commercially affected, cannot be added as a defendant because the court has no jurisdiction, under the relevant rule, to bring him on the record even as a " proper party ".
That was a suit to restrain the alleged infringement of the plaintiff"s patent by the defendant, Marsden.
The Court held, reversing the order of the trial judge, that the party sought to be added had no direct interest in.
the subject matter of the litigation, and all that could have been said on behalf of the party intervening was that the judgment against the defendant would affect his interest commercially.
The Court distinguished the previous decisions in Vavasseur vs Krupp(7) and Apollinaris Company vs Wilson (8), on the ground that in those cases the litigation would have affected the property of the persons not before the court.
This leading case of Moser vs Marsden (1) is clearly an authority for the proposition that the court has jurisdiction to add as a party defendant only a person (1) (2) (3) Mad.
(4) [195O] 2 All E. R. 605.
(5) Mad.
(6) A. I. R. (7) .
(8) 1120 who is directly interested in the subject matter of the litigation and not a person who will be only indirectly or commercially affected.
Kay L. J. who agreed with Lindley L. J. in that case, observed that the relevant rule of the Supreme Court, on its proper construction, authorized the court to add only such persons as would be bound by the judgment to be given in the action, but did not authorize the court to add any persons who would not be so bound and whose interest may only indirectly be affected in a commer cial sense.
To the same effect is the decision in Re I. G. Farbeninadusrie A. G. Agreement (1).
The Court held that in order that a party may be added as a defendant in the suit, he should have a legal interest in the subject matter of the litigation legal interest not as distinguished from an equitable interest, but an interest which the law recognizes.
Lord Greene M. R. giving the judgment of the Court, also observed that the court had.
no jurisdiction to add a person as a party to the litigation if he had no legal interest in the issue involved in the case.
In the case of Vydianadayyan vs Sitaramayyan (2), in which the wider view of the interpretation of the relevant rule was taken, Turner C. J. delivering the judgment of the Court, observed that the wider interpretation which enabled the court to avoid conflicting decisions on the same question and which would finally and effectually put an end to the litigation respecting it, should be adopted.
But in that case also the party added as defendant was interested in the subject matter of the litigation, though there was no impediment to the court determining the issues between the parties originally before the court.
The learned Judge, on a discussion of the English and Indian cases on the subject, came to the conclusion that a material question common to all the parties to the suit and to third parties should be tried once for all.
He held that to secure this result the court bad a discretion to add parties a discretion which has to be judicially exercised, that is, that by adding the new parties the court should not inflict injustice upon the parties already on the record, in the sense (1) (2) Mad.
1121 that they would be prejudiced in the fair trial of the questions in controversy.
The two Madras decisions in Sri Mahant Prayaga Doss Jee Varu vs The Board of Commissioners for Hindu Religious Enclowmentg, Madras (1) and Secy.
of State vs M. Murugesa Mudaliar (2) appear to have taken conflicting views on the question whether Government could be added as a party to the litigation not because it was directly interested in the subjectmatter of the litigation, but because the law enacted by the legislature of that State had been questioned.
this controversy appears to have been raised in the Federal Court in the case of The United Provinces vs Mst.
Atiqa Begum (3).
In that case the provincial legislature of the United Provinces, as it then was, had enacted the United Provinces Regularization of Remissions Act (XIV of 1938) precluding the courts from entertaining any question as to the validity of certain orders of remission of rents.
The validity of that Act was questioned in a litigation between a landlord and his tenants.
At the High Court stage the Provincial Government was added as a party to the litigation at the instance of the Advocate General, with a view to enabling the Government to come up in appeal to the Federal Court in order to obtain a more authoritative pronouncement on the vales of the Act.
In the Federal Court the power of the High Court to add the Provincial Government as a party was specifically questioned.
Gwyer C. J. noticed the two Madras decisions referred to above but assumed that there was jurisdiction in the Court in a proper case to do so, and, therefore, did not express his considered opinion in view of the fact that his two colleagues, Sulaiman and Varadachariar JJ.
had agreed, though for different reasons, in the view that the High Court had jurisdiction to implead the Government though it was only indirectly interested in the litigation.
Sulaiman J. was inclined to take the view that there was a discretion in the High Court to add the Government as a party.
On the other hand, Varadachariar J. (1) Mad. 34.
(2) A.I.R. 1929 Mad 443.
(3) 1122 was inclined to take the view that the State did not stand on the same footing as a private third party for all purposes.
He took the view that the State as the guardian of the public interest should not be called upon to show some pecuniary or proprietary interest or interest in public revenue in the questions involved, to be added as a party.
He also observed that in a case where the State intervention was concerned, " it must be decided on broad grounds of justice and convenience and not merely as turning on the interpretation of a particular rule in the Civil Procedure Code.
" Discussing the question whether it was a matter of discretion or of Jurisdiction in the court to make an order adding a party, the learned Judge made the following observations : " In my opinion, there is no case here of defect of jurisdiction in the sense in which it is said that consent cannot cure a defect of jurisdiction.
It is true that in Moser vs Marsden (1), Lindley L. J. observed that the question was not one of " discretion but of jurisdiction ".
But as the antithesis shows, the learned L. J. apparently had in mind the difference between the decision of the question of joinder on the interpretation of a rule of law and a direction given by the lower court in the exercise of its discretion, because in the latter case the court of appeal would generally be reluctant to interfere.
It may even be regarded as a case of excess of jurisdiction within the meaning of section 115 of the Civil Procedure Code, but that will not make the order void in the sense that it may be ignored or treated as if it had never been passed.
" It would thus appear that the courts in India have not treated the matter of addition of parties as raising any question of the initial jurisdiction of the court.
It may sometimes involve a question of jurisdiction in the limited sense in which it is used in section 115 of the Code of Civil Procedure.
It is no use multiplying references bearing on the construction of the relevant rule of the Code relating to addition of parties.
Each case has to be determined on its own facts, and it has to be recognized that no decided cases have been brought to our notice which (1) 1123 can be said to be on all fours with the facts and circumstances of the present case.
There. ,cannot be the least doubt that it is firmly established as a result of judicial decisions that in order that a person may be added as a party to a suit he should have a direct interest in the subject matter of the litigation whether it raises questions relating to moveable or immoveable property.
In the instant case, we are not concerned with any controversy as regards property or estate.
Hence, all the cases cited at the bar, laying down that a person who has no present interest in the subjectmatter cannot be added, are cases which were con cerned with property rights.
In this case, we are concerned primarily with a declaration as regards status which directly comes under the provisions of section 42 of the Specific Relief Act.
We are concerned, in this case, with the following provisions of section 42: " 42.
Any person entitled to any legal character, or to any right as to any property, may institute a suit against any person denying.
or interested to deny, his title to such character or right, and the Court may in its discretion make therein a declaration that he is so entitled, and, the plaintiff need not in such suit ask for any further relief.
" This section recognizes the right in any person to have a declaration made in respect of his legal character or any right to property.
To such a suit for a mere declaration, any person denying or interested to deny the existence of any legal character or the alleged right to any property, would be a necessary party.
The plaintiff appellant chose to implead only her alleged husband, the Prince.
There is no clear averment in the plaint that the defendant had ever denied the legal character in question, namely, the status of the plaintiff as his wife.
The substance of the plaintiff 's cause of action is stated in para.
3 of the plaint.
From the words used in the said para.
of the plaint, it is clear that the persons who are alleged to have known the existence of the relationship of husband and wife between the parties would include the respondents 1 and 2, and that the Prince had been trying to suppress the fact of 143 1124 the marriage with the plaintiff so as to lead the members of his family to conclude that the plaintiff is not his wife,.
The gravamenofthechargeagaiiistthePrince is that " he refuses to openly acknowledge the plaintiff as his legally wedded wife, ", and that this conduct has cast a cloud oil the plaintiff 's status as such wife.
Such a conduct on the part of the Prince, it is further alleged, is not only injurious and detrimental to the rights of the plaintiff, but is adversely affecting the rights of the issue of the marriage, meaning thereby, the three daughters by the plaintiff.
It is thus clear, as was contended on behalf of respondents I and 2, that reading between the lines of the averments aforesaid, it is suggested that not only the defendantrespondent 3 but the other inembers of his family, including respondents I and 2, were interested ill deying the plaintiff 's alleged status, and that this suit ,",as being instituted to clear the cloud cast not, only upon the plaintiffs status as a legally wedded wife, but upon the status of the three daughters by her.
It is clear, therefore, that if the plaintiff had been less disingenuous and had impleaded the first and the second respondents also, as defendants in the suit, the latter could not have been discharged from the action on the ground that they had been unnecessarily impleaded and that no cause of action bad been disclosed against them.
They would certainly have been proper parties to the suit.
This is a very important aspect of the case which has to be kept ill view in order to determine the question whether respondonts, 1 and 2 had been rightly added as defendants on their own intervention.
It is also clear on the words of the statute, quoted above, that the grant of a declaration such as is contemplated by section 42, is entirely in the discretion of the court.
At this stage it is convenient to deal with the other contention raised on behalf of the appellant namely, that in view of the unequivocal admission of the plaintiffs claim by the Prince in his written statement and repeated as aforesaid in his counter to the application for intervention by respondents I and 2, no serious controversy now survives.
It is suggested 1125 that the declarations sought in this case would be granted as a matter of course.
In this connection, our attention was called to the provisions of r. 6 of 0. 12 of the Code of Civil Procedure, which lays down that upon such admissions as have been made by the Prince in this case the court would give judgment for the plaintiff.
These provisions have got to be read along with r. 5 of 0. 8 of the (,ode with particular reference to the proviso which is in these terms: " Provided that the Court may in its discrettion require any fact so admitted to be proved otherwise than by such admission.
" The proviso quoted above is identical with the proviso to section 58 of the Indian Evidence Act, which lays down that facts admitted need not be proved.
Reading all these provisions together, it is manifest that the court is not bound to grant the declarations prayed for even though the facts alleged in the plaint may have been admitted.
In this connection, the following passage in Anderson 's " Actions for Declaratory Judgments ", Vol. 1, p. 340, under article 177, is relevant: " A claim of legal or equitable rights and denial thereof on behalf of an adverse interest or party constitutes a ripe cause for a proceeding, seeking declaratory relief.
A declaration of rights is not proper where the defendant seeks to uphold the plaintiff , in such an action.
The required element of adverse parties is absent." " In others words the controversy must be between the plaintiff and the respondent who asserts an interest adverse to the plaintiff.
In the absence of such a situation there is no justiciable controversy and the case must be characterized as one asking for an advisory opinion, and as being academic rather than justiciable. . . " " i.e., there must be an actual controversy of justiciable character between parties having adverse interest." Hence, if the court, in all the circumstances of a parti cular case, takes the view that it would insist upon the burden of the issue being fully discharged, and if the, 1126 court, in pursuance of the terms of section 42 of the Specific Relief Act, decides, in a given case, to insist upon clear proof of even admitted facts, the court could not be said to have exceeded its judicial powers.
That the plaintiff herself or her legal advisers did not take the view contended for on her behalf, is shown by the fact that a few days after the filing of the written statement of the Prince, on April 27, Barkat Ali, the Mujtahid, who is alleged to have solemnized the marriage, was examined in court, and he gave his statement on oath in support of the plaintiff 's claim.
He also proved certain documents in corroboration of the plaintiff 's case and his own evidence.
This witness was not cross examined on behalf of the defendant.
It was stated before us, on behalf of respondents 1 and 2, that there were pieces of documentary evidence apart from certain alleged admissions made by or on behalf of the plaintiff, which seriously militate against the plaintiff 's case and the statement of the witness referred to above.
We need not go into all that con troversy, because we are not, at this stage, concerned with the truth or otherwise of the plaintiffs case.
At this stage we are only concerned with the question whether in adding respondents I and 2 as defendants in the action, the courts below have exceeded their powers.
It is enough to point out at this stage that the plaintiff did not invite the court to exercise its powers under r. 6 of 0. 12 of the Code of Civil Procedure, and, therefore, we are not called upon to decide whether the trial court was right in not pronouncing judgment on mere admission.
The court, when it is called upon to make a solemn declaration of the plain tiff 's alleged status as the defendant 's wife, has, naturally, to be vigilant and not to treat it as a matter of course, as it would do in a mere money claim which is admitted by the defendant.
The adjudication of status, the declaration of which is claimed by the plaintiff, is a more serious matter, because by its intendment and in its ultimate result it affects not only the persons actually before,the court in the suit as originally framed, but also the plaintiff 's progeny who are not parties to the action, and the respondents 1 and 2.
1127 If the declaration of status claimed by the plaintiff is granted by the court, naturally the three daughters by the plaintiff would get the status of legitimate children of the Prince.
If the decision is the other way, they become branded as illegitimate.
The suit clearly is not only in the interest of the plaintiff herself but of her children also.
It is equally clear that not only the Prince is directly affected by the declaration sought, but his whole family, including respondents I and 2 and their descendants, are also affected thereby.
This, naturally leads us to a discussion of the effect of section 43 of the Specific Relief Act, which goes with and is an integral part of the scheme of declaratory decrees which form the subject matter of Ch.
VI of the Act.
That section is in these terms: " 43.
A declaration made under this Chapter is binding only oil the parties to the suit, persons claiming through them respectively, and where any of the parties are trustees, on the persons for whom, if in existence at the date of the declaration, such parties would be trustees.
" On behalf of the appellant it was contended by the learned Attorney General that the declaration of status sought in this suit by the plaintiff will be binding only upon her and the Prince, and being a rule of ' res judicata will bind only the parties to the suit and their privies.
It was further contended that respondents I and 2 are in no sense such privies.
The argument proceeds thus: Section 43 lays down a rule of res judicata in a modified form, and it was so framed as to make it clear beyond all doubt by the use of the word " only " that a declaration under section 42 is binding on the parties to the suit and on persons claiming through them respectively.
If any question arises in the future after the inheritance to the estate of the, Prince opens out, it could not be said that the plaintiff and respondents 1 and 2 were claiming through different persons under a conflicting title which was the core of the rule of res judicata.
In this connection, reliance was placed upon the decision of the Judicial Committee of the Privy Council 'in the case of Syed ' Ashgar Reza Khan vs Syed Mahomed Mehdi Hossein 1128 Khan (1).
That case lays down that a decision in a former suit that the common ancestor of all the parties to the subsequent suit was entitled to the whole of the profit of a market in dispute in the two litigations, as against his co sharers in the zamindari in which the market was situate, does not operate as res judicata in a subsequent dispute between those who claim under him.
In this connection, reliance was also placed upon a decision of the Madras High Court in the case of Vythilinga Muppanar vs Vijayathammal(2), to the same effect.
Mr. Pathak, appearing on behalf of the .Prince, the third respondent, supported the appellant by raising a further point that the words " claiming through " mean the same thing as " claiming under in section 11 of the Code of Civil Procedure, laying down the rule of res judicata, and that those words are not apt to refer to a declaration.
of a more personal status, and that they mean the same thing as pi ivy in estate ,is understood under the common law.
He called our attention to the following passage in ' Bigelow on Estoppel ', 6th Edn., at pp.
158 and 159: " In the law of estoppel one person becomes privy to another (1) by succeeding to the position of that other as regards the Subject of the estoppel, (2) by holding in subordination to that other. . . .
But it should be noticed that the ground of privity is property and not personal relations To make a man a privy to an action he must have acquired an interest in the subject matter of the, action either by inheritance, succession, or purchase from a party subsequently to the action, or he must hold property sub ordinately.
" He also drew our attention to similar observations in " Casperz on Estoppel".
On the other hand, Mr. Purshottam and Sir Syed Sultan Ahmed, appearing on behalf of respondents I and 2, respectively, contended that " claiming through " and " claiming under " have not exactly the same significance in law, and that the rule laid down in section 43 of the Specific Relief Act does not stand on the same footing as a rule of res judicata contained in section II of the Code of (1) (1903) L.R. 30 I.A. 71.
(2) ivlad.
43. 1129 Civil Procedure, or estoppel by judgment, as discussed in the works of Bigelow and (Casperz, relied upon on behalf of the other side.
On behalf of respondents I and 2 it was further contended that the suit was really intended not to bind the Prince who has shown no hostility to the claim, but to bind respondents 1 and 2.
It was also contended that if the court were to grant the declaration that the plaintiff is the lawfully wedded wife of the Prince, if a controversy arises hereafter between the plaintiff and her children on the one side and respondents I and 2 on the other, this judgment will not only be admissible in evidence in that litigation, but will be binding upon thereon the plaintiff ', because she is privy to the judgment, and oil her children, because they will be claiming the benefit of the declaration through her, and on respondents I and 2 because they are admittedly the wife and son of the Prince and will be manifestly claiming through him.
In this connection, it has to be remarked that the discretion vested in a court to grant a merely declaratory relief as distinguished from a judgment which is capable of being enforced by execution, derives its utility and importance from the objects it has in view, namely to " prevent future litigation by removing existing causes of controversy to quiet title" and "to perpetuate testimony ", as also to avoid multiplicity of proceedings.
This practice of granting declaratory reliefs, which originated in England in the Equity courts, has been very much extended in America by statutory provisions.
In India, the law has been codified in the Specific Relief Act, in Ch.
VI, and has, in a sense, extended the scope of the rule by providing for declarations not only in respect of claims to property but also in respect of disputes as regards status.
From the terms of section 42 of the Act, it would appear that the Indian courts have not been empowered to grant every form of declaration which may be available in America.
In its very entire, a declaratory decree does not confer any new right, but only clears Lip mists which may have gathered round the title to property or to status or a legal character.
When a 1130 court makes a declaration in respect of a disputed status, important rights flow from such a judicial declaration.
Hence, a declaration granted in respect of a legal character or status in favour of a person is meant to bind not only persons actually parties to the litigation, but also persons claiming through them as laid down in section 43 of the Act.
It is, thus, a rule of substantive law, and is distinct and separate from the rule of res judicata or estoppel by judgment.
The doctrine of res judicata, as it has been enunciated in a number of rules laid down in section 11 of the Code of Civil Procedure, covers a much wider field than the rule laid down in section 43 of the Specific Relief Act.
For example, the doctrine of res judicata lays particular stress upon the competence of the court.
On the other hand, section 43 emphasizes the legal position that it is a judgment in personam as distinguished from a judgment in rem.
A judgment may be res judicata in a subsequent litigation only if the former court was competent to deal with the later controversy.
No such considerations find a place in section 43 of the Specific Relief Act.
Again, a previous judgment may be res judicata in a subsequent litigation between parties even though they may not have been eo nomine parties to the previous litigation or even claiming through them.
For example, judgment in a representative suit, or a judgment obtained by a presumptive reversioner will bind the actual reversioner even though he may not have been a party to it, or may not have been claiming through the parties in the previous litigation.
When a declaratory judgment has been given, by virtue of section 43, it is binding not only on the persons actually parties to the judgment but their privies also, using the term 'privy ' not in its restricted sense of privy in estate, but also privy in blood.
Privity may arise (1) by operation of law, for example, privity of contract; (2) by creation of subordinate interest in property, for example, privity in estate as between a landlord and a tenant, or a mortgagor and a mortgagee; and (3) by blood, for example, privity in blood in the case of ancestor and heir.
Otherwise, in some conceivable cases, the provisions of section 43, quoted 1131 above, would become otiose.
The contention raised on behalf of the appellant, which was strongly supported by the third respondent through Mr. Pathak, as stated above, is that a declaratory judgment would not bind anyone other than the party to the suit unless it affects some property, in other words, unless the parties were privy in estate.
But such a contention would render the provisions of section 43 aforesaid, applicable only to declarations in respect of property and not declarations in respect of status.
That could not have been the intendment of the statutory rule laid down in section 43.
Sections 42 and 43, as indicated above, go together, and are meant to be co extensive in their operation.
That being so, a declaratory judgment in respect of a disputed status, will be binding not only upon the parties actually before the court, but also upon persons claiming through them respectively.
The use of the word only ' in section 43, as rightly contended on behalf of the appellant, was meant to emphasize that a declaration in Ch.
VI of the Specific Relief Act, is not a judgment in rem.
But even though such a declaration operates only in personam, the section proceeds further to provide that it binds not only the parties to the suit, but also persons claiming through them, respectively.
The word I respectively ' has been used with a view to showing that the parties arrayed on either side, are really claiming adversely to one another, so far as the declaration is concerned.
This is another indication of the sound rule that the court, in a particular case where it has reasons to believe that there is no real conflict, may, in exercise of a judicial discretion, refuse to grant the declaration asked for for oblique reasons.
As a result of these considerations, we have arrived at the following conclusions: (1) That the question of addition of parties under r. 10 of 0.
I of the Code of Civil Procedure, is generally not one of initial jurisdiction of the court, but of a judicial discretion which has to be exercised in view.
of all the facts and circumstances of a particular case; but in some cases, it may raise controversies as to the power of the court, in contra distinction to its inherent 144 1132 jurisdiction, or, in other words, of jurisdiction in the limited sense in which it is used in section 115 of the Code; (2)That in a suit relating to property in order that a person may be added as a party, he should have a direct interest as distinguished from a commercial interest in the subject matter of the litigation; (3)Where the subject matter of a litigation is a declaration as regards status or a legal character, the rule of present or direct interest may be relaxed in a suitable case where the court is of the opinion that by adding that party it would be in a better position effectually and completely to adjudicate upon the controversy ; (4)The cases contemplated in the last proposition have to be determined in accordance with the statutory provisions of sections 42 and 43 of the Specific Relief Act ; (5)In cases covered by those statutory provisions the court is not bound to grant the declaration prayed for, on a mere admission of the claim by the defendant, if the court has reasons to insist upon a clear proof apart from the admission; (6)The result of a declaratory decree on the question of status such as in controversy in the instant case affects not only the parties actually before the court but generations to come, and, in view of that consideration, the rule of I present interest ' as evolved by case law relating to disputes about property does not apply with full force; and (7)The rule laid down in section 43 of the Specific Relief Act is not exactly a rule of res judicata.
It is narrower in one sense and wider in another.
Applying the propositions enunciated above to the facts of the instant case, we have come to the conclusion that the courts below did not exceed their power in directing the addition of respondents I and 2 as parties defendants in the action.
Nor can it be said that the exercise of the discretion was not sound.
Furthermore, this case comes before us by special leave and we do not consider that it is a fit case where we should interfere with the exercise of discretion by the courts below.
The appeal is, accordingly, 1133 dismissed.
As regards the question of costs, we direct that it will abide the ultimate result of the litigation and will be disposed of by the trial court.
IMAM J.
I regret I cannot agree with the opinion of my learned brethren expressed in the judgment just delivered.
The appellant in her plaint had asked for a declaration that she was a legally wedded wife of respondent 3 and that she was also entitled to receive from him Kharch e Pandan at the rate of Rs. 2,000 per month.
This respondent filed his written statement in which he unequivocally admitted that the appellant was married to him and that she was also entitled to the Kharch e Pandan as claimed in the plaint.
He further admitted that the appellant bore him three issues out of the marriage.
The appellant sought no relief or any declaration against respondents 1 and 2 as, indeed, she could not have, because she had no cause of action against them.
There is nothing in the pleadings of the appellant and respondent 3 which discloses that respondents I and 2 have any cause of action against the appellant.
Respondents 1 and 2, however, filed an application under 0. 1, r. 10(2), of the Code of Civil Procedure before the Judge of the City Civil Court, Hyderabad, praying that they should be added as parties to the suit filed by the appellant.
The Judge of the City Civil Court allowed the application and his decision was affirmed by the High Court.
The question for decision in this appeal is whether the J@dge of the City Civil Court was justified in adding respondents I and 2 as parties to the suit and whether the decision of the High Court upholding his order should be affirmed.
The provisions of 0. 1, r. 1, state as to who may be joined as plaintiffs in a suit and 0. 1, r. 3, states who may be joined as defendants.
The parties who are to be joined as plaintiffs and defendants in a suit are persons in whom and against whom any right to relief in respect of or arising out of the same act or transaction or series of acts or transactions is alleged to exist, whether jointly, severally or in the alternative, where, if such persons were parties in separate suits, any 1134 common question of law or fact would arise.
Independent of this, a court has jurisdiction under 0.1, r. 10(1), to substitute or add as plaintiff any person whom it considers necessary for the determination of the real matters in dispute.
Under 0. 1, r. 10(2), the court has the power to strike off a party who has been improperly joined, whether as plaintiff or defendant, and to join, as plaintiff or defendant, any person who ought to have been joined, or whose presence before the court may be necessary in order to enable it effectually and completely to adjudicate upon and settle all the questions involved in the suit.
It is quite obvious from the contents of the plaint and the written statement of respondent 3 that there was no occasion for the appellant to have joined respondents I and 2 as defendants in the suit.
There remains, then, to consider whether the circumstances appearing in this case justified the Judge of the City Civil Court to add respondents 1 and 2 as defendants under the provisions of 0. 1, r. 10(2).
Respondents 1 and 2 in their application under 0. 1, r. 10(2), of the Code of Civil Procedure, in essence, relied upon the five following grounds for their plea that they should be added as defendants in the suit: (1)That respondent I was the lawful and legally wedded wife of respondent 3, (2) That respondent 2 was the son of respondent 3, (3) That respondents 1 and 2 should be joined as parties to the suit because the question to be adjudicated upon would seriously affect their rights and interest in the estate of respondent 3, (4)That by adding respondents 1 and 2 as parties neither a new cause of action would be introduced nor would the nature of the suit be altered, (5)That the issue to be tried in the suit, after res pondents I and 2 were added as parties, would still be the same as the case made by the appellant was that respondent 3 was interested in denying the appellant 's marriage to respondent 3 a fact which respondents I and 2 were equally interested in denying.
The first two grounds afford no justification for respon dents I and 2 being added as parties to the suit, where 1135 the only question to be decided is whether the appellant is married to respondent 3 and whether he had contracted to pay to the appellant Rs. 2,000 a month as Kharch e pandan.
Even if the appellant successfully proved that she was married to respondent 3, who had contracted to pay her Rs. 2,000 per month as Kharch e pandan, the status and the rights of respondents I and 2 as wife and son of respondent 3 would remain unaffected.
A Mohammedan is entitled to marry more than once and have wives to the number four at one and the same time.
This is his right under his personal law and no one can question the exercise of this right by him.
In the suit between the appellant and respondent 3, the question as to whether the appellant was married to respondent 3 was a matter entirely personal to the appellant and respondent 3.
The appellant claimed that she was lawfully married to respondent 3.
It was open to respondent 3 to either deny or admit her claim.
In fact, respondent 3 had admitted the claim of the appellant that she was married to him.
It is not open to anyone else in the present litigation to say that he has falsely made such an admission.
It is true that respondents 1 and 2 have alleged collusion between the appellant and respondent 3.
No positive facts are asserted in support of this.
The suggestion is based merely on suspicion.
Unless the court is justified in adding respondents 1 and 2 as defendants in the suit the suggestion made by them that there is collusion between the appellant and respondent 3 should be ignored by the court on the simple ground that respondents 1 and 2 have no locus standi to make any such representation in the present case.
The 3rd, 4th and 5th grounds may be considered together as they are inter connected.
Grounds 4 and 5 suggest that there would be neither a new cause of action introduced nor would the nature of the suit be altered and the issue to be tried in the suit would still be the same even if respondents I and 2 were added as parties.
The only issue in the suit filed by the appellant is whether she was married to respondent 3 and whether there was a contract by the latter to pay 1136 her Rs. 2,000 per month as Kharch e pandan.
If respondents I and 2 are added as parties, questions relating to right of inheritance in the estate of respondent 3 would arise for determination in addition to the only issue stated above in the case.
The main ground, upon which respondents 1 and 2 claim that they should be added as parties to the suit, is to be found in the 3rd ground which, in substance, is that if the appellant is declared to be lawfully wedded to respondent 3, then the rights and interests of respondents I and 2 in the estate of respondent 3 would be affected.
In other words, in the estate of respondent 3, on his death, in addition to respondents 1 and 2, the appellant and her three children by him would have rights of inheritance.
Consequently, the extent of inheritance of respondents I and 2 in the estate of respondent 3 would be considerably diminished.
It was urged that if the appellant is given the declaration, which she seeks, the judgment of the court would be in the exercise of matrimonial jurisdiction and it would be a judgment in rem as stated in section 41 of the Indian Evidence Act.
Such a declaration would also be binding on respondents 1 and 2 by virtue of the provisions of section 43 of the Specific Relief Act.
The appellant asked for a declaration under section 42 of the Specific Relief Act.
This section permitted a person who claimed to be entitled to any legal character, or to any right to property, to institute a suit against any person denying, or interested to deny, such character or right.
Respondents 1 and 2 was interested in denying the appellant 's status as a wife and the status of her three children as the legitimate children of respondent 3.
A declaration in her favour would be binding on respondents I and 2 and they would never be in a position to disprove the appellant 's marriage to respondent 3.
This was an impossible situation where the declaration had been obtained from a court as the result of collusion between the appellant and respondent 3.
This submission presupposes that respondents I and 2 would survive respondent 3.
During the lifetime of respondent 3 neither the appellant nor her children on 1137 the one hand nor respondents 1 and 2 on the other have any right, , whatsoever in his estate under the Mohammedan law.
During the lifetime of respondent 3 respondents I and 2 would have the right to be maintained by him and, if the appellant is also his wife, then she and her children would also have the right to be maintained by him.
The appellant and respondent 1 would also have rights arising out of a contract, if any, between them and respondent 3.
None of these rights, however, are rights or interests in the estate of respondent 3.
The submission also presupposes that on the death of respondent 3 he would have left behind some estate to be inherited by his heirs.
These submissions are entirely speculative and afford no basis for the impleading of respondents 1 and 2 as parties to the appellant 's suit.
It was said, however, that the right to inherit is a present right in respondents 1 and 2 and if the appellant is declared to be the wife of respondent 3, then that right to inheritance is affected.
This contention is erroneous and there is no legal basis to support it.
If the appellant is declared to be the wife of respondent 3 such a declaration could not affect the right to inherit on the part of respondents I and 2 in the estate of respondent 3, assuming that respondent 3 on his death left an estate to be inherited and that the appellant and her children and respondents I and 2 survived him.
The extent of the inheritance of each one of these may thus become less but so far as that is concerned it cannot be predicated during the lifetime of respondent 3 as to what would be the extent of the inheritance of his heirs.
Under the Mohammedan law, by which the parties are governed, respondent 3 could yet validly marry two other women and have children from them, in which case, the inheritance, if any, could not be to the same extent if respondent 3 died leaving only respondents I and 2 as his heirs.
The entire question raised by res pondents I and 2 is based on the supposition that they have rights in the estate of respondent 3.
Under the Mohammedan law they have no such rights.
It is only in the event of their surviving respondent 3 that their rights will vest in his estate and the extent of 1138 their inheritance will be calculated on the number of persons entitled to inherit his estate at the time of his death.
It was urged, however, that unless respondents 1 and 2 are now given an opportunity to show that there was no valid marriage between the appellant and respondent 3, a declaration that there was a marriage between these two persons would be binding on them by virtue of the provisions of section 43 of the Specific Relief Act.
If, therefore, on the death of respondent 3 a question arose as to who were entitled to inherit his estate, respondents I and 2 would not be able to question the rights of the appellant and her children and they would be adversely affected by the declaration.
It is somewhat doubtful, having regard to the terms of section 43, that such a declaration in the present suit would be binding on respondents I and 2 as they would not be claiming their right to inheritance through the appellant and respondent 3 respectively.
Assuming, however, that such a declaration would be binding on them, that would be no justification for their being impleaded in the present litigation where the issue is not one of inheritance but one of marriage between the appellant and respondent 3.
If the submission has any substance it might as well be said by any one that he should be impleaded as a party to a suit and should be allowed to contest the suit, although there was no cause of action against him, because the decree in the suit would bind him on the ground of res judicata.
It is true that in a suit under section 42 of the Specific Relief Act it is discretionary with the court to make or not to make the declaration asked for.
The exercise of that discretion, however, has to be judicial.
In the present case there does not appear to be any legal impediment in the way of the court refusing to make the declaration asked for since respondent 3 had acknowledged the marriage and had admitted the claim for Rs. 2,000 per month as Kharch e pandan.
The appellant has not asked for any sum of money to be decreed in her favour.
There is no cause of action now left to the appellant which can be the basis for the present suit.
The appellant could rely upon the 1139 acknowledgement which raises a presumption under the Mohammedan law that she is married to respondent 3.
There appears to be no good ground for adding respondents I and 2 as parties to the present suit.
If hereafter on the happening of a certain event and the existence of certain circumstance any question arose whether the appellant was married to respondent 3, then those who were interested in disproving the marriage would be in a position to do so and rebut the presumption arising from the acknowledgement.
Under O. 1, r. 10, of the Code of Civil Procedure the court has the power to pass orders regarding the adding of parties or striking off the name of a party.
Whether the exercise of this power is a matter of jurisdiction or of discretion appears to have been the subject of difference of opinion in the courts of law here and in England.
Whichever view may be correct it is.
patent that resort to the exercise of such power could only be had if the court is satisfied that it is necessary to make an order under 0. 1, r. 10, in order to effectually and completely adjudicate upon and settle all questions involved in the suit.
The court ought not to compel a plaintiff to add a party to the suit where on the face of the plaint the plaintiff has no cause of action against him.
If a party is added by the court without whose presence all questions involved in the suit could be effectually and completely adjudicated upon, then the exercise of the power is improper and even if it be a matter of discretion such an order should not be allowed to stand when that order is questioned in a superior court.
The plaintiff is entitled to choose as defendants against whom he has a cause of action and he should not be burdened with the task of meeting a party against whom he has no cause of action.
It was, however, suggested that on the face of the plaint not only respondent 3 was interested in denying his marriage with the appellant but a legitimate inference could be drawn from the contents of the pleadings that respondents 1 and 2 were also interested in denying the marriage.
No allegation made in the pleadings even remotely suggests that respondents I and 2 were interested to deny the alleged 145 1140 marriage of the appellant to respondent 3 or were denying the same.
Under section 42 of the Specific Relief Act a suit may be instituted against any person denying or interested to deny the plaintiffs legal character or right to any property.
The plaint does not suggest that respondents 1 and 2 were denying the appellant 's status as wife of respondent 3.
Such an issue was raised by the appellant against respondent 3 only.
In law, it cannot be said that respondents 1 and 2 are interested to deny the status of the appellant as the wife of respondent 3 because the status of respondent I as wife and respondent 2 as the son of respondent 3 is not in the least affected even if the appellant is declared to be the wife of respondent 3, as under the Mohammedan law respondent 3 is entitled to have both the appellant and respondent 1 as his wives and .children through them.
The true legal position in the present suit between the appellant and respondent 3 is that respondents I and 2 have no locus standi in such a suit.
There is no danger of multiplicity of suits during the lifetime of respondent 3.
The suggestion that the present suit would lead to multiplicity of suits is founded on an assumption which no court of law can assume.
It cannot be assumed that respondent 3 would die first.
It may well be that he may survive both respondents I and 2, in which case, no question of any suit coming into existence at their instance would arise.
If the order allowing respondents 1 and 2 to be added as parties in a suit of the present nature is allowed to stand it will open the way to a wider exercise of powers under 0. 1, r. 10, and in a manner which was not contemplated by the Code of Civil Procedure, or section 42 of the Specific Relief Act or permissible under the Mohammedan law.
I would, accordingly, allow the appeal as both the courts below were in error in supposing that this was a case in which the provisions of 0. 1, r. 10, applied and would set aside the orders of the courts below.
The appellant is entitled to her costs throughout.
BY COURT: The appeal is dismissed.
Costs to abide the result of litigation in the trial court.
Appeal dismissed.
| IN-Abs | The appellant instituted a suit against the third respondent, inter alia, for a declaration that she was his lawfully married wife, alleging that though the fact of her marriage was known to all who knew him, he was trying to suppress the facts in such a way that the members of his family should conclude that she was not his Nikah wife, that he refused to openly acknowledge her as his legally wedded wife and that this conduct on his part had cast a cloud on her status as such wife and was affecting the rights of the issue of the marriage, her three daughters.
The third respondent filed his written statement admitting the claim, but on the same date respondents i and 2 made an application under 0.
i, r. 10(2), of the Code of Civil Procedure for being impleaded in the suit as defendants on the grounds that they were respectively the wife and son of the third respondent, that they were interested in denying the appellant 's status as wife and the status of her children is the legitimate children of the third respondent, that the suit was the result of a collusion between the appellant and the third respondent and that if the appellant was declared to be lawfully wedded to the third respondent, the rights and interests of respondents i and 2 in the estate of the third respondent would be affected.
The application was contested by both the appellant and the third respondent.
The trial court allowed the application and the order was confirmed by the High Court in its revisional jurisdiction.
The question was whether the lower courts did not exceed their powers in directing the addition of respondents i and 2 as parties defendants in the action : Held (per Sinha and Kapur jj.
Imam J., disscenting), that in view of the averments in the plaint which showed that not only the third respondent but the other members of his family, including respondents i and 2, were interested in denying the appellant 's status as a legally wedded wife, respondents i and 2 were proper parties to the suit.
The question of addition of parties under O. I, r. 10, of the Code of Civil Procedure is generally not one of initial Jurisdiction of the court, but of a judicial discretion ; in a suit for a declaration as regards status or a legal character under section 42 Of 1112 the Specific Relief Act, the rule that in order that a person may be added as a party he must have a present or direct interest in the subject matter of the suit, is not wholly applicable, and the rule may be relaxed in a suitable case where the court is of the opinion that by adding that party it would be in a better position effectually and completely to adjudicate upon the controversy.
In such suits the court is not bound to grant the declaration prayed for, on a mere admission of the claim by the defendant, if the court has reasons to insist upon clear proof, apart from the admission.
A declaratory judgment in respect of a disputed status will be binding not only upon the parties actually before the court but also upon persons claiming through them respectively, within the meaning of section 43 Of the Specific Relief Act.
The word " respectively " in the section has been used with a view to showing that the parties arrayed on either side, are really claiming adversely to one another, so far as the declaration is concerned.
Per Imam J.
The facts of the present case do not justify the addition of respondents i and 2 as defendants under the provisions of 0.
i, r. 1O(2), of the Code of Civil Procedure, because. : (1)There is nothing in the pleadings to suggest that respondents 1and 2 were denying the appellant 's status as wife of the third respondent, and the court ought not to compel the plaintiff to add parties to the suit where on the face of the pleadings plaintiff has no cause of action against them.
(2)Under the Mohammedan law a man is entitled to have four wives at one and the same time and, consequently, as the third respondent has admitted that the appellant was married to him, respondents i and 2 have no locus standi to make any representation in the suit that there was collusion between the appellant and the third respondent.
(3)During the lifetime of the third respondent neither the appellant nor her children on the one hand nor respondents i and 2 on the other have any rights in his estate, under the Mohammedan law.
(4)Assuming that a declaration in the suit would be binding upon respondents i and 2, which is doubtful having regard to the terms of section 43 of the Specific Relief Act, that would be no justification for their being impleaded in the suit where the issue is not one of inheritance but one of marriage between the appellant and the third respondent.
|
N: Criminal appeal No. 383 of 1991.
From the Judgment and Order dated 17.7.1990 of the Orissa High Court in Crl.
Rev. No. 382 of 1986.
Janaranjan Das for the Appellants.
A.K. Panda for the Respondent.
The Judgment of the Court was delivered by RAY, J.
Special leave granted.
Arguments heard.
This appeal by special leave is directed against the judgment and order dated July 17, 1990 passed by the High Court of Orissa in Criminal Revision No. 382 of 1986 dismissing the revision and affirming the concurrent findings of the courts below.
The prosecution case in short is that on 19th March, 1983 at about 7.p.m.
while the victim girl Srimanthini Samal (P.W. 2) was going to the house of Rama Samal, for study, the appellant Gagan informed her that the other appellant Prafulla and others had tied her tutor Rabi Babu in a nearby mango grove and her father was present there.
Having believed the version of the appellant Gagan, her agnatic uncle, she accompanied him and ultimately the appellants forcibly took her to a lonely house in hills where she was made to sit on a chair and the appellant Gagan forcibly thrushed in her mouth a liquor bottle and she was made to drink the liquor.
Thereafter both the appellants after having undressed her committed sexual assault on her.
Then she was brought to expression highway from where she was bodily lifted to a truck standing there and left her in the truck.
While the said truck was unloading materials near village Kurujanga, the victim girl stealthily left the truck and concealed her presence near a fence.
Subsequently, one Purusottam Mohanty rescued her and brought her to his house and then she was left to the house of one Niranjan Rout (P.W. 8), who was distantly related to her and took shelter till her father took her back on being 842 informed.
On the information lodged by her father (P.W. 1) in the police station of Badachana a case under sections 363 and 376 read with section 34 of the I.P.C. was registered against the accused appellants and after investigation the I.O. sent the victim girl as well as the appellants for medical examination and after completion of the investigation a charge sheet was submitted against the appellants to stand their trial.
The pleas of the appellants were a total denial of the prosecution case.
The appellant Prafulla took the plea the there was a marriage proposal of the victim girl with him but when it was disclosed that she had illicit relationship with her tutor Rabi, he refused to marry her for which this false case was foisted against him.
The plea of the other appellant Gagan as suggested to the informant, was that due to his previous enmity he was falsely implicated with the alleged crime.
The appellants were committed to the Court of Sessions.
The learned Assistant Sessions Judge after considering the evidences on record rejected the defence pleas, and found that the accused appellants committed rape on the victim girl without her consent relying on the provisions of Section 114(A) of the Evidence Act, and convicted them under section 376(2)(g) I.P.C. and sentenced each of the accused appellants to rigorous imprisonment for three years considering the young age of the appellants.
The Assistant Sessions Judge, however, acquitted the appellants from the charge under section 366 I.P.C. as the victim girl was more than 16 years of age at the time of occurrence.
Against this judgment and order of conviction the appellants filed an appeal being Criminal Appeal No. 153 of 1984 in the Court of First Additional Sessions Judge, Cuttack.
The Additional Sessions Judge considered the pleas of the appellants as well as duly scrutinized and appraised the evidences on record and found that the accused appellants committed rape on the victim girl without her consent and affirmed the conviction and sentence imposed by the Trial Court dismissing the appeal.
The appellants thereafter filed a Revision Case being Criminal Revision No. 382 of 1986 in the High Court of Orissa at Cuttack against the said judgment and order passed by the First Additional Sessions Judge, Cuttack.
The High Court duly considered and appraised the evidences of all the 9 P. Ws. including the deposition of the victim girl Srimanthni Samal (P.W. 2), the evidence of her father (P.W. 1) as well as the evidence of her mother (P.W. 3) and the evidences of the two Doctors (P.W. 4) and P.W. (5) and held that the accused persons committed rap on P.W. 2 forcibly without her con 843 sent.
It has been further found from the reliable evidences of P.Ws. 1 and 3 that as soon as P.W. 2 met her mother, P.W. 3, P.W. 2 told her mother about both the accused persons committing rape on her in a solitary house and also about the accused persons taking her away to the highway and keeping her in a truck, and corroborate the version of P.W. 2 regarding the occurrence of rape committed n her by both the accused persons.
It has been further observed that even though the P.Ws. 7 and 8 became hostile still then their evidences can be safely relied on as the same fully corroborates the version of P.W. 2 that on the relevant night the she, with the help of P.W. 7 had taken shelter in the house of P.W. 8 P.W. 6 who the driver of the truck No. ORG 4839 also stated in his evidence that the accused persons and two others took the victim girl and left her in the truck.
P.W. 6 further admitted that as he stopped the truck at village Ambura for unloading the boulders, the girl had stealthily left his truck and inspite of his searching her, he could not trace her.
This fully supports the version of P.W. 2 that she left the truck and concealed herself near a fence in darkness.
The learned Judge, therefore, held "Hence, on a careful scrutiny of the evidences of the hostile witnesses P.Ws. 6 and 8 it is seen that even they corroborate the evidence of the victim gild, P.W. 2 on material aspects of the prosecution case.
" In cases of rape, generally it is difficult to find any corroborative witnesses except the victim of the rape.
It has been observed by this Court in Bharwada Bhoginbhai Hirjibhai vs State of Gujarat, ; as follows: "Corroboration is not the sine qua non for a conviction in a rape case.
In the Indian setting, refusal to act on the testimony of a victim of sexual assault inthe absence of corroboration as a rule, is adding insult to injury.
Why should the evidence of the girl or the woman who complains of rape or sexual molestation be viewed with the aid of spectacles fitted with lenses tinged with doubt, disbelief or suspicion? To do so is to justify the charge of male chauvinism in a male dominated society.
A girl or a woman in the tradition bound non permissive society of India would be extremely reluctant even to admit that only incident which is likely to reflect on her chastity had ever occurred.
She would be conscious of the danger of being ostracized by the society or being looked down by the society including by her own family members, 844 relatives, friends, and neighbours.
She would face the risk of losing the love and respect of her own husband and near relatives, and of her matrimonial home and happiness being shattered.
If she is unmarried, she would apprehend that it would be difficult to secure an alliance with a suitable match from a respectable or an acceptable family.
In view of these and similar factors, the victims and their relatives are not too keen to bring the culprit to book.
And when in the face of these factors the crime is brought to light there is a built in assurance that the charge is genuine rather than fabricated.
" The above observation has been made by this Court relying on the earlier observations made by this Court in Rameshwar vs The State of Rajasthan, with regard to corroboration of girl 's testimony and version.
Vivian Bose, J, who spoke for the Court observed as follows: "The rule, which according to the case has hardened into one of law, is not that corroboration is essential before there can be a conviction but that the necessity of corroboration, as a matter of prudence, except where the circumstances make it safe to dispense with it, must be present to the mind of the judge, . . . .The only rule of law is that this rule of prudence must be present to the mind of the judge or the jury as the case may be and be understood and appreciated by him or them.
There is no rule of practice that there must, in very case, be corroboration before a conviction can be allowed to stand.
" In the instant appeal as had been stated hereinbefore that P.W. 2, the victim girl has clearly stated in her evidence that she had been taken to a solitary house in the hills by the appellant No. 1 Gagan Bihari Samal and there she was made to drink liquor and thereafter she was undressed and forcibly subjected to sexual intercourse by both the accused appellants one after the other.
He uncontroverted testimony has been accepted by all the courts and the courts concurrently found that she was raped without her consent.
It has been tried to be contended on behalf of the appellants that the amended section 114(A) was brought into the Evidence Act after the commission of the offence for which the appellants were charged and as such no assumption can be made on the basis of this provision.
This submission is of no avail in as much as it is clearly evident that the victim girl protested and 845 struggled while she was subjected to sexual assault forcibly by the accused persons and this clearly evinces absence of consent on part of the victim girl in such sexual intercourse apart from the legal presumption that follows from the provisions of Section 114(A) of the Evidence Act.
The learned counsel on behalf of the appellants further tried to argue on the basis of some minor discrepancies in the evidences of P.W. 2 that the prosecution case was a false one and it has been foisted on the appellants due to enmity and also due to accused Prafulla, one of the appellants, having disagreed to marry the victim girl.
The courts below have clearly found that the defence case was not at all sub stantiated by any cogent evidence.
So this contention is not at all tenable.
It is apropos to mention here the observation made by this Court in the case of State of Orissa vs Nakula Sahu and Ors., ; which are set out herein: "Although the revisional power of the High Court under Section 439 read with section 435 is as wide as the power of Court of appeal under Sec.
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 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.
Inspite of the wide language of Section 435, the High Court is not excepted to act under Section 435 or Section 439 as if it is hearing an appeal.
" The High Court of Orissa referred to the said observation and rightly held that the High Court cannot be expected to re appraise the evidence as a court of appeal.
This Court hearing an appeal by special leave cannot consider and re appraise the evidences once again in the face of concurrent findings of facts arrived at by all the courts below.
For the reasons aforesaid we dismiss the appeal and uphold the conviction and sentence as found by the High Court.
R.P. Appeal dismissed.
| IN-Abs | The appellants forcibly took P.W. 2 to a lonely place on 19.3.1983, made her to drink liquor and committed sexual assault on her.
Thereafter they left her in a truck.
While the said truck was unloading materials near a village, the victim stealthily left the truck and concealed herself near a fence.
P.W. 7 rescued her and took her to the house of P.W. 8, one of her distant relative, from where her father P.W. 1 took her back and lodged the report at the police station.
A case under sections 363 and 376 read with section 341.I.P.C. was registered against both the appellants.
After completion of the investigation, a charge sheet was submitted and the appellants were tried for the aforesaid offences.
The appellants denied the prosecution allegations and pleaded that they were falsely implicated because of refusal by one of them to marry the girl and previous enmity with the other.
The Assistant Sessions Judge rejected the defence pleas, and found that the appellants committed rape on the victim without her consent, and relying on section 114A of the Evidence Act, convicted the appellants under section 376(2)(g), I.P.C. and sentenced each of them to rigorous imprisonment for three 840 years.
Since the victim was more than 16 years of age, the appellants were acquitted of the charge under section 363, I.P.C. On dismissal of their appeal against the conviction and sentence by the Addl.
Session Judge, the appellants filed a revision application before the High Court.
The High Court duly considered and appraised the evidence and held that the appellants committed rape on PW 2 forcibly without her consent.
Ultimately the appellants came in appeal by special leave to this Court.
Dismissing the appeal, this Court, HELD: 1.
In cases of rape, generally it is difficult to find any corroborative witnesses except the victim of the rape.
However, corroboration is not the sine que non for a conviction in a rape case.
In the Indian setting, refusal to act on the testimony of a victim of sexual assault in the absence of corroboration as a rule, is adding insult to injury.
[843D F] Bharwada Bhoginbhai Hirjibhai vs State of Gujarat, ; and Rameshwar vs The State of Rajasthan, ; , relied on.
In the instant case, the victim girl clearly stated in her evidence that she had been taken to a solitary house in the hills by appellant No. 1 where she was made to drink liquor and thereafter she was undressed and forcibly subjected to sexual intercourse by both the accused appellants one after the other.
Her uncontroverted testimony was accepted by all the courts and they concurrently found that she had been raped without her consent.
[844F G] 3.
Apart from the legal presumption that flows from the provisions of section 114A of the Evidence Act, it is clearly evident in the instant case, that the victim girl protested and struggled while she was subjected to sexual assault forcibly by the accused persons and this clearly evinces absence of consent on her part in such sexual intercourse.
[844H; 845A] 4.
The High Court rightly held that it cannot be expected to re appraise the evidence as a court of appeal while exercising its revisional power under section 401 Cr.
P.C. [845E F] 841 State of Orissa vs Nakula Sahu and Ors., ; , relied on.
This Court hearing an appeal by special leave cannot consider and re appraise the evidence once again in the face of concurrent findings of facts arrived at by all the courts below.
[845F]
|
1 of 1991.
IN Writ Petition No. 491 of 1991.
WITH Writ Petition Nos. 541 & 560 of 1991 etc.
(Under Article 32 of the Constitution of India).
G. Ramaswamy, Attorney General, Shanti Bhushan, Ashok Desai, Hardev Singh, Ms. Indira Jaisingh, P.S. Poti, Rajinder Sachhar, M.K. Ramamurty, R.K. Garg, S.K. Garg, S.K. Dholakia, Santosh Hedge, V.N. Ganpule, Tapas Ray, N.B. Shetye, P.P. Rao, Kapil Sibal, D.S. Tewatia, Hari Swarup, Jayant, Jayant Bhushan, Prashant Bhushan, Ms. Madhoo Moolchandani, Ms. Kamini Jaiswal, A.K. Srivastava, E.M.S. Anam, N.D. Garg, A.M. Khanwilkar and Ms. A. Subhashini for the Appearing Parties.
The following Order of the Court was delivered: This writ petition is by a body of advocates styled "Sub Committee on Judicial Accountability" and raises certain questions as to the validity and implementation of the action of the Speaker of the Lok Sabha admitting a notice of motion moved by 108 Members of Parliament under Article 124(5)read with the and constituting an Inquiry Committee consisting of a Judge of the Supreme Court, Chief Justice of a High Court and a jurist to investigate into the allegations of misconduct made against a sitting 743 Judge of the Supreme Court pertaining to his conduct as the erstwhile Chief Justice of the Punjab and Haryana High Court.
The main prayers in the writ petition are that the Union Government be directed to afford facilities to the Inquiry Committee to discharge its constitutional and statutory functions; and for directions to the Hon 'ble Chief Justice of India to abstain from allocating any judicial work to the concerned Judge during the pendency of the proceedings before the Committee.
In regard to the latter prayer that notice should go to the Hon 'ble Chief Justice of India, we think that aspect of the matter should be deferred for the present and considered at the appropriate stage of the final hearing.
In regard to the directions to the Union Government, the Union Government by means of an affidavit subscribed to by the Joint Secretary, Ministry of Law and Justice, has made manifest its stand that in its view the motion initiated by the 108 Members of Parliament on which the Speaker took the decision to constitute a Committee had lapsed with the dissolution of the Lok Sabha and that nothing further remains to be done in the matter.
It is in that view, as averred in the affidavit, that the Government of India did not advise the President to issue any notification as required by Para 9 read with Para 11(b)(i), of Second Schedule to the Constitution enabling the sitting Judge of this Court and the Chief Justice of High Court to reckon the time spent by them in functioning as members of the Committee as part of their `actual service '.
The contention of the petitioner is that having regard to the constitutional and statutory of the sitting Judges who function in the Committee, the time spent by them in performance of such function is to be reckoned as part of their `actual service ' as judges and no notification under the concerned provisions by the President is necessary.
It is relevant to mention here that some of the interveners who seek to oppose the writ petition have, in addition to their stand against the writ petition, also filed individual writ petitions of their own in which, more or less, they seek to endorse the stand taken by the Government raising the question as to whether the motion survives the dissolution of the Lok Sabha or not.
Shri Shanti Bhushan, learned counsel for the petitioner made an impassioned plea that having regard to the dire need of maintaining public confidence in the apex institution and its reputation it is necessary that the concerned Judge should abstain from discharging judicial functions during the pendency of the enquiry against him.
In the alternative, it is submitted that if a direction to that effect is not issued, 744 it should at the least necessarily be directed that pending disposal of the writ petition on merits, the Union of India shall afford to the Committee such facilities as may be necessary for its effective and prompt functioning.
Shri Shanti Bhushan submitted that even if ultimately the writ petition fails no loss or injury would be caused to anybody and what would have resulted would only be that the eminent body of Judges would have Occasion to look into the allegations against a sitting Judge and if they found the allegations to be baseless, the concerned Judge would be cleared of the imputations and cloud against his conduct.
He urged, if such a direction or interim mandamus is not issued it would seriously impair the image of the Court as the apex Court in the country and affect the confidence of the people in the quality of justice dispensed by it.
We have given our anxious consideration to the matter and having regard to the nature and importance of the issues involved it is appropriate that the main matter along with the connected writ petitions is heard as expeditiously as possible.
We, therefore, direct that his matter be listed on July 9, 1991 with a direction that hearing of the matters be proceeded with day to day until conclusion.
We also indicated that arguments on all sides should be completed within a period of ten working days and the learned counsel for all the parties and interveners should file their written arguments in advance latest by July 1, 1991.
The actual hearing time to each of the counsel will be appointed at the commencement of the hearing on July 9, 1991.
In this view of the matter, we think it appropriate not to embark upon an examination of the contentions in support of and the prayer for interlocutory relief.
We, however, make it clear that our disinclination to issue any interlocutory orders at this stage shall not be construed as an expression of opinion on the merits of the merits of the issues either way and shall not also be construed as an interdiction of the functioning of the Committee if the Committee otherwise considers appropriate to proceed with the matter.
We also make it clear that during the pendency of these matters before this Court no proceeding pending or filed hereafter in any other court shall be heard or any order passed therein relating to the issues involved in these matters.
NVP Petition dispose of.
| IN-Abs | A Writ Petition filed by the Petitioner Committee, a body of Advocates, praying for directions to be issued to the Union government and the Chief Justice of India, in connection with the enquiry into allegation of misconduct made against a sitting Judge of the Supreme Court, pertaining to his conduct as Chief Justice of a High Court, raised certain questions as to the validity and implementation of the action of the Speaker of the Lok Sabha in admitting a notice of motion moved by the Members of Parliament under Article 124(5) of the Constitution of India, 1950 read with .
Some intervention applications, opposing the Writ Petition, and some other Writ Petitions more of less endorsing the Government 's stand raising the question as to whether the motion in question survived the dissolution of the Lok Sabha or not, were also filed.
Praying for interim direction, which was identical with the prayer in main Writ Petition, it was urged on behalf of the Petitioner Committee that having regard to the dire need of maintaining public confidence in the institution and its reputation as apex Court, it was necessary that the concerned Judge should abstain from discharging judicial functions during the pendnecy of the enquiry, and a direction should be issued accordingly, or pending disposal of the Writ Petition, the Union Government should be directed to afford all necessary facilities to the Committee for smooth and efficient functioning.
Directing expeditious hearing of the Writ Petition and connected matters, this Court, 742 HELD: 1.1 Having regard to the nature and importance of the issues involved, it is appropriate that the main matter along with the connected writ petitions is heard as expeditiously as possible.
Accordingly, this matter should be listed on July 9, 1991 and hearing of the matters proceeded with day to day until conclusion.
[744D] 1.2 In the circumstances, it is not appropriate to embark upon an examination of the prayer for interlocutory relief.
However, the Court 's disinclination to issue any interlocutory orders at this stage should not be construed as an expression of opinion on the merits of the issues either way and as an interdiction of the functioning of the Committee, if the Committee otherwise considers appropriate to proceed with the matter.
[744E F]
|
ivil Appeal No. 2378 of 1977.
804 From the Judgment dated 3.2.1977 of the Gujarat High Court in Special Civil Application No. 551 of 1972.
B. Datta, L.B. Kolekar, Ms. Chetna Anand and P.H. Parekh (NP) for the Appellant.
S.K. Kholakia, R.B. Haribhakti and P.C. Kapoor (NP) for the Respondents.
The Judgment of the Court was delivered by K. RAMASWAMY, J.
The facts relevant to the controversy are as under: The appellant had taken on lease, about 55 years ago, an extent of 2 acres, 6 gunthas of agricultural lands situated in Akote village from Vishwas Rao.
The Bombay Tenancy and Agricultural Lands Act 67 of 1948 for short `the Act ' applies to the lease.
By operation of section 32(1) the appellant became a deemed purchaser from tillers ' day i.e., April 1, 1957.
Section 32 G provides the procedure to determine purchase price.
Since the landlord was insane, the right to purchase was statutorily deferred under section 32 F till date of its cessation or one year after death.
Under section 88(1)(b) of the Act certain areas abutting Baroda Municipality were notified as being reserved for non agricultural or industrial purpose with effect from May 2, 1958.
By another notification published in the Gujarat State Gazette dated July 2, 1964, certain lands including those situated in Akote and of the appellant 's lease hold lands were reserved for industrial purpose.
Consequently Ss. 1 to 87 of the Act do not apply to the exempted area.
While the landlord was continuing under disability, his son Vasant Rao sold the land to the respondent under registered sale deed dated August 19, 1964.
By another notification under Section 88(1)(b) published in the Gazette dated October 29, 1964, the Government restricted the operation of the exemption to the area originally notified on May , 1958 i.e., Ss. 1 to 87 do not apply to the lands in question.
This notification was rescinded by further notification published in the Gazette dated August 23, 1976.
The Bombay Tenancy and Agricultural Lands(Gujarat) Amendment Act 36 of 1965, section 18(1) and 18(2) thereof introduced two provisos to section 88(1)(b) of the Act which was published in the Gazette on December 29, 1965 which are relevant for purpose of the case.
Section 88(1)(b) with amendments reads thus: "(1) Save as otherwise provided in sub section (2) 805 nothing in the following provisions of this Act shall apply (a) to lands belonging to, or held on lease form the Government; (aa) to lands held or leased by a local authority; (b) to any area which the State Government may, from time to time, by notification in th official Gazette, specify as being reserved for non agricultural or industrial development; Provided that if after a notification in respect of any area specified in the notification is issued under this clause, whether before or after the commencement of the Bombay Tenancy and Agricultural Lands (Gujarat Amendment) Act, 1965, the limits of the area so specified are enlarged on account of the addition of any other area thereto, then merely by reason of such addition, the reservation as made by the notification so issued shall not apply and shall be deemed never to have applied to the area so added, notwithstanding anything to the contrary contained in any judgment, or order of any court, Tribunal or any other authority.
Provided further that if any land in the area so added has been transferred or acquired after the issue of notification referred to in the first proviso but before the 9th day of October, 1964, such transfer or acquisition of land shall have effect as if it were made in an area to which this clause applies".
Vishwash Rao died in September 1965.
The appellant became entitled to purchase the land on and from August 19, 1966.
He filed an application before Mamlatdar to fix the price.
He fixed on enquiry at Rs.4,925.65 paise which was paid by the appellant.
In the enquiry, the respondent contended that he purchased the property from Vasantrao, son of the landlord.
By operation of second proviso to section 88(1)(b) the lands stood exempted from operation of Ss. 1 to 87 of the Act.
So the Mamlatdar had no jurisdiction to decide the 806 price of the land.
The appellant raised the contention that Vasantrao has no right to sell during the life time of the father, the Karta of the Hindu Joint Family.
The sale is invalid and does not bind him.
He acquired statutory right of deemed purchaser and its exemption under section 88(1)(b) does not divest his statutory right.
The Mamlatdar accepted the appellant 's contention and allowed the petition.
On appeal to the Collector and revision to the Revenue Tribunal the decision was reversed.
The Division Bench of the High Court by order dated February 3, 1977 dismissed the writ petition.
The appellant had leave of this Court by article 136.
Thus this appeal.
From these admitted facts the question emerges whether the operation of the second proviso to section 88(1)(b) has retrospective effect depriving the appellant of the statutory right of `deemed purchaser '.
section 88 of the Act empowers the government to exempt certain other lands from the purview of Ss. 1 to 87 of the Act.
The State Government exercised their power from time to time under section 88(1)(b) and issued notification and published in the official Gazette specifying certain areas as being reserved for non agricultural or industrial development i.e., urban development.
Consequently the first proviso gets attracted which say that notwithstanding any judgment or order of any court, tribunal or any other authority under the Act to the contrary, once the notification was issued either before or after commencement of the Amendment Act reserving the area so added for non agricultural or industrial development i.e. expansion for urbanisation, to the extent of the area covered under the first proviso, the provisions of Ss. 1 to 87 were not applied and shall be deemed never to have been applied.
The second proviso which is material for the purpose of the case further postulates that: "Provided further that if any land in the are so added has been transferred or acquired after the issue of the notification referred to in the first proviso but before the 29th day of October, 1964, such transfer or acquisition of the land shall have effect as if it was made to an area to which this clause applies".
(emphasis supplied) What is the effect of the second proviso to the facts is the question? Mr. Dutta, the learned counsel for the appellant contended that the first proviso has the effect of excluding Ss. 1 to 87 of the Act only to those areas which were initially reserved for non agricultural or industrial development and has no application to the land added to it by a 807 subsequent notification though it would become part thereof.
Any alienation in violation of the Act would not attract the operation of the second proviso.
The Act is an agrarian reform which created a vested right in the tenant as a deemed purchaser with effect from Tillers ' day which cannot be divested retrospectively.
The proviso should be construed to inhere in the tenant the vested rights created under the Act.
The Withdrawal of the notification dated Oct. 29, 1964 renders the right of the appellant uneffected.
It is a cardinal rule of interpretation that a proviso to a particular provision of a statute only embraces the filed, which is covered by the main provision.
It carves out an exception to the main provision to which it has been enacted by the proviso and to no other.
The proper function of a proviso is to except and deal with a case which would otherwise fall within the general language of the main enactment, and its effect is to confine to that case.
Where the language of the main enactment is explicit and unambiguous, the proviso can have no repercussion on the interpretation of the main enactment, so as to exclude from it, by implication what clearly falls within its express terms.
The scope of the proviso, therefore, it to carve out an exception to the main enactment and it excludes something which otherwise would have been within the rule.
It has to operate in the same field and it the language of the main enactment is clear, the proviso cannot be torn apart from the main enactment nor can it be used to nullify by implication what the enactment clearly says nor set at naught the real object of the main enactment, unless the words of the proviso are such that it is its necessary effect.
The effect of the notification issued under section 88(1)(b) was the subject of consideration in several decisions of this Court.
In Sukharam @ Bapusaheb Narayan Sanas & Anr.
vs Manikchand Motichand Shah and Anr., [196] SCR 59 Sinha, CJ., held that the provisions of section 88 are entirely prospective and apply to such lands as are described in clauses (a) to (d) of section 88(1) from which the Act came into operation, namely, December 28, 1948 and are not a confiscatory in nature so as to take away from the tenant the status of a protected tenant already accrued to him.
In Mohanlal Chunilal Kothari vs Tribhovan Haribhai Tamboli, ; a Constitution Bench speaking through Sinha, CJ. held that Clauses (a) to (c) of section 88(1) applies to things as they were on the date of the commencement of the Act of 1948 whereas clause (d) authorised the State Govt.
to specify certain areas as being reserved for urban non agricultural or industrial development, by notification in the official Gazette, from 808 time to time.
It was specifically provided in clauses (a) to (c) that the Act, from its inception, did not certain areas then identified, whereas clause (d) has reference to the future.
The State Govt, could take out of the operation of the Act such areas as in its opinion should be reserved for urban non agricultural or industrial development.
Clause (d) would come into operation only upon such a notification being issued by the State Govt.
In Sukhram 's case, this Court never intended to lay down that the provisions of clause (d) are only prospective and have no retrospective operation.
Unlike clauses (a) to (c) which are clearly prospective, clause (d) has retrospective operation in the sense that it would apply to land which would be covered by the notification to be issued by the government from time to time so as to take that land out of the operation of the Act of 1948, granting the protection.
(emphasis supplied) So far as clauses (a) to (c) are concerned, the Act of 1948 would not apply at all to lands covered by them, but that would not take away the rights covered by the Act of 1939 which was repealed by the Act of 1948.
Therefore, it was held that by operation of section 89(2) the rights acquired under the Act of 1939 would be available to the tenant.
When a doubt was expressed of the correctness of the above views on reference, another Constitution Bench in Sidram Narsappa Kamble vs Sholapur Borough Municipality & Anr., ; , held at p. 65 thus: "New there is no doubt that section 88 when it lays down inter alia that nothing in the foregoing provisions of the 1948 Act shall apply to lands held on lease from a local authority, it is an express provision which takes out such leases from the purview of sections 1 to 87 of the 1948 Act.
One of the provisions therefore which must be treated as non existent where lands given on lease by a local authority is in section 31. .but the effect of the express provision contained in section 88(1)(a) clearly is that section 31 must be treated as non existent so far as lands held on lease from a local authority are concerned and in effect therefore section 88(1)(a) must be held to say that there will be no protection under the 1948 Act for protected tenants under the 1939 Act so far as lands held on lease from a local authority are concerned . . 809 the appellant cannot claim the benefit of section 31; nor can it be said that his interest as protected tenant is saved by section 89(2)(b).
This in our opinion is a plain effect of the provisions contained in section 31, section 88 and section 89(2)(b) of the 1948 Act".
In Parvati & Ors.
vs Fatehsinhrao Pratapsinhrao Gaekwad, ; the facts were that the Government issued a notification on May 21, 1958 under section 88(1)(b) of the 1948 Act reserving the land within the municipal limits of the city of Baroda for non agricultural and industrial development.
The appellant 's husband had taken possession of certain lands situated in the city of Baroda on lease from the respondent trustee.
The respondent laid the suit against the appellant for recovery of arrears of rent.
The defence was that the suit was not maintainable.
Dealing with the effect of the notification issued under section 88(1)(b), this Court held that the notification had retrospective operation and subject to certain exceptions provided in sub section (2) of section 88 all rights, title, obligations etc.
Accrued or acquired under the said Act ceased to exist.
Therefore, section 89(2)(b) was inapplicable to protect such right, title or interest, acquired under the Act except as provided in s 89A owing to express provision made in section 88 of the Act.
Accordingly it was held that the Civil Court was legally competent to determine the reasonable rent payable by the tenant.
In Navinchandra Ramanlal vs Kalidas Bhudarbai & Anr., ; this court was to consider a case that the notification under section 88(1)(b) was issued on May 30, 1959 by which date the tenant acquired the statutory right of a deemed purchaser with effect from April 1, 1957.
This Court held that the tenant cannot be divested of his deemed purchase by a subsequent notification issued thereunder.
It would be seen that the effect of the second proviso was not considered therein.
The above interpretation would equally apply to the interpretation of the notification issued under the proviso to section 88(1)(b) adding to the area reserved for non agricultural or industrial development.
Its effect is that notwithstanding any judgment or order of any court or Tribunal or any other authority, the provisions of Ss. 1 to 87 shall not apply and shall be deemed never to have applied to such added area as well.
If any land in the newly added area has been transferred or acquired between the date of the notification issued under first proviso and October 9, 1964, such transfer or acquisition of land shall have the effect as if it was made in an area to which the main part of the proviso and section 88(1)(b) would apply.
The necessary consequence would be that the provisions of sections 1 to 87 shall not apply and shall be 810 deemed never to have applied to such added area.
It is implicit that such transfer or acquisition made, to bring within the net of second proviso, must be valid and bona fide one and not colourable, fraudulent, fictitious or nominal.
The Legislature appears to relieve hardship to the bona fide purchasers.
The title acquired by such transfer is not effected by the provisions of the Act.
The Legislature advisedly used the words `acquired or transferred '.
The respondent 's own case is that Vishwesh Rao, Karta of the Hindu Joint Family was under disability due to lunacy.
The tenant acquired statutory right as deemed purchaser under section 32.
The Act, by necessary implication, divests the landlord of his right to alienate the land held by the tenant.
The statutory right topurchase the land under section 32 as deemed purchaser was postponed by operation of section 32 F of the Act till the cessation of the disability or one year after the death of the landlord.
In such situation can the son during the life time of the father, has right to sell the same property to the respondents, and whether such a sale made on August 19, 1964 to the respondents was valid and binds the appellant.
In Raghavachariar 's Hindu Law Principles and Precedents, Eighth Ed., 1987 in section 275 at p. 39 stated thus: "So long as the joint family remains undivided, the senior member of the family is entitled to manage the family properties, and the father, and in his absence, the next senior most male member of the family, as its manager provided he is not incapacitated from acting as such by illness or other sufficient cause.
The father 's right to be the manager of the family is a survival of the patria potastas and he is in all cases, naturally, and in the case of minor sons necessarily the manager of the joint family property.
In the absence of the father, or if he resigns, the management of the family property devolves upon the eldest male member of the family provided he is not wanting in the necessary capacity to manage it".
Regarding the management of the Joint Family Property or business or other interests in a Hindu Joint Family, the Karta of the Hindu Joint Family is a prima inter pares.
The managership of the Joint Family Property goes to a person by birth and is regulated by seniority and the Karta or the Manager occupies a position superior to that of the other members.
A junior member cannot, therefore, deal with the joint family property as Manager so long as the Karta is available except where the Karta relinquishes his right expressly or by necessary impli 811 cation or in the absence of the Manager in exceptional and extra ordinary circumstances such as distress or calamity effecting the whole family and for supporting the family or in the absence of the father whose whereabouts were not known or who was away in remote place due to compelling circumstances and that is return within the reasonable time was unlikely or not anticipated.
No such circumstances are available here to attract the facts of the case.
Vasantrao, the vendor, son of the Karta of the Hindu Joint Family per se has no right to sell the property in question as Manager so long as the father was alive.
When father was under disability due to lunancy, an order from the Court under Indian Lunancy Act IV of 1912 was to be obtained to manager the joint family property.
No proceedings were taken under sections 39, 43 and 45 of the Indian Lunacy Act to have the inquisition made by a competent District Court to declare him as insane and to have him appointed as Manager of the Joint Family.
In P.K. Gobindan Nair & Ors.
vs P. Narayanan Nair & Ors., [1912] 23 M.L.J. 706=17 Indian Cases 473 a division Bench of the Madras High Court held that a guardian cannot be appointed as Manager under the Guardian and Wards Act on an adjudication of Karnavan of an undivided Malabar Tarwad as a lunacy.
In A. Ramacharlu vs Archakan Ananthacharlu & Anr., A.I.R. 1955 A.P. 261 a division Bench consisting of Subba Rao, C.J. and Satyanarayana Raju, J. (as they were) considered the question of appointment of a son as the Manager of the Mitakshara family whose father was alleged to be a lunatic.
Subba Rao, C.J. speaking for the Bench, held that in view of the finding that the Karta, though was mentally not sound, but was capable to manage the property, the application for appointment of a son as manager of the joint family property was not be ordered.
Since Vasantrao did not obtain any order from the competent court under the Lunacy Act to have him appointed as Manager of the joint family to alienate the property, the sale is per se illegal.
The sale, therefore, appears to be to defeat the statutory right of the appellant.
The rigour of the second proviso to section 88(1)(b) is thus inapplicable.
Thereby the right and interest as a deemed purchaser acquired by the appellant has not been effected by a subsequent notification issued under section 88(1)(b).
The High Court, therefore, committed manifest error in holding that the appellant is not entitled to the relief.
The appeal is accordingly allowed and the orders of the High court, The Tribunal and District Collector are set aside and that of the Mamlatdar is confirmed, but in the circumstances parties are directed to bear their own costs.
Y.Lal.
Appeal Allowed.
| IN-Abs | The appellant took on lease some agricultural lands from one Viswas Rao and by operation of Section 32(1) of the Bombay Tenancy and Agricultural Lands Act 67 of 1948, which was applicable to the lease, he became a deemed purchaser from tillers ' day i.e. 1.4.1957.
Since the landlord was insane, the right to purchase was statutorily deferred under section 32 F till date of its cessation or one year after death.
Pursuant to the notification issued under Section 88(1)(b) of the Act, certain lands including those of the appellant 's lease hold lands were reserved for industrial purpose; thereby making sections 1 to 87 of the Act inapplicable to the exempted area.
During the subsistence of disability of the landlord, his son Vasant Rao sold the land to the respondent under registered sale deed.
Vishwas Rao died in September 1965.
The appellant became entitled to purchase the land on and from August 19, 1966.
He therefore filed an application before Mamlatdar to fix the price.
He fixed on enquiry at Rs.4,95/65 P. which was paid by the appellant.
In the enquiry, the respondent contended that he purchased the property from Vasantrao, son of the landlord and by operation of the second proviso to Section 88(1)(b), the lands stood exempted from the operation of Section 1 to 87 of the Act.
So the Mamlatdar had no jurisdiction to decide the price of the land.
The appellant 's contention was that Vasantrao had no right to sell the lands during the life time of his father, the Karta of the Hindu Joint Family.
The sale was invalid and did not bind him.
He had acquired statutory right of `deemed purchaser ' and its exemption under section 88(1)(b) did not divest his statutory right.
The Mamlatdar accepted the appellant 's contention and allowed the petition.
On appeal to the Collector and revision to the Revenue Tribunal, the decision of Mamlatdar was reversed.
The Division Bench of the High Court dismissed the writ petition.
Hence this appeal by the appellant, after obtaining special leave.
On the question: whether the operation of the second proviso to Section 88(1)(b) of the tenancy Act, 1948 has retrospective effect depriving the appellant of the statutory right? 803 Allowing the appeal, this Court HELD: Section 88 of the Act empowers the government to exempt certain other lands from the purview of Sections 1 to 87 of the Act.
The State Governments exercised their power from time to time under Section 88(1)(b) and issued notification and punished in the official Gazette specifying certain areas as being reserved for non agricultural or industrial development i.e., urban development.
[806C D] It any land in the newly added area has been transferred or acquired between the date of the notification issued under first proviso and October 9, 1964, such transfer or acquisition of land shall have the effect as if it was made in an area to which the main part of the proviso and Section 88(1)(b) would apply.
The necessary consequence would be that the provisions of Sections 1 to 87 shall not apply and shall be deemed never to have applied to such added area.
It is implicit that such transfer or acquisition made, to bring within the net of second proviso, must be valid and bona fide one and not colourable, fraudulent, fictitious or nominal.
[809G 810B] In the instant case, since Vasantrao did not obtain any order from the competent court under the Lunacy Act to have him appointed as Manager of the joint family to alienate the property, the sale is per se illegal, The sale, therefore, appears to be to defeat the statutory right of the appellant.
The rigour of the second proviso to Section 88(1)(b) is thus inapplicable.
Thereby the right and interest as deemed purchaser acquired by the appellant has not been affected by subsequent notification issued under section 88(1)(b).
[811F G] Sukharam @ Bapusaheb Narayan Sanas & Anr.
vs Manikchand Motichand Shah & Anr., [196] 2 S.C.R. 59; Mohanlal Chunilal Kothari vs Tribhovan Haribhai Tamboli, ; ; Sidram Narsappa Kamble vs Sholapur Borough Municipality & Anr., ; ; Parvati & Ors vs Fatehsinhrao Pratapsinghrao Gaekwad, ; ; Navinchandra Ramanlal vs Kalidas Bhudarbai & Anr., ; ; P.K. Gobindan Nair & Ors.
vs P. Narayanan Nair & Ors., Indian Cases 743; and A. Ramacharlu vs Archakan Ananthacharlu & Anr., A.I.R. 1955 A.P. 261, referred to.
|
vil Appeal Nos. 179 189 of 1991 etc.
From the Judgment and Order dated 3.9.1990 of the Gauhati High Court in Election Petition No. 7 of 1989.
A.M. Mazumdar, Dr. L.M. Singhvi, S.K. Nandy, section Parekh and Ms. Lira Goswami for the Appellants.
Dr. B.L. Wadehra and M.K.D. Namboodiri for the Respondents.
The Judgment of the Court was delivered by AHMADI, J.
Special granted in all SLPs.
Mizoram acquired Statehood on February 20, 1987.
At the general election held on January 21, 1989, the respondents of this batch of appeals contested the State Assembly elections as candidates of the Mizo National Front (MNF) from different constituencies.
The 759 results of the election were declared on January 23, 1989.
They lost to candidates fielded by the Indian National Congress (I).
The unsuccessful MNF mainly on the ground that they had indulged in and were guilty of corrupt practices.
As many as fifteen such election petitions came to be filed in the Gauhati High Court on one single day, March 9, 1989.
Although fifteen petitions were filed, one Congress (I) candidate had succeeded from two constituencies and one candidate belonged to the Mizo National Front (Democratic) Party.
On service of notice of the filing of the election petitions, the returned candidates entered appearance and raised certain preliminary objections regarding the maintainability of each petition.
On the basis thereof two preliminary issues were raised for consideration.
The returned candidates moved for striking off the pleadings.
Thereupon the original petitioners applied for amendment of their election petitions which was strongly opposed by the returned candidates.
The preliminary objections, the applications for striking off the pleadings and the amendment applications were heard together.
The two preliminary issues raised by the learned Judge hearing the election petitions were (i) whether the election petitions were in conformity with the requirements of Sections 81 and 83 of the Representation of the People Act, 1951 (R.P. Act), and the Rules framed thereunder by the Gauhati High Court and (ii) whether rule 1 and the other related rules and notes thereto enabling the filing of the Election Petition before the Stamp Reporter assigned to the election court by the learned Chief Justice were ultravires Article 329 of the Constitution and Section 169 read with Sections 80, 80A and 81 of the R.P. Act.
so far as the first objection was concerned, the returned candidates contended that the election petitions were photo copies and could not, therefore, be treated as election petitions as contemplated by law, the copies of petitions served on the returned candidates were not attested to be true copies of the original petitions as required by Section 81(3), the copies served on them with the annexures were not true copies of the original; the election petitions were not signed and verified in the manner laid down by the Code of Civil Procedure inasmuch as the source of information had not been disclosed in the verification or the affidavit in Form 25 as required by rule 94A of the Conduct of Election Rules, 1961 (the Rule) and no schedule of material particulars of corrupt practice had been annexed to the affidavit purporting to be under Form 25.
In regard to the second objection the contention was that the presentation of the election petitions before the Stamp Reporter was inconsistent with Sections 80, 80A and 81 of 760 the R.P. Act and Article 329 of the Constitution inasmuch as the law requires that an election petition shall be presented to the High Court.
The learned Judge in the High Court overruled both the preliminary objections holding, in the case of the first, that there was substantial compliance with the requirements of the relevant provisions and on the second point he ruled that the presentation of the election petition to the Stamp Reporter appointed or authorised under the Rules was presentation in accordance with the Rules and the same did not conflict with Article 329(b) of the Constitution.
Thus both the preliminary objections stood rejected.
The returned candidates had applied under Order VII Rule 16 of the Code of Civil Procedure.
(the Code), for striking out certain averments from the memo of the election petitions on the ground of failure to disclose a cause of action.
A prayer was also made for dismissal of the petitions on that ground.
The learned Judge in the High Court rejected this contention observing that under the election law the High Court is empowered to permit amendment of the election petition with a view to amplifying the averments bearing on the question of corrupt practice which it considers necessary for ensuring a fair and effective trial of the election dispute.
In this view of the matter the learned Judge examined the averments of each paragraph in detail and directed the deletion or modification of certain paragraphs, the averments wherein were vague of benefit of necessary particulars.
He directed that paragraphs 6, 9, 12, 13, 21, 22, 38 and 40 shall stand deleted whereas paragraphs 3, 4, 5, 8, 14 to 20, 25 to 27, 30 to 37, 39 and 45 of the petition giving rise to CA No. 179 of 1991 shall stand modified.
All allegations against the election agent or other agents of the returned candidates were ordered to be struck off.
In other words he directed that the allegations of corrupt practice shall be confined to the returned candidates only.
Similar orders were passed in the other election petitions subject to the variation in number of paragraphs, etc.
For convenience we will take the pleadings of C.A. No. 179/91 as representative since we are told that the averments in each election petition are identical except for some variations here and there.
Thus the learned Judge rejected the preliminary objections and partly allowed the application for striking off the averments in the election petitions and partly permitted certain amendments to the election petitions.
It is against the said order that the returned candidates have approached this Court under Article 136 of the Constitution.
At the time of admission of these appeals two questions were formulated for examination and we will confine ourselves to them in 761 the course of this Judgment.
These two questions are as under: (1)``The Election Petitions are liable to be dismissed in limine under Section 83 of the Representation of the People Act, 1951 as the affidavit filed by the Election Petitioner in each case is not strictly in conformity with Form 25, inasmuch as the verification as regards the averments based on knowledge and the averments based on information has not been made separately as required by the said Form prescribed under Rule 95 A of the Representation of the People Rules, 1951; and (II) The copies of the Election petitions served on the petitioners herein (the respondents in the Election Petitions) not being true copies of the Election Petitions , the Election Petitions were not maintainable and were liable to be dismissed in limine in view of Section 81 read with Section 86 of the Representation of the People Act, 1951. ' ' The appellants herein are the returned candidates.
Election Petitions were filed against them challenging their election on more or less identical grounds.
Since the Election Petitions are stated to be based on a single master copy, we would refer to the averments of E.P. No. 7 of 1989 filed against the appellant F. Sapa of Civil Appeal No. 179 of 1991.
On a perusal of the cause title of the petition it becomes evident that the name of the constituency and the particulars of the petitioner and the respondents are left blank and filled in hand.
The petition is stated to be under Sections 80 and 81 of the R.P. Act.
Paragraph 1 furnishes the dates concerning the election programme and the particulars regarding the petitioner.
In paragraph 2 the particulars regarding the total votes, votes pulled by each candidate, etc., have been set out.
While the various heads are typed, the figures are hand written.
The various typed heads would show that particulars upto five respondents figure.
That is why the columns regarding three respondents have been filled in while serial Nos. 6 and 7 meant for respondents 4 and 5 have been left blank.
This supports the appellant 's say that one master copy of the election petition were prepared and thereafter particulars in respect of each petitioner were filled in hand.
In paragraph 3 it is averred that the M.P.C.C. (I) had with the consent and knowledge of the returned candidate conceived and 762 executed the entire election campaign of the returned candidate between December 31, 1988 and January 19, 1989.
So also the returned candidate had on his own and with the help of M.P.C.C. (I), its functionaries and workers organised and addressed public meetings and undertook door to door canvassing to promote his chances for success.
Thereafter the list of towns and villages where he held such meetings, etc., are written in hand in the blank space left for that purpose.
This is also indicative of that fact that a master copy was prepared to challenge all the fifteen elections.
In paragraphs 4 and 5 the details regarding the campaign literature or material, such as stickers, hand bill, pamphlets, press publications etc., have been furnished.
These have been produced with their English translations at Annexures I to VI(a).
It is averred that this campaign literature was widely distributed throughout the length and breadth of the entire constituency between the aforestated dates and was also air dropped by helicopter on January 20, 1989 throughout the constituency.
These were also read out and explained to the voters in the constituency during the aforesaid period.
After making this averment in paragraph 6, the petitioner proceeds to add in paragraph 7 as under: ``That by publishing printing, circulating, distributing and by reading out and explaining to the audiences including the electors and their family members throughout the length and breadth of the constituency as indicated above, Respondent No. 1 (returned candidate) has been guilty of corrupt practices under Section 123. . . ' ' The details in regard to the M.P.C.C. (I) 's Election Manifesto produced at Annexure I (English translation Annexure 1A) have been set out in paragraphs 8 to 22 along with comments, inferences, etc.
In paragraph 23 there is a mention of Annexure II which is merely a repeat of Annexure I dealt with in the aforesaid paragraphs 8 to 22.
In paragraph 24 reference is to Annexure III which is merely the summary of the Election Manifesto dealt with in the preceding paragraphs.
Paragraphs 25 to 29 refer to the leaflet Operation Josna Annexure IV and submission thereon.
The next two paragraphs 30 and 31 contain reference is to a sticker Annexure V which appeals to the religious sentiments of those following the Christian faith and states: ``Let us vote Mizoram Congress(i) for Mizos and Christians ' ' which, it is contended, constitutes corrupt practice.
Then come paragraphs 32 to 40 which relate to a leaflet Annexure VI entitled ``what our vote will bring about ' ' and then proceeds to add ``Christian Government ' ' and ``promise of visit of the holy land (Israel) ' '.
Then, 763 after referring to the activities aforestated, it is alleged in paragraph 41 that this has materially affected the election prospects of the other contesting candidates also.
Paragraphs 42, 43 and 44 refer to Press publications in `India Today ', `Statesman and the Assam Tribune and Sentinals '.
Paragraph 45 enumerates the grounds on which the election of the returned candidate is liable to be set aside.
Paragraphs 45A to 47 deal with sundry items.
This in brief is the nature of the Election Petition.
The petition is verified as under: ``I. SANGURA the petitioner herein verify that the facts mentioned in paragraphs 1, 2, 4, 5, 18, 19, 28, 35, 30, 33, 36, 38, 41, 42, 43, 44, 45, 45A, 46 & 47 are true to my knowledge and facts mentioned in paragraphs 7, 8, 9, 10, 11, 12, 13, 14, 15, 20, 21, 22, 23, 24, 26, 27, 29, 32, 34, 3 35, 37, 40 & 41 are based on information received and believed to be true.
Grounds A, B & C and the legal submissions are based on legal advice.
Verified at Guwahati on 7th March, 1989. ' ' The verification is typed but the petitioner 's name and the paragraph numbers at both the places are hand written.
It will be seen from the above verification clause that paragraphs 3, 16, 17, 25, 31 & 39 have not been verified at all either as true to knowledge or on information and/or belief whereas paragraph 41 is mentioned at both the places.
It may also be noted at this stage that in regard to the second part of the verification based on `information received ' and believed to be true ' it is not clarified which of the paragraphs are based on `information received ' (nor is the source of information disclosed) and which are founded on `believed to be true '.
Appended to the petition is the petitioner 's typed affidavit, which runs into six paragraphs.
The name of the petitioner, his age and address appear to be filled in on a typewriter.
In paragraph 2 of the affidavit it is stated that the petitioner (unsuccessful candidate) has alleged several corrupt practices on the part of the Respondent No. 1 (the returned candidate), his election agent and other agents and virtually the same phrase is repeated in paragraph 3.
The in paragraph 4 it is stated: `for brevity the details of the corrupt practices alleged by me which have been given in the Election Petition and are not being repeated in this affidavit and the same may be treated and read as part of this affidavit ' and then the deponent proceeds to add `The said particulars and details of corrupt practices and contained in paragraphs 4 to 40 of the said election petition '.
The word and figures `4 to 40 ' are 764 written in hand after scoring out the words and figures `7 to 47 '.
Then comes paragraph 5 which may be reproduced: ``That I solemnly state and affirm that all that has been stated in the election petition by way of corrupt practices as a correct to the best of my knowledge and to the information received by me and believed by me to be true ' '.
It will be seen from the above that according to the election petitioner the particulars and details of the corrupt practices are contained in paragraphs 4 to 40 which also omits paragraph 3 which is, according to the returned candidate/appellant crucial.
Then in paragraph 5 extracted above the election petitioner states that all that he has stated in regard to corrupt practices in his election petition (which according to paragraph 4 are contained in paragraphs 4 to 40) is `correct to the best of my knowledge and to the information received by me and believed by me be true '.
It is not stated which of the particulars contained in paragraphs 4 to 40 are true to his knowledge, which are based on information received (apart from disclosure of source of information) and which he believes to be true.
The affidavit is totally silent in regard to paragraphs 1 to 3, and 41 to 47 of the election petition.
The returned candidate/the appellant herein, therefore, contends that paragraph 3 which is the most crucial paragraph in the entire election petition inasmuch as it discloses the names of towns and villages as well as the period during which the alleged corrupt practices were committed has been carefully, deliberately and scrupulously omitted both from the verification clause and the affidavit referred to hereinabove for reasons best known to the election petitioner and, contends the appellant, once this paragraph 3 is kept out of consideration, the Election Petition is, rendered `a theoretical and unimaginative essay ' on corrupt practice of appeal to religion.
It is, therefore, contended that failure to mention paragraph 3 of the election petition in both the verification clause of the petition and the affidavit filed in support thereof is fatal and cannot be cured particularly after the expiry of the limitation period of 45 days.
The appellant further contends that the affidavit is not in Form No. 25 prescribed under Rule 94A of the Rules and hence the affidavit is no affidavit at all.
Since Section 83 of the R.P. Act is mandatory and strict compliance thereof is expected of an election petitioner failure to adhere to Form No. 25 is fatal as the doctrine of substantial compliance has no place in election law but even if that doctrine could be 765 invoked to rescue the election petitioner out of the situation in which he was placed himself, it was absolutely essential for him to clearly state in his affidavit which paragraphs of the Election Petition are based on his knowledge, which are based on information received and which are based on his belief.
Since even this is missing it is difficult to say that there is substantial compliance assuming the doctrine has application.
Counsel for the appellant fairly stated that if the averments in the election petition had been sworn to in the above manner it could perhaps be argued that failure to strictly follow Form 25 could be excused on the doctrine of substantial compliance and the procedural defect could be cured by an appropriate amendment.
But, argued counsel, the doctrine could never be pressed into service where the petitioner has failed to disclose which part of the allegations regarding corrupt practice are based on knowledge, which on information received and which on belief.
Where there is failure to comply with even the basic requirements of an affidavit, there can be no question of substantial compliance; this being a case of non compliance, whatsoever.
Where several paragraphs of the election petition remain unaffirmed under the verification clause as well as the affidavit, the unsworn allegation can have no legal existence and the election court cannot take cognizance thereof.
The further allegation was that the election petitions being photocopies could not be entertained as valid election petitions; that copies of the election petitions served on the returned candidates were not attested as true copies of the original as required by Section 81(3) and that the election petitions and the schedule and annexures were not signed and verified as required by the Code.
An election dispute founded on the allegation of corrupt practice being quasi criminal in nature calls for strict adherence to the requirements of election law as is evident from Section 86(1) of R.P. Act which provides for dismissal of an election petition which fails to comply with the requirements of Sections 81, 82 or 117 on the said statute.
Before we set out of the relevant provisions of the R.P. Act, reference may be made to Order VI Rule 15 of the Code which deals with verification of pleadings.
This rule is divided into three parts: the first part begins with `save as otherwise provided by any law for the time being in force ' and then proceeds to add that every pleading shall be verified by the party or by one of the parties or by some other person acquainted with the facts of the case; the second part posits that every person verifying shall specify what he verifies of his own knowledge and what he verifies upon information received or believed to be true by reference to paragraph numbers and the third part states that the 766 verification shall be signed by the party making it.
It was however, pointed out that by virtue of sub section (3) of Section 1, the Code extends to the whole of India except (a) the State of Jammu and Kashmir and (b) the State of Nagaland and the tribal areas.
The explanation defines the expression `tribal areas ' as territories which, immediately before January 21, 1972 were included in the tribal areas of Assam as referred to in paragraph 20 of the Sixth Schedule to the Constitution.
Paragraph 20 says that the areas specified in Parts I,II and III of the table shown below shall respectively be the tribal areas within the State of Assam, the State of Meghalaya, and the Union Territory of Mizoram.
Part III which is relevant for our purpose comprises (1) the Chakma District (2) the Lakher District and (3) the Pawi District.
During the British period the area was divided into North Lushai Hills and South Lushai Hills but was later amalgamated into a single District of Lushai Hills and was made part of Assam and was placed under the administrative charge of a Superintendent.
On our attaining independence, the Superintendent was replaced by a Deputy Commissioner but the District of Lushai Hills continued to be part of Assam.
The Lushai Hill District was renamed Mizo District in 1954 by an Act of Parliament and was placed under a District council.
After a spell of disturbances on the implementation of the North Eastern Reorganisation Act, 1971, the Mizo District was upgraded into a Union Territory and was renamed Mizoram.
It was divided into three districts, namely, (i) Aizawal ( i) Lunglei and (iii) Chhimtuipui.
The Mizo Hill District was replaced by Chakma, Lakher and Pawi Districts which find a mention in Part III of the Table to paragraph 20 of the Sixth Schedule to the Constitution.
It was, therefore, argued that the provisions of the Code did not and do not apply to the State of Mizoram.
In support of this contention reliance is placed on three decisions of this Court namely (1) Gurumayam section Sarma V.K. Ongbi Anisija Devi, Civil Appeal No. 659 of 1957 dated February 9, 1961 (2) State of Nagaland V. Rattan Singh, ; and (iii) V.L. Rohlus V. Deputy Commissioner, Aizawal, It is unnecessary to notice these decisions in detail because Dr. Singhvi does not seriously question this proposition.
But, contends Dr. Singhvi, if the Code did not apply to Mizaoram in view of the above, it applied to an election petition because Section 83(1)(c) obligates that an election petition `shall be signed by the petitioner and verified in the manner laid down in the Code for the verification of pleadings '.
Therefore, even though the provisions do not extend to Mizoram by virtue of Section 1(3) of the Code, counsel submitted they are applicable by incorporation to election petitions by the thrust of Section 83(1)(c) of the R.P. Act to the extent indicated therein.
767 And now to the relevant provisions of the R.P. Act and the Rules framed thereunder.
The expression `corrupt practice ' defined in Section 1(c) means any of the practices specified in Section 123.
The various corrupt practices enumerated in Section 123 are (1) bribery, (2) undue influence, (3) an appeal by a candidate or his agent or by another other person with the consent of the candidate or his election agent to vote or refrain from voting for any person on the ground of his religion, race, caste, community or language or the use of, or appeal to religious symbols, etc., (3A) the promotion of, or attempt to promote, feelings of enmity or hatred between different classes of the citizens of India on grounds of religion, race, caste, community, or language, (4) the publication of any statement of fact which is false and which he either believes to be false or does not believe to be true, in relation to another candidate, (5) the hiring or procuring of any vehicle or vessel or the use of such vehicle or vessel for the free conveyance of any elector to or from any polling station, (6) the incurring or authorising of expenditure in contravention of Section 77, (7) the obtaining or procuring of any assistance from any Government servant of the class specified and (8) booth capturing.
Sections 8 and 8A lay down that any person convicted for practising any corrupt practice by an order made by the High Court under Section 99 shall be disqualified for a period of six years in the case of the former in addition to being punished on conviction and for a period not exceeding six years in the case of the latter.
Counsel for the appellant, therefore, contended that proof of allegations of corrupt practice would visit the returned candidate with certain serious consequences and must, therefore, be viewed seriously.
Being quasi criminal in nature courts have and must always insist on strict compliance with the provisions of law in that behalf and failure to do so must prove fatal.
Laying this background, counsel for the appellants invited our attention to Sections 80 to 86 of the R.P. Act.
The R.P. Act is divided into XI parts.
We are essentially concerned with Part VI entitled `Disputes Regarding Elections ' which is divided into V chapters.
Chapter I is a single section chapter comprising section 79 which defines certain expressions used in Part VI and Part VII dealing with corrupt practices and electoral offences.
Chapter II entitled `Presentation of election petitions to Election Commission ' comprises Sections 80 to 85 having since been repealed.
Section 80 says no election shall be called in question except by an election petition presented in accordance with the provisions contained in that part.
Section 80A, inserted by Act 47 of 1966, confers jurisdiction on the High Court to try an election petition.
Section 81 768 deals with the presentation of such petitions.
It reads under: ``81.
Presentation of petitions. (1) An election petition calling in question any election may be presented on one or more of the grounds specified in sub section (1) of section 100 and section 101 to the High Court by any candidate at such election or any elector within forty five days from, but not earlier than, the date of election of the returned candidate, or if there are more than one returned candidate at the election and the dates of their election are different, the later of those two dates.
Explanation.
In this sub section, `elector ' means a person who was entitled to vote at the election to which the election petition relates, whether he has voted at such election or not.
(3) Every election petition shall be accompanied by as many copies thereof as there are respondents mentioned in the petition, and every such copy shall be attested by the petitioner under his own signature to be a true copy of the petition. ' ' Sub section (2) of this section was omitted by Act 47 of 1966 when by the same statute the words `Election Commission ' were substituted by the expression `High Court ' with effect from December 14, 1966.
Even though by the said Amendment Act jurisdiction was conferred on the High Court in place of the Election Commission, surprisingly the title of Chapter II continues to read `Presentation of election petitions to Election Commission '.
Parliament will do well to correct this slip by substituting the words `High Court ' for the expression `Election Commission ' to bring it in conformity with the changes introduced by Act 47 of 1966.
Section 82 indicates the parties to be joined as respondents.
Then comes Section 83 which reads thus: ``83.
Contents of petition. (1) An election petition (a) shall contain a concise statement of the material facts on which the petitioner relies; (b) shall set forth full particulars of any corrupt practice that the petitioner alleges, including as full a statement as possible of the means of the parties alleged to have com 769 mitted such corrupt practice and the date and place of the commission of each such practice; and (c) shall be signed by the petitioner and verified in the manner laid down in the Code of Civil Procedure, 1908 (5 of 1908) for the verification of pleadings: Provided that where the petitioner alleges any corrupt practice, the petition shall also be accompanied by an affidavit in the prescribed form in support of the allegation of such corrupt practice and the particulars thereof.
(2) Any schedule or annexure to the petition shall also be signed by the petitioner and verified in the same manner as the petition. ' ' On a plain reading of this provision it is manifest that it is incumbent on the petitioner to set forth `full particulars of any corrupt ' he alleges against the returned candidate.
This should be accompanied by `as full a statement as is possible ' of the names of those who have indulged in such corrupt practice and the date and place of the commission thereof.
Clause (c) of sub section (1) enjoins that the election petition shall not only be signed but also verified in the manner laid down in the Code.
The proviso then prescribes an additional safeguard in cases where corrupt practice is alleged, as in the present case, namely, that the election petition shall be accompanied by an affidavit in the prescribed form in support of the allegation of such corrupt practice and the particulars thereof.
This provision reflects the anxiety of the legislature to ensure that allegations of corrupt practice are not lightly made; not only that but it ensures that the responsibility thereof is fixed on the petitioner himself by asking him to swear an affidavit in support thereof.
`Prescribed ' says Section 2(g) means prescribed by rules made under the said Act.
Form 25 is the form of the affidavit prescribed by Rule 94A of the Rules.
Next sub section (2) of this section provides that any schedule or annexure to the petition shall also be signed and verified in the same manner as the petition itself.
Section 84 sets out what relief the petitioner can claim in such an election petition.
That brings us to chapter III entitled `Trial of election petitions '.
Only two sections from this chapter require to be noticed.
The first is section 86, the relevant part whereof reads: ``86.
Trial of election petitions. (1) The High Court shall dismiss an election petition which does not comply with the 770 provisions of section 81 or section 82 or section 117.
Explanation.
An order of the High Court dismissing an election petition under this sub section shall be deemed to be an order made under clause (a) of section 98.
(2) As soon as may be after an election petition has been presented to the High Court.
It shall be referred to the Judge or one of the Judges who has or have been assigned by the Chief Justice for the trial of election petitions under sub section (2) of section 80A. ' ' The rest of the sub sections are not germane to the controversy before us.
Section 87 outlines the procedure to be followed by the High Court in the trial of an election petition.
It says that it shall be tried `as nearly as may be ', in accordance with the procedure applicable under the Code to the trial of suits.
Since sub section (1) of the Section 86 refers to Section 117 we may notice it at this stage.
It provides for a deposit of Rs. 2,000 as security for the petition with which we are now concerned.
Dr. Singhvi, therefore, emphasised that the law for the trial and resolution of election disputes found in the aforesaid provisions of this Act and the Rules made thereunder offers a self contained Code and it is not necessary to look elsewhere except where provisions of any other law are incorporated in this statute by reference.
He further submitted that since some of the election disputes could be quasi criminal in nature, e.g., where corrupt practice is alleged, strict compliance with the provisions of the statute and Rules is expected by the legislature in such cases and even if the provisions are treated as directory as held by the learned Judge in the High Court, the degree of non compliance which the Court will tolerate to ensure substantial compliance will not be the same as in an ordinary civil proceeding.
He submitted that tested on this touchstone, this Court should hold that there is no substantial compliance for otherwise the election law would loss its sanctity and seriousness and vague charges of corrupt practice would be lightly made to vex the returned candidates and when faced with an objection attempts to cure the defects through applications for amendment of the pleadings would become the order of the day thereby defeating the very object of expeditious disposals of election petitions envisaged in Section 86(7) of the R.P. Act.
Dr. Singhvi took strong exception to the approach of the learned Judge in the High Court when he ruled that strict compliance with the provisions of Sections 81 and 83 of R.P. Act was not necessary and 771 that the procedural requirements thereunder were to be treated in the same manner as a suit or any other proceedings of a civil nature.
He submitted that this approach of the learned Judge betrays an erroneous understanding that election petitions are also to be treated on par with ordinary proceedings, notwithstanding the quasi criminal character of such proceedings, and it is this approach of the learned Judge which has led him to reach a conclusion unknown to election law.
In particular he invited our attention to the following observations of the learned Judge which according to counsel betrays his fallacious approach: ``I am not prepared to hold that simply because a petition before the court happens to be an election petition, the procedural requirements should be construed in a mechanical or pedantic manner without any regard to the object sought to be achieved thereby.
The law does not require the court, while dealing with an election petition, to construe the pleadings in such a hyper technical manner and to make a microscopic examination thereof with a view to finding out a slip here or a deviation there which may be used as a ground for the rejection of the petition in limine in the name of maintaining the democratic process or the purity of election.
In any opinion, the procedural requirements in an election case also should be construed in the same manner as in cases under the C.P.C. The approach of the court should not be to reject the election petition, in limine on every possible pretext of non compliance with one more of the procedural requirements unless the law itself, in clear terms, mandates it to do so. ' ' It is manifest from the above observations that the learned Judge took the view that the procedural requirements are intended to serve the object of providing a mechanism to reach the ultimate objective of dispensing justice in election disputes.
According to him these provisions were merely adjectival and must, therefore, be construed liberally so as to advance the cause of justice and not to stifle it at the threshold.
In support of this line of thought the learned Judge placed reliance on the observations of this Court in Raj Narain vs Indira Gandhi, AIR 1973 SC 1302 at 1307 wherein this Court has observed as under: ``Rules of pleadings are intended as aids for fair trial and for reaching a just decision.
An action at law should not be 772 equated to a game of chess.
Provisions of law are not mere formulae to be observed as rituals.
Beneath the words of a provision of law, generally speaking, there lies a justice principle.
It is the duty of the Court to ascertain that principle and implement it. ' ' Let us examine if the criticism of the learned counsel to the approach of the learned Judge is well founded.
It is fairly well settled that our election law being statutory in character must be strictly complied with since an election petition is not guided by ever changing common law principles of justice and notions of equity.
Being statutory in character it is essential that it must conform to the requirements of our election law.
But at the same time the purity of election process must be maintained at all costs and those who violate the statutory norms must suffer for such violation.
If the returned candidate is shown to have secured his success at the election by corrupt means he must suffer for his misdeeds.
The mode for calling in question the election of a returned candidate is by presenting an election petition `in accordance with the provisions of this Part ' (Section 80).
Such a petition has to be presented within 45 days from the date of election of the returned candidate.
Sub section (3) of section 81 provides that such an election petition must be accompanied by as many copies thereof as there as there are respondents and every such copy shall be attested by the petitioner under his own signature to be a true copy of the petition.
This provision which explains how a copy of an election petition shall be attested, emphasises that such attestation will be under the petitioner 's own signature.
What the contents of an election petition shall be is enumerated in Section 83.
It must contain a concise statement of material facts on which the petitioner relies but where a petition is founded on the allegation of corrupt practice, it shall set forth full particulars of the corrupt practice alleged by the petitioner, including as full a statement as possible of the names of the parties who have indulged in such corrupt practice together with the date and place of the commission thereof.
Such an election petition as well as every schedule or annexure thereto must be signed by the petitioner and verified in the manner provided by the Code for the verification of pleadings.
But, in cases where the petitioner has alleged corrupt practice that is not enough, the proviso demands that the petition shall be accompanied by an affidavit in the prescribed from supporting the allegation of such corrupt practice and the particulars thereof.
Therefore, an election 773 petition in which corrupt practice is alleged stands on a different footing from an election petition which does not carry such an allegation.
The legislature has taken special care to ensure that ordinary verification will not suffice, it must be supported by an affidavit in the prescribed form.
Form 25 has been prescribed for such an affidavit under rule 91A of the Rules.
That rule says that the affidavit referred to in the proviso to Section 83(1) shall be in Form 25.
The form of the affidavit requires the deponent to state which of the paragraphs of the election petition in which allegations of corrupt practice are made are based on his own knowledge and which are based on this information.
Section 86(1) then mandates that the High Court `shall ' dismiss an election petition which does not comply with the provisions of Section 81 or Section 82 or Section 117 of the R.P. Act.
The language of this sub section is quite imperative and commands the High Court, in no uncertain terms, to dismiss an election petition which does not comply with the requirements section 81 or section 82.
This mandate is, however, qualified by sub section (5) referred to earlier.
Election of a returned candidate can be rendered void on proof of the alleged corrupt practice.
In addition thereto he would incur a subsequent disqualification also.
This harshness is essential if we want our democratic process to be clean, free and fair.
Eradication of corrupt practice from our democratic process is essential if we want it to thrive and remain healthy.
Our democratic process will collapse if unhealthy corrupt practices like appeals to voters on basis of caste, creed, community, religion, race, language, etc., are allowed to go unchecked and unpunished.
Use of corrupt practices in elections to secure short term gains at the cost of purity of our democratic process must be frowned at by every right thinking citizen.
It is for that reason that the law has provided for double jeopardy to deter candidates, their agents and others from indulging in such nefarious practices.
But while there is sufficient justification for the law to be harsh with those who indulge in such practices, there is also the need to ensure that such allegations are made with a sense of responsibility and concern and not merely to vex the returned candidate.
It is this in view that the law envisages that the particulars of such allegations shall be set out fully disclosing the name of the party responsible for the same and the date and place of its commission.
A simple verification was considered insufficient and, therefore, the need for an affidavit in the prescribed form.
These procedural precautions are intended to ensure that the person making the allegation of corrupt practice realises the seriousness thereof as such a charge would be akin to a criminal charge since it visits the party indulging in such practice with a two fold penalty.
That 774 is why this Court described it as quasi criminal in nature in Manphul Singh vs Surinder Singh, [1973] 2 SCC 599 at 608 and reiterated the same in K.M. Mani vs P.J. Antony, ; Hence the insistence that each ingredient of the charge must be satisfactorily proved before a verdict of guilt is recorded by the Court.
In Mani 's case this Court held that the allegations must be established beyond reasonable doubt and not merely by a preponderance of probability.
It is, therefore, equally essential that the particulars of the charge or allegation are clearly and precisely stated in the election petition to afford a fair opportunity to the person against whom it is leveled to effectively counter the same.
The law in regard to the adjudication of an election dispute has been set out, as stated earlier, in Part VI of the R.P. Act, the provisions whereof constitute a self contained Code.
Therefore, an election petition calling in question the election of a returned candidate must be made in accordance with the provisions of this part of the statute.
Under the provisions of this part an election petition calling in question the election of a returned candidate must be founded on one or more of the grounds specified in Sections 100 and 101 for any of the reliefs specified in Section 84 thereof.
Section 100 specifies several grounds, one of them being commission of a corrupt practice by the returned candidate.
Section 83(1)(a) stipulates that every election petition shall contain a concise statement of the "material facts" on which the petitioner relies.
That means the entire bundle of facts which would constitute a complete cause of action must be concisely stated in an election petition.
Section 83(1)(b) next requires an election petitioner to set forth full 'particulars ' of any corrupt practice alleged against a returned candidate.
These 'particulars ' are obviously different from the 'material facts ' on which the petition is founded and are intended to afford to the returned candidate an adequate opportunity to effectively meet with such an allegation.
The underlying idea in requiring the election petitioner to set out in a concise manner all the 'material facts ' as well as the 'full particulars ', where commission of corrupt practice is complained of, is to delineate the scope, ambit and limits of the inquiry at the trial of the election petition.
Before the amendment of the R.P. Act by Act 27 of 1956, section 83(3) provided for an amendment of an election petition insofar as 'particulars ' of corrupt practice were concerned.
By the 1956 amendment this provision was replaced by Section 90(5) which in turn came to be deleted and transferred as sub section (5) of section 86 by the Amendment Act 47 of 1966.
Section 86(5) as it presently stands 775 empowers the High Court to allow the `particulars ' of any corrupt practice alleged in the petition to or amplified the amendment does not have the effect of widening the scope of the election petition by introducing particulars in regard to a corrupt practice not previously alleged or pleaded within the period of limitation in the election petition.
In other words the amendment or amplification must relate to particle already pleaded and must not be an effort to expand the scope of the inquiry by introducing particulars regarding a different corrupt practice not earlier pleaded.
Only the particulars of that corrupt practice of which the germ exists in the election petition can be amended or amplified and there can be no question of introducing a new corrupt practice.
It is significant to note that section 86(5) permits `particulars ' of any corrupt practice `alleged in the petition ' to be amended or amplified and not the `material facts '.
It is, therefore, clear from the trinity of clauses (a) and (b) of 83 and section sub section (5) of section 86 that there is a distinction between `material facts ' referred to in clause (a) and `particulars ' referred to in clause (b) and what Section 86(5) permits is the amendment/amplification of the latter and not the former.
Thus the power of amendment granted by section 86(5) is relatable to clause (b) of section 83(1) and is coupled with a prohibition, namely, the amendment will not relate to a corrupt practice not already pleaded in the election petition.
The power is not relatable to clause (a) of section 83(1) as the plain language of section 86(5) confines itself to the amendments of `particulars ' of any corrupt practice alleged in the petition and does not extent to `material facts '.
This becomes crystal clear on the plain words of the closely connected trinity of Section 83(1)(a), 83(1)(b) and 86(5) and is also supported by authority.
See Samant N. Balkrishna vs George Fernandez, ; and D.P. Mishra vs Kamal Narayan Sharma, ; In Balwan Singh vs Lakshmi Narain, this Court held that it full particulars of an alleged corrupt practice are not supplied, the proper course would be to give an opportunity to the petitioner to cure the defect and if he fails to avail of that opportunity that part of the charge may be struck down.
We may, however, hasten to add that once the amendment sought falls within the purview of section 86(5), the High Court should be liberal in allowing the same unless, in the facts and circumstances of the case, the Court finds it unjust and prejudicial to the opposite party to allow the same.
Such prejudice must, however, be distinguished from mere inconvenience, vide Raj Narain vs Indira Gandhi, ; This much for the provisions of section 83(1)(a) and (b) and section 86(5) of the R.P. Act.
776 The brings us to clause (c) of sub section (1) of section 83, which provides that an election petition shall be signed by the petitioner and verified in the manner laid down by the Code for the verification of the pleadings.
Under section 83(2) any schedule or annexure to the pleading must be similarly verified.
Order 6 Rule 15 is the relevant provision in the Code.
Sub rule (2) of Rule 15 says that the person verifying shall specify with reference to the numbered paragraphs of the pleading, what he verifies on his own knowledge and what he verifies upon information received and believed to be true.
The verification must be signed by the person making it and must state the date on and the place at which it was singed.
The defect in the verification can be (i) of a formal natural and not very substantial (ii) one which substantially complies with the requirements and (iii) that which is material but capable of being cured.
It must be remembered that the object of requiring verification of an election petition is clearly to fix the responsibility for the averments and allegations in the petition on the person signing the verification and at the same time discouraging wild and irresponsible allegations unsupported by facts.
Then comes the proviso which provides that in cases where corrupt practice is alleged in the petition, the petition shall also be supported by an affidavit in the prescribed form i.e. From No. 25 prescribed by Rule 94A of the Rules.
Lastly sub section (2) of section 83 lays down that any schedule or annexure to the petition shall also be similarly signed and verified.
Two question arise: (i) what is the consequence of a a defective or incomplete verification and (ii) what is the consequence of a defective affidavit? It was also said that the verification clause in regard to averments or allegations based on information ought to disclose the source of information which had not been done in this case.
It must at the outset be realised that section 86(1) which lays down that the High court `shall ' dismiss an election petition which does not comply with the provisions of section 81 or section 8 or section 117 does not in terms refer to section 83.
It would, therefore, seem that the legislature did not view the non compliance of the requirement of section 83 with the same gravity as in the case of sections 81, 82 or 117.
But it was said that a petition which does not strictly comply with the requirements of section 83 cannot be said to be an election petition within the contemplation of section 81 and hence section 86(1) was clearly attracted.
In Murrka Redhey Shyam vs Roop Singh Rathore, ; one of the defects pointed out was that though the verification stated that the averments made in some of the paragraphs of the petition were true to the personal knowledge of the petitioner and the averments in in some other paragraphs were verified 777 to be true on advice and information received from legal and other sources, the petitioner did not in so may words state that the advice and information received was believed by him to be true.
The Election Tribunal held that this defect was a matter which came within section 83(1)(c) and the defect could be cured in accordance with the principles of the Code.
This Court upheld this view in the following words: "It seems clear to us that reading the relevant sections in Part VI of the Act, it is impossible to accept the contention that a defect in verification which is to be made in the manner laid down in the Code of Civil Procedure, 1908, for the verification of pleadings as required by cl.
(c) of sub section
(1) of section 83 is fatal to the maintainability of the petition.
" It is thus clear from this decision which is binding on us that mere defect in the verification of the election petition is not fatal to the maintainability of the petition and the petition cannot be thrown out solely on that ground.
As observed earlier since section 83 is not one of three provisions mentioned in section 86(1), ordinarily it cannot be construed as mandatory unless it is shown to an integral part of the petition under section 81.
The proviso to section 83(1) was inserted by section 18 of Amendment Act 40 of 1961.
It is attracted where the petitioner alleges any corrupt practice.
In that case the election petition must be accompanied by an affidavit inthe prescribed form i.e. Form No. 25.
The affidavit is intended to support the allegation of corrupt practice and the particulars thereof pleaded in the election petition.
Order 19 Rule 3 of the Code provides that affidavits should be confined to such facts as the deponent is able on his own knowledge to prove.
Here again the submission was that the affidavit to be sworn in Form No. 25 prescribed by Rule 94A must be sworn consistently with Order 19 Rule 3 of the Code.
The submission, therefore, was that the affidavit must disclose the source of information for otherwise it will be no affidavit at all.
In this connection reliance is placed on the decision of this Court in State of Bombay vs Purushottam Jog Naik; , wherein at page 681 this Court while dealing with the verification of the affidavit of the Home Secretary observed that when the matter deposed to is not based on personal knowledge the source of information should be clearly disclosed.
Again in The Barium Chemicals Ltd. vs The Company Law Board, [1966] Supp.
SCR 311 Shelat, J. at page 352 reiterated that where allegations of mala fides are not grounded on personal knowledge but only on `reason to believe ', the source of 778 information must invariably be disclosed.
Same was the view expressed in the case of K.K. Nambiar vs Union of India, ; at 125.
Based on the law laid down in the aforesaid three cases the learned counsel for the appellants submitted that an affidavit which on its to disclose the source of information has no efficacy in law and is not worth the paper on which it is written, more so in an election petition alleging corrupt practice, for otherwise it will fail to achieve the purpose, namely, to give an opportunity to the returned candidate to counter the allegation.
According to the learned counsel, the affidavit contemplated by the proviso to section 83(1) is intended to be an integral part of the petition under section 81 and failure to comply with the requirement of disclosing the source of information renders the petition liable to summary dismissal under section 8(1) of the R.P. Act.
Reliance was placed on Jadav Gilua vs Suraj Narain Jha, AIR 1974 Patna 207; M/s Sunder Industries Ltd. vs G.E. Works, AIR 1982 Delhi 220; K.K. Ramachandran, AIR 1988 Kerala 259; Kamalam vs Dr. syed Mohamad; , and M/s Sukhwinder Pal vs State of Punjab, ; , which support this view.
In the case of Murarka Radhey Shyam, (supra) two election petitions were filed challenging his election to the House of the People.
In those two petitions certain preliminary objections were raised touching on the maintainability of the petitions on the ground that there was failure to comply with the mandatory requirements of the R.P. Act.
One of the preliminary objections with which we are presently concerned was non compliance with section 83 inasmuch as the affidavit in respect of corrupt practices which accompanied the petition was neither properly made nor in the prescribed form.
The further submission was that an election petition under section 81 must comply with the requirements of section 83 for otherwise it cannot be rightly described as an election petition under section 81 of the R.P. Act.
This Court referred to the observation of the Election Tribunal, which reads as under: "The verification of the affidavit of the petitioner is apparently not in the prescribed form but reading as a whole the verification carries the same sense as intended by the words mentioned in the prescribed form.
The mistake of the Oaths Commissioner in verifying the affidavit cannot be a sufficient ground for dismissal of the petitioner 's petition summarily, as the provisions of section 83 are not necessarily to be complied with in order to make a petition valid and such 779 affidavit can be allowed to be filed at a later stage also." and expressed its agreement therewith.
It also held that the defect in the time and place of verification cannot be a fatal defect and can be remedied.
In Virendra Kumar Saklecha vs Jagjiwan and Others, Rule 7 of the M.P. High Court Rules Provided that every affidavit should cleraly express how much is a statement and declaration from knowledge and how much is based on information or belief and must also state the source of information or belief.
This Court held that the requirements of Form 25 were not consistent with Rule 7 which purported to give effect of Order 19 of the Code.
In that case the affidavit accompanying the petition did not disclose the source of information in respect of certain speeches alleged to have been made by the appellant which constituted corrupt practice nor were the notes thereof allegedly made by certain persons therewith.
This Court while stating that it was not necessary to express any opinion on the question whether the non disclosure of the source or ground of information in the affidavit can prove fatal, nevertheless observed that the grounds or sources of information are required to be stated since section 83 states that an election petition shall be verified in the manner laid down by the Code and affidavit was, therefore, required to be modelled as required by Order 19 of the Code.
This decision is not an authority for the proposition that failure to disclose the source or ground of information would result in dismissal of the petition under section 86(1) of the R.P. Act.
In Krishan Chand vs Ram Lal, ; the appellant, a voter questioned Ram Lal 's election on the allegation that he, his election agent and some others with his consent, had committed various acts of corrupt practices detailed in paragraphs 11 and 12 of the petition.
The petition was verified by the appellant and was accompanied by an affidavit wherein he stated that paragaphs 11 12 were based on information received and believed to be true.
The respondent raised a preliminary objection that the petition was liable to be dismissed for non compliance with the provisions of the R.P. Act read with the Code as the sources of information were not disclosed.
In support of this contention reliance was placed on the decisions rendered under Order 6 Rule 15 and Order 19 Rule 2 of the Code.
Dealing with this submission, this Court observed in paragraph 6 of the judgment as under: 780 "At the outset it may be stated that the provision for setting out the sources of information where the allegations have been verified as having been made on information and knowledge of the petitioner is not a requisite prescribed under Rule 94 A of the Conduct of Election Rules, 1961, which are applicable to the filing of an election petition.
Under sub section (1) of Section 83 an election petition has to contain a concise statement of the material facts on which the petitioner relies; it has to set forth full particulars of any corrupt practice that the petitioner alleges, including as full a statement as possible of the names of the parties alleged to have committed such corrupt practice and the date and place of the commission of each such practice and shall be signed by the petitioner and verified in the manner laid down in the Code of Civil Procedure, 1908, for the verification of the pleadings, provided that where the petitioner alleges any corrupt practice, the petition shall also be accompanied by an affidavit in the prescribed form in support of the allegation of such corrupt practice and the particulars thereof." Setting out Form 25 prescribed under Rule 94A, this Court proceeded to further observe: "There is nothing in this form which requires the petitioner to state under clause (b) of Form 25 the source or sources of his information.
The appellant has referred us to Order XI, Rule 13 of the Supreme Court Rules as also to Rule 1(A) of the Punjab High Court Rules, in which when the deponent in the affidavit filed in support of the petition states that he has made the allegations in the paragraph or paragraphs specified on information, he is required also to disclose the sources of information.
But when there are specific rules made under the Act which govern the election petitions, no other rules are applicable.
Nor is the disclosure of the source of information a requisite under Order VI, Rule 15(2) C.P.C.
On this ground alone the submission of the appellant can be rejected.
" Thus this Court came to the conclusion that the election petition under section 83(1)(b) must itself contain all the necessary material facts and in the affidavit in support the petitioner is required to say which of the allegations are based on personal knowledge and which are based on 781 information received and believed to be true.
If the source of information has not been set out and the opposite party finds it difficult to answer the allegations regarding corrupt practice, he can always apply for better particulars.
In other words the failure to disclose or divulge the source of information was not considered fatal to the petition.
This Court, therefore, concluded that the election petition did not suffer from any defect on that score.
Similar was the view taken by this Court in Z. B. Bukhari vs Brij Mohan, while dealing with the contention that the affidavit in support of the election petition founded on allegations of corrupt practice falling under sub section (3) and (3A) of section 123 was not in proper form.
Repelling this contention the Court held that a petition can only be dismissed for a substantial defect.
In taking this view reliance was placed on Prabhu Narayan vs A.K. Srivastava, ; wherein this Court had negatived the contention that failure to disclose the sources of information would render the affidavit defective.
However, strong reliance was placed on this Court 's decision in Kamalam vs Dr. Syed Mohamad, ; In that case the respondent 's election to the Lok Sabha was challenged alleging corrupt practice.
The election petition was duly signed and verified by the appellant and was accompanied by the requisite affidavit in support of the allegations of corrupt practice and their particulars.
The election petition and the affidavit were tied together as on document.
The appellant 's signature appeared at the foot of the affidavit but there was no such signature at the foot of the election petition itself.
In this backdrop of facts this Court held that both the election petition and the affidavit constituted one single document.
This Court after referring to section 81(3), 83 and 86(1) observed as under: "The context in which the proviso occurs clearly suggests that the affidavit is intended to be regarded as part of the election petition.
Otherwise, it need not have been introduced in a section dealing with contents of an election petition nor figured as a proviso to a sub section which lays down what shall be the contents of an election petition.
Sub section (2) also by analogy supports this inference.
It provides that any schedule or annexure to an election petition shall be signed by the petitioner and verified in the same manner as an election petition.
It is now established by the decision of this Court in Sahodrabai Rai vs Ram 782 Singh Aharwar; , that sub section (2) applied only to a schedule or annexure which is an integral part of the election petition and not to a schedule or annexure which is merely evidence in the case but which is annexed to the election petition merely for the sake of adding strength to it.
" After quoting from the decision in Sahodrabai 's case at pages 19 20, this Court proceeded to state: "It would, therefore, be seen that if a schedule or annexure is an integral part of the election petition, it must be signed by the petitioner and verified, since it forms part of the election petition.
The subject matter of sub section (2) is thus a schedule or annexure forming part of the election petition and hence it is placed in section 83 which deals with contents of an election petition.
Similarly, and for the same reasons, the affidavit referred to in the provisos to Section 83 sub section (1) also forms part of the election petition.
The election petition is in truth and reality reality one document consisting of two parts, one being the election petition proper and the other being the affidavit referred to in the proviso to section 83, sub section (1).
The copy of the election petition required to be filed under the first part of sub section (3) of section 81, would, therefore, on a fair reading of that provision along with section 83, include a copy of the affidavit.
" The above observations have, however, to be read in the context on the controversy before the Court.
The dispute between the parties was limited to the fulfilment of the last part of section 81(3), viz., the requirement that every such copy of the election petition `shall be attested by the petitioner under his own signature to be a true copy of the petition '.
As pointed out earlier it was found as a fact that the signature was at the foot of the affidavit tied to the petition and not at the foot of the petition itself.
The Court, therefore, came to the conclusion that since the affidavit constituted an integral part of the election petition, the requirement of the latter part of section 81(3) was satisfied.
The decision clearly turned on the special facts of that case.
From the text of the relevant provisions of the R.P. Act, Rule 94A and Form 25 as well as Order 6 Rule 15 and Order 19 Rule 3 of the 783 Code and the resume of the case law discussed above it clearly emerges (i) a defect in the verification, if any, can be cured (ii) it is not essential that the verification clause at the foot of the petition or the affidavit accompanying the same should disclose the grounds or sources of information in regard to the averments or allegations which are based on information believed to be true (iii) if the respondent desire better particulars in regard to such averments or allegations, he may call for the same in which case the petitioner may be required to supply the same and (iv) the defect in the affidavit in the prescribed Form 25 can be cured unless the affidavit forms an integral art of the petition, in which case the defect concerning material facts will have to be dealt with, subject to limitation, under section 81(3) as indicated earlier.
Similarly the Court would have to decide in each individual case whether the schedule or annexure referred to in section 83(2) constitutes an integral part of the election petition or not; different considerations will follow in the case of the former as compared to those in the case of the latter.
A charge of corrupt practice has a two dimensional effect; its impact on the returned candidate has to be viewed from the point of view of the candidate 's future political and public life and from the point of view of the electorate to ensure the purity of the election process.
There can, therefore, be no doubt that such an allegation involving corrupt practice must be viewed very seriously and the High Court should ensure compliance with the requirements of section 83 before the parties go to trial.
This is quite clear from the observations of this Court in the case of K.M. Mani vs P.J. Anthony, ; While defective verification or a defective affidavit may not be fatal, the High Court should ensure its compliance before the parties go to trial so that the party required to meet the charge is not taken by surprise at the actual trial.
It must also be realised that delay in complying with the requirements of section 83 read with the provisions of the Code or the omission to disclose the grounds or sources of information, though not fatal, would waken the probative value of the evidence ultimately lead at the actual trial.
Therefore, an election petitioner can afford to overlook the requirements of section 83 on pain of weakening the evidence that he may ultimately tender at the actual trial of the election petition.
That is because as held in Mani 's case the charge of corrupt practice has to be proved beyond reasonable doubt and not merely by preponderance of probabilities.
Allegation of corrupt practice being quasi criminal in nature, the failure to supply full particulars at the earliest point of time and to disclose the source of information promptly may have an adverse bearing on the probative value to be 784 attached to the evidence tendered in proof thereof at the trial.
Therefore, even though ordinarily a defective verification can be cured and the failure to disclose the grounds or sources of information may not be fatal, failure to place them on record with promptitude may lead the court in a given case to doubt the veracity of the evidence ultimately tendered.
If, however, the affidavit or the schedule or annexure forms an integral part of the election petition itself, strict compliance would be insisted upon.
The next objection is based on the language of section 81 of the R.P. Act.
This section deals with the presentation of an election petition.
Sub section (1) thereof says that an election petition may be presented by any candidate at such election or any elector within 45 days from, but not earlier than, the date of the election of the returned candidate or if there are more than one returned candidate at the election and the dates of their election are different, the late of those dates.
This sub section specifies on what ground or grounds the election of the returned candidate can be challenged, who can challenge the election and imposes a period of limitation for filing sucha petition.
Sub section (2) of this section was omitted by Act 47 of 1966.
Then comes sub section (3) which stipulates that every election petition shall be accompanied by as many copies thereof as there are respondents mentioned in the petition, and every such copy shall be attested by the petitioner under his own signature to be a true copy of the petition.
This sub section enjoins (i) supply of such number of copies of the petition as are respondents and (ii) every such copy must be attested by the petitioner under his own signature to be a true copy of the petition.
There is no controversy regarding the first aspect, the controversy centres round the second part.
It must the remembered that non compliance with the requirement of sub section (1) or (3) of section 81 can prove fatal in view of section 86(1) of the R.P. Act.
See Satya Narain vs Dhuja Ram, ; ; M. Karunanidhi vs Dr. H.V. Hande, ; Mithilesh Kumar Pandey V. Baidyanath Yadav, [1984] 2 SCR 278; Rajender Singh vs Usha Rani, [1984] 3 SCC 339 and U.S. Sasidharan vs K. Karunakaran, ; It is quite obvious from these decisions that the requirements of section 81(3) are mandatory and failure to comply with them would render the petition liable to summary dismissal under section 86(1) of the R.P. Act.
The objection raised in the context of section 81 is that the election petition in every case is a mere photocopy prepared from a typed one and the copy of the election petition served on the returned candi 785 date in each case was not duly attested to be a true copy of the original as required by section 81(3) and hence the petition was liable to be dismissed in limine under section 86(1) of the R.P. Act.
Section 81(1) does not debar photo copying but Rule 1 of the Rules says that is shall be "type written or printed".
There is not dispute that a model election petition was prepared and got typed and prints thereof were taken out by the process of photocopying.
These prints were used both as original election petitions as well as copies.
The particulars in regard to each petition, e.g., the names of the parties, the voting pattern, the towns and villages where utterances amounting to corrupt practice were made, etc., were filled in and the court fee was fixed on one of them which constituted the original and photocopies thereof were filed before the Stamp Reporter in accordance with the Rules.
The photocopy bearing the court fee stamps was indisputably signed by the election petitioner and was presented with sufficient copies to the Stamp Reporter.
The original election petition is, therefore, a photocopy of the typed model and the copies are also photocopies prepared from the original petition.
Evidently the underlying idea in providing that the election petition shall be type written or printed is to ensure that the document is legible.
There is no complaint that the document which is admitted as an election petition and the copies thereof are not legible.
It that be so it is difficult to appreciate the objection that the photocopy should not be treated as an original petition even if it otherwise complies with the requirement of law.
The High Court was, therefore, justified in treating the same as the original election petition.
The next objection raised by the appellants is that the copy of the petition served on each one of them is not attested to be a true copy of the original petition as required by section 81(3) of the R.P. Act and Rule 1 of the Rules.
Each copy is attested as `certified true copy ' and the petitioner has put his signature thereunder.
This, contend the appellants, is not in conformity with section 81(3) and, therefore, it is obvious that the mandatory requirement of section 81(3) read with section 86(1) is not satisfied.
On a plain reading of section 81(3) it become clear that the requirement of that provision is (i) the election petition should be accompanied by as many copies thereof as there are respondents mentioned in the petition and (ii) every such copy shall be attested by the petitioner under his own signature to be a true copy of the petition.
There is no dispute in regard to the compliance of the first part.
So far as the second part is concerned, all that the section requires is that the copy should be attested by the petitioner to be a true copy of the petition under his own signature.
The requirement of this part of the provision is met by each copy having been signed at the 786 foot thereof by the concerned petitioner.
What is essential is that the petitioner must take the responsibility of the copy being a true copy of the original petition and sign in token thereof.
No particular form of attestation is prescribed; all that the sub section enjoins is that the petitioner must attest the copy under his own signature to be a true copy of the petition.
By certifying the same as true copy and by putting his signature at the foot thereof, the petitioner of each election petition had clearly complied with the letter and spirit of section 81(3) of the R.P. Act.
In fact in Ch.
Subba Rao vs Member.
E.T. Hyderabad, which was followed in Kamalam 's case (supra) this Court had accepted the mere signature without the words like true copy, sufficient attestation under section 81(3) of the R.P. Act.
We are, therefore, in agreement with the finding recorded in this behalf by the High Court.
The next grievance of the appellants is that they were not served with a true copy of the election petition inasmuch as the annexures served therewith were not true copies of the original.
Section 83(2) lays down that any schedule or annexure to the petition shall be signed by the petitioner and verified in the same manner as a petition.
The grievance under this head is not that there is no compliance with section 83(2) but that the annexure which was an integral part of the election petition was not a true copy of the original, inasmuch as certain pages found in the annexure produced with the petition were missing from the copies supplied to the returned candidates/appellants.
It was strongly submitted that an annexure which is an integral part of the election petition is an important and vital document and failure to supply a true copy thereof clearly violates the mandatory requirement of section 81(3) and renders the petition liable to be dismissed by virtue of section 86(1) of the R.P. Act.
As held in Sahodrabai ' case (supra) where details of averments too compendious for inclusion in the petition are included inthe schedule or annexure, the schedule or annexure in that case must be treated as integrated with the election petition and must comply with the requirement of Section 83(2) and section 81(3) failing which the provision of section 86(1) would stand attracted.
But this does not apply to a schedule or annexure which produces a document as evidence in support of the allegation in the election petition.
Such a schedule or annexure cannot be described as integrated with the election petition and defect in verification thereof would not prove fatal.
In Sasidharan 's case (supra) the same principle has been reiterted.
In the case the election petitioner referred to a video cassette showing progress of the constituency which also contained speeches of government servants.
A copy 787 of the document was not served on the opposite party alongwith the election petition.
It was held that the said document formed part of the election petition and failure to supply a copy thereof along with the election petition was fatal.
If a document does not form an integral part of the election petition but is merely referred to in the petition of filed in the proceedings as evidence of any fact, failure to supply a copy thereof will not prove fatal.
Therefore, the maintainability of an election petition, in the context of the point on hand will depend on whether the schedule or annexure to the petition constitutes an integral part of the election petition or not.
If it constitutes an integral part it must satisfy the requirements of section 81(3) and failure in that behalf would be fatal.
But if it does not constitute an integral part of the election petition, a copy thereof need not be served along with the petition to the opposite party.
Much would, therefore, depend on whether the schedule or annexure was an integral part of the election petition or not; if the former, failure to serve it along with the petition to the returned candidate would be fatal but not so in the latter case.
The appellants contend that it was an integral part of the election petition but the High Court didnt not go into this question; it solely relied on the Stamp Reporter 's report.
It then emphasised that no defect was noticed by the Stamp Reporter in the following words: "The stamp reporter, in the instant case, found the copies in order and made his endorsement accordingly.
I do not find any reason not to rely upon the endorsement of the stamp reporter.
" Therefore, the criticism that the High Court which was duty bound to apply its mind and decide the question judicially had abdicated in favour of the Stamp Reporter 's decision extracted earlier.
We are afraid this criticism is not wholly correct because the High Court has also observed that `no specific omission or deviation in the copy from the original was pointed out ' nor was it shown that the respondents were misled on that account.
We have also closely scrutinised the application made by the returned candidate in the High Court and except for a general allegation that the annexure served along with the petition was not a true copy, no specific allegation is found.
However, in the special leave petition filed in this Court question No. (vi) states that certain pages were missing from the copy of the annexure served on the returned candidate.
Then in paragraph 11 it is averred that pages 15 and 16 of Annexure II were missing.
Since no such specific allegation was made in the application filed by the returned candidate, the High Court had no occasion to go into this allegation and to ascer 788 tain if the missing pages contained material forming an integral part of the election petition.
We would not like to embark upon an inquiry in this behalf and would leave it to the appellants to agitate the question before the High Court.
We would request the High Court to examine the contention on merits, if raised, and answer the same in accordance with law.
Although we have come to the conclusion that the defect in verification is not fatal and can be cured, no attempt has been made by the election petitioners to cure the same nor has the High Court directed the petitioners to do so.
By way of a sample our attention was drawn to the election petition No. 7 of 1989 which has given rise to Civil Appeal No. 179 of 1991.
The said petition had 47 paragraphs besides the prayer clause.
The verification clause shows that paragraphs 1, 2, 4, 5, 18, 19, 28, 35, 30, 33, 36, 38, 41 to 47 of the election petition are on knowledge whereas paragraphs 7 to 15, 20, to 24 , 26, 27, 29, 32, 34, 37, 40 and 41 are on information received and believed to be true.
It will be seen from the above that paragraphs 3, 6, 16, 17, 25, 31 and 39 are not verified at all.
It was submitted by counsel for the appellants that paragraph 3 contained vital allegations regarding corrupt practice and since that paragraph has not been verified at all, the appellant is likely to be handicapped at the trial.
It was contended that such was the position in as many as six petitions if not more.
Further some of the paragraphs, e.g., 41 are verified under both heads of the verification clause, thereby causing confusion.
In the affidavit sworn in compliance of the proviso to section 83(1) it is stated that particulars and details of corrupt practice are contained in paragraphs 4 to 40 of the election petition.
Then the petitioner states that what he has alleged by way of corrupt practice in the election petition is correct `to the best of my knowledge and to the information received by e and believed by me to be true '.
It is thus not clear which allegation of corrupt practice is based on his knowledge and which information he believes to be true.
Besides when this affirmation is compared with the verification clause of the election petition, the confusion is worst confounded.
Similar is the case with the verification of the annexures.
There, therefore, considerable force in the submission of the learned counsel for the appellants that even if the High Court concluded that the defect in verification/affirmation was not fatal, the High Court ought to have directed the petitioners to cure the defects within the time stipulated by it so that the appellants would know the exact position before the trial and would not be taken by surprise.
We think the High Court committed an error in failing to give appropriate directions in the matter.
More or less similar defects are 789 also found in the verification/affirmation clause in the other election petitions/affidavits.
We would, therefore, request the High Court to issue directions to the election petitioner of each petition to remove the defects within such time as it may allow and if they or any of them fail to do so, pass appropriate consequential orders in accordance with law.
The High Court has applied the correct test while permitting the amendments.
The High Court has rightly pointed out that the power conferred by section 86(5) cannot be exercised to allow and amendment which will have the effect of introducing a corrupt practice not previously alleged in the petition.
If it is found that the proposed amendments are not in the nature of supplying particulars but raise new grounds, the same must be rejected but if the amendments are sought for removing vagueness by confining the allegations to the returned candidate only such an amendment would fall within the parameters of section 86(5) of the R.P. Act.
It was on this correct understanding of the legal position that the High Court scrutinised the amendment application.
It was not shown at the hearing of these appeals that any particular averment introduced by way of an amendment had the effect of introducing a totally new allegation of corrupt practice not previously pleaded in the election petitions.
Yet, if the appellants can point out any inconsistency, the High Court will remove the same.
These were all the submissions made before us.
We have dealt with them in extenso and have clarified the legal position.
We have suggested certain modifications in the impugned orders and have indicated the course of action to be adopted by the High Court.
We need not recapitulate the modifications and the future course of action.
The impugned order of the High Court in each petition will stand modified to the extent it is inconsistent with the legal position explained hereinabove.
The High Court will pass appropriate orders to remove the inconsistencies.
The appeals will stand allowed only to the extent of the modifications/directions made by this order with no order as to cost in each election petition.
V.P.R. Appeals partly allowed.
| IN-Abs | The respondents, who lost the State Assembly elections as candidates of the Mezo National Front(MNF) from different constituencies of Mizoram, challenged the election of the Congress (I) candidates on the ground of corrupt practices in the High Court.
The appellants the returned candidates raised certain preliminary objections regarding the maintainability of each petition.
On the basis therefore two preliminary issues were raised for consideration.
The appellants moved for striking off the pleadings.
Thereupon, the original petitioners the respondents applied for amendment of their election petitions which was strongly opposed by the appellants.
The preliminary objections, the applications for striking off the pleadings and the amendment applications were heard together.
The two preliminary issues raise were (i) whether the election petitions were in conformity with the requirements of Section 81 and 83 753 of the Representation of the Peoples Act, 1951 and the Rules framed thereunder by the High Court and (ii) whether rule 1 and the other related rules and notes thereto enabling the filing of the Election Petition before the Stamp Reporter assigned to the election court by the Chief Justice were ultra vires Article 329 of the Constitution and Section 169 read with Sections 80, 80A and 81 of the R.P. Act.
The appellants contended that the election petitions being photo copies, could not be treated as election petitions as contemplated by law; that the copies of petitions served on them were not attested to be true copies of the original petitions as required by Section 81(3); that the election petitions were not signed and verified in the manner laid down by the Code of Civil Procedure inasmuch as the source of information had not been disclosed in the verification or in the affidavit in Form 25 as required by rule 94A of the Conduct of Election Rules, 1961 (the Rules); that no schedule of material particulars of corrupt practice had been annexed to the affidavit purporting to be under Form 25, and that the presentation of the election petitions before the Stamp Reporter was inconsistent with Sections 80, 80A and 81 of the R.P. Act and Article 329 of the Constitution.
The averments in each election petition were identical.
The High Court rejected the preliminary objections and party allowed the applications for striking off the averments in the election petitions and partly permitted certain amendments to the election petitions, against which order the present appeals are filed in this Court under Article 136 of the Constitution.
The returned candidate the appellant contended that paragraph 3 of the election petition was the most crucial paragraph inasmuch as it disclosed the names of towns and villages as well as the period during which the alleged corrupt practices were committed had been deliberatedly omitted from the verification clause and the affidavit; that failure to mention paragraph 3 of the election petition in both the verification clause of the petition and the affidavit was fatal and cannot be cured after the expiry of the limitation period of 45 days; that the affidavit was not in Form No. 25 prescribed under Rule 94A of the Rules and since Section 83 of the R.P. Act is mandatory and failure to adhere to Form No. 25 was fatal, as the doctrine of substantial compliance had no place in election law but even if that doctrine could be invoked, the respondent failed to make substantial compliance; that the election petitions being photocopies could not be entertained as valid 754 election petitions; that copies of the election petitions served on the returned candidates were not attested as true copies of the original as required by Section 81(3); that the election petitions and the schedule and annexures were not signed and verified as required by the Code; that an election dispute founded on the allegation of corrupt practice being quasi criminal in nature calls for strict adherence to the requirements of election law as was evident from Section 86(I) of R.P. Act which provided for dismissal of an election petition which failed to comply with the requirements of Section 81, 82 or 117 of the statute; and that if the Code did not apply to Mizoram, it applied to an election petition because section 83(I)(c) obligates that an election petition `shall be signed by the petitioner and verified in the manner laid down in the Code for the verification of pleadings '.
This Court partly allowing the appeals, HELD: 1.
Our election law being statutory in character must be strictly complied with since an election petition is not guided by ever strictly complied with since an election petition is not guided by ever changing common law principles of justice and notions of equity.
Being statutory in character it is essential that it must conform to the requirements of our election law.
But at the same time the purity of election process must be maintained at all costs and those who violate the statutory norms must suffer for such violation.
If the returned candidate is shown to have secured his success at the election by corrupt means he must suffer for his misdeeds.
[772B D] 2.
A charge of corrupt practice has a two dimensional effect; its impact on the returned candidate has to be viewed from the point of view of the candidate 's future political and public life and from the point of view of the electorate to ensure the purity of the election process.
There can, therefore, be no doubt that such an allegation involving corrupt practice must be viewed very seriously and the the High Court should ensure compliance with the requirements of Section 83 before the parties go to trial.
[783D E] 3.
What is essential is that the petitioner must take the responsibility of the copy being a true copy of the original petition and sign in token thereof.
No particular form of attestation is prescribed; all that the sub section enjoins is that the petitioner must attest the copy under his own signature to be a true copy of the petition.
By certifying the same as true copy and by putting his signature at the foot thereof, the petitioner of each election petition had clearly complied with the letter and spirit of section 81(3) of the R.P. Act.
[786A B] 755 4.
Section 86(I) mandates that the High Court `shall ' dismiss an election petition which does not comply with the provisions of Section 81 or Section 82 or Section 117 of the R.P. Act.
The language of this sub section is quite imperative and commands the High Court, in no uncertain terms, to dismiss an election petition which does not comply with the requirements of section 81 of section 82.
[773B D] 5.
Election of a returned candidate can be rendered void on proof of the alleged corrupt practice.
In addition thereto he would incur a subsequent disqualification also.
This harshness is essential if we want our democratic process to be clean, free and fair.
Eradication of corrupt practice from our democratic process is essential if we want it to thrive and remain healthy.
Our democratic process will collapse if unhealthy corrupt practices like appeals to voters on basis of caste, creed, community religion, race, language, etc., are allowed to go unchecked and unpunished.
Use of corrupt practices in elections to secure short term gains at the cost of purity of our democratic process must be frowned at by every right thinking citizen.
[773D F] 6.
It is for that reason that the law has provided for double jeopardy to deter candidates, their agents and others from indulging in such nefarious practices, their agents and others from indulging in such nefarious practices.
But while there is sufficient justification for the law to be harsh with those who indulge in such practices, there is also the need to ensure that such allegations are made with a sense of responsibility and concern and not merely to vex the returned candidate.
It is with this in view that the law envisages that the particulars of such allegations shall be set out fully disclosing the name of the party responsible for the same and the date and place of its commission.
A simple verification was considered insufficient and, therefore, the need for an affidavit in the prescribed form.
These procedural precautions are intended to ensure that the person making the allegation of corrupt practice realises the seriousness thereof as such a charge would be akin to a criminal charge since it visits the party indulging in such practice with a two fold penalty.
[773E H] 7.
If full particulars of an alleged corrupt practice are not supplied, the proper course would be to give an opportunity to the petitioner to cure the defect and if he fails to that opportunity that part of the charge may be struck down.
[775F G] 8.
Once the amendment sought falls within the purview of section 86(5), the High Court should be liberal in allowing the same unless, in the facts and circumstances of the case, the Court finds it unjust and 756 prejudicial to the opposite party to allow the same.
Such prejudice must, however, be distinguished from mere inconvenience.
[775G H] 9.
The power conferred by section 86(5) cannot be exercised to allow any amendment which will have the effect of introducing a corrupt practice not previously alleged inthe petition.
If it is found that the proposed amendments are not in the nature of supplying particulars but raise new grounds, the same must be rejected but if the amendments are sought for removing vagueness by confining the allegations to the returned candidate only such an amendment would fall within the parameters of section 86(5) of the R.P. Act.
[789B D] 10. Clause(c) of sub section 83 provides that an election petition shall be signed by the petitioner and verification of the pleadings.
Under section 83(2) any schedule or annexure to the pleading must be similarly verified.
Order 6 Rule 15 is the relevant provision in the Code.
Sub rule (2) of Rule 15 says that the person verifying shall specify with reference to the numbered paragraphs of the pleading, what he verifies on his own knowledge and what he verifies upon information received and believed to be true.
The verification must be signed by the person making it and must state the date on and the place at which it was signed.
The defect in the verification can be (i) of a formal nature and not very substantial (ii) one which substantially complies with the requirements and (iii) that which is material but capable of being cured.
[776A C] 11.
The object of requiring verification of an election petition is clearly to fix the responsibility for the averments and allegations in the petition on the person signing the verification and at the same time discouraging wild and irresponsible allegations unsupported by facts.
[776C D] 12.
In cases where corrupt practice is alleged in the petition, the petition shall also be supported by an affidavit in the prescribed form, i.e. Form No. 25 prescribed by Rule 94A of the Rules.
[776D E] 13.
While defective verification or a defective affidavit may not be fatal, the High Court should ensure its compliance before the parties go to trial so that the party required to meet the charge is not taken by surprise at the actual trial.
[783E F] 14.
The charge of corrupt practice has to be proved beyond reasonable doubt and merely preponderance of probabilities.
757 Allegation of corrupt practice being quasi criminal in nature, the failure to supply full particulars at the earliest point of time and to disclose the source of information promptly may have an adverse bearing on the probative value to be attached to the evidence tendered in proof thereof at the trial.
Therefore, even though ordinarily a defective verification can be cured and the failure to disclose the grounds or sources of information may not be fatal, failure to place them on record with promptitude may lead the court in a given case to doubt the veracity of the evidence ultimately tendered.
If, however, the affidavit of the schedule or annexure forms an integral part of the election petition itself, strict compliance would be insisted upon.
[783G 784B] 15.
The requirements of section 81(3) are mandatory and failure to comply with them would render the petition liable to summary dismissal under section 86(I) of the R.P. Act.
[784G] 16.
If a document does not form an integral part of the election petition but is merely referred to in the petition or filed in the proceedings as evidence of any fact, failure to supply a copy thereof will not prove fatal.
Therefore the maintainability of an election petition will depend on whether the schedule or annexure to the petition constitutes an integral part of the election petition or not.
If it constitutes an integral part it must satisfy the requirements of section 81(3) and failure in that behalf would be fatal.
But if it does not constitute an integral part of the election petition, a copy thereof need not be served along with the petition to the opposite party.
[787A C] 17.
The High Court is directed to issue directions to the election petitioner of each petition to remove the defects within such time as it may allow and if they or any of them fail to do so, pass appropriate consequential orders in accordance with law.
[789A B] Gurumayam section Sarma vs K. Ongbi Anisija Devi, Civil Appeal No. 659 of 1957 dated 9.2.1961; State of Nagaland vs Rattan Singh; , ; V.L.Rohlus vs Deputy Commissioner, Aizawal, ; Raj Narain vs Indira Gandhi; , at 1307: ; ; Manphul Singh vs Surinder Singh, [1973] 2 SCC 599 at 608; K.M. Mani vs P.J. Antony, ; ; Samant N. Bal Krishna vs George Fernandez, ; ; D.P. Mishra vs Kamal Narayan Sharma, ; ; Balwan Singh vs Lakshmi Narain, ; Murarka Radhey Shyam vs Roop Singh Rathore; , ; State of Bombay vs Purushottam Jog Naik; , ; The Barjum Chemicals Ltd. The Company Law 758 Board, [1966] Supp.
SCR 311; K.K. Nambiar vs Union of India, ; at 125; Jadav Gilua vs Suraj Narain Jha, AIR 1974 Patna 207; M/s Sunder Industries Ltd. vs G.E. Works, AIR 1982 Delhi 220; K.K. Somanathan vs K.K. Ramachandran, AIR 1988; Kerala 259; Kamalam vs Dr. Syed Mohammad, ; ; M/s. Sukhwinder Pal vs State of Punjab, ; ; Z.B. Bukhari vs Brij Mohan, ; Prabhu Narayan vs K.K. Srivastava, ; ; Satya Narain vs Dhuja Ram, ; ; M. Karunanidhi vs Dr. H.V. Hande, ; Mithlesh Kumar Pandey vs Baidyanath Yadav, [1984] 2 SCR 278; Rajender Singh vs Usha Rani, [1984] 3 SCC 339; U.S. Sasidharan vs K. Karunakaran; , and Ch.
Subba Rao vs Member, E.T. Hyderabad, Referred to.
When by the same statute the words `Election Commissioner ' were substituted by the expression `High Court ' with effect from December 14, 1966.
Even though by the said Amendment Act jurisdiction was conferred on High Court in place of the Election Commission, surprisingly the title of chapter II continues to read `Presentation of election petitions to Election Commission '.
Parliament will well to correct this slip by substituting the words `High Court ' for the expression `Election Commission ' to bring it in conformity with the changes introduced by Act 47 of 1966.
[768E F]
|
ivil Appeal No. 526 (NT) of 1979.
From the Judgment dated 16.12.1976 of the Kerala High Court in I.T.R. No. 101 of 1974.
Dr. V. Gauri Shankar, section Rajappa and Ms. A. Subhashini for the Appellant.
Santosh N. Hegde, E.M.S. Anam and K.L. Mehta for the Respondents.
The Judgment of the Court was delivered by K. JAGANNATHA SHETTY, J.
This appeal by special leave is against the decision of the High Court of Kerala in Income Tax Reference No. 101/1974 and it raises an important issue concerning the requirements of a gift made "in contemplation of death" within the meaning of Section 5(1)(xi) of Gift Tax Act, 1958 (`The Act ').
That reference was made under Section 26(1) of the Gift Tax Act, 1958 by the Income Tax Appellate Tribunal Cochin Bench.
The Tribunal referred to the High Court two questions for its opinion, out of which we are concerned only with the first question which reads: "Whether on the facts and circumstances of the case the 850 Tribunal was right in holding that the gift of movables valued at Rs.67,578 is not a gift made in contemplation of death within the meaning of section 5(1)(xi) of ?" The facts of the case as found by the Tribunal are simple and not unusual.
Abdul Karim Mohammed a businessman in Cochin executed a document styled as "settlement will" gifting certain movables to the assessee respondent inthe shape of business assets valued by the Gift Tax Officer at Rs.67,578.
The document was executed on 4 April 1964 and at the time of execution, the donor was seriously ill.
He died of the illness after about six weeks.
In gift tax assessment proceedings the assessee claimed exemption for this gift under section 5(1)(xi) of the Act which provides that a gift shall not be charged under the in respect of a gift made by any person in contemplation of death.
The Gift Tax Officer rejected the claim of the assessee and brought the said amount to tax.
But on appeal the Appellate Assistant Commissioner held to the contrary.
He allowed the exemption sought for on the ground that the gift was in contemplation of death.
He has relied upon the circumstances under which the gift was made and the events followed thereafter to reach his conclusion.
He has described the facts and circumstances as follows: "Now I agree with Sri Karunakaran, that the absence of any reference in the deed of settlement to the illness from which the donor was suffering does not lead to the conclusion that there was no illness, or that the donor was nor apprehensive of death resulting from the same.
There is ample evidence to show that he was seriously ill at the time when he made the gift.
He was aged about 72 at the time and he was also suffering from paralysis, diabetes, hernia etc.
In fact, in view of the seriousness of the condition he could not proceed to the Sub Registrar 's office for registration of the document; on the other hand the sub registrar ws brought to his residence for the purpose of effecting the registration.
In an affidavit filed by him before the Gift Tax Officer on the 3rd August, 1969, the sub registrar has affirmed that at the time of execution of the document the settler was in sick bed and was unable to move out of the same.
He has also stated that the settler as well as his children showed anxiety and haste in the matter of registration on account of the serious nature of the illness.
At that time, according to the sub registrar the settler was in his proper sense, but soon after the execution of the deed, further complications set in and his power of speech and movements became impaired.
Dr. V.B. Mohammed who was treating him has certified that 851 on 4th June 1964 patient was unable to recognise the surroundings properly, and that his mental condition was impaired to a great degree.
On 9th June, 1964 i.e. within about six weeks from the date of the settlement he died.
In these circumstances, I am satisfied that the donor, an aged gentleman who seriously ill at the time of the settlement entertained no hope of recovery, and that it was in such a state of mind, that he made the settlement.
Hence the gifts must be taken to have been made in contemplation of death.
" The Gift Tax Officer appealed to the Tribunal against the decision of the Appellate Assistant Commissioner.
The Tribunal has affirmed the finding of the Appellate Assistant Commissioner that the donor at the time of gift was ill and expected to die shortly of his illness.
The Tribunal observed "But we are satisfied that the Appellate Assistant Commissioner was on the facts and circumstances of the case right in his conclusion that the donor, an aged gentleman, who was seriously ill at the time of the settlement entertained no hope of recovery and that it was in such a state of mind that he made the settlement.
The materials referred, relied on and discussed by the Appellate Assistant Commissioner in the appellate order are sufficient enough to lead to a reasonable conclusion that the donor was, at the time of execution of the document, ill and that he expected to die shortly of his illness." The Tribunal however, did not agree with the exemption allowed to the assessee.
It has stated that the finding recorded by the Assistant Commissioner that the donor was ill at the time of gift and he died thereafter out of the illness alone is not sufficient to hold that the gift was made in contemplation of gift death.
In order to satisfy the requirements of gift in contemplation of death there must be two other conditions to be satisfied; (i) There must be delivery of possession of the gifted movables to the donee; (ii) that a gift is entitled to take effect only in the event of the donor 's death and that if the donor recovers from the illness the property should revert back.
On the first condition the Tribunal found on facts that there was delivery of possession of the gifted movables.
On the second condition, the Tribunal observed that the gift was unconditional and it was in nature of settlement deed, pure and simple.
It was executed to settle absolutely forever the property of the donor without any condition.
It is just like any other settlement executed by a person without the contemplation of death.
It has not been expressly specified or impliedly present in the deed that the gift must revert back in the event of the donor recovering from illness.
The gifted property has to be kept as a gift in case the donor shall die of his illness has also not been satisfied in the case.
With these findings, the Tribunal allowed the appeal of the Gift Tax Officer.
852 Thereafter, at the instance of the assessee the question set out earlier was referred to the High Court for its opinion.
The High Court has answered the question in the negative and in favour of the assessee.
The High Court expressed the view that it is not necessary that there must be recital in the deed stating that the property would revert to the donor in the event of his recovery from the illness, or the donor surviving the donee.
Such a condition could be inferred from the attending circumstances of the gift.
The High Court has referred to the affidavits filed by the sub registrar who registered the document and the Doctor who treated the donor to come to the conclusion that the donor was seriously ill at the time of execution of the deed and expected to die shortly of that illness.
The factum of delivery of the gifted assets to the donee at a time when the donor was seriously sick and the donor 's death shortly thereafter were also relied upon.
It was then stated that in as much as the donor was actually sick at the time of execution of the deed and died of the same illness without recovery, after a short period, the gift in question was made in contemplation of death and therefore, entitled to exemption from tax under Section 5(1)(xi) of the Act.
The legality of the view expressed by the High Court is under challenge in this appeal.
First, we may refer to the relevant statutory provisions bearing on the question.
Section 3 of the Act is the charging section and it provides that in respect of gifts there shall be charged tax referred to as the gift tax at the rate specified in the schedule.
Section 5 provides exemption in respect of certain gifts.
Section 5 sub section (1)(xi) provides that gift tax shall not be charged under the Act in respect of gifts made by any person in contemplation of death.
Explanation (d) to sub section (2) of Section 5 states "that gifts made in contemplation of death" has the same meaning as in Section 191 of the .
Section 191 of the deals with the requirements of gifts made in contemplation of death.
It reads as follows: "191.
Property transferable by gift made in contemplation of death.
(1) A man may dispose, by gift made in contemplation of death, of any movable property which he could dispose of by will.
(2) A gift said to be made in contemplation of death where a man, who is ill and expects to die shortly his illness, 853 delivers to another the possession of any movable property to keep as a gift in case the donor shall die of that illness.
(3) Such a gift may be resumed by the giver; and shall not take effect if he recovers from the illness during which it was made; nor if e survives the person to whom it was made.
The requirements of a gift in contemplation of death as laid down by Section 191 of the are: (i) the gift must be of movable property; (ii) it must be made in contemplation of death; (iii) the donor must be ill and he expects to die shortly of the illness; (iv) possession of the property should be delivered to the donee; and (v) the gift does not take effect if the donor recovers from the illness or the donee predeceases the donor.
There is nothing new in the requirements provided under Section 191 of the Succession Act.
They are similar to the constituent elements of a valid donatio mortis causa.
The essential conditions of a donatio mortis causa may be summarised thus: "For an effectual donatio mortis causa three things must combine: firs, the gift or donation must have been made in contemplation, though not necessarily in expectation of death; secondly, there must have been delivery to the donee of the subject matter of the gift; and thirdly.
the gift must be made under such circumstances as shew that the thing is to revert to the donor in case he should recover.
This last requirement is sometimes put some what differently, and it is said that the gift must be made under circumstances shewing that it is to take effect only if the death of donor follows; it is not necessary to say which way of putting it is the better." (See Cain vs Moon, at 286).
Now, all the conditions of a valid gift in contemplation of death except perhaps the last condition prescribed under section 191 of the are found present in this case by the fact finding authorities.
The gift was made when the donor was seriously ill and apprehending his death.
The donor died within six weeks after the execution of the deed.
The possession of the property gifted has been delivered to the donee before the death.
But it is said that there is nothing to show in the document expressly or impliedly that the gift was made under such circumstances that the thing was to revert to the donor in case he should recover.
Dr. Gauri Shankar learned counsel for the Revenue contends that the gift in contemplation of death should be conditional that is, on the term that if the donor would not 854 die he should be entitled to remain complete dominion of the property, the subject matter of the gift.
There should be indications in the document to that effect without which, counsel states that the gift becomes inter vivos and absolute.
It seems to us that the recitals in the deed of gift are not conclusive to determine the nature and validity of the gift.
The party may produce evidence aliunde to prove that the donor gifted the property when he was seriously ill and contemplating his death with no hope of recovery.
These factors in conjunction with the factum of death of the donor may be sufficient to infer that the gift was made in contemplation of death.
It is implicit in such circumstances that the donee becomes the owner of the gifted property only if the donor dies of the illness and if the donor recovers from the illness, the recovery itself operates as a revocation of the gift.
It is not necessary to state that in the gift deed that the donee becomes the owner of the property only upon the death of the donor.
Nor it is necessary to specify that the gift is liable to be revoked upon the donor 's recovery from the illness.
The law acknowledges these conditions from the circumstances under which the gift is made.
Reference may be made to the following passage from Halsbury 's Laws of England (4th ed.
20 p. 41 para 67): "There is an implied condition that the gift is to be retained only in the event of death, even though the donor does not expressly say so.
The death may take place some time afterwards, or the donor may actually die from some other illness, but if the donor recovers from illness, during which the gift is made the donee has no title, and can only hold what was delivered to him in trust for the donor." Jerman on Wills (8th ed.
1 p. 46 47) also lends light on this aspect: "The conditional nature of the gift need not be expressed: It is implied in the absence of evidence to the contrary.
And even if the transaction is such as would in the case of a gift inter vivos confers a complete legal title, if the circumstances authorise the supposition that the gift was made in contemplation of death, mortis causa is presumed.
It is immaterial that the donor in that dies from some disorder not contemplated by him at the time he made the gift.
" Similar is the statement of law in Williams on "Executors and 855 Administrators" (14 ed.
p. 315): "542.
Conditional on death: "The gift must be conditioned to take effect only on the death of the donor.
But it is not essential that the donor should expressly attach this condition to the gift; for if a gift is made during the donor 's last illness and in contemplation of death, the law infers the condition that the donee is to hold the donation only in case the donor dies.
" The principles in the Corpus Juris Secundum (vol. 38 p. 782) are not quite different: ".
A gift causa mortis differs from a gift inter vivos in that it is made in view of expected or impending death, as appears infra $$ 75,78.
The vital distinction between a gift inter vivos and a gift causa mortis is that the former is irrevocable, while the latter may be revoked at any time before the donor 's death, and may be defeated by the recovery or survival of the donor.
More fully, a gift causa mortis is liable to revocation by the donor and does not pass an irrevocable title until the death of the donor, while a gift inter vivos vests an irrevocable title on delivery; in the case of a gift inter vivos the title is not only transferred and vested in the donee at once, but the gift is immediately completed and is absolute and irrevocable, while in the case of a gift causa mortis the transfer is subject to be defeated by the happening of any one of the conditions implied by the law.
" It is further stated (at p. 917 para 110): "A gift causa mortis is revoked by the recovery of the donor, from the particular illness, or his survival of the peril, which existed at the time of the gift and in contemplation of which the gift was made.
The recovery of the donor from the particular illness, or his survival of the peril, which existed at the time of the gift and in contemplation of which the gift was made will of itself operate as a revocation of the gift.
" 856 In the light of these principles and in view of the findings recorded by the Tribunal about the serious sickness of the donor and his state of mind at the time of making the gift in question, it can be reasonably concluded that the gift was not absolute and irrevocable.
On the contrary, it will be legitimate to infer that the gift was in contemplation of death.
Any other view in this case would be inappropriate.
No account in this regard would be complete unless it is held that marz ul maut gift with which we are concerned is also entitled to exemption from gift tax under Section 5(1)(xi) of the Act.
Counsel for the Revenue argues that the exemption provided under Section 5(1)(xi) of the Act is not available to the assessee since Section 191 of the is not applicable to marz ul maut gift.
We do not find much substance in this submission.
The exemption to gift in contemplation of death is provided under Section 5(1)(xi) of the Act and not under Section 191 of the .
Section 191 furnishes only the meaning or requirements of gift in contemplation of death.
If a gift in contemplation of death is recognised by the personal law of parties satisfying the conditions contemplated under Section 191 of the , it cannot be denied exemption under Section 5(1)(xi) of the act even assuming that Section 191 as such will not be applicable to the parties.
Under Mohammedan Law gift made during marz ul maut (death bed illness) is subject to very strict scrutiny for its validity.
Marz ul maut is a malady which induces an apprehension of death in the person suffering from it and which eventually results in his death.
There are three tests laid down to determine whether illness is to be regarded as marz ul maut.
They are: (1) Proximate danger of death so that there is a preponderance of Khauf or apprehension that at the given time death must be more probable than life.
(2) There must be some degree of subjective apprehension of death in the mind of the sick person.
(3) There must be external indicia chief among which would be the inability to attend to ordinary avocations.
(See: Rashid Karmalli and Anr.
vs sherbanoo, The gift made during marz ul maut is subject to all other conditions necessary for the validity of a hiba or gift, including delivery of possession by the donor to the donee.
(See: Mulla 's Mohammedan Law pp.
109, 111 Section 135 & 136).
Syed Ameer Ali in his book on "Mohammedan Law" throws some more light on the principles of `gift of the sick '.
It is stated: "In the chapter in the "Fatawai Alamgiri" dealing with "the gift of the sick" the principles are set forth at some length.
In the first place it is stated from the Asal that neither a gift nor a sadakah by a mariz a person suffering from 857 marz ul maut of which the definition is given later on is effective without possession: and if possession is taken, it is valid inrespect of a third.
If the donor were to die before delivery (taslim) the whole disposition would be invalid.
It is, therefore, necessary to understand that a gift by a mariz is a contract and not a wasiat, and the right of disposition is restricted to a third on account of the right of the heirs which attaches to the property of the mariz.
And as it is an act of bounty it is effective so far only as the law allows and that is a third.
And being a contractual disposition it is subject to the conditions relating to gifts, among them the taking of possession by the donee before the death f the donor." (Vol.
14th ed.
1985 p. 59 60).
From these principles of Mohammedan Law it will be clear that the gift made in marz ul maut could be regarded as gift made in contemplation of death since it has all the requisites prescribed under Section 191 of the .
The only limitation under Mohammedan Law is that the disposition is restricted to a third on account of the right of the heirs.
Marz ul maut gift cannot therefore take effect beyond a third of the estate of the donor after payment of funeral expenses and debt unless heirs give their consent after the death of the donor, to the excess taking effect.
Whether there is any such consent given in this case by his heirs is the subject matter of enquiry to be made by the Tribunal.
It may be stated that the second question refered to the High Court relates to the validity of the gift beyond a third of the estates of the donor.
On that question the High Court has not expressed any view and it has directed the Tribunal to consider that issue afresh.
We, therefore, refrain from expressing any views on that matter.
From the foregoing discussion, the view taken by the High Court is correct and it does not call for interference.
We accordingly dismiss the appeal with costs.
N.P.V. Appeal dismissed.
| IN-Abs | Gift to certain movable assets was made to the respondent assessee by a Muslim businessman, when he was seriously ill, and died of the illness after six weeks of the execution of the document.
In gift tax assessment proceedings, the assessee claimed exemption for this gift under Section 5(1)(xi) of the Gift Tax Act, 1958, on the ground that the gift was made in contemplation of death.
The Gift Tax Officer rejected the claim.
But, on appeal, the Appellate Assistant Commissioner allowed the exemption relying on the circumstances under which the gift was made and the events followed thereafter and the evidence of the Sub Registrar, who was brought to residence for effecting registration, and the doctor, who was treating the donor.
On appeal by the Gift Tax Officer, the Tribunal affirmed the finding of the Appellate Assistant Commissioner regarding the donor 's illness but did not allow the exemption on the ground that, though there was delivery of possession of the gifted movables, the gift was unconditional and absolute, since it had not been specifically expressed or impliedly present in the deed that the gift must revert back in the event of the donor recovering from illness and that the gifted property had to be kept as a gift in case the donor died of his illness.
However, on a reference made at the instance of the assessee for opinion, the High Court held that such a condition need not be mentioned in the deed and 847 it could be inferred from the attending circumstances of the gift, and since the donor was actually sick at the time of execution of the deed and died of the same illness without recovery, after a short period, the gift in question was made in contemplation of death and therefore, entitled to exemption from tax under Section 5(1)(xi) of the Act.
In the appeal before this Court, on behalf of the Department it was contended that the gift in contemplation of death should be conditional, and in the absence of indications in the document to the effect that if the donor did not die, he should be entitled to remain in complete domination of the gifted property, the gift would become inter vivos and absolute, and that the exemption under Section 5(1)(xi) of the Gift Tax Act was not available to the assessee, since Section 191 of the Indian Succession Act was not applicable to marz ul maut gift.
Dismissing the appeal by the Department, this Court HELD: 1.1 Explanation (d) to sub section (2) of Section 5 of the Gift Tax Act, 1958 states that a gift made in contemplation of death has the same meaning as in Section 191 of the .
The requirements of a gift in contemplation of death as laid down by Section 191 are: (i) the gift must be of movable property; (ii) it must be made in contemplation of death; (iii) the donor must be ill and he expects to die shortly of the illness; (iv) possession of the property should be delivered to the done; and (v) the gift does not effect if the donor recovers from the illness or the donee predeceases the donor.
These requirements are similar to the constituent elements of a valid donatio martis causa.
[853C E] Cain vs Moon, @ 286, referred to. 1.2.
In the instant case, all the conditions prescribed, except perhaps the last one are found present by the fact finding authorities.
[853G] 1.3.
The recitals in the deed of gift are not conclusive to determine the nature and validity of the gift.
The party may produce evidence aliunde to prove that the donor gifted the property when he was seriously ill and contemplating his death with no hope of recovery.
These factors in conjunction with the factum of death of the donor may be sufficient to infer that the gift was made in contemplation of death.
It is implicit in such circumstances that the donee becomes the owner of the gifted property only if the donor dies of the illness and if the donor recovers from the illness, the recovery itself operates as a revocation of the gift.
[854B C] 848 1.4 It is not necessary to state in the gift deed that donee becomes owner of the property only upon the death of the donor.
Nor it is necessary to specify that the gift is liable to be revoked upon the donor 's recovery from the illness.
The law acknowledges these conditions from the circumstances under which the gift is made.
[854C D] Halsbury 's Laws of England, 4th Edn.
20 p. 41 para 67; Jerman on Wills, 8th Edn.
Vol, 1 p. 46 47; Williams on "Executors and Administrators", 14th Edn.
p. 315, and Corpus Juris Secundum, vol.
38 p. 782 and p. 917 para 110, referred to.
1.5 In the light of this and in view of the findings recorded by the Tribunal about the serious sickness of the donor and his state of mind at the time of making the gift in question, it can be reasonably concluded that the gift was not absolute and irrevocable.
On the contrary, it would be legitimate to infer that the gift was in contemplation of death.
any other view would be inappropriate.
[856A B] 2.1 Marz ul maut is also entitled to exemption from gift tax under Section 5(1)(xi) of the Gift Tax Act, 1958.
[856B] 2.2 The exemption to gift in contemplation of death is provided under Section 5(1)(xi) of the Gift Tax Act, and not under Section 191 of the , Section 191 furnishes only the meaning or requirements of gift in contemplation of death.
It a gift in contemplation of death is recognised by the personal law of parties satisfying the conditions contemplated under Section 191 of the , cannot be denied exemption under Section 5(1)(xi) of the Act, Even assuming that Section 191 as such will not be applicable to the parties.
[856C D] 2.3 Under Mohammedan Law gift made during marz ul maut (death bed illness) is subject to very strict scrutiny and subject to all other conditions necessary for the validity of a hiba or gift, including delivery of possession of the donor to the donee.
[856D] Mulla 's Mohammedan Law, pp. 111 Sections 135 & 136, referred to.
2.4 Marz ul maut is a malady which induces an apprehension of death inthe person suffering from it and which eventually results in his death.
There are three tests laid down to determine whether illness is to be regarded as marz ul maut.
They are; (i) Proximate danger of death 849 so that there is preponderance of khauf or apprehension that at the given time death must be more probable than life.
(2) There must be some degree of subjective apprehension of death in the mind of the sick person.
(3) There must be external indicia chief among which would be the inability to attend to ordinary avocations.
[856E F] Rashid Karmalli and anr.
vs Sherbanoo, [1907] 31 ILR Bombay 2641, referred to.
2.5 Therefore, under the Principles of Mohammedan Law, the gift made in marz ul maut could be regarded as gift made in contemplation of death, since it has all the requisites prescribed under Section 191 of the .
The only limitation is that the disposition is restricted to a third on account of the right of the heirs.
[857C D] Syed Ameer Ali: Mohammedan Law, Vol. 1, 4th Edn.
1985 p. 59 60, referred to.
|
Special Leave Petition (Civil) No. 5383 of 1990.
From the Judgment and Order dated 9.3.1990 of the Bombay High Court in Appeal No. 231 of 1990 in W.P. No. 3016 of 1989.
747 K.K. Venugopal, G.L. Sanghi, Sudhir Shah and P.N. Misra for the Petitioners.
K.K. Singhavi, N.B. Shetye, D.N. Mishra and A.S. Bhasme for the Respondents.
The Judgment of the Court was delivered by KASLIWAL, J.
This petition under Article 136 the Constitution of India is directed against the order of Bombay High Court dated 9th March, 1990.
Facts necessary and shorn of details are given as under.
Pratibha Cooperative Housing Society Ltd. (hereinafter referred to as `the Housing Society ') made some unauthorised constructions in a 36 storeyed building in a posh and important locality of the city of Bombay.
The Bombay Municipal Corporation issued a showcause notice dated 7th August, 1984 calling upon the Housing Society to showcause within 7 days as to why the upper right floors of the building should not be demolished so as to limit the development to the permissible Floor Space Index (F.S.I.).
In the notice it was gained by the Housing Society and that the construction work had already reached 36 floors and that on the basis of the actual area of the building, the upper eight floors were beyond the permissible F.S.I. limit and as such were required to be removed.
The Housing Society submitted a reply to the showcause notice by their letter 13th August, 1984.
The Administrator of the Bombay Municipal Corporation made an order on 21st September, 1984 requiring the Housing Society to demolish 24,000 sq.
on the eight upper floors of the building on the basis of 3000 Sq.
on each floor.
The Housing Society made a representation but the same was dismissed by the Administrator by order dated 31st October, 1984.
An appeal submitted by the Housing Society was also dismissed by the State Government on 7th October, 1985.
The Housing Society then filed a writ petition No. 4500 of 1985 in the High Court.
A Division Bench of the High Court dismissed the writ petition on 28th October, 1985.
However, the High Court while dismissing the writ petition also observed as under: "It would, however, be fair and just in the circumstances of the case to give a choice to the society to reduce the construction up to permissible limit or whatever other method they can think of.
It is of course for the society to come 748 forward with a proposal in that behalf.
We therefore direct that in case the society comes with any such alternative proposal within the four corners of the rules and regulations within one month from today the Municipality may consider.
" The case of the Housing Society is that in pursuance to the said order it submitted application to the Municipal Corporation giving several alternative proposals on 21st November, 1985.
It may be noted at this stage that the Housing Society had preferred a special leave petition No. 17351 of 1985 before this Court against the judgment of the High Court dated 28th October, 1985 and the said special leave petition was dismissed by this Court on 17th january, 1986.
Further allegation of the Housing Society was that it submitted another proposal to the Municipal Corporation on 17th February, 1986 and thereafter wrote to the Municipal Council on 14th August, 1986 to consider their alternative proposals.
A similar letter was also written to the Chief Minister of Maharashtra.
On 29th August, 1986 the Municipal Commissioner fixed up a meeting for hearing the alternative proposals of the Housing Society.
It has been alleged that in the said meeting the Housing Society had put forward its case in support of the new proposals and the Municipal commissioner had thereafter informed the Housing Society that he would consider the said proposals and take decision.
However, no decision was taken till the filing of the present special leave petition before this Court.
it has been further alleged that on 27th December, 1988 the Housing Society wrote a letter to the Municipal Commissioner to consider the alternative proposals mainly of vertical demolition of the building instead of demolishing the eight upper floors.
It had been alleged that a meeting took place between the architects of the Housing Society as well as the officers of the Municipal Corporation in January, 1989 wherein the officers of the Corporation agreed that instead of demolishing eight upper floors, demolition can be made vertically so as to bring the entire construction within the permissible F.S.I.
It has been further alleged that immediately thereafter the Housing Society was informed that henceforth it should contact the Municipal Commissioner directly and not any officers of the Corporation.
It has been further alleged that the Corporation without considering the proposals of the Housing Society entrusted the work of demolition of the upper eight floors of the building to a company.
In these circumstances the Housing Society filed writ petition No. 3016 of 1989 in the High Court.
Learned Single Judge dismissed the writ petition by order dated 19th December, 1989 and the appeal preferred against the said order was dismissed by the Division Bench of the High 749 Court by order dated 9th March, 1990.
In view of the fact that the main grievance of the Housing Society was that its alternative proposal of demolishing the building vertically instead of eight upper floors was not considered on merits by the Corporation, a serious effort was made by this Court to get the feasibility of such proposal examined by the Corporation.
Orders in this regard were passed by this Court on several occasions but ultimately no agreeable solution could fructify.
The proposal was got examined at the highest level by the Municipal Corporation and ultimately the Commissioner rejected the proposal on 13th November, 1990 and submitted a detailed report in writing for the perusal of this Court.
In the above report it has been stated that in pursuance to the order of this Court dated 22nd October, 1990, the proposals submitted by the Housing Society on 27th October, 1990 and 29th October, 1990 in supersession of all alternative proposals, to demolish vertically one bedroom and servant quarters on all the floors to bring the building in tune with the F.S.I. was considered but on the grounds stated in the report the proposal submitted by the Housing Society cannot be approved.
In the circumstances mentioned above on the request of learned counsel for both the parties to decide the case on merits, we heard the arguments in detail on 23.4.1991.
Thereafter, in order to clarify some points we directed the Chief Engineer cum Architect and the Municipal Commissioner to remain present on the next date namely, 1.5.1991 and to keep the record of the case also ready for our perusal.
We have heard learned counsel for the parties at great length and have thoroughly perused the record.
It may be noted that the Housing Society had made illegal constructions in violation of F.S.I. to the extent of more than 24,000 sq.
and as such an order for demolition or eight floors was passed by the Administrator, Municipal Council as back as 21st September, 1984.
The writ petition filed against the said order was dismissed by the High Court on 28th October, 1985 and special leave petition against the said order of the High Court was also dismissed by this Court.
The High Court in its order dated 28th October, 1985 had granted an indulgence to the Housing Society for submitting an alternative proposal within the four corners of the rules and regulations within one month and the municipality to consider the same.
The proposal was submitted on 21st November, 1985 but in the said proposal there was no mention of any vertical demolition of the building.
The proposal with regard to the demolition vertically of one 750 bedroom and servant quarters on all the floors was submitted for the first time on 27th December, 1988.
During the pendency of the special leave petition before this Court, this proposal was got examined by the Municipal corporation.
The Municipal commissioner submitted a report on 13th November, 1990 giving detailed reasons for rejecting such proposal.
It is well settled that the High Court under Article 226 of the Constitution is not an Appellate Court on the administrative decisions taken by the authorities.
It cannot be said that the decision taken by the Municipal Commissioner suffers from any want of jurisdiction or is violative of any law or rules.
The proposal submitted by the Housing Society was got examined by the architects and engineers and thereafter the order was passed by the Municipal Commissioner.
It cannot be said that the action of the Municipal Corporation is tainted with mala fides.
It was submitted by the learned counsel for the Corporation that the Corporation has entrusted the matter for investigation by the CBI and suitable action is being processed against the guilty officers of the Corporation with whose connivance these illegal constructions were made by the Housing Society.
It is an admitted position that six floors have been completely demolished and a part of seventh floor has also been demolished.
It was pointed out by Mr. K.K. Sighvi, learned counsel for the Corporation that the tendency of raising unlawful constructions by the builders in violation of the rules and regulations of the Corporation was rampant in the city of Bombay and the Municipal Corporation with its limited sources was finding it difficult to curb such activities.
We are also of the view that the tendency of raising unlawful constructions and unauthorised encroachments is increasing in the entire country and such activities are required to be dealt with by firm hands.
Such unlawful constructions are against public interest and hazardous to the safety of occupiers and residents of multistoreyed buildings.
The violation of F.S.I. in the present case was not a minor one but was to an extent of more than 24,000 sq.
Such unlawful construction was made by the Housing Society in clear and flagrant violation and disregard of F.S.I. and the order for demolition of eight floors had attained finality right upto this Court.
The order for demolition of eight floors has been substantially carried out and we find no justification to interfere in the order passed by the High Court as well as in the order passed by the Municipal Commissioner dated 13th November, 1990.
In the result we find no force in the petition and the same is dismissed with no order as to costs.
Before parting with the case we would like to observe that this case should be a pointer to all the 751 builders that making of unauthorised constructions never pays and is against the interest of the society at large.
The rules, regulations and bylaws and made by the Corporations or development authorities taking in view the larger public interest of the society and it is the bounden duty of the Citizens to obey and follow such rules which are made for their own benefits.
S.B. Petition dismissed.
| IN-Abs | The appellant Co operative Housing Society Ltd. made some unauthorised constructions in a 36 storeyed building.
The Bombay Municipal Corporation issued a show cause notice calling upon the society to show cause as to why the upper eight floors of the building should not be demolished so as to limit the development to the permissible Floor Space Index (F.S.I.) since the additional Floor Space Index to the extent of 2773 sq.
was gained by the appellant.
The appellants submitted a reply to the show cause notice.
The Administrator of the Municipal Corporation made an order on 21st Septmber, 1984 requiring the appellant to demolish 24,000 sq.
on the eight upper floors of the building on the basis of 3000 sq.
on each floor.
The Administrator as well as the State Government dismissed the representation and appeal by the appellant.
So the appellant filed a writ petition in the High Court which also dismissed with the observation that the appellant be given a choice to reduce the construction upto permissible limit by any alternative proposal within the four corners of the rules and regulations within one month from 28th October 1985 the Municipality may consider.
The appellant made application to the Municipal Corporation giving several alternative proposals on 21st November 1985.
But it also preferred a special leave petition before this court against the High Court Judgment.
The special leave petition leave petition was dismissed on January 17, 1986.
The appellants alleged that they submitted another proposal to the Municipal Corporation on 17th February, 1986 and a meeting for hearing alternative proposals was fixed up by the Municipal commissioner and put forward its case in support of the new proposals and the Municipal Commissioner said he would consider the proposals and take decision.
On 27th December 1988 the appellant wrote a letter to the Municipal Commissioner to consider the alternative proposal i.e. of 746 vertical demolition of the building instead of demolishing the eight upper floors.
In January, 1989 the officers of the corporation agreed that demolition can be made vertically so as to bring the entire construction within the permissible Floor Space Index where as the work of demolition of upper eight floors of the building were entrusted to a company by the Municipal Commissioner.
So the appellant again filed a writ in the High Court.
It was dismissed by the Single Judge as well as by the Division Bench dated 5th March, 1990.
The appellants came by Special Leave Petition in this Court; The main grievance of the appellant being that vertical demolition proposal was not considered.
Inspite of orders of this Court in this regard to the Municipal Corporation no agreeable solution could fructify.
The proposal was examined by the Municipal Commissioner but rejected on 13th November, 1990 and submitted the detailed report to this Court.
Dismissing the petition the Court HELD: The appellant had made illegal constructions in violation of Floor Space Index to the extent of more than 24000 sq.
The decision taken by the Municipal Commissioner does not suffer from any want of jurisdiction nor is violative of any law or rules.
It is well settled that the High Court under Article 226 of the Constitution is not an appellate Court on the administrative decision taken by the authorities.
Since the tendency of raising unlawful constructions and unauthorised encroachments is increasing in the entire country and such activities are required to be dealt with by firm hands.
Such unlawful constructions are against public interest and hazardous to the safety of occupiers and residents of the multistoreyed buildings.
[749F, 750B, E F] This case should be a pointer to all the builders that making of unauthorised construction never pays and is against the interest of the society at large.
The rules, regulations and by laws are made by the corporations or development authorities taking in view the larger public interest of the society and it is the bounden duty of the citizens of obey and follow such rules which are made for their own benefits.
[750H 715B]
|
ivil Appeal Nos. 657 of 1979 & 2117 21 of 1977.
From the Judgment and Order dated 20.1.1978 & 6.5.1976 of Allahabad High Court in Income Tax Rule No. 502/74 and Income Tax Reference No. 827 of 1973.
S.B.L. Srivastava, Manoj Swarup and Lalita Kohli for the Appellants.
J. Ram Murthy, K.P. Bhatnagar and Ms. A. Subhashini for the Respondent.
The Judgment of the Court was delivered by K. JAGANNATHA SHETTY, J.
The common question which arises for decision in these appeals by special leave is whether the interest paid on a debit balance of Rs. 1,75,310 taken over by the assessee firm from the erstwhile Hindu Undivided Family (HUF), would be an allowable deduction under Section 36(1) (iii) of the Income Tax Act, 1922.
922 The partners of the firm were members of the HUF which carried on business at Varanasi in the name of M/s Badal Ram Laxmi Narain.
The family had no capital of its own and had been running business with the help of borrowed money.
On 20 October 1951, there was partial partition in the family.
As a result whereof the business of the family was partitioned between the members of the family.
The members formed themselves into partnership and continued the same business.
On the date of partition, there was a debit balance of Rs. 1,75,310 in the capital account of the family.
This debit balance was transferred in equal proportion to the personal accounts of the three partners of the firm.
The newly formed firm took over the business assets as well as liabilities of the HUF.
The question arose as to whether the interest paid by the firm on the said debit balance was an allowable deduction in the computation of its income? One of the contentions urged for the firm was that the debit balance was taken over by the firm in consideration of the goodwill of the business.
The Appellate Assistant Commissioner had held that the HUF business had no goodwill.
The Tribunal did not agree with the Appellate Assistant Commissioner.
It has observed that the business of the HUF was of a very long standing and the previous years returns and assessment of income prior to the date of partition indicated that the HUF had flourishing business.
Since the running business was taken over by the assessee with the debit balance, the Tribunal expressed the view that the firm could be deemed to have taken the liability of Rs. 1,75,310 in consideration of the sale of goodwill and the interest paid thereon was an allowable deduction.
The following question of law was referred to the High Court.
"Whether on the facts and in the circumstances of the case, the assessee was entitled to the deduction of interest on a debit balance of Rs.1,75,310 taken over from the erstwhile Hindu Undivided Family?" The High Court examined the facts of the case to find out whether there was any sale of the goodwill.
It observed that the goodwill of the HUF business was never sold or purchased.
Had there been any such transaction, appropriate entries in the books of account of the HUF would have been made.
The HUF should have credited the amount in its account in respect of the price paid for the goodwill and since there was no such entries, there could not be any inference that the firm has taken over the liability of Rs. 1,75,310 for the sale of goodwill.
The High Court also has observed that the partners of the 923 firm were bound to take over the liability of HUF because, the liability was that of the family of which they were members and on partition every member became liable to discharge the debt according to his share.
Clause (iii) of Section 36(1) applies only where capital has been borrowed for the purposes of the business or profession.
The amount of interest paid on the borrowed capital is an allowable deduction.
It is not in dispute and indeed cannot be disputed that if the goodwill is purchased out of the borrowed capital, the interest paid on the borrowed capital is an allowable deduction.
The Tribunal has correlated the debit balance to the purchase of goodwill since the firm has taken over the running business.
The High Court has held that there was no sale of goodwill by the HUF to the firm in view of the absence of related entries in the books of account of HUF.
The conclusion of the High Court seems to be as much an inference as that of the Tribunal on the same set of facts and circumstances.
It is important to point out that there was only a partial partition in the family, particularly with regard to HUF business.
It was not necessary for the firm to have taken over the debit balance of the HUF since the HUF had other properties.
The conclusion of the Tribunal that the firm has taken over the debit balance of Rs.1,75,310 in consideration of the sale of the goodwill, in the premises, stands to reason.
Indeed, it seems to be neither unreasonable or unwarranted, nor arbitrary or unjust.
The High Court ought not to interfere with such conclusion even if another view is possible.
The second reason given by the High Court is also not acceptable.
we are concerned with the rights of the assessee and not the liability of the individual members of the HUF.
The claim of the assessee for allowable deduction of the interest paid cannot be defeated by the existence of personal liability of the members of the HUF.
That is wholly beside the point.
We are therefore, unable to sustain the order of the High Court.
In the result, the appeal are allowed and the decision of the High Court is set aside.
The question referred to the High Court in each case is answered in favour of the assessee and against the revenue.
The assessee shall be entitled to one set of costs in this Court.
N.P.V. Appeals allowed.
| IN-Abs | The partners of the assays firm were members of a HUF, which was carrying on business with borrowed capital.
Consequent on partial partition in the family and partition of the family business, the members formed the assays firm.
There was a debit balance in the capital account of the family which was transferred to the personal accounts of the partners of the firm.
The firm, which continued the family business and took over the business assets and the liabilities of the HUF, claimed that the interest paid on the debit balance was an allowable deduction in the computation of income since it had taken over the debit balance in consideration of the goodwill of the business.
The Appellate Assistant Commissioner held that the HUF business had no goodwill.
On appeal, the Tribunal held that the HUF had a very long standing and flourishing business, and hence the firm could be deemed to have taken over the liability in consideration of the sale of goodwill and the interest paid thereon was an allowable deduction.
On a reference made by the Tribunal the High Court held that the goodwill of the HUF business was never sold or purchased, and that the partners of the firm were bound to take over the HUF 's liability, since it was that of the family of which they were members, and became liable to discharge their share of the debt.
Allowing the appeals preferred by the assessee, this Court HELD: 1.1 Clause (iii) of Section 36(1) of the Income Tax Act, 1922 applies only where capital has been borrowed for the purposes of the business or profession.
The amount of interest paid on the borrowed capital is an allowable deduction.
It cannot be disputed that if the goodwill is purchased out of the borrowed capital, the interest paid on the borrowed capital is an allowable deduction.
[923B] 921 1.2 In the instant case, there was only a partial partition in the family, particularly with regard to HUF business and it was not necessary for the firm to have taken over the debit balance of the HUF, since the HUF had other properties.
[923D] 1.3 The Tribunal has correlated the debit balance to the purchase of goodwill since the firm had taken over the business.
The High Court has held that there was no sale of goodwill by the HUF to the firm in view of the absence of related entries in the books of account of HUF.
The conclusion of the High Court is as much an inference as that the Tribunal on the same set of facts and circumstances.
The Tribunal was right in holding that the firm had taken over the debit balance in consideration of the sale of the goodwill and this conclusion is neither unreasonable or unwarranted, nor arbitrary or unjust.
The High Court ought not to interfere with such conclusion even if another view is possible.
Besides, the relevant point to be considered is the rights of the assessee and not the liability of the individual members of the HUF.
The claim of the assessee for allowable deduction of the interest paid cannot be defeated by the existence of personal liability of the members of HUF.
[923C, E, F]
|
rl.) Petition No. 96 of 1989.
(Under Article 32 of the Constitution of India).
Nand Lal, S.K. Bagga and Mrs. S.K. Bagga for the Petitioner.
V.C. Mahajan Mrs. Indra Sawhney, Ms. A. Subhashini, Aruneshwar Gupta, Surya Kant and I. Makwana for the Respondents.
The Judgment of the Court was delivered by AHMADI, J.
Liberty is the life line of every human being.
Life without liberty is `lasting ' but not `living '.
Liberty is, therefore, considered one of the most precious and cherished possessions of a human being.
Any attempt to take liberties with the liberty of a human being is visited with resistance.
Since no human being can tolerate fetters on his personal liberty it is not surprising that the petitioner Ashok Kumar alias Golu continues to struggle for his liberty, premature release, not fully content with the enunciation of the law in this behalf 864 by this Court in Maru Ram vs Union of India, {1981] 1 SCR 1196.
The questions of law which are raised in this petition brought under Article 32 of the Constitution arise upon facts of which we give an abridged statement.
On the basis of a FIR lodged on October 21, 1977, the petitioner was arrested on the next day and he along with others was chargesheeted for the murder of one Prem Nagpal.
The petitioner was tried and convicted for murder on December 20, 1978 in Sessions Case No. 32 of 1978 by the learned Sessions Judge, Ganganagar, and was ordered to suffer imprisonment for life.
His appeal, Criminal Appeal No. 40 of 1979, was dismissed by the High Court of Rajasthan.
Since then he is serving time.
It appears that he filed a Habeas Corpus Writ Petition No. 2963 of 1987 in the High Court of Rajasthan at Jodhpur for premature release on the plea that he was entitled to be considered for such release under the relevant rules of Rajasthan Prisons (Shortening of Sentences) Rules, 1958, (hereinafter alluded to as `the 1958 Rules ') notwithstanding the insertion of Section 433A in the Code of Criminal Procedure, 1973 (hereinafter called `the Code ') with effect from December 18, 1978, just two days before his conviction.
His grievance was that he was being denied the benefit of early release under the 1958 Rules under the garb of the newly added Section 433A, on the ground that it places a statutory embargo against the release of such a convict `unless he has served atleast 14 years of imprisonment '.
He contended that the said provision could not curtail the constitutional power vested in the Governor by virtue of Article 161 of the Constitution which had to be exercised on the advice of the Council of Ministers which advice could be based on a variety of considerations including the provisions of the 1958 Rules.
The writ petition was, however, dismissed by the High Court on October 31, 1988, on the ground that it was premature inasmuch as the petitioner 's two representations, one to the Governor and another to the State Home Minister, were pending consideration.
The High Court directed that they should be disposed of within one month.
In this view of the matter the High Court did not deem it necessary to consider the various questions of law raised in the petition on merits.
After the rejection of his writ petition by the High Court, the petitioner through his counsel addressed a letter dated November 28, 1988 to the Governor inviting his attention to the earlier representation dated August 29, 1988 and requesting him to take a decision thereon within a month as observed by the High Court.
Failing to secure his early release notwithstanding the above efforts, the petitioner has invoked the extraordinary jurisdiction of this Court under Article 32 of the Constitution. 865 The petitioner 's case in a nutshell is that under the provisions of the 1958 Rules, a `lifer ' who has served an actual sentence of about 9 years and 3 months is entitled to be considered for premature release if the total sentence including remissions works out to 14 years and he is reported to be of good behaviour.
However, the petitioner contends, his case for premature release is not considered by the concerned authorities in view of the newly added section 433A of the Code on the interpretation that by virtue of the said provision the case of a `lifer ' cannot be considered for early release unless he has completed 14 years of actual incarceration, the provisions of sections 432 and 433 of the Code as well as the 1958 Rules notwithstanding.
According to him, even if the provisions of sections 432 and 433 of the Code do not come into play unless a convict sentenced to life imprisonment has completed actual incarceration for 14 years as required by section 433A, the authorities have failed to realise that section 433A cannot override the constitutional power conferred by Articles 72 and 161 of the Constitutional on the President and the Governor, respectively, and the State Government i.e., the Council of Ministers, could advise the Governor to exercise power under Article 161 treating the 1958 Rules as guidelines.
Since the petitioner had already moved the Governor under Article 161 of the Constitution it was incumbent on the State Government to consider his request for early release, notwithstanding section 433A, and failure to do so entitled the petitioner to immediate release as his continued detention was, wholly illegal and invalid.
In support of this contention the petitioner has placed reliance on the ratio of Maru Ram 's decision.
The petitioner brands section 433A of the Code to be a `legislative fraud ' inasmuch as the said provision was got approved by the Parliament on the assurance that the said provision is complementary to the various amendments proposed in the Indian Penal Code.
In the alternative it is contended that in any case this Court should by a process of interpretation limit the scope of section 433A of the Code to those cases only to which it would have been limited had the legislation proposing amendments in the Indian Penal Code gone through.
In any case after the decision of this Court in Maru Ram 's case, the efficacy of section 433A is considerably reduced and the petitioner is entitled to early release by virtue of the power contained in ARticle 161 read with the 1958 Rules even if guidelines are not formulated notwithstanding the subsequent decision of this Court in Kehar Singh vs Union of India, ; Counsel submitted that after the decision of this Court in Bhagirath vs Delhi Administration, ; whereunder this Court extended the benefit of section 428 of the Code even 866 to life convicts, the ratio in Gopal Godse vs State of Maharashtra, ; had undergone a change.
On this broad approach, counsel for the petitioner, formulated questions of law which may be stated as under: 1.
Whether the insertion of section 433A in the Code was a legislative fraud inasmuch as the connected legislation, namely, the Indian Penal Code (Amendment) Bill XLII of 1972 did not become law although passed by the Rajya Sabha as the IPC (Amendment) Act, 1978, on November 23, 1978? 2.
Whether on the ration of Maru Ram 's decision, in the absence of any guidelines formulated by the State under Article 72 of 161 of the Constitution, section 433A of the Code would not apply to life convicts and the 1958 Rules will prevail for the purpose of exercise of power under Article 72 of 161 of the Constitution? Inter connected with this question, the following .l questions were raised: a) Whether Maru Ram 's decision is in conflict with Kehar Singh 's Judgment on the question of necessity or otherwise of guidelines for the exercise of power under Article 7 and 161 of the constitution? b) Whether the use of two expressions "remission" and "remit" in Articles 72 and 161 convey two different meanings and if yes, whether the content f power in the two expressions is different? c) Whether the persons sentenced to death by Court, whose death sentence has been commuted to life imprisonment by executive clemency, form a distinct and separate class for the purpose of application of section 433A of the Code as well as for the purpose of necessity (or not) of guidelines for premature release in exercise of power under Articles 72 and 161, from the persons who at the initial stage itself were sentenced to life imprisonment by court verdict? And whether in the latter case guidelines are mandatory under Article 72 and 161 and a well designed scheme of remission must be formulated if the constitutional guarantee under Articles 14 and 21 is to be preserved? d) Whether the whole law of remission needs to be reviewed after Bhagirath 's case wherein this Court held that imprisonment 867 for life is also an imprisonment for a term and that a life convict is entitled to set off under section 428 Cr.
P.C.? e) Whether it is permissible in law to grant conditional premature release to a life convict even before completion of 14 years of actual imprisonment notwithstanding section 433A of the Code? If yes, whether the grant of such conditional release will be treated as the prisoner actually serving time for the purpose of section 433A of the Code? First the legislative history.
The Law Commission had in its 42nd Report submitted in June, 1971 suggested numerous changes in the Indian Penal Code (IPC).
Pursuant thereto an Amendment Bill No. XLII of 1972 was introduced in the Rajya Sabha on December 11, 1972 proposed wide ranging changes in the IPC.
One change proposed was to bifurcate section 302, IPC into two parts, the first part providing that except in cases specified in the second part, the punishment for murder will be imprisonment for life whereas for the more heinous crimes enumerated in clauses (a) to (c), of sub section (2) the punishment may be death or imprisonment for life.
A motion for reference of the Bill to the Joint Committee of both the Houses was moved in the Rajya Sabha on December 14, 1972 by the then Minister of State in the Ministry of Home Affairs and was adopted on the same day.
The Lok Sabha concurred in the motion of the Rajya Sabha on December 21, 1972.
The Joint Parliamentary Committee presented its report to the Rajya Sabha on January 29, 1976 recommending changes in several clauses of the Bill.
While retaining the amendment proposed in section 302, IPC, it recommended inclusion of one more clause (d) after clause (c) in sub section (2) thereof and at the same time recommended deletion of section 303, IPC.
It also recommended substitution of the existing section 57, IPC, by a totally new section, the proviso whereto has relevance.
The proposed proviso was as under: "Provided that where a sentence of imprisonment for life is imposed on conviction of a person for a capital offence, or where a sentence of death imposed on a person has been commuted into one of imprisonment for life, such person shall not be released from prison unless he had served at least fourteen years of imprisonment.
" The reason which impelled the Committee to introduce the above proviso was "That sometimes due to grant of remission even murderers sentenced or commuted to life imprisonment were released at the end 868 of 5 to 6 years.
" The Committee, therefore, felt that such a convict should not be released unless he has served atleast 14 years of imprisonment.
It is evident from the scheme of the aforesaid recommendations that the proviso was intended to apply to only those convicts who were convicted for a capital offence (this expression was defined by clause 15 of the Bill recommending substitution of section 40, IPC, as `an offence for which death is one of the punishments provided by law ') or whose sentence of death was commuted into one of imprisonment for life and not to those who were governed by the first part of the proposed section 302, IPC.
It was pointed out by counsel that similar benefit would have accrued to offenders convicted for offences covered under section 305, 307 or 396 if the proposed sections 305, 307(b) and 396(b) had come into being.
That, contends the petitioner 's counsel, would have considerably narrowed down the scope of the proposed proviso to section 57, IPC, and consequently the rigour of the said provision would have fallen on a tiny minority of offenders guilty of a capital offence.
Pursuant to the recommendations made by the Committee, two bills, namely, the IPC (Amendment) Bill, 1978, came to be introduced, the former was passed with changes by the Rajya Sabha on November 23, 1978 while the latter was introduced in the Lok Sabha on November 8, 1978, and in the Rajya Sabha on December 5, 1978.
The proposal to add a proviso to the proposed section 57, IPC did not find favour as it was thought that the said subject matter appropriately related to Chapter XXXII of the Code and accordingly the said provision was introduced as section 433A in the Code.
While the amendments to the Code became law with effect from December 18, 1978, the IPC amendments, though passed by the Rajya Sabha could not be got through the Lok Sabha and lapsed.
It may here be mentioned that the IPC Bill as approved by the Rajya Sabha contained the proposal to divide section 302 into two parts, in fact an additional clause was sought to be introduced in the second part thereof and sections 305, 307 and 396 were also sought to be amended as proposed by the Committee.
This in brief is the legislative history.
In the backdrop of the said legislative history, counsel for the petitioner argued that a legislative fraud was practised by enacting section 433A of the Code and failing to carry out the corresponding changes in sections 302, 305, 307, 396, etc., assured by the passing of the Indian Penal Code (Amendment) Act, 1978, by the Rajya Sabha on November 23, 1978.
According to him it is evident from the scheme of the twin Amendment Bills that the legislative intent was to apply the rigour of section 433A of the Code to a small number of heinous 869 crimes which fell within the meaning of the expression capital offence.
It was to achieve this objective that section 302, IPC was proposed to be bifurcated so that a large number of murders would fall within the first part of the proposed provision which prescribed the punishment of life imprisonment only and thus fell beyond the mischief of section 433A of the Code.
To buttress his submission our attention was invited to Annexure II to the petition which is a copy of the letter dated July 10, 1979, written by the Joint Secretary in the Ministry of Home Affairs to Home Secretaries of all the concerned State Governments explaining the purport of the newly added section 433A. After explaining that section 57, IPC, had a limited scope, namely, calculating fractions of terms of imprisonment only, he proceeds to state in paragraph 3 of the letter as under: "The restrictions imposed by section 433A applies only to those life convicts who are convicted for offences for which death is one of the punishments prescribed by law.
In the Indian Penal Code (Amendment) Bill, 1978 as passed by the Rajya Sabha and now pending in the Lok Sabha, section 302 is proposed to be amended so as to provide that the normal punishment for murder shall be imprisonment for life and that only in certain cases of aggravating circumstances will the court have discretion to award death sentences.
" Then in paragraph 4 he proceeds to clarify as under: "Even regarding these convicts the restriction imposed by section 433A is not absolute for, the Constitutional power of the Governor under Article 161 to commute and remit sentences remains unaffected and can be exercised in each case in which the exercise of this power is considered suitable.
" Then in paragraph 4 he proceeds to clarify as under: "Even regarding these convicts the restriction imposed by section 433A is not absolute for, the Constitutional power of the Governor under Article 161 to commute and remit sentences remains unaffected and can be exercised in each case in which the exercise of this power is considered suitable.
" In paragraph 6 of the detailed note appended to the said letter, the legal position was explained thus: "It may be pointed out that the restriction introduced by section 433A does not apply to all life convicts.
It applies only to those prisoners who are convicted of a capital offence i.e. an offence for which death is one of the punishments prescribed by law.
Once the Indian Penal Code (Amendment) Bill becomes the law, offenders sentenced 870 under proposed section 302(i) will not be covered by this provision as the offence will not be a capital offence.
Thus in future the restriction introduced by section 433A will not be applicable to them and will, in effect, cover only a very small number of cases.
Even in this small number of cases the restriction will not in any way curb the Constitutional power to grant remission and commutation vested in the President or the Governor by virtue of Articles 72 and 161.
" There can be no doubt that by this letter it was clarified that section 433A of the Code will apply to only those convicted of a capital offence and not to all life convicts.
It is equally clear that the said provision was expected to apply to exceptionally heinous offences falling within the definition of `capital offence ' once the Indian Penal Code (Amendment) Bill became law.
Section 433A was, therefore, expected to deny premature release before completion of actual 14 years of incarceration to only those limited convicts convicted of a capital offence, i.e., an exceptionally heinous crime specified in the second part of the proposed section 302, IPC.
Lastly it clarifies that section 433A cannot and does not in any way affect the constitutional power conferred on the President/Governor under ARticle 72/161 of the Constitution.
It cannot, therefore, be denied that this letter and the accompanying note does give an impression that certain provisions of the Indian Penal Code (Amendment) Boll were interlinked with section 433A of the Code.
Assuming the Criminal Procedure Code (Amendment) Bill and the Indian Penal Code (Amendment) Bill were intended to provide an integrated scheme of legislation, can it be said that the failure on the part of the Lok Sabha to pass the letter renders the enactment of the former by which section 433A was introduced in the Code, `a legislative fraud ' as counsel had liked to call it or to use a more familiar expression `colourable exercise of legislative power '? Counsel submitted that section 433A was got introduced on the statute book by deception, in that, when the former Bill was made law an impression was given that the twin legislation which had already been cleared by the Rajya Sabha on November 23, 1978 would in due course be cleared by the Lok Sabha also so that the application of section 433A would be limited to capital offences only and would have no application to a large number of `lifers '.
It must be conceded that such would have been the impact if the Indian Penal Code (Amendment) Bill was passed by the Lok Sabha in the form in which the Rajya and approved it.
871 This is not a case of legislative incompetence to enact section 433A.
No such submission was made.
Besides the question of vires of section 433A of the Code has been determined by the Constitution Bench of this Court in Maru Ram 's case.
This Court repelled all the thrusts aimed at challenging the constitutional validity of section 433A.
But counsel submitted that the question was not examined from the historical perspective of the twin legislations.
Counsel for the State submitted that it was not permissible for us to reopen the challenge closed by the Constitution Bench on the specious plea that a particular argument or plea was not canvassed or made before that Bench.
The objection raised by counsel for the State Government is perhaps not without substance but we do not propose to deal with it because even otherwise we see no merit in the submission of the petitioner 's counsel.
It is only when a legislature which has no power to legislate frames a legislation so camouflaging it as to appear to be within its competence when it knows it is not, it can be said that the legislation so enacted is colourable legislation.
In K.C. Gajapati Narayan Deo vs State of Orissa, ; the Orissa Agricultural Income tax (Amendment) Act, 1950, was challenged on the ground of colourable legislation or a fraud on the Constitution as its real purpose was to effect a drastic reduction in the amount of compensation payable under the Orissa Estates Abolition Act, 1952.
The facts were that a Bill relating to the Orissa Abolition Act, 1952 was published in the Gazette on January 3, 1950.
It provided that any sum payable for agricultural income tax for the previous year should be deducted from the gross asset of an estate for working out the net income on the basis whereof compensation payable to the estate owner could be determined.
Thereafter on January 8, 1950, a Bill to amend the Orissa Agricultural Income tax, 1947, was introduced to enhance the highest rate of tax from 3 annas to 4 annas in a rupee and to reduce the highest slab from Rs. 30,000 to Rs. 20,000.
The next Chief Minister, however, dropped this Bill and introduced a fresh Bill enhancing the highest rate to 12 annas 6 pies in a rupee and reducing the highest slab to rs.
15,000 only.
On the same becoming law it was challenged on the ground that the real purpose of the legislation was to drastically reduce the compensation payable to the estate owners.
Mukherjea, J., who spoke for the Court observed as under: "It may be made clear at the outset that the doctrine of colourable legislation does not involve any question of bona fides or mala fides on the part of the legislature.
The whole doctrine resolves itself into the question of competency of a particular legislature to enact a particular law.
If 872 the legislature is competent to pass a particular law, the motives which impelled it to act are really irrelevant.
On the other hand, if the legislature lacks competency, the question of motive does not arise at all.
Whether a statute is constitutional or not is thus always a question of power.
" Thus the whole doctrine resolves itself into a question of competency of the concerned legislature to enact the impugned legislation.
If the legislature has transgressed the limits of its powers and if such transgression is indirect, covert or disguised, such a legislation is described as colourable in legal parlance.
The idea conveyed by the use of the said expression is that although apparently a legislature in passing the statute purported to act within the limits of its powers, it had in substance and reality transgressed its powers, the transgression being veiled by what appears on close scrutiny to be a mere pretence or disguise.
In other words if in pith and substance the legislation does not belong to the subject falling within the limits of its power but is outside it, the mere form of the legislation will not be determinate of the legislative competence.
In Sonapur Tea Co. Ltd. vs Must.
Mazirunnessa; , it was reiterated relying on Gajapati 's case that the doctrine of colourable legislation really postulates that legislation attempts to do indirectly what it cannot do directly.
Such is not the case before us.
It is no body 's contention that Parliament was not competent to amend the Criminal Procedure Code by which section 433A was inserted.
Whether or not the connecting Indian Penal Code (Amendment) Bill ought to have been cleared or not was a matter left to the wisdom of the Lok Sabha.
Merely because the Criminal Procedure Bill was made law and the Indian Penal Code (Amendment) Bill was passed by the Rajya Sabha did not obligate the Lok Sabha to clear it.
The Lok Sabha to clear it.
The Lok Sabha could have its own views on the proposed Indian Penal Code amendments.
It may agree with the executive 's policy reflected in the Bill, with or without modifications, or not at all.
Merely because in the subsequent instructions issued by the letter of July 10, 1979 and the accompanying note (Annex.
II) the Joint Secretary had interlinked the two Bills, the Lok Sabha was under no obligation to adopt the measure as such representation could not operate as estoppel against it.
Even the indirect attempt on the part of the High Court of Himachal Pradesh in the ragging case to force the State Government to legislate, State of Himachal Pradesh vs A Parent of a student of Medical College, Simla, [1985] 3 SCC 169 was disapproved by this Court as a matter falling, outside the functions and duties of the judiciary.
It is, therefore, obvious that no question of mala fides on the part of the legislature was involved in the enactment of one legislation and failure to 873 enact another.
There is no question of `legislative fraud ' or `colourable legislation ' involved in the backdrop of the legislative history of section 433A of the Code as argued on behalf of the petitioner.
Counsel for the Petitioner, However, tried to seek support form the Privy Council decision in W.R. Moram vs Deputy Commissioner of Taxation for N.S.W., Wherein the question to be considered was whether the legislative scheme was a colourable one forbidden by section 5(ii) of the Australian Constitution.
There was no attempt to disguise the scheme as it was fully disclosed.
The Privy Council, while holding that the scheme was not a colourable legislation, observed that `where there is admittedly a scheme of proposed legislation, it seems to be necessary when the `pith and substance ' or `scope and effect ' of any one of the Acts is under consideration, to treat them together and to see how they interact '.
But that was a case where the scheme was carried out through enactments passed by the concerned legislatures.
It is in that context that the above observations must be read and understood.
In the present case also if both the Bills had become law, counsel would perhaps have been justified in demanding that in understanding or construing one legislation or the other, the scheme common to both must be kept in view and be permitted to interact.
But where the linkage does not exist on account of the Indian Penal Code (Amendment) Bill not having become law we are unable to appreciate how section 433A can be read down to apply to only those classes of capital offences to which it would have applied had the said Bill been passed by the Lok Sabha in the terms in which it was approved by the Rajya Sabha.
The language of section 433A is clear and unambiguous and does not call for extrinsic aid for its interpretation.
To accept the counsel 's submission to read down or interpret section 433A of the Code with the aid of the change proposed by the Indian Penal Code (Amendment) Bill would tantamount to treating the provisions of the said Bill as forming part of the Indian Penal Code which is clearly impermissible.
To put such an interpretation with the aid of such extrinsic material would result in violence to the plain language of section 433A of the Code.
We are, therefore, unable to accept even this second limb of the contention.
The law governing suspension, remission and commutation of sentence is both statutory and constitutional.
The stage for the exercise of this power generally speaking is post judicial, i.e., after the judicial process has come to an end.
The duty to judge and to award the appropriate punishment to the guilty is a judicial function which culminates by a judgment pronounced in accordance with law.
After 874 the judicial function thus ends the executive function of giving effect to the judicial verdict commences.
We first refer to the statutory provisions.
Chapter III of IPC deals with punishments.
The punishments to which the offenders can be liable are enumerated in section 53, namely, (i) death (ii) imprisonment for life (iii) imprisonment of either description, namely, rigorous or simple (iv) forfeiture of property and (v) fine.
Section 54 empowers the appropriate government to commute the punishment of death for any other punishment.
Similarly section 55 empowers the appropriate government to commute the sentence of imprisonment for life for imprisonment of either description for a term not exceeding 14 years.
Chapter XXXII of the Code, to which section 433A was added, entitled `Execution, Suspension, Remission and Commutation of sentences ' contains sections 432 and 433 which have relevance; the former confers power on the appropriate government to suspend the execution of an offender 's sentence or to remit the whole or any part of the punishment to which he has been sentenced while the latter confers power on such Government to commute (a) a sentence of death for any other punishment (b) a sentence of imprisonment for life, for imprisonment for a term not exceeding 14 years of for fine (c) a sentence of rigorus imprisonment for simple imprisonment or for fine and (d) a sentence of simple imprisonment for fine.
It is in the context of the aforesaid provisions that we must read section 433A which runs as under: "433A. Restriction on powers of remission or commutation in certain cases Notwithstanding anything contained in Section 432, where a sentence of imprisonment for life is imposed on conviction of a person for an offence for which death is one of the punishments provided by law, or where a sentence of death imposed on a person has been commutted under section 433 into one of imprisonment for life, such person shall not be released from prison unless he had served at least fourteen years of imprisonment.
" The section begins with a non obstante clause notwithstanding anything contained in section 432 and proceeds to say that where a person is convicted for an offence for which death is one of the punishments and has been visited with the lesser sentence of imprisonment for life or where the punishment of an offender sentenced to death has been commuted under section 433 into one of imprisonment for life, such offender will not be released unless he has served at least 14 years of imprisonment.
The reason which impelled the legislature to insert this provision has been stated earlier.
Therefore, one who could have been 875 visited with the extreme punishment of death but on account of the sentencing court 's generosity was sentenced to the lesser punishment of imprisonment for life and another who actually was sentenced to death but on account of executive generosity his sentence was commutted under section 433(a) for imprisonment for life have been treated under section 433A as belonging to that class of prisoners who do not deserve to be released unless they have completed 14 years of actual incarceration.
Thus the effect of section 433A is to restrict the exercise of power under sections 432 and 433 by the stipulation that the power will not be so exercised as would enable the two categories of convicts referred to in section 433A to freedom before they have completed 14 years of actual imprisonment.
This is the legislative policy which is clearly discernible from the plain language of section 433A of the Code.
Such prisoners constitute a single class and have, therefore, been subjected to the uniform requirement of suffering atleast 14 years of internment.
Counsel for the petitioner next submitted that after this court 's decision in Bhagirath 's case permitting the benefit of set off under section 428 in respect of the detention period as an undertrial, the ratio of the decision in Godse 's case must be taken as impliedly disapproved.
We see no basis for this submission.
In Godse 's case the convict who was sentenced to transportation for life had earned remission for 2963 days during his internment.
He claimed that in view of section 57 read with section 53A, IPC, the total period of his incarceration could not exceed 20 years which he had completed, inclusive of remission, and, therefore, his continued detention was illegal.
Section 57, IPC reads as follows: "57.
Fractions of terms of punishment In calculating fractions of terms of punishment, imprisonment for life shall be reckoned as equivalent to imprisonment for twenty years.
" The expression `imprisonment for life ' must be read in the context of section 45, IPC.
Under that provision the word `life ' denotes the life of a human being unless the contrary appears from the context.
We have seen that the punishments are set out in section 53, imprisonment for life being one of them.
Read in the light of section 45 it would ordinarily mean imprisonment for the full or complete span of life.
Does section 57 convey to the contrary? Dealing with this contention based on the language of section 57, this Court observed in Godse 's case at pages 444 45 as under: 876 "Section 57 of the Indian Penal Code has no real bearing on the question raised before us.
For calculating fractions of terms of punishment the section provides that transportation for life shall be regarded as equivalent to imprisonment for twenty years.
It does not say that transportation for life shall be deemed to be transportation for twenty years for all purposes; nor does the amended section which substitutes the words "imprisonment for life" for "transportation for life" enable the drawing of any such all embracing fiction.
A sentence of transportation for life or imprisonment for life must prima facie be treated as transportation or imprisonment for the whole of the remaining period of the convicted person 's natural life.
" This interpretation of section 57 gets strengthened if we refer to sections 65, 116, 120 and 511, of the Indian Penal Code which fix the term of imprisonment thereunder as a fraction of the maximum fixed for the principal offence.
It is for the purpose of working out this fraction that it became necessary to provide that imprisonment for life shall be reckoned as equivalent to imprisonment for 20 years.
If such a provision had not been made it would have been impossible to work out the fraction of an in definite term.
In order to work out the fraction of terms of punishment provided in sections such as those enumerated above, it was imperative to lay down the equivalent term for life imprisonment.
The second contention urged before the Court in Godse 's case was based on the Bombay Rules governing the remission system framed in virtue of the provisions contained in the .
This Court pointed out that the did not confer on any authority a power to commute or remit sentences.
The Remission Rules made thereunder had, therefore, to be confined to the scope and ambit of that statute and could not be extended to other statutes.
Under the Bombay Rules three types of remissions for good conduct were allowed and for working them out transportation for life was equated to 15 years of actual imprisonment.
Dealing with Godse 's plea for premature release on the strength of these rules this Court observed at page 447 as under: "The rules framed under the enable such a person to remission ordinary, special and State and the said remissions will be given credit towards his term of imprisonment.
For the purpose of working out the remis 877 sions the sentence of transportation for life is ordinarily equated with a definite period, but it is only for that particular purpose and not for any other purpose.
As the sentence of transportation for life or its prison equivalent the life imprisonment is one of indefinite duration, the remissions so earned do not in practice help such a convict as it is not possible to predicate the time of his death.
That is why the rules provide for a procedure to enable an appropriate Government to remit the sentence under section 401 (now section 432) of the Code of Criminal Procedure on a consideration of the relevant factors including the period of remissions earned.
The question of remission is exclusively within province of the appropriate Government; and in this case it is admitted that though the appropriate Government made certain remissions under section 401 of the Code of Criminal Procedure, it did not remit the entire sentence.
" On this line of reasoning the submission of counsel that if the Court were to take the view that transportation for life or imprisonment for life enures till the last breath of the convict passes out, the entire scheme of remissions framed under the or any like statute and the whole exercise of crediting remissions to the account of the convict would collapse, was spurned.
This Court came to the conclusion that the Remission Rules have a limited scope and in the case of a convict undergoing sentence of transportation for life or imprisonment for life it acquires significance only if the sentence is commuted or remitted, subject to section 433A of the Code or in exercise of constitutional power under Articles 72/161.
In Maru Ram 's case the Constitution Bench reaffirmed the ratio of Godse 's case and held that the nature of a life sentence is incarceration until death; judicial sentence for imprisonment for life cannot be in jeopardy merely because of long accumulation of remissions.
Release would follow only upon an order under section 401 of the Criminal Procedure Code, 1898 by the appropriate Government or on a clemency order in exercise of power under Articles 72/161 of the Constitution.
At page 1220 the Constitution Bench expressed itself thus: "Ordinary where a sentence is for a definite term, the calculus of remissions may benefit the prisoner to instant release at that point where the substraction result is zero.
878 Here, we are concerned with life imprisonment and so we come upon another concept bearing on the nature of sentence which has been highlighted in Godse 's case.
Where the sentence is indeterminate or of uncertain duration, the result of substraction from an uncertain quantity is still an uncertain quantity and release of the prisoner cannot follow except on some fiction of quantification of a sentence of uncertain duration.
" Referring to the facts of Godse 's case and affirming the view that the sentence of imprisonment for life enures upto the last breath of the convict, this Court proceeded to estate as under: "Since death was uncertain, deduction by way of remission did not yield any tangible date for release and so the prayer of Godse was refused.
The nature of a life sentence is incarceration until death, judicial sentence of imprisonment for life cannot be in jeopardy merely because of the long accumulation of remissions.
" It is, therefore, clear from the aforesaid observations that unless the sentence for life imprisonment is commuted or remitted as stated earlier by the appropriate authority under the provisions of the relevant law, a convict is bound in law to serve the entire life term in prison; the rules framed under the or like statute may enable such a convict to earn remissions but such remissions will not entitle him to release before he has completed 14 years of incarceration in view of section 433A of the Code unless of course power has been exercised under Article 7/161 of the Constitution.
It will thus be seen from the ratio laid down in the aforesaid two cases that where a person has been sentenced to imprisonment for life the remissions earned by him during his internment in prison under the relevant remission rules have a limited scope and must be confined to the scope and ambit of the said rules and do not acquire significance until the sentence is remitted under section 432, in which case the remission would be subject to limitation of section 433A of the Code, or constitutional power has been exercised under Article 72/161 of the Constitution.
In Bhagirath 's case the question which the Constitution Bench was required to consider was whether a person sentenced to imprisonment for life can claim the benefit of section 428 of the Code which, inter alia provides for setting off the period of detention undergone by the accused as an undertrial against the sentence of 879 imprisonment ultimately awarded to him.
Referring to section 57, IPC, the Constitution Bench reiterated the legal position as under: "The provision contained in Section 57 that imprisonment for life has to be reckoned as equivalent to imprisonment for 20 years is for the purpose of calculating fractions of terms in punishment.
We cannot press that provision into service for a wider purpose.
" These observations are consistent with the ratio laid down in Godse and Maru Ram 's cases.
Coming next to the question of set off under section 428 of the Code, this Court held: "The question of setting off the period of detention undergone by an accused as an undertrial prisoner against the sentence of life imprisonment can arise only if an order is passed by the appropriate authority under section 432 of section 433 of the Code.
In the absence or such order, passed generally or specially, and apart from the provisions, if any of the relevant Jail Manual, imprisonment for life would mean, according to the rule in Gopal Vinayak Godse, imprisonment for the remainder of life.
" We fail to see any departure from the ratio of Godse 's case; on the contrary the afore quoted passage clearly shows approval of that ratio and this becomes further clear from the final order passed by the Court while allowing the appeal/writ petition.
The Court directed that the period of detention undergone by the two accused as undertrial prisoners would be set off against the sentence of life imprisonment imposed upon them, subject to the provisions contained in section 433A and, `provided that orders have been passed by the appropriate authority under section 433 of the Code of Criminal Procedure '.
These directions make it clear beyond any manner of doubt that just as in the case of remissions so also in the case of set off the period of detention as undertrial would enure to the benefit of the convict provided the appropriate Government has chosen to pass an order under sections 432/433 of the Code.
The ratio of Bhagirath 's case, therefore, does not run counter to the ratio of this Court in the case of Godse or Maru Ram.
Under the Constitutional Scheme the President is the Chief Executive of the Union of India in whom the executive power of the Union vests.
Similarly, the Governor is the Chief Executive of the 880 concerned State and in him vests the executive power of that State.
Articles 72 and 161 confer the clemency power of pardon, etc., on the President and the State Governors, respectively.
Needless to say that this constitutional power would override the statutory power contained in sections 432 and 433 and the limitation of section 433A of the Code as well as the power conferred by sections 54 and 55, IPC.
No doubt, this power has to be exercised by the President/Governor on the advice of his Council of Ministers.
How this power can be exercised consistently with Article 14 of the Constitution was one of the Questions which this Court was invited to decide in Maru Ram 's case.
In order that there may not be allegations of arbitrary exercise of this power this Court observed at pages 1243 44 as under: "The proper thing to do, if Government is to keep faith with the founding fathers, is to make rules for its own guidance in the exercise of the pardon power keeping, ofcourse, a large residuary power to meet special situations or sudden developments.
This will exclude the vice of discrimination such as may arise where two persons have been convicted and sentenced in the same case for the same degree of guilt but one is released and the other refused, for such irrelevant reasons as religion, caste, color or political loyalty.
" Till such rules are framed this Court thought that extant remission rules framed under the or under any other similar legislation by the State Governments may provide effective guidelines of a recommendatory nature helpful to the Government to release the prisoner by remitting the remaining term.
It was, therefore, suggested that the said rules and remission schemes be continued and benefit thereof be extended to all those who come within their purview.
At the same time the Court was aware that special cases may require different considerations and `the wide power of executive clemency cannot be bound down even by self created rules '.
Summing up its findings in paragraph 10 at page 1249, this Court observed: "We regard it as fair that until fresh rules are made in keeping with the experience gathered, current social conditions and accepted penological thinking a desirable step, in our view the present remissions and release schemes may usefully be taken as guidelines under ARticles 72/161 and orders for release passed.
We cannot fault the Government, if in some intractably savage delinquents, section 881 433A is itself treated as a guideline for exercise of Articles 72/161.
These observations of ours are recommendatory to avoid a hiatus, but it is for Government, Central or State, to decide whether and why the current Remission Rules should not survive until replaced by a more wholesome scheme.
" It will be obvious from the above that the observations were purely recommendatory in nature.
In Kehar Singh 's case on the question of laying down guidelines for the exercise of power under Article 72 of the Constitution this Court observed in paragraph 16 as under: "It seems to us that there is sufficient indication in the terms of Article 72 and in the history of the power enshrined in that provision as well as existing case law, and specific guidelines need not be spelled out.
Indeed, it may not be possible to lay down any precise, clearly defined and sufficiently channelised guidelines, for we must remember that the power under Article 72 is of the widest amplitude, can contemplate a myriad kind of and categories of cases with facts and situations varying from case to case, in which the merits and reasons of State may be profoundly assisted by prevailing occasion and passing time.
And it is of great significance that the function itself enjoys high status in the constitutional scheme.
" These observations do indicate that the Constitution Bench which decided Kehar Singh 's case was of the view that the language of Article 72 itself provided sufficient guidelines for the exercise of power and having regard to its wide amplitude and the status of the function to be discharged thereunder, it was perhaps unnecessary to spell out specific guidelines since such guidelines may not be able to conceive of all myraid kinds and categories of cases which may come up for the exercise of such power.
No doubt in Maru Ram 's case the Constitution Bench did recommend the framing of guidelines for the exercise of power under Articles 72/161 of the Constitution.
But that was a mere recommendation and not a ratio decidendi having a binding effect on the Constitution Bench which decided Kehar Singh 's case.
Therefore, the observation made by the Constitution Bench in Kehar Singh 's case does not upturn any ratio laid down in Maru Ram 's case.
Nor has the Bench in Kehar Singh 's case said anything with regard to using the 882 provisions of extent Remission Rules as guidelines for the exercise of the clemency powers.
It is true that Articles 72/161 make use of two expressions `remissions ' with regard to punishment and `remit ' in relation to sentence but we do not think it proper to express any opinion as to the content and amplitude of these two expressions in the abstract in the absence of a fact situation.
We, therefore, express no opinion on this question formulated by the learned counsel for the petitioner.
Lastly the learned counsel for the petitioner raised a hypothetical question whether it was permissible in law to grant conditional premature release to a life convict even before completion of 14 years of actual imprisonment, which release would tantamount to the prisoner serving time for the purpose of section 433A of the Code? It is difficult and indeed not advisable to answer such a hypothetical question without being fully aware of the nature of conditions imposed for release.
We can do no better than quote the following observations made at page 1247 in Maru Ram 's case: ". . the expression `prison ' and `imprisonment ' must receive a wider connotation and include any place notified as such for detention purposes.
`Stone walls and iron bars do not a prison make ': nor are `stone walls and iron bars ' a sine qua non to make a jail.
Open jails are capital instances.
any life under the control of the State whether within high walled or not may be a prison if the law regards it as such.
House detentions, for example, Palaces, where Gandhiji was detained were prisons.
Restraint on freedom under the prison law is the test.
Licencsed where instant re capture is sanctioned by the law and likewise parole, where the parole is not free agent, and other categories under the invisible fetters of the prison law may legitimately be regarded as imprisonment.
This point is necessary to be cleared even for computation of 14 years under section 433A.
Therefore, in each case, the question whether the grant of conditional premature release answers the test laid down by this Court in the afore quoted passage, would depend on the nature of the conditions imposed and the circumstances in which the order is passed and is to be executed.
No general observation can be made and we make none.
883 In paragraph 10 of the memorandum of the Writ petition.
, three reasons have been assigned for invoking this Court 's jurisdiction under Article 32 of the Constitution, viz., (i) the questions involved in this petition will affect the right of a large body of life convicts seeking premature release; (ii) this Court 's judgment in Bhagirath 's case deviated from the ratio laid down in Godse 's case and, therefore, the entire law of remissions needed a review; and (iii) the High Court of Rajasthan had refused to examine the merits of the various important questions of law raised before it.
It is on account of the fact that this petition was in the nature of a representative petition touching the rights of a large number of convicts of the categories referred to in section 433A of the Code, that we have dealt with the various questions of law in extenso.
Otherwise the petition could have been disposed of on the narrow ground that even though in view of sections 433A of the Code, premature release could not be ordered under sections 432/433 of the Code read with the 1958 Rules until the petitioner had completed 14 years of actual imprisonment, his release could be considered in exercise of powers under Articles 72/161 of the Constitution treating the 1958 Rules guidelines, if necessary.
The relief claimed in the petition is two fold, namely, (a) to grant a mandamus to the appropriate Government for the premature release of the petitioner by exercising constitutional power with the aid of 1958 Rules and (b) to declare the petitioner 's continued detention as illegal and void.
The petitioner has not completed 14 years of actual incarceration and as such he cannot invoke sections 432 and 433 of the Code.
His continued detention is consistent with section 433A of the Code and there is nothing on record to show that it is otherwise illegal and void.
The outcome of his clemency application under the constitution is not put in issue in the present proceedings if it has been rejected and if the same is pending despite the directive of the High Court it would be open to the petitioner to approach the High Court for the compliance of its order.
Under the circumstance no mandamus can issue.
The writ petition must, therefore, fail.
It is hereby dismissed.
Rule discharged.
G.N. Petition dismissed.
| IN-Abs | The petitioner was convicted for murder and sentenced to life imprisonment, which was confirmed by the High Court.
Later he filed a Writ Petition before the High Court for premature release on the plea that he was entitled to be considered for release under the Rajasthan Prisons (Shortening of Sentences) Rules, 1958 notwithstanding the insertion of Section 433A in the Code of Criminal Procedure, 1973 with effect from 18.12.1978, just two days before his conviction.
It was contended that Section 433A Cr. P.C. which places an embargo of 14 years imprisonment before premature release could not curtail the constitutional power vested in the Governor by virtue of Article 161 of the Constitution.
The High Court, dismissed the Writ Petition on the ground that the petitioner 's representations to the Government and State Home Minister were pending consideration.
However, the High Court directed that the two representations of the petitioner should be disposed of within one month.
Unable to secure his release from the High Court as also from the State Government, the petitioner filed the present Write Petition before this Court, contending that the insertion of Section 433A in the Code of Criminal Procedure was invalid; that in the absence of guidelines under articles 72/161 of Constitution, Section 433A Cr.
P.C. could not apply to life convicts; that the Rajasthan Prisons (Shortening of Sentences) Rules, 1958 would prevail over Section 433A Cr.
P.C., and that the constitutional guarantee under Articles 14 and 21 was violated.
Dismissing the Writ Petition, this Court HELD: 1.1.
It is only when a legislature which has no power to legislate frames a legislation so camouflaging it as to appear to be within its competence when it knows it is not, it can be said that the legislation so enacted is colourable legislation.
If in pith and substance the legislation does not belong to the subject falling within the limits of its power but is outside it, the mere form of the legislation will not be determinate of the legislative competence.
[871C; 872C] 1.2.
It is not a case of legislative incompetence to enact section 433A.
No such contention was raised.
Besides the question of vires of section 433A of the Code has been determined by the Constitution Bench of this Court in Maru Ram 's case.
This Court Repelled all the thrusts aimed at challenging the constitutional validity of section 433A. [871A] 860 1.3.
It is no body 's contention that Parliament was not competent to amend the Criminal Procedure Code by which section 433A was inserted.
Whether or not the connecting Indian Penal Code (Amendment) Bill ought to have cleared or not was matter left to the wisdom of the Lok Sabha.
Merely because the Criminal Procedure Bill was made law and the Indian Penal Code (Amendment) Bill was passed by the Rajya Sabha did not obligate the Lok Sabha to clear it.
The Lok Sabha could have its own views on the proposed Indian Penal Code amendments.
It may agree with the executive 's policy reflected in the Bill, with or without modifications, or not at all.
Merely because in the subsequent instructions issued by the letter of July 10, 1979 and the accompanying note, the Joint Secretary had interlinked the two Bills, the Lok Sabha was under no obligation to adopt the measure as such representation could not operate as estoppel against it.
It is obvious that no question of mala fides on the part of the legislature was involved in the enactment of one legislation and failure to enact another.
There is no question of `legislative fraud ' or `colourbale legislation ' involved in the backdrop of the legislative history of section 433A of the Code of Criminal Procedure.
[872D H; 873A] 1.4.
In the present case if both the Bills had become law, then in understanding or construing one legislation or the other, the scheme common to both would be kept in view and be permitted to interact.
But where the linkage does not exist on account of the Indian Penal Code (Amendment) Bill not having become law, section 433A cannot be read down to apply to only those classes of capital offences to which it would have applied had the said Bill been passed by the Lok Sabha in the terms in which it was approved by the Rajya Sabha.
The language of section 433A is clear and unambiguous and does not call for extrinsic aid for its interpretation.
To read down or interpret section 433A of the Code with the aid of the changes proposed by the Indian Penal Code (Amendment) Bill would tantamount to treating the said Bills forming part of the Indian Penal Code, which is clearly impermissible.
To put such an interpretation with the aid of such extrinsic material would result in violence to the plain language of section 433A of the Code.
[873D F] Maru Ram vs Union of India, ; , followed.
K.C. Gajapati Narayan Deo vs State of Orissa, ; and Sonapur Tea Co. Ltd. vs Must Mariruznessa, ; , relied on.
861 State of Himachal Pradesh vs A Parent of a student of Medical College, Simla, [1985] 3 SCC 169 and W.R. Moram vs Deputy Commissioner of Taxation for N.S.W., , referred to.
The law governing suspension, remission and commutation of sentence is both statutory and constitutional.
The stage for the exercise of this power generally speaking is post judicial, i.e., after the judicial process has come to an end.
The duty to judge and to award appropriate punishment to the guilty is a judicial function which culminates by a judgment pronounced in accordance with law.
After the judicial function thus ends the executive function of giving effect to the judicial verdict commences.
[873G H; 874A] 2.2.
One who could have been visited with the extreme punishment of death but on account of the sentencing court 's generosity was sentenced to the lesser punishment of imprisonment for life and another who actually was sentenced to death but on account of executive generosity his sentence was commuted under section 433(a) for imprisonment for life have been treated under section 433A as belonging to that class of prisoners who do not deserve to be released unless they have completed 14 Years of actual incarceration.
Thus, the effect of section 433A is to restrict the exercise of power under sections 432 and 433 by the stipulation that the power will not be so exercised as would enable the two categories of convicts referred to in section 433A to freedom before they have completed 14 years of actual imprisonment.
This is the legislative policy which is clearly discernible from the plain language of section 433A of the Code.
Such prisoners constitute a single class and have, therefore, been subjected to the uniform requirement of suffering atleast 14 years of internment.
[874G H; 875A C] 3.
The expression `life imprisonment ' must be read in the context of section 45 IPC.
Read so, it would ordinarily mean imprisonment for the full or complete span of life.
Section 65, 116, 120 and 511 of the Indian Penal Code fix the term of imprisonment thereunder as a fraction of the maximum fixed for the principal offence.
It is for the purpose of working out this fraction that it became necessary to provide under section 57 that imprisonment for life shall be reckoned as equivalent to imprisonment for 20 years.
If such a provision had not been made it would have been impossible to work out the fraction of an indefinite term.
In order to work out the fraction of terms of punishment provided in the above sections it was imperative to lay down the equivalent term for life imprisonment.
[875G; 876C E] 862 Gopal Goads vs State of Maharashtra, ; ; affirmed.
4.1 Unless the sentence for life imprisonment is commuted or remitted by the appropriate authority under the provisions of the relevant law, a convict is bound in law to serve the entire life term in prison; the rules framed under the Prisons Act or life statute may enable such a convict to earn remissions but such remissions will not entitle him to release before he has completed 14 years of incarceration in view of section 433A of the Code unless of course power has been exercised under Article 72/161 of the Constitution.
Where a person has been sentenced to imprisonment for life the remissions earned by him during his internment in prison under the relevant remission rules have a limited scope and must be confined to the scope and ambit of the said rules and do not acquire significance until the sentence is remitted under section 432, in which case the remission would be subject to limitation of section 433A of the Code, or constitutional power has been exercised under Articles 72/161 of the Constitution.
[878D E] 4.2.
Articles 72 and 161 confer the clemency power of pardon, etc., on the President and the State Governors, respectively.
This constitutional power would override the statutory power contained in sections 432 and 433 and the limitation of section 433A of the Code as well as the power conferred by sections 54 and 55 IPC.
No doubt, this power has to be exercised by the President/Governor on the advice of his Council of Ministers.
[880A B] 4.3.
Though in Maru Ram 's case, this Court recommended the framing of guidelines for the exercise of power under Articles 72/161 of the Constitution of India, it had no binding effect on the Constitution Bench which decided Kehar Singh 's case.
Nor has this Court said anything in Kehar Singh 's case with regard to using the provisions of extent Remission Rules as guidelines for the exercise of clemency powers.
[881H; 882A] Maru Ram vs Union of India, ; ; Kehar Singh vs Union of India, ; ; Bhagirath vs Delhi Administration; , and Gopal Godse vs State of Maharashtra; , , affirmed.
It is true that Articles 72/161 make use of two expressions `remissions ' with regard to punishment and `remit ' in relation to sentence but it is not proper to express any opinion as to the content and amplitude of these two expressions in the abstract, in the absence of a fact situation.
[882B] 863 6.1 The hypothetical question whether it was permissible in law to grant conditional premature release to a life convict even before completion of 14 years of actual imprisonment, which release would tantamount to the prisoner serving time for the purpose of section 433A Cr.
P.C., need not be answered without being fully aware of the conditions imposed for release.
In each case, the question whether the grant of conditional premature release answers the test laid down by this Court in Maru Ram 's case, would depend on the nature of the conditions imposed and the circumstances in which the order is passed and is to be executed.
No general observation can be made.
[882C H] Maru Ram vs Union of India, ; ; referred to.
In the instant case, petitioner has not completed 14 years of actual incarceration and as such he cannot invoke sections 43 and 433 of the Code of Criminal Procedure.
His continued detention is consistent with section 433A of the Code and there is nothing on record to show that it is otherwise illegal and void.
The outcome of his clemency application under the Constitution is not put in issue in the present proceedings if it has been rejected, and if the same is pending despite the directive of the High Court it would be open to the petitioner to approach the High Court for the compliance of its order.
[883E F]
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ISDICTION: Civil Appeal No. 855 (n) of 1979.
From the Judgment and Order dated 22nd October, 1975 of the Bombay High Court in Special Civil Application No. 985 of 1969.
WITH Civil Appeal No. 2665 of 1991.
M. Chander Sekhar, Additional Solicitor General (NP), A. Subba Rao and C.V. Subba Rao for the Appellants.
R.K. Garg, R.P. Singh, Rakesh Khanna, P.C. Kapur and Raj Kumar Gupta for the Respondents.
The Judgment of the Court was delivered by K. JAGANNATHA SHETTY, J.
In the field of mines and minerals, the Government of India has two departments, (i) Exploration Wing of the Indian Bureau of Mines (IBM) and (ii) Geological Survey of India (GSI).
The GSI is responsible for geological mapping and exploratory drilling calculated to delineate mineralised zones in the country.
The IBM conducts detailed probing operations in selected blocks of mineralised areas.
The functions of these two departments were found to be overlapping.
The Government of India, therefore, decided to merge the Exploratory Wing of IBM with the GSI to eliminate overlapping works and rationalise the functions of the two departments.
To accomplish this purpose, different cadres of the Exploration Wing of IBM were merged with the GSI from different dates.
There is no dispute that the posts concerned in these cases also came to be merged with the GSI.
The question, however, for consideration is about the date of that merger: whether it was from 1 January, 1966 or from any subsequent date.
The Government of India contends that the merger took place on 4/6 February 1969 while the contesting respondents claim that it was with effect from 1 January 1966.
The dispute as to the date of merger has arisen because of the 896 following circumstances.
That between the period from 1 January 1966 to 4 February 1969, thirty nine persons in the cadre of Lower Division Clerks belonging to GSI were promoted as Upper Division Clerks against the vacancies that arose in the GSI.
They were apparently juniors to their counterparts in the IBM.
Being aggrieved by the said promotions, the Association of the Officers who originally belonged to the IBM preferred Special Civil Application No. 985/69 at Nagpur Bench of the Bombay of the Bombay High Court for setting aside the seniority list and for a direction to consider their cases of promotion with effect from 1 January 1966.
It was contended before the High Court that the merger of the two departments took place with effect from 1 January 1966 and not from 4 February 1969 and therefore, there cannot be two separate channels of promotions from 1 January 1966 one for the employees of the Exploration Wing of IBM and another for the employees of GSI.
The Government of India sought to justify the promotions exclusively given to the Officers of GSI between the period from 1 January 1966 to 4 February 1969 on the ground that the actual merger took place not on 1 January 1966 but on 4 February 1969.
the High Court, however, did not accept the submission of the Government of India.
The High Court summarised its conclusion thus: ``It is also to be noted that after 1.1.1966 the petitions did not get any promotion or were not considered for promotion by the Indian Bureau of Mines because they were treated under the administrative control of Geological Survey of India.
If the contention of the respondents is accepted then it will have to be held that for three years the cases of the petitioners cannot be considered by the Geological Survey of India and they were not considered by the Indian Bureau of Mines because they were not under the administrative control of Indian Bureau of Mines.
This will result into absurdity and, therefore, such a contention cannot be accepted.
We are, therefore, inclined to hold on consideration of the annexures produced along with this petition that the merger in the two wings has taken place on 1.1.1966.
Therefore, the seniority of Upper Division Clerks will have to be considered and made in this light after taking into consideration the fact that the petitioners merged and became the part of Geological Survey of India on 1.1.1966 and, therefore, for the purpose of counting their seniority, their past service rendered with the Indian Bureau of Mines will have to be treated as service rendered with the Geological Survey of India.
This 897 is the correct effect of the letter R 2 relied upon by the respondents.
We, therefore, direct the respondent Nos. 1, 2, & 4 to prepare a fresh seniority list in the light of the observations made above as if the merger has taken place on 1.1.1966 and after determining inter seniority give an appropriate relief to the petitioners. ' ' Civil Appeal No. 855(N) of 1979 has been preferred against the above decision of the Bombay High Court.
A Senior Technological Assitant (Geology) of the erstwhile IBM moved the Karnataka High Court for similar relief contending inter alia that his case ought to have been considered for promotion in the merged cadre with effect from 1 January 1966.
The Karnataka High Court also allowed his claim with a direction to consider him for promotion with effect from 1 January 196 in the merged cadre.
That decision was not implemented by the GSI, perhaps on the ground that the dispute as to the date of merger is already pending consideration before this Court.
In the contempt proceedings taken for disobedience of the judgment, the High Court however, did not accept that excuse put forward by the GSI and Government of India, but allowed six weeks time for compliance.
SLP(C) No. 4906 of 1991 has been preferred against that direction issued by the Karnataka High Court.
Since the issue raised in both the matters is common, we grant special leave in this case also.
The issue as to the date of merger of the Exploration Wing IBM with GSI turns on the contents of some of the letters written by the Government of India to the Director General of GSI.
Both the parties depend upon the same letters but with different contentions and constructions.
We will now draw attention to the letters one by one.
(i) ``LETTER DATED 10 DECEMBER 1965 GOVERNMENT OF INDIA MINISTRY OF STEEL AND MINES, DEPARTMENT OF MINES AND METALS.
To The Director, Indian Bureau of Mines, Nagpur.
(For the attention of Sh.
K.N. Murthy, Deputy Director, IBM) 898 Sub: Reorganisation of the IBM and GSI.
Sir, xxxxx xxxxx xxxxx After careful consideration of all these matters and in consultation with Director General, GSI and IBM, the Government have decided to transfer the following from the IBM to the administrative control of the GSI w.e.f.
1st January 1966: (i) All the posts and personnel in the Prospecting Drilling and Mining Divisions of the Bureau will be transferred to the GSI as detailed in Appendices I & II.
(ii) The workshop and Mineral Technology and Physical Analysis Laboratories will transferred to the GSI along with the posts in these laboratories as detailed in Appendix II.
(iii) The posts in the common cadres in the Administration and Accounting Divisions as have been on the basis of actual work load as detailed in Appendix II.
The personnel holding the posts will be allocated to the GSI and the IBM on the basis of options indicated by them, the principal guideline being exigency of public service.
(iv) The equipment, vehicles and stores, will be transferred by the IBM to the GSI according to the distribution made on the basis of equipment etc.
being required by the organisations as per statement in Appendix III. 2.
The headquarters of the Prospecting, Drilling and Mining Divisions, as also the workshop and the Mineral Technology and Physical Analysis Laboratories, which are being transferred from the Bureau to the GSI, will continue to be at Nagpur.
On transfer of these Divisions, these will work as separate entity of the GSI under the administrative control of the DG, GSI.
Headquarters of the Mineral Technology Laboratory at Delhi will continue to remain at Delhi.
899 3.
The service conditions of the personnel to be transferred to the GSI such as status, emoluments, seniority etc.
will be governed by the existing recruitment rules until further orders.
The IBM will be responsible for the administration of Mines (Control and conservation) collection of statistical data of minerals and Ore Dressing Laboratory as here to before.
With effect from 1.1.1966 the GSI will provide in their budget the expenditure connected with the work transferred to them from the IBM and put up a Supplementary demand.
Correspondingly IBM will surrender the L(equivalent) amount from its budget. ' ' (ii) LETTER DATED 28 JUNE 1967 GOVERNMENT OF INDIA MINISTRY OF STEEL MINES & METALS, DEPARTMENT OF MINES AND METALS.
To The Director General, Geological Survey of India, 27, Chowringhee Road, Calcutta 13 Sub: Merger of Class I and II posts in the Drilling Divisions of the Geological Survey of India (Proper and Exploration Wing) and combined seniority lists.
Sir, In partial modification of the Ministry of Steel and Mines (Department of Mines & Metals) letter No. 20/4/65 MIII dated 10 December 1965, I am convey sanction of the Government to merge class I and II posts in the Drilling Divisions of the Exploration Wing and the Geological Survey of India (Proper) with immediate effect.
Heretofore, the service conditions of the class I and II officers of Drilling category of the merged Drilling Division would be governed in accordance with the revised recruitment rules which are under issue separately.
900 2.
In drawing up the combined seniority lists of the officers in different grades in the amalgamated cadres of Class I and II posts para 3 of the annexure to the Ministry of Home Affairs O.M. No. 9/11/55 RPS dt.
22.12.1958 according to which permanent officers of the grade are senior to temporary officiating officers of that grade, is not applicable.
In such cases, seniority is determined with reference to the date of continuous appointment to that grade on a regular basis in accordance with the other principles prescribed in the Ministry of Home Affairs O.M. No. dt.
23.12.1959 referred to above lists so drawn may please be sent for approval of Government.
Yours faithfully, Sd/ (A. Sethumadhavan) Under Secretary to the Govt.
of India (iii) LETTER DATED 4/6 FEBRUARY GOVERNMENT OF INDIA MINISTRY OF STEEL, MINES AND METALS (DEPARTMENT OF MINES AND METALS) No. 1/16/68 MIII To The Director General, Geological Survey of India, Calcutta.
Sub: Merger of Posts/scales of pay in the GSI (Proper) and the Exploration Wing transferred from the Indian Bureau of Mines to the Geological Survey of India.
Sir, I am directed to invite your attention to this Ministry 's letter No. 3/17/67 MIII, dated 28.6.1967 and to say that the President is pleaded to sanction merger of the posts and to prescribe the scales of pay for the merged cadres as shown in the enclosed statement with immediate effect.
Orders regarding merger of the remaining posts will be issued separately.
901 2.
The inter seniority of the incumbents in the merged cadres will governed in accordance with the principles laid down in para 2 of the Ministry 's letter referred to above.
The merger/revision of the scales of pay does not involve any change in the nature and duties of the respective posts.
The fixation of pay in the revised scales of pay may be done under FR 23, read with audit instruction 1 under FR 22. 4.
The officers concerned should be asked to exercise their option in writing so as to reach the authority concerned within four months of the issue of this letter, provided that: (i) in the case of a Government servant who is on that date out of India on leave, deputation or foreign service or active service, the said option shall be exercised in writing so as to reach the prescribed authority within four months of the date of his taking over charge of his post in the GSI and (ii) Where a Government servant is under suspension the option may be exercised by him within four months of the date of his return to duty, if that date is later than the date prescribed here.
In case the individual concerned fails to exercise the option within the time limit, he will be treated to have accepted the new scale of pay. ' ' In between these correspondence, the Government of India wrote one more letter to the Director General of GSI.
It was dated 29 November, 1966 which will be referred later.
Mr. Garg and Mr. Vaidyanathan, counsel for the contesting respondents rely on the first letter dated 10 December 1965 and also on the subsequent letter dated 29 November 1966 in support of the decision of the High Courts that the merger took place on 1 January 1966.
Mr. Subba Rao, counsel for the Union of India wants to take assistance from the terms of the letter dated 1/6 February 1969 in support of the counter plea.
It may be significant to note that the letter dated 10 December 1965 does not indicate the date of merger.
It is 902 stated therein that after consultation with the Director General of GSI and IBM, the Government has decided to transfer to the administrative control of GSI with effect from 1 January 1966 the posts and personnel in the prospecting drilling and mining divisions of the Bureau with the workshop, mineral technology and physical analysis laboratories.
The letter further states that the posts in the common cadres in the administration and accounting divisions as have been divided on the basis of actual work load (as detailed in Appendix II) with the personnel holding the post will be allocated to GSI and IBM on the basis of options indicated by them.
The equipment, vehicles and stores will be transferred by IBM to GSI according to the distribution made as per requirements of the two organisations.
The most important statements in the letter are these: (i) on transfer of the divisions they will however work as separate entity of the GSI under the administrative control of the Director General, GSI and (ii) the service conditions of the personnel to be transferred to GSI such status, emoluments, seniority etc.
will be governed by the existing recruitment rules until further orders.
It is further directed in the letter that with effect from January 1966, the GSI will provide in their budget the expenditure connected with the work transferred to them from the IBM and put up a supplementary demand.
Correspondingly, IBM will surrender the (equivalent) amount from the budget.
These statements in the letter make it abundantly clear that it was only administrative control of the relevant Wings of IBM that were transferred to GSI with effect from 1 January 1966.
The letter does not refer to the decision of merger of the two departments.
The decision taken on the merger of the posts as rightly submitted by Mr. Subba Rao was communicated by subsequent letters dated 28 June 1967 and 4/6 February 1969.
By letter dated 28 June 1967 the Government communicated the sanction of merger of class I & II posts in the drilling divisions of Exploration Wing of IBM and GSI (Proper) with immediate effect.
The letter also contains certain instructions to department about service conditions and seniority of persons in the amalgamated cadres of class I & II posts.
The decision with regard to merger in respect of other categories of posts is contained in the letter dated 4/6 February 1969.
Thereunder it is expressly stated that ``the President is pleased to sanction merger of the posts and to prescribe the scales of pay for the merged cadres as shown in the enclosed statement accompanying the letter include the posts with which we are concerned in these cases and there is no dispute on this matter.
903 The letter dated 4/6 February 1969 further provides that the inter se seniority of the incumbents in the merged cadres will be governed in accordance with the principles laid down in the earlier letter dated 28 June 1967.
The merger/revision of the scales of pay does not involve any change in the nature of duties of the respective posts.
The officers concerned in the merged cadre will be given options in writing for opting the new scales of pay in the merged cadre.
In case an individual concerned fails to exercise the option within the time limit, he will be treated to have accepted the new scale of pay.
It will be apparent from the terms of the letter dated 4/6 February 1969 that the posts referred to in the letter were merged with GSI with effect from 4 February 1966, as contended for the respondents, the letter dated 4/6 February 1969 would be unnecessary and uncalled for.
Counsel for the respondents however, placed strong reliance in support of the counter point on the letter dated 29 November 1966 which reads as follows: GOVERNMENT OF INDIA No. 8/39/66 MIII NEW DELHI 29TH NOV.
1966 To The Director General, Geological Survey of India, 27, Chowringhee Lane, Calcutta 13 Sub: Absorption of Shri B.K. Chatterjee, Stenographer (Selection Grade) of the Indian Bureau of Mines, in Geological Survey of India (Exploration Wing).
Sir, I am directed to refer to your letter No. 832/8 (N)/115/65/15 dated 4.11.1966 on the subject mentioned and to say that transfer in question cannot be termed as transfer from one department to the other department, since it place on a result of the reorganisation of the Indian Bureau of Mines and transfer was effected on the recommenda 904 tions of the Merger Committee when there was a vacancy in the GSI.
The transfer was made in the public interest and it is considered not necessary to approve the transfer in question in relaxation of the recruitment Rules as proposed.
The transfer of Shri Chatterjee may be treated as in order.
Further, the inter seniority of Stenographer and other categories of posts transferred from the Bureau to the Geological Survey of India as a result of the reorganisation of the former may be decided taking into account the fact that such transfers have been made in the public interest and such cases may be examined on the basis as if the individual concerned were originally appointed in the Geological Survey of India.
Yours faithfully, Sd/ (A. Sethumadhavan) Under Secy.
to the Govt.
of India We do not find any support from this letter to the submission of the respondents.
The letter concerns with the transfer of one Stenographer called Shri B.K. Chatterjee from IBM to the GSI.
The transfer was made in the public interest.
Consequently.
it was held that the person transferred was entitled to seniority as if he were originally appointed in the GSI.
That is a normal incident of transfer from one department to another and there is nothing strange in it.
But it may be noted that the respondents were not transferred from IBM to GSI with effect from 1 January 1966.
They were neither transferred to GSI, nor their posts were transferred to GSI with effect from 1 January 1966.
They were only brought under the administrative control of the Director General of GSI.
The result is that the posts and personnel remained in their own department and they would continue to be governed by their own service conditions.
This would indeed be the consequence of one department being brought under the control or supervision of another departmental head.
This point has also been made clear in the letter dated 1 January 1966 in which it has been provided ``that the service conditions of the personnel to be transferred to the GSI such as status, emoluments, seniority etc. will be governed by the existing recruitment rules until further orders ' '.
In other words, the service conditions which the respondents were entitled to, in their parent department would continue to be available to them until further orders.
905 The Bombay High Court has however, observed that it will lead to absurdity if the contesting respondents are not considered for promotion in the GSI from 1 January 1966 since they could not get any promotion in or were not considered for promotion by IBM because they were treated under administrative control of GSI.
It is difficult to accept this view.
This conclusion is based more on equitable consideration than on law.
It is the result of failure to focus on the difference between the terms of letters dated 1 January 1966 and 4/6 February 1969.
It may be emphasised that non consideration of the contesting respondents for promotion in the IBM during the period from 1966 to 1969 even assuming it to be true is however no ground for them to seek promotion in GSI.
They must seek their promotion during the interregnum only in their parent department.
Reference is made to the combined provisional seniority list of persons in class III cadres of IBM and GSI prepared as on 1 December 1968.
It is submitted that if the merger took place with effect from 4 February 1969 there were no necessity for GSI to prepare the provisional seniority list of officers of the combined cadre as on 1 December 1968.
Reference is also made to the ``Introduction to the compilation Vol.
100 Part I, Records of the GSI ' ', in which it is mentioned that on 1 January 1966, the Mining Divisions of the IBM have been merged with the GSI.
The said provisional seniority list and the statement of introduction to the compilation, in our opinion, are no evidence of the date of merger and indeed, they do not reflect the decision of the Government of India which we have earlier discussed.
For the foregoing reasons, we accept the appeals and set aside the impugned judgment and order.
In the circumstances of the case, however, there should not be any order as to costs.
V.P.R. Appeals allowed.
| IN-Abs | In Civil Appeal No. 855(N) of 1979 and Civil Appeal No. 2665 of 1991 the issue raised was common and relating to the date of merger of the two departments of the Government of India, in the field of mines and minerals, namely (i) Exploration Wing of the Indian Bureau of Mines (IBM) and (ii) Geological Survey of India (GSI).
Between 1.1.1966 to 4.2.1969 thirty nine Lower Division Clerks belonging to GSI were promoted as Upper Division Clerks against the vacancies that arose in the GSI.
They were juniors to their counterparts in the IBM.
Being aggrieved by the said promotions, the respondents who originally belonged to the IBM, preferred Special Civil Application in the Bombay High Court for setting aside the seniority list and for a direction to consider their cases of promotion with effect from 1 January, 1966 and not from 4 February 1969 and therefore, there cannot be two separate channels of promotions from 1 January 1966 one from the employees of the Exploration Wing of IBM and another for the employees of GSI.
The appellants contended that the Officers of GSI were promoted on the ground that the actual merger took place not on 1 January 1966 but on 4 February 1969.
The High Court allowed the petition against which Civil Appeal No. 855(N) of 1979 has been preferred.
A Senior Technological Assistant (Geology) of the erstwhile IBM moved the Karnataka High Court for similar relief contending inter 894 alia that this case ought to have been considered for promotion in the merger cadre with effect from 1 January 1966.
The Karnataka High Court also allowed his claim with a direction to consider him for promotion with effect from 1 January 1966 in the merged cadre.
That decision was not implemented by the GSI.
In the contempt proceedings taken for disobedience of the judgment, the High Court allowed six weeks time for compliance, against which, SLP(C) No. 4906 of 1991 has been preferred.
Respondents relying on the letters dated 10 December 1965 and 29 November 1966 contended in support of the decision of the High Courts that the merger took place on 1 January 1966, whereas the appellants took assistance from terms of the letter dated 4/6 February 1969 in support of the counter plea.
Allowing the appeals, this Court, HELD: 1.
The statements in the letter make it abundantly clear that it was only administrative control of the relevant wings of IBM that were transfered to GSI with effect from 1 January 1966.
The letter does not refer to the decision of merger of the two departments.
[902E] 2.
The decision taken on the merger of the posts was communicated by subsequent letters dated 28 June 1967 and 4/6 February 1969.
By letter dated 28th June 1967 the Government communicated the sanction of merger of class I IBM and GSI (Proper) with immediate effect.
The letter also contains certain instructions to department about service conditions and seniority of persons in the amalgamated cadres of class I & II posts.
The decision with regard to merger in respect of other categories of posts which include are concerned in these cases is contained in the letter dated 4/6 February 1969.
[902F G] 3.
The letter dated 4/6 February 1969 further provides the inter se seniority of the incumbent in the merged cadres will be governed in accordance with the principles laid down in the earlier letter dated 28th June 1967.
The merger/revision of the scales of pay does not involve any change in the nature of duties of the respective posts.
The Officers concerned in the merged cadre will be given options in writing for opting the new scales of pay in the merged.
In case an individual concerned fails to exercise the option within the time limit, he will be treated to have accepted the new scale of pay.
It will be apparent from the terms of the letter dated 4/6 February 1969 that the posts 895 referred to in the letter were merged with GSI with effect from 4 February 1969 would be unnecessary and uncalled for.
[903A C] 4.
Provisional seniority list and the statement of introduction to the compilation are no evidence of the date of merger do not reflect the decision of the Govt.
of India.
|
t Petition (Civil) No. 13704 of 1983.
(Under Article 32 of the Constitution of India) P.N. Lekhi and M.K. Garg for the Petitioner.
Prithvi Raj, P.P. Rao, Govind Mukhoty, Satish Chander, Raju Ramachandran, Mrs. section Dikshit, A.K. Sangal, P.K. Chakraborty.
Ms. Sadhya Goswami and Y.C. Maheshwari for the Respondents.
K.R. Gupta, Smt.
Nanita Sharma, R.C. Gubrele, Vivek Sharma and O.P. Sharma for the Intervener.
The Judgment of the Court was delivered by KULDIP SINGH, J.
Ram Sewak Prasad, the petitioner before us, was appointed as Excise Sub Inspector, in the State of Uttar Pradesh in February, 1964 and was promoted to the post of Excise Inspector on ad hoc basis on February 24, 1972.
He was confirmed as Excise Sub Inspector by an order dated December 2, 1972 with effect from April 1, 1967.
Though promoted on ad hoc basis the petitioner 887 has continuously been working as Excise Inspector since February 24, 1972.
Raghubir Singh and Ram Dhan, respondents are direct recruits to the post of Excise Inspector.
The joined as such on March 29, 1972 and May 14, 1972 respectively.
They were promoted to the post of Excise Superintendent by an order dated September 29, 1983.
It is not disputed that the petitioner was not considered for promotion alongwith the respondents or at any time thereafter.
Even his name was not shown in the seniority list of Excise Inspectors circulated from time to time.
The respondents, including the State Government, have taken the stand that the petitioner 's promotion to the post of Excise Inspector was against the rules, he continues to be an ad hoc appointee and is not a member of the Excise Inspectors Service constituted under the rules.
For that reason he is neither been shown in the seniority list of Excise Inspectors nor considered for promotion to the post of Excise Superintendent.
It is necessary to examine the relevant statutory rules regulating recruitment and conditions of service of the Excise Inspectors.
Rule 3(ix) and 5 of the Uttar Pradesh Subordinate Excise Service Rules, 1967 (hereinafter called `1967 rules ') are as under: "3(ix).
"Member of the service" means a person appointed in a substantive capacity under the provisions of these rules, or of rules in force previous to the enforcement of these rules to a post in the cadre of the service" . 5.
Sources of recruitment Recruitment to the service shall be made (a) by direct recruitment of candidates, on the result of a combined competitive examinations conducted by the Commission, who having been selected in the prescribed manner for undergoing practical training have completed the course of training and passed the departmental examination prescribed in rule 23: Provided that no candidate shall be allowed to avail of more than three chances for appearing at the competitive examination; (b) by promotion of permanent clerks of the office at 888 the Headquarters of the Excise Commissioner and other regional and Subordinate Excise Offices of Assistant Excise Commissioners and Superintendents of Excise in Uttar Pradesh; and (c) by promotion of permanent Tari Supervisors The 1967 rules were superseded by the Uttar Pradesh Subordinate Excise Service Rules, 1983 (hereinafter called 1983 rules) which came into force on March 24, 1983.
Rule 3(g), 3(j), 5 and 21(1) of the 1983 rules are reproduced hereinafter: "3(g).
"Member of Service" means a person substantively appointed under or the rules or orders in force prior to the commencement of these rules to a post in the cadre of the service". "3(j).
"Substantive appointment" means an appointment, not being an ad hoc appointment, on a post in the cadre of the service, made after selection in accordance with the rules and, if there are no rules, in accordance with the procedure prescribed for the time being by executive instructions, issued by the Government.
" Sources of Recruitment.
Recruitment to the various categories of posts in this service shall be made from the following sources: (A) EXCISE INSPECTOR (1) 90% by direct recruitment on the result of a combined competitive examination conducted by the Commission.
(2) 10% by promotion from amongst the permanent sub Excise Inspectors.
"Rule 21(1) Except as hereinafter provided, the seniority of persons in any category of post shall be determined from the date of the order of substantive appointment and if two or more persons are appointed together, by the order in which their names are arranged in the appointed order; 889 Provided that if the appointment order specifies a particular back date with the effect from which a person is substantively appointed, that date, will be deemed to be the date of order of substantive appointment and, in other case it will mean the date of issue of the order;" Mr. Satish Chandra, learned senior advocate, appearing for some of the respondents who are direct recruits of 1982/83 has contended that the 1967 rules were holding the field when the petitioner was promoted as Excise Inspector on ad hoc basis.
According to him only clerks and Tari Supervisors could be considered for promotion to the post of Excise Inspector under rule 5 of the 1967 rules and the Excise Sub Inspectors were not eligible.
The petitioner 's promotion being in violation of the 1967 rules, he was not a member of the service and as such was rightly not shown in the seniority list of Excise Inspectors.
He, however, accepts the position that the petitioner can be considered for promotion to the post of Excise Inspector under the 1983 rules and would become member of the service from the date of promotion under the said rules.
Mr. Satish Chandra finally contended that the appointment of the petitioner from 1972 to 1983 being violative of 1967 rules, the benefit of the said service cannot be given to the petitioner towards seniority in the cadre of Excise Inspectors.
In support of his arguments Mr. Satish Chandra relied upon the judgments of this Court in Masood Akhtar Khan and Others vs State of Madhya Pradesh and Others, and Direct recruits class II Engineering Officers Association vs State of Maharashtra and Others, [1990] 2S.C.C. 715.
Mr. Govind Mukhoty, Mr. P.P. Rao and Mr. O.P. Sharma, learned senior advocates appearing for various respondents reiterated, with different flavour, the arguments advanced by Mr. Satish Chandra.
They further cited P. Mahendran and Ors etc.
vs State of Karnataka and Ors. etc.
, ; State of Punjab vs Jagdip Singh and Ors., ; ; Krishena Kumar and Ors.
vs Union of India and Ors.
, ; and A.K. Bhatnagar and Ors.
vs Union of India and Ors.
, ; Mr. Prithviraj, learned senior advocate appearing for the State of Uttar Pradesh stated that it may be possible to absorb the petitioner in the cadre of Excise Inspectors from the date of enforcement of the 1983 rules but the benefit of service rendered by him as Excise Inspector prior to that date cannot be given to him.
Mr. P.N. Lekhi, learned senior advocate appearing for the petitioner vehemently argued that the petitioner was promoted in `public interest ' as Excise Inspector in the year 1972 and since then he 890 has been working as such continuously.
He is being paid the same salary for doing the same work as is being done by the directly recruited Excise Inspectors.
There can no justifiable reason to treat the petitioner as an ad hoc Excise Inspector even after working as such for almost two decades.
According to him the 1967 rules which confined the channel of promotion to Tari Inspectors and Clerks were wholly arbitrary and as such violative of Articles 14 and 16 of the Constitution of India.
The Excise Sub Inspectors are at a lower rung in the same hierarchy of service to which Excise Inspectors belong.
The Sub Inspectors perform similar duties of less responsibility.
Mr. Lekhi further contended that providing avenue of promotion to Tari Inspectors and Clerks who had no similarity or service0link with the cadre of Excise Inspectors and depriving the same to the Excise Sub Inspectors render the 1967 rules arbitrary and discriminatory.
He relied upon Baleshwar Dass and Ors.
vs State of U.P. and Ors., [1981] 1 SCR 449; Narender Chadha and Ors.
vs Union of India and Ors.
, ; ; Rajendera Parsad Dhasmane vs Union of India and Ors., ; and Kumari Shrilekha Vidyarthi etc.
vs State of U.P. and Ors., Mr. Lekhi finally submitted that the petitioner is, in any case, entitled to be promoted substantively to the cadre of Excise Inspectors under the 1983 rules and he is entitled to fixation of seniority by counting his entire service as Excisa Inspector from 1972 onwards.
It is not necessary to go into the judgments cited by the learned counsel for the parties.
The judgments are on the peculiar facts of these cases and do not render much assistance to resolve the controversy before us.
The 1967 rules provided recruitment to the cadre of Excise Inspectors by way of direct recruitment and by promotion.
Recruitment by promotion was only confined to permanent clerks in the office of Excise Commissioner and Tari Supervisors.
The Excise Sub Inspectors were not eligible.
On the plain interpretation of 1967 rules Mr. Satish Chandra is justified to contend that the petitioner was not eligible for promotion to the post of Excise Inspector and as such he could not be member of the Uttar Pradesh Subordinate Excise Service as constituted under the 1967 rules.
On the other hand there is plausibility in the argument of Mr. P.N. Lekhi that rule 5 of the 1967 rules which denies avenue of promotion to the Excise Sub Inspectors is arbitrary and discriminatory.
When the 1967 rules were enforced on May 24, 1967 there was in existence a permanent cadre of Excise Sub Inspectors.
The nature of duties of both the cadres 891 were similar.
The Excise Inspectors, on molasses duty of the ranges, used to supervise the work of Excise Sub Inspectors under them.
The Excise Sub Inspectors were thus natural contenders for the post of Inspectors.
There was no justification whatsoever with the framers of the 1967 rules to have kept the Excise Sub Inspectors out of the channel of promotion to the post of Excise Inspectors.
Prima facie there is no escape from the conclusion that the Excise Sub Inspectors were dealt with in an arbitrary manner by the framers of 1967 rules.
However, the view we propose to take on the interpretation of 1983 rules it is not necessary for us to deal with the respective arguments of the learned counsel for the parties regarding the 1967 rules.
Rule 5 of the 1983 rules provides recruitment to the cadre of Excise Inspectors from two sources, 90% by direct recruitment and 10% by promotion from amongst the permanent Excise Sub Inspectors.
It is not disputed that under the 1983 rules the petitioner is eligible to be promoted and appointed as Excise Inspector.
In the writ petition the petitioner has specifically pleaded that the service record of the petitioner is unblemished and he is holding the post of Excise Inspector within the 10% promotion quota provided for the permanent Excise Sub Inspectors.
The State Government in its counter has not denied these averments.
The 1983 rules came into force on March 24, 1983.
There is nothing on the record to show as to why the petitioner was not considered for promotion under the 1983 rules till today.
Inaction on the part of the State Government is wholly unjustified.
The petitioner has been made to suffer for no fault of his.
He has been serving the State Government as Excise Inspector since February 24, 1972 satisfactorily.
Least the State Government could do was to consider the petitioner under the 1983 rules.
Mr. Prithviraj, learned counsel for the State of Uttar Pradesh has however fairly stated that the State Government is willing to promote the petitioner to the cadre of Excise Inspectors under the 1983 rules effect from the date of enforcement of the said rules.
Rule 21(1) of the 1983 rules provides that the seniority of a person in any category of post shall be determined from the date of the order of substantive appointment.
First proviso provides that if the appointment order specifies a particular back date with effect from which a person is substantively appointed then the said back date shall be deemed to be the date of order of substantive appointment.
It is thus obvious that rule 21(1) of the 1983 rules specifically permits substantive appointment to the cadre of Excise Inspectors with back date.
The framers of the 1983 rules were conscious that the cadre of 892 Excise Sub Inspectors was in existence from 1964 onwards and some of them were promoted to the post of Excise Inspectors much earlier to the enforcement of the 1983 rules.
In all probability the provision of back date appointment was made in the 1983 rules to do justice to persons like the petitioner.
The petitioner is eligible under the rules to be appointed as Excise Inspector by way of promotion.
It is not disputed that the petitioner was appointed as Excise Inspector on February 24, 1972 and he has been actually working in the said post continuously from that date and has been drawing the salary of the post of Excise Inspector.
This is a fit case where the petitioner should be appointed as Excise Inspector under the 1983 rules by giving him back date appointment with effect from February 24, 1972.
We, therefore, hold that the petitioner shall be deemed to be appointed by way of promotion as substantive Excise Inspector under the 1983 rules with effect from February 24, 1972.
The petitioner shall be entitled to the benefit of his entire period of service as Excise Inspector from February 24, 1972 towards fixation of his seniority in the cadre of Excise Inspector.
We further direct that the petitioner shall be considered for promotion to the post of Excise Superintendent from a date earlier than the date when respondents Ram Dhan and Raghubir Singh were promoted to the said post.
The petitioner shall also be entitled to be considered to the post of Assistant Excise Commissioner in accordance with the rules from a date earlier than the date when any of his juniors were promoted to the said post.
We make it clear that none of the respondents who have already been promoted to the higher rank of Excise Superintendents or Assistant Excise Commissioners be reverted to accommodate the petitioner or any other person similarly situated.
The State Government shall create additional posts in the cadre of Excise Superintendents and Assistant Excise Commissioners to accommodate the petitioner and other similar persons, if necessary.
The writ petition is allowed with costs in the above terms.
We quantify the costs as Rs.10,000 to be paid by the State of Uttar Pradesh.
Y.Lal.
Petition allowed.
| IN-Abs | The petitioner was appointed as Excise Sub Inspector in February 1964 in the State of U.P. and was later promoted as Excise Inspector on ad hoc basis on February 24, 1972.
He was confirmed as Excise Sub Inspector w.e.f. April 1, 1967.
Though promoted on ad hoc basis, the petitioner has continuously been working as Excise Inspector since February 24, 1972.
Raghubir Singh and Ram Dhan, respondents are direct recruits to the post of Excise Inspector and they had joined the cadre later in point of time than the petitioner i.e. after 24.2.1972.
They were promoted to the post of Excise Superintendent on 29.9.1983 and the petitioner was ignored.
Being aggrieved the petitioner has filed this petition under Article 32 of the Constitution.
According to the State and other respondents, the petitioner 's promotion to the post of Excise Inspector being on ad hoc basis was against the 1967 rules, he continues to be an ad hoc appointed and as such is not a member of the Excise Inspectors service constituted under the rules.
His name has not been shown in the seniority list of Excise Inspectors.
According to them his case has rightly not been considered for further promotion.
On the other hand, it is contended on behalf of the petitioner that the 1967 Rules in as much as they confine the channel of promotion to Tari Inspectors and Clerks were wholly arbitrary and as such violative of Articles 14 and 16 of the Constitution.
It is submitted on his behalf that the petitioner is, in any case, entitled to be promoted substantively to the cadre of excise Inspectors under 1983 rules and he is also entitled to fixation of seniority by counting his entire service as Excise Inspector from 1972 onwards.
Respondents concede that the petitioner can be appointed under 1983 rules, but contend that he is not entitled to the benefit of past service for purposes of seniority.
885 Allowing the writ petition this Court HELD: When the 1967 rules were enforced on May 24, 1967 there was in existence a permanent cadre of Excise Sub Inspectors.
The nature of duties of both the cadres were similar.
The Excise Inspectors, on molasses duty of the ranges, used to supervise the work of excise Sub Inspectors under them.
The Excise Sub Inspectors were thus natural contenders for the post of Inspectors.
There was no justification whatsoever with the framers of the 1967 rules to have kept the Excise Sub Inspectors out of the channel of promotion to the post of Excise Inspectors.
Prime facie there is no escape from the conclusion that the Excise Sub Inspectors were dealt with in an arbitrary manner by the framers of 1967 rules.
[890H 891B] It is not disputed that under the 1983 rules, the petitioner is eligible to be promoted and appointed as Excise Inspector.
[891C D] The 1983 rules came into force on March 24, 1983.
There is nothing on the record to show as to why the petitioner was not considered for promotion under the 1983 rules till today.
Inaction on the part of the State Government is wholly unjustified.
The petitioner has been made to suffer for no fault of his.
He has been serving the State Government as Excise Inspector since February 24, 1972 satisfactorily.
[891E] Rule 21(i) of the 1983 rules specifically permits substantive appointment to the cadre of Excise Inspectors with back date.
In all probability the provision of back date appointment was made in the 1983 rules to do justice to persons like the petitioner.
The petitioner is eligible under the rules to be appointed as Excise Inspector by way of promotion.
Accordingly the Court directed that the petitioner shall be deemed to be appointed by way of promotion as substantive Excise Inspector under the 1983 rules with effect from February 24, 1972.
The petitioner shall be entitled to the benefit of his entire period of service as Excise Inspector from February 24, 1972 towards fixation of his seniority in the cadre of Excise Inspector.
The petitioner shall be considered for promotion to the post of Excise Superintendent from a date earlier than the date when respondents Ram Dhan and Raghubir Singh were promoted to the said post.
The petitioner shall also be entitled to be considered to the post of Assistant Excise Commissioner in accordance with the rules from a date earlier than the date when any of his juniors were promoted to the said post.
[891G, 892B E] None of the respondents who have already been promoted to the 886 higher rank of Excise Superintendents or Assistant Excise Commissioners be reverted to accommodate the petitioner or any other person similarly situated.
The State Government shall create additional posts in the cadre of Excise Superintendents and Assistant Excise Commissioners to accommodate the petitioner and other similar persons, if necessary.
[892F] Masood Akhtar Khan & Ors.
vs State of Madhya Pradesh, ; Direct recruits Class II Engineering Officers Association vs State of Maharashtra & Ors., ; ; P. Mahendran & Ors, etc.
vs State of Karnataka Singh & Ors.
, ; ; Krishena Kumar & Ors.
vs Union of India & Ors.
, ; ; A.K. Bhatnagar & Ors.
vs Union of India & Ors.
, ; ; Baleshwar Dass & Ors. etc.
vs State of U.P. & Ors.
, [1981] 1 S.C.C. 449; Narender Chadha & Ors.
vs Union of India & Ors.
, ; and Kumari Shrilekha Vidyarthi etc.
vs State of U.P. & Ors.
, , referred to.
|
Appeals Nos. 254 to 256 of 1958.
Appeals by special leave from the judgment and orders dated May 14, 1956, and June 15, 1956, of the Bombay High Court in Special Civil Applications Nos.
1270, 1373 and 1374 of 1956.
ORIGINAL JURISDICTION: Petitions No& IS and 66 of 1957.
Petitions under Article 32 of the Constitution of India for the enforcement of fundamental rights.
A. V. Viswanatha Sastri and section section Shukla, for the appellants and the petitioners.
C. K. Daphtary, Solicitor General of India, H. J. Umrigar and B. H. Dhebar, for the respondents.
December 16.
The Judgment of the Court was delivered by SUBBA RAO, J.
These are three appeals by Special Leave from the judgment of the High Court of Judicature at Bombay dismissing the petitions filed by the appellants for Writs in the nature of Prohibition restraining the respondents from realising from the appellants land revenue in respect of their estates at an enhanced rate for the year 1955 56.
The petitioners in the two petitions also asked for similar relief against the respondents.
The appeals as well as the Writ Petitions were heard together, as they raised a common question of law.
The material facts in Civil Appeal No. 254 of 1958 may be briefly stated: The appellant was a taluqdar owning several taluqdari villages situate in the Dholka Taluka of Ahmedabad District.
In the year 1922 23 there was a revision settlement of land revenue of the lands situate in the said taluka including the said taluqdari villages.
Under that settlement the aggregate of the land revenue payable in respect of the lands comprised in the said taluqdari villages was fixed in a sum of Rs. 62,627 2 6.
In the year 1925 26, in exercise of the powers conferred under 913 s.22 of the Gujarat Taluqdars Act, 1888 (Bom.
VI of 1888) (hereinafter referred to as the Taluqdars ' Act), the Government of Bombay ascertained and declared that a jama of Rs. 32,643 3 0 was payable in respect of the said taluqdari villages and the said declaration was to remain in force for a period of thirty years from the year 1925 26.
In the year 1949, the Bombay Legislature passed the Bombay Taluqdari Abolition Act, 1949, hereinafter referred to as the Abolition Act, and it came into force on or about August 15, 1950.
By section 3 of the Abolition Act, taluqdari tenure was abolished and all the incidents of the said tenure attaching to any land comprised in the taluqdari estate were extinguished.
Under the Abolition Act, the appellant became an occupant of the lands.
After the expiry of the thirty year period, the talatis of the respective villages called upon the appellant to pay the full land revenue assessment in respect of the lands comprised in the said villages.
The appellant contending that he was only liable to pay jama declared to be payable by him by the Government in 1925 26 filed a Writ Petition in the High Court of Bombay for the aforesaid relief.
The appellant in Civil Appeal No. 255 of 1958 was a; taluqdar owning several taluqdari villages situate in Dholka and Dhandhulka Talukas of Ahmedabad District.
The facts in this case are similar to those given in Civil Appeal No. 254 of 1958 except in regard to the fact that the jama ascertained and declared to be payable by the appellant in this appeal by the Government in 1925 26 was about Rs. 5,734 as against the settlement amount of Rs. 14,452 11 0.
The appellant in Civil Appeal No. 256 of 1958 was a taluqdar owning several taluqdari villages situate in Dholka Taluka in Ahmedabad District.
The facts in this appeal also are similar to those in the other two except in regard to the fact that in this case the Government ascertained and declared the jama payable by the appellant to be Rs. 21,877 as against the settlement amount of Rs. 44,551.
115 914 Writ Petition No. 66 of 1957 filed by the appellant in C. A. No. 254 of 1958 relates to the demand of enhanced revenue in respect of his Sanad estate.
The facts in this petition are similar to those in the appeals except that the Government ascertained and declared the jama payable by him at Rs. 20,886 as against the settlement amount of Rs. 48,247 13 0.
The Writ Petition relates to the demand made for the year 1956 57.
Writ Petition No. 18 of 1957 was filed by Thakur Vikramsinhji Manharsinhji of Gumph Estate, Ahmedabad District, Bombay State, who was a taluqdar of Gumph Estate in Ahmedabad District comprising of seven taluqdari villages.
The facts in this petition also are similar to those in the appeals.
In, this case the jama ascertained and declared was Rs. 16,499 4 0 whereas the assessment was fixed at Rs. 30,223 12 0.
This Writ Petition also relates to the demand made for the year 1955 56.
The appellants in the appeals and the petitioners in the Writ Petitions aforesaid will be, for the sake of convenience, described hereafter as the appellants.
Mr. A. V. Viswanatha Sastri, the learned Counsel for the appellants, contends that the jama ascertained and declared to be due from the appellants for a period of thirty years was fixed at the revenue settlement, that by reason of section 117R of the Bombay Land Revenue Code, 1879 (hereinafter referred to as the Code), they were liable to pay only the said assessment till there was re settlement and that therefore the respondents have no right to make a demand for an amount higher than that declared to be due from them in 1925 26.
The learned Solicitor General counters this argument by contending that under the Taluqdars ' Act, there was an essential distinction between revenue settlement and the ascertainment and declaration of the jama; that after the Abolition Act, the amount of jama was payable only till the expiry of the thirty year period and that thereafter the appellants who bad become mere occupants would be liable to pay the entire land revenue assessment already fixed in respect of those lands.
The question 915 is which of the two contentions should prevail having regard to the relevant provisions of the Taluqdars ' Act, the Abolition Act and the Code.
It will be convenient to read the relevant provisions from the two Acts.
GUJARAT TALUQDARS ACT, 1888: " 2.
(1) In this Act, unless there be something repugnant in the subject or context, (a) . . . . . . . . . . (b) . . . . . . . . . . (c) " jama " means land revenue payable by a taluqdar to the Provincial Government.
It shall be lawful for the Provincial Government whenever it may seem expedient, to direct a revenue survey or a revised revenue survey of any taluqdari estate, under the provisions of the Bombay Land Revenue Code, 1879, applicable to such survey.
The settlement register prepared by the Survey Officer under section 108 of the said Code on the occasion of making any such survey shall, unless the Provincial Government otherwise direct contain, in lieu of the particulars specified in the said section, the following particulars (namely) : (a) the area and the assessment of each surveynumber.
22.(1) If a taluqdar 's estate, or any portion thereof, is not wholly or partially exempt from landrevenue and its liability to payment of land revenue is not subject to special conditions or restrictions, the jama payable to Government in respect of such estate or person thereof shall, if a survey settlement has been extended thereto, be the aggregate of the surveyassessments of the lands composing such estate or such portion thereof, minus such deduction, if any, as Government shall in each case direct.
(2) The Governor in Council may declare the amount of jama so ascertained fixed for any term not exceeding thirty years." BOMBAY TALUQDARI TENURE ABOLITION ACT, LXII of 1949: 916 "3.With effect from the date on which this Act comes into force, (i)the tuluqdari tenure shall wherever it prevails be deemed to have been abolished; and (ii)save as expressly provided by or under the provisions of this Act, all the incidents of the said tenure attaching to any land comprised in a taluqdari estate shall be deemed to have been extinguished.
(4)All revenue surveys or revised revenue surveys of taluqdari estates directed by the State Government under section 4 of the Taluqdars Act and all settlements made shall be deemed to have been made under Chapters VIII and VIII A of the Code and the settlement registers and other records prepared of such surveys shall be deemed to have been prepared under the corresponding provisions of the Code.
(5)(1) Subject to the provisions of sub section (2), (a)all taluqdari lands are and shall be liable to the payment of land revenue in accordance with the provisions.
of the Code and the rules made thereunder, and (b) a taluqdar holding any taluqdari land or a cadet of a taluqdar 's family holding any taluqdari land hereditarily for the purpose of maintenance, immediately before the coming into force of this Act, shall be deemed to be an occupant within the meaning of the Code or any other law for the time being in force.
(2)Nothing in sub section (1) shall be deemed to affect (b)the right of any person to pay jama only under any agreement or settlement recognised under section 23 or under a declaration under section 22 of the Taluqdars ' Act so long as such agreement, settlement or declaration remains in force under the provisions of this Act.
(17) The enactments specified in Schedule II are hereby repealed: Provided that the repeal of the said enactment shall not in any way be deemed to affect, (a) . . . . . . . . . . 917 (b). . . . . . . . . . (c) any declaration made or any agreement or settlement recognised, any partition confirmed and any management of the taluqdari estate assumed under the provisions of any of the enactments hereby repealed, and any proceedings connected with such partition or management instituted before the aforesaid date shall be continued and disposed of as if this Act had not been passed.
" The position emerging from the aforesaid provisions may be summarized thus: The Taluqdars ' Act was enacted to make special provision for the revenue administration of the estates held by certain superior land holders in the districts of Ahmedabad, Kaira, Broach and the Panch Mahals.
Section 4 enabled the Governor in Council to direct a revenue survey or revised revenue survey of any taluqdari estate under the provisions of the Bombay Land Revenue Code.
In regard to such an estate, survey would be made under section 108 of the Code and the Settlement Officer would I prepare a Register to be called the " Settlement Register which would contain the particulars mentioned in section 5 of the Taluqdars ' Act in lieu of the particulars specified in section 108 of the Code.
Under section 22 of the Taluqdars ' Act, the jama payable by a taluqdar would be the aggregate of the survey assess ments of the lands compoSING sucH an estate or such portion thereof minus such deduction, if any, that the Government in each case should direct.
Under sub section 2, the Governor in Council was empowered to declare the jama so ascertained fixed for any term not exceeding thirty years.
In 1949, the taluqdari tenure was abolished by the Bombay Taluqdari Tenure Abolition Act.
By section 5 of the Abolition Act, the taluqdars became occupants within the meaning of the Code, i.e., they were deemed to be holders in actual possession of unalienated lands other than the tenants; with the result that all the taluqdari lands became liable to, the payment of land revenue in accordance with the provisions of the Code and the rules made thereunder.
918 Sub section 2 of section 5 saved the right of any person to pay jama only under an agreement or settlement recognized under section 23 or a declaration made under section 22 of the Taluqdars ' Act so long as such agreement, settlement or declaration remained in force.
Shortly stated, the combined effect of the provisions was that the taluqdari tenure was abolished and that the taluqdar became the occupant with liability to pay land revenue in accordance with the provisions of the Code.
If there was no other relevant provision indicating a contrary intention, it is manifest from the aforesaid summary that the appellants would be liable to pay land revenue in accordance with the provisions of the Code after the period fixed in the declaration expired, i.e., from the year 1955 1956.
The learned Counsel for the appellants contends that by reason of section 117R of the Code, the declaration made by the Governor in Council fixing the amount of jama, for a period of thirty years would continue to be in force even after the expiry of the said period till a revision settlement was made and therefore the saving clause would preclude the Government from demanding higher amount of revenue than the jama ascertained and fixed in the declaration till the date of the revised settlement.
Section 117R of the Code reads: " All settlements of land revenue heretofore made and introduced and in force at the date of the commencement of the Bombay Land Revenue Code (Amendment) Act, 1939, shall be deemed to have been made and introduced in accordance with the provisions of this Chapter and shall, notwithstanding anything contained in section 117E, be deemed to continue to remain in force until the introduction of a revision settlement.
" If the declaration of the Governor in Council is a settlement of land revenue within the meaning of this section, it would continue to be in force till the intro duction of the revision settlement.
It is, therefore, necessary to ascertain the meaning of the words " settlement of land revenue " in the section.
Settlement is defined by section 117C(1) to mean the result.
of the 919 operations conducted in a zone in order to determine the land revenue assessment.
What is the scope of the operations conducted to arrive at the said result ? The provisions of Ch.
VIII A lay down the successive steps to be followed by the authorities concerned to fix the land revenue.
Under section 117D, the Government may at any time direct a settlement of the land revenue of any land of which revenue survey has been made under section 95 or not.
It may also direct at any time a revised settlement of the land revenue of such lands.
A settlement once made remains in force for a period of thirty years unless the State Government directs that it should remain in force for any period less than thirty years.
In a case where a revised settlement of land revenue has not been made for one reason or other, the Government may extend the term of the settlement for such period as it may think fit.
The land revenue assessment shall be determined by dividing the lands to be settled into different groups and fixing a standard rate for each group.
Groups are ordinarily formed on a consideration of various factors such as physical configuration, climate, rainfall, price and yield of principal crop and other relevant considerations.
Land revenue of individual survey numbers and sub divisions shall be based on their classification and value in the manner prescribed.
The Settlement Officer, who is entrusted with the duty of making the settlement, shall follow the prescribed procedure and fix a standard rate for each class of land in each group on a consideration of the relevant factors.
A hierarchy of Tribunals are created for the persons aggrieved to take the matter in appeal.
Finally the State Government passes orders approving the standard rates or varying them.
After the State Government has passed orders and the notice of the same has been given in the prescribed manner, settlement will be deemed to have been introduced and land revenue according to such settlement will be levied from such date as the State Government may direct.
It will be seen from the aforesaid summary of the scheme of land revenue settlement that land revenue is fixed for each land, having regard to the group 920 within which it falls.
All such settlements of landrevenue made before the Bombay Land Revenue (Amendment) Code, 1939, will be deemed to remain in force until the introduction of a revised settlement.
Part II of the Taluqdars ' Act provided for survey and settlement.
Under section 4 of the Taluqdars ' Act, the Governor in Council might direct a revenue survey of the taluqdari estate under the provisions of the Code.
The settlement register prepared under that Code was directed contain particulars mentioned in section 5 such as area and assessment of such survey number, etc.
Presumably, under that Act a settlement was made in regard to the taluqdari estates and settlement registers were prepared fixing the assessment of each survey number.
That settlement would certainly be a settlement of land revenue within the meaning of section 117R of the Code and that would continue to be in force till a resettlement was made.
Part IV of the Taluqdars ' Act dealt with Revenue Administration.
Section 22 laid down that in a case where survey settlement had been extended to a taluqdari estate, the jama payable by the taluqdar to Government in respect of such an estate shall be the aggregate of the survey assessments of the lands composing such estate or such portion thereof minus such deduction, if any, as Government shall direct in each case.
Under sub section
(2) of section 22, the Governor in Council could declare the amount of jama so ascertained fixed for any term not exceeding thirty years.
Under section 23, nothing in the Act was deemed to affect the validity of any agreement thereto before entered into by or with a taluqdar and still in force as to the amount of his jama, nor of any settlement of the amount of jama made by or under the orders of Government for a term of years and still in force.
Sections 22 and 23 provided for the arrangements entered into or to be entered into with the Governor in Council in respect of the jama payable by the taluqdars.
Section 23 saved the previous agreements or settlements in respect of the jama.
Section 22 authorised the Government to fix the jama, having regard to the aggregate of the survey assessments of the lands and to declare 921 the same fixed for a period of years not exceeding thirty.
The declaration under a. 22 or the agreement or settlement of jama mentioned in section 23(1) might be described broadly as a settlement entered into between the Government and a taluqdar but it was not a settlement of land revenue within the meaning of section 117R of the Code, for settlement of revenue was the result of operations carried on in respect of different classes of lands in the manner prescribed by Ch.
A of the Code or the settlement in respect of such lands in accordance with the pre existing laws it was beyond the scope of Ch.
VIII A to ascertain ' the jama, though the rates fixed under such a settlement were taken as the basis by the Government in ascertaining the jama payable by the taluqdar.
The jama payable by the taluqdar was distinct from the revenue assessment of the land comprised in the taluqdari estate and they could not be equated.
Section 17 of the Abolition Act repealed the Taluqdars ' Act and expressly provided that the repeal of the said enactment shall not affect any declaration made or any agreement or settlement recognized in respect of the taluqdari estates.
Section 5(2) (b) of the Abolition Act expressly saved the agreement or settlement recognized under section 23 or a declaration made under section 22 from the operation of the Act till such agreement, settlement or declaration remained in force.
It is, therefore, manifest that the declaration made under the Taluqdars ' Act enured to the advantage of the taluqdars, notwithstanding the repeal of the Taluqdars ' Act, till such time it was in force.
When the Abolition Act came into force, the time mentioned in the declaration in the cases before us, i.e., thirty years, had not run out and therefore the declaration made by the Government under the Taluqdars ' Act continued to be in force till 1955 56.
After the expiry of the time, the appellants would be liableto pay the entire land revenue according to the settlement register.
The entire scheme of the Abolition Act was that after the passing of that Act, the taluqdars became 116 922 occupants with the result that they would be liable to pay land revenue in accordance with the provisions of the Land Revenue Code.
If sub section
(2) was not inserted in section 5, they would be liable to pay land revenue under the Code, notwithstanding the declaration made or the agreement entered into by the Government with them in regard to the jama payable by them.
Sub section (2) was only enacted to preserve to them the concession till the period fixed had expired.
We, therefore, hold that the declaration made by the Governor in Council in 1925 26 expired in 1955 56 and the appellants became liable to pay the entire land revenue according to the settlement registers from the year 1955 56.
In the result, all the appeals and the Writ Petitions are dismissed with costs.
, the State of Bombay and the Collector of Ahmedabad, who are the respondents herein, getting one set of hearing costs in all.
Petitions dismissed.
| IN-Abs | The appellants were Taluqdars owning taluqdari villages in District Ahmedabad, State of Bombay.
In 1922 23 there was a revision settlement of land revenue and the aggregate sum of land revenue payable by each taluqdari estate was fixed.
In 1925 26, in exercise of the powers conferred by section 22 of the Gujrat Taluqdars Act, 1888 (Bom.
VI of 1888), the Government of Bombay ascertained and declared the jama payable by each taluq which was much less than the amount of land revenue and the said declaration was to remain in force for thirty years.
With the passing in 1949 of the Bombay Taluqdari Abolition Act, 1949, the taluqdari estates of the appellants were abolished and they became occupants of the lands and, after the expiry of the thirty years, were called upon to pay the full land revenue assessment in respect of the lands.
It was contended on behalf of the appellants that by reason of section II7R of the Bombay Land Revenue Code, i879, the declaration made by the Governor in council fixing the amount of jama for a period of thirty years would continue to be in force even after the expiry of that period till a revision settlement was made and the Government was precluded from demanding the higher amount of revenue till then.
Held, that the contention must fail.
The jama payable by the Taluqdars under section 22 Of the Gujrat Taluqdars Act, 1888, was distinct from the revenue assessment of land comprised in the taluqdari estate and they could not be equated.
The declaration under section 22 or the fixation of the jama under section 23(1) of the Act was in the nature of a settlement entered into between the Government on the one hand and the Taluqdar on the other but that was no settlement of land revenue within the meaning of section II7R of the Bombay Land Revenue Code, 1879.
As section 5(2) (b) of the Bombay Taluqdari Tenure Abolition Act, 1949, expressly saved the settlement made under section 23 and the 912 declaration under section 22 of the Gujrat Taluqdars Act, the appellants were liable to pay the entire land revenue after the expiry Of 30 years, i.e., from the year 1955 56.
|
ON: Civil Appeal No. 4297 of 1983.
From the Judgment and Order dated 26.10.1979 of the Allahabad High Court in C.M.W. No. 7168 of 1972.
Raja Ram Agarwal and A.K. Srivastava for the Appellants.
K.K. Venugopal, Rajinder Sachher, Satish Chandra, K.C. Dua, and J.P. Misra for the Respondents.
The Judgment of the Court was delivered by K.N. SAIKIA, J.
The State of U.P. by special leave appeals from the Judgment of the High Court of Allahabad dated 26.10.1979, allowing the respondents ' writ petition and holding that the State of U.P. and the Excise authori ties were not entitled to levy excise duty on the wastage of liquor in transit.
The respondents are manufacturers of high strength spirit classified as other sorts of spirit not otherwise specified ' under Section 28 of the United Prov inces Excise Act, 19 10, hereinafter referred to as 'the Act '.
After manufacture they transport those spirit in big containers from the distilleries to their warehouses, trans porting them on passes issued under section 16 of the Act.
In the bonded warehouses the same are sometimes diluted, separately bottled and sold.
They also used to manufacture and bottle military rum under a licence and supply the same to the defence personnel inside and outside the State of U.P.
The Officer Commanding Rail Head Depot A.S.C., Pathan kot having obtained permits from the State of Punjab for the import of military rum, against those permits the respond ents exported military rum from their distillery, under different passes.
The excise duty on military rum for export was Rs.7 per L.P. Litre while the rate for consumption within the State was 171 Rs.21 per L.P. Litre.
If the exported military rum was under bond thereupon duty was realised by the importing State from the importer thereof.
The respondents bottled the rum ac cording to rules and supplied the same to the consignees at the distillery premises and the consignments were taken by the consignees under the seal of the railway authorities to their respective destinations.
It appears by Notification dated March 26, 1979 in exercise of the powers under Sections 28 and 29 of the Act, read with section 21 of the U.P. General Clauses Act, 1904, and in supersession of the earlier Government Notification the Governor was pleased to direct that with effect from April 1, 1979 duty shall be imposed on country spirit at the rates specified in the schedule thereto and the duty was payable "before the issue from the distillery or bonded warehouse concerned save in the case of issued under bond".
By order dated 13.10.1970 notice was issued to the respond ents demanding Rs.4,295.55p.
on the wastage which was termed as "excess transit wastage" of rum calculated at the maximum rate of Rs.21 per L.P. Litre.
A representation of the re spondents dated November 9, 1970 was rejected by order dated 15.1.1972.
Another representation through the All India Distillers Association was also rejected by order dated August 28, 1972.
Several writ petitions challenging similar orders were filed by others before the Allahabad High Court for quashing the orders.
The respondents also filed Civil Miscellaneous Writ No. 7168 of 1972 under Article 226 of the constitution of India praying for appropriate writ, order or direction quashing the impugned orders dated 13.10.1970, 9.11.1970, 15.1.1972 and 28.8.1972 and for a mandamus commanding the State of U.P. not to realise or adjust any amount of duty towards wastage from the respondents ' advance duty account otherwise than in accordance with law and restraining them from giving effect to the impugned orders.
The High Court by the impugned judgment dated 26.10.1979 relying on an earlier Division Bench decision of the same High Court in M/s. Mohan Meakin Breweries Ltd. and Anr.
vs State of Uttar Pradesh and Ors.
, (Writ Petition No. 2604 of 1973, decided on 11.9.1979) allowed the writ petition and quashed the impugned orders thereby holding that no excise duty could legally be levied on the excess wastage the occurred during the transport of liquor in course of export, that is, taking out of U.P. otherwise than across a customs frontier as defined by the Central Government.
Mr. Raja Ram Agarwal, the learned counsel for the appel lants, submits that the duty has been levied keeping in mind the fact that in 172 U.P. excise duty is levied at two different rates at a higher rate when the liquor is sold inside the State, and at a lower rate when it is exported outside the State.
Counter vailing duty is paid by the importer on the quantity actual ly received in the importing State.
If there is excess wastage on transit the result is that the quantity actually received by the destination State is less than the quantity on which the State of U .P. charged the lower rate and, therefore, on the quantity shown as wastage the State of U.P. ought to recoup its differential duty by charging excise duty at the higher rate; and that this is clearly envisaged by the Act and the United Provinces Excise Manual Rules, hereinafter referred to as 'the Rules '.
Counsel further submits that it has a wholesome purpose, namely, to discourage evasion of duty and that there is no question of levying excise duty twice on the same article inasmuch as the amount of export duty actually paid is always deducted from the demand; and that it is a duty of regulatory charac ter meant to guard against perpetration of fraud or decep tion on excise revenue which the State is entitled to re ceive.
It is said to be a realisation of escaped duty justi fied by the implied presumption.
Mr. K.K. Venugopal, the learned counsel for the respond ents, submits that in this case while the exporting State, that is, U.P., levied export duty at a concessional rate the importing State levied countervailing duty on the quantity of rum imported; and the quantity exported and subjected to excise duty by the exporting State being the same as the quantity whereupon countervailing duty was imposed by the importing State, there could be no question of collecting differential duty on the excess wastage by the exporting State and if that was done it would amount to double taxa tion.
Explaining the procedure for export from U.P. counsel states that after export duty is paid, the exporter gets the alcohol released and transport it to the importing States in bottles or casks.
In the importing State countervailing duty is paid on full consignment at its destination and the seals of the bottles transported are intact.
So the entire con signment is taxed less the wastage.
The impugned demand notices have, submits counsel, rightly been quashed by the High Court and the appellants have rightly been restrained from levying such differential duty on excess wastage on transit in course of export.
The only question to be decided, therefore, is whether the differential duty is leviable under the Act and the Rules.
For answering the question we may refer to the Act and the Rules.
Included in Chapter V of the Act, which deals with duties and fees, Section 28 of the Act provides that an excise duty or a countervailing duty, as the 173 case may be, at such rate or rates as the State Government shall direct may be imposed either generally or for any specified local area on any excisable article stated in that section.
"Excise duty" and "countervailing duty" as defined in Section 3(3a) of the Act means any such excise duty or countervailing duty, as the case may be, as is mentioned in entry 51 of List II in the Seventh Schedule to the Constitu tion.
That entry reads as follows: "51.
Duties of excise on the following goods manufactured or produced in the State and countervailing duties at the same or 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 narcot ics; but not including medicinal and toilet preparations containing alcohol or any substance included in subparagraph (b) of this entry.
" The original Section 28 of the Act now re numbered as subsection (1) thereof, and sub sections 2 and 3 inserted by section 2 of the U.P. Act 7 of 1970 clearly covers Indian made foreign liquors.
There could be no dispute as to mili tary rum being one of the Indian made foreign liquors ex cisable under the Act.
A duty of excise under Section 28 is primarily levied upon a manufacturer or producer in respect of the excisable commodity manufactured or produced irre spective of its sale.
Firstly, it is a duty upon excisable goods, not upon sale or proceeds of sale of the goods.
It is related to production or manufacture of excisable goods.
The taxable event is the production or manufacture of the liq uor.
Secondly, as was held in A.B. Abdulkadir vs The State of Kerala.
reported in ; , an excise duty imposed on the manufacture and produc tion of excisable goods does not cease to be so merely because the duty is levied at a stage subsequent to manufac ture or production.
That was a case on Central Excise, but the principle is equally applicable here.
It does not cease to be excise duty because it is collected at the stage of issue of the liquor out of the distillery or at the subse quent stage of declaration of excess wastage.
Legislative competence under entry 51 of list II on levy of excise duty relates only to goods manufactured or produced in the State as was held in Bimal Chandra Banerjee vs State of Madhya Pradesh, ; In the instant case there is no 174 dispute that the military rum exported was produced in the State of U.P.
In State of Mysore & Ors.
vs M/s. D. Cawasji & Co., 10, which was on Mysore Excise Act, it was held that the excise duty must be closely related to production or manufacture of excisable goods and it did not matter if the levy was made not at the moment of production or manufacture but at a later stage and even if it was collected from retailer.
The differential duty in the in stant case, therefore, did not cease to be an excise duty even it was levied on the exporter after declaration of excess wastage.
The taxable event was still the production or manufacture.
It is settled law as was held in Bimal Chandra Banerjee vs State of Madhya Pradesh (supra), a case under the Madhya Pradesh Excise Act, that no tax can be levied by the State Government in the absence of specific authorisation by statute.
In that case the levy of duty on liquor which the contractor failed to lift was held to have been an attempt to exercise a power which the State Government did not possess.
Mr. Agarwal refers us to Rule 636 of the Rules which at the relevant time said: "636.
A distiller holding licences for bottling Indianmade foreign liquor of his own manufacture and for selling it by wholesale may export such foreign liquor bottled on his wholesale premises, to any other State or Union Territory in India subject to the following condi tions: (1) The exporter shall obtain from the importer a permit authorizing the import signed by the Chief Revenue Authority of the importing State or Union Territory or by an officer duly authorized in this behalf.
(2) The permit shall specify: (a) the name and address of the person of firm authorized to import; (b) the description and quantity of the foreign liquor to be imported; (c) the rate of duty chargeable in the importing State or Union Territory in case the Indian made foreign 175 liquor is imported in State or Union territory with which the state of Uttar Pradesh has entered into reciprocal arrangements for the adjustment of the excise duty by book transfer.
(d) the rate of duty charged in the importing State or Union Territory and the fact that it has been realized in advance in cases of import other than those covered by clause (c).
(3) On receipt of the permit the exporter shall deposit into the treasury; (a) Export duty on the total quantity of liquor to be ex ported; and (b) Where the export is made to a State or Union Territory with which the State of Uttar Pradesh has entered into a reciprocal arrangement for the adjustment of the excise duty by book transfer, and the rate higher than that enforced in the State of Uttar Pradesh, and that payable in the importing State or Union Territory on the total quantity of liquor to be exported.
(4) On receipt of the permit and the treasury receipt the wholesale vendor shall prepare a pass in form F.L. 23 in quadruplicate and submit it to the Excise Inspector, in charge of the distillery.
The Excise Inspector shall after satisfying himself that duty has been correctly realized, affix his signature to the pass.
The exporter shall then send one copy of the pass to the Collector of the district of export, one copy to the Chief Revenue Authority of the place of import or such other officer as may be authorised in this behalf.
One copy to the consignee and shall retain the fourth copy.
The treasury receipt shall always accompany the copy of the pass sent to the Collector of the exporting districts.
(5) The pass in form F.L. 23 shall state clearly: (a) the name and address of the consignor; 176 (b) the name and address of the consignee; (c) the exact description and quantity of each kind of foreign liquor despatched under the pass; (d) the route by which it is despatched; (e) the date of despatch; and (f) in case of export against duty paid permit, the fact that the duty has been prepaid in the State of import.
(6) A separate pass in form F.L. 23 shall be issued in respect of each consignment.
The Chief Revenue Authority or other officer of the place of import should send the copy of the pass received by him, duly countersigned, to the Excise Commissioner, Uttar Pradesh, in support of the claim for ' refund of duty annually after the close of the excise year.
(7) Should the rate of duty in the importing State be lower than that in force in Uttar Pradesh, exporter shall be entitled to a refund of the difference in duty.
If the duty has been prepaid in the State of import at the rate in force at the time of issuing import permit, the exporter shall be entitled to a refund of duty deposited by him in the State of export on verification of the claim by the Excise Inspector incharge of the distillery on the basis of export passes in form F.L. 23 duly countersigned by the Chief Revenue Authority of the State or Union Territory of import or the officer appointed in this behalf in token of receipt of the consignment of Indian made foreign liquor" Rule 637 provided than the duty, other that export duty, on foreign liquor manufactured at any distillery in Uttar Pradesh and exported therefrom on prepayment of duty to any State or Union Territory of India shall be credited by book transfer to the Government of the importing State or Union Territory after the close of the excise year.
Rule 637 A provided for registration of claims for refund or export of Indian made foreign liquor and provided that every distiller making exports of Indian made foreign liquor to other States, shall submit a statement showing all such exports made during the proceeding quarter, in form P.D. 31 to the Excise Commissioner, duly 177 verified by the officer incharge, distillery, despatching simultaneously a copy thereof to the Assistant Excise Com missioner of the charge.
Rule 37 B provided for maintenance of register of refunds against exports of Indian made for eign liquor and said that the Excise Inspector incharge of the distillery shall enter all the details given by the distillers in the statement in form P.D. 31, in a register to be maintained by him in form P.D. 31 A. As and when refunds are allowed by the Excise Commissioner, he shall make entries about refund in this register in relevant columns under his signature.
Similar entries shall also be made by the office of the Assistant Excise Commissioner concerned, on the copies of P.D. 31 statement received from the exporters, and be initialled by the Assistant Excise Commissioner after verification.
Thus it is seen that though not specifically mentioning charging up of differential export duty on excess wastage, the above rules definitely envisaged refund of excise duty of countervailing or equalising nature.
Mr. Agarwal also brings to our notice R.ale 8 14 which substituted the old Rule by the Excise Commissioner 's Noti fication No. 10909/IX.
241 A, dated February 8, 1978.
It provided as under: "Allowance for loss in transit.
An allowance upto 0.5 per cent will be made for the actual loss in transit by leakage, evaporation or other unavoidable cause, or spirit transport ed or exported under bond in wooden casks or metal vessels.
The allowance to be made under this rule will be determined by deducting from the quantity of spirit despatched from the distillery, the quantity received at the place of destina tion, both quantities being stated in terms of alcohol.
The allowance will be calculated on the quantity contained in each wooden cask metal vessels comprised in a consignment.
If the report of the officer by whom the consign ment of spirit has been gauged and proved at its destination shows that the wastage has occurred above the limit allowa ble the person executing the bond shall be liable to pay duty on so much of the deficiency as in excess of the allow ance.
The rate of duty leviable shall be the highest rate of duty leviable on such spirit in this State.
178 When the wastage does not exceed the prescribed limit, no action need be taken by the Officer in charge of the Distillery or bonded warehouse, as the case may be, but when the wastage exceeds the allowable limit, the Officer in charge of the Distillery shall obtain the expla nation of the Distillers or the person executing the bond and forward the same together with a full report of the circumstances to the Assistant Excise Commissioner or the Deputy Excise Commissioner of the charge in which the Dis tillery is situated.
The Assistant Excise Commissioner or the Deputy Excise Commissioner shall charge duty on excess wastage provided that when the total wastage in a consign ment is within the allowable limit.
Deputy/Assistant Excise Commissioner of the charge may write off the excess wastage in any particular wooden cask or metal vessel: Provided further that the Deputy Excise Commis sioner may write off the duty upto Rs.500, if he is satis fied that the excess wastage in a consignment was on account of an accident or other unavoidable cause but in other cases, the matter shall be referred to the Excise Commis sioner for orders.
Cases in which the Deputy Excise Commis sioner writes off duty shall be reported by him to the Excise Commissioner.
" It is emphasised by Mr. Agarwal that this provision is meant to discourage evasion of duty.
If any part of the lower export duty charged liquor is not in fact exported it should be made to pay the higher excise duty as payable on home consumed liquor.
It does not impose any new duty.
We are inclined to agree.
This rule does not authorise imposition of any new tax but only authorises charging up excise duty on the excess wastage of liquor in course of export which was charged at concessional rate.
The old Rule 814 of the Rules was made by B.O. No. 423/V 284 B, dated September 6, 1910 and No. 20/8 V E 980B, dated May 28, 1918 providing for allowance for Joss in transit.
It said: "An allowance will be made for the actual loss in transit, by leakage, evaporation or other unavoidable cause, of spirit transported or exported under bond.
The allowance is subject to the following maximum limits.
" Limits were prescribed differently for wooden casks and metal vessels, keeping in mind the duration of transport.
179 Thus, we find that the minimum limits of wastage in transit was prescribed even under the old rule.
This by implication enjoined that the excess wastage would be taxed as if not wasted.
The question may arise as to the date of the new Rule 814, to decide whether the impugned notices would be covered by it or by the old Rule.
Section 77 of the Act provides the answer.
It says: "77.
Publication of rules and notifications.
All rules made and notifications issued under the Act shall be published in the Official Gazette, and shall, have effect as if enacted in this Act from the date of such publication or from such other date as may be specified in that behalf." (The two provisos are not relevant for the purpose of this case) Both the old and the new Rule 8 14 must, therefore, have effect from the date of publication in the Official gazette or from such other date as may be specified in that behalf as if enacted in the Act.
The object of this ancient formu la, namely, "as if enacted in this Act" was to emphasise the fact that the notifications were to be as effective as the Act itself.
Its validity could be questioned in the same way as the validity of the Act could be questioned.
It is an ancient form of rule making still to be found in the Act.
Thus the Act having provided for fixed wastage allowance also in effect provided that the excess above the allowable wastage will be taxed.
It can not, therefore, be said that no such charging up of excise duty on the excess wastage in transit could be validly made.
The validity of Rule 814 had not been questioned before the High Court.
Absolute equality and justice is not attainable in taxing laws.
Legislature must be left to decide the State policy within Constitution al limitations.
In M/s. Mohan Meakin Breweries Ltd. vs Excise & Taxation Commissioner, Chandigarh, reported in 10: ; 1, the appellant company carried on the busi ness of manufacture, storage and sale of liquors.
Between June, 1967 and April 1969,.
it transported various quanti ties of liquor from its distilleries in U.P. to its bonded warehouse at Chandigarh.
On arrival, the consignments were examined by the Officer in Charge of the warehouse, and a shortage was found, exceeding the wastage allowance permis sible under rule 8 of the Punjab Bonded Warehouse Rules, 1957.
The Excise and Taxation Commissioner, exercising the powers of the .
Financial Commissioner. issued a show cause notice and then ordered 180 the appellant to pay duty on the wastage in excess.
The show cause notice required the appellant to pay duty on excess wastage in course of import of liquor from U.P. and the rules governing the appellant 's licence provided for a wastage allowance not exceeding 1% of the actual loss in transit by leakage or breakage of vessels or bottles con taining liquor, and if the wastage exceeded the prescribed limit the licensee should be liable to pay duty at the prescribed rate as if the wastage in excess of the pre scribed limit had actually been removed from the Warehouse, and it was also provided that the Financial Commissioner could in his discretion on goods cause being shown remit the whole or a part of the duty leviable on such wastage, and these provisions were challenged.
This Court held that the impugned rules did not impose any new duty or create any liability and that they were in essence and substance of a regulatory character meant to guard against perpetration of fraud or deception on the revenue.
"They provide for and regulate the storage and subsequently the removal of liquor from the bonded warehouse, on payment or otherwise of the duty which is chargeable under the Fiscal Rules of 1937.
" We agree with Mr. Agarwal that the instant Rules 636 and 814 are also a regulatory character and they are precautionary against perpetration of fraud on the excise revenue of the exporting State.
If out of the quantity of military rum in a consignment, a part or portion is claimed to have been wastage in transit and to that extent did not result in export, the State would, in the absence of reasonable expla nation, have reason to presume that the same have been disposed of otherwise than by export and impose on it the differential excise duty.
A statute has to be construed in light of the mischief it was designed to remedy.
There is no dispute that excise duty is a single point duty and may be levied at one of the points mentioned in Section 28.
The submission of the respondents that they paid duty on the entire quantity of rum to be exported under excise passes issued to the importer and that after payment of the export duty the rum bottled under the conditions enumerated in the Rules was supplied to the consignee at the distillery premises and the consignments were taken by the consignees under their seals and under the seal of the Railway authori ties and the consignments reached their destination with seals intact would not go to support the contention that the State Government was not competent to levy any duty on the excess wastage that is shown to have occurred during transit inasmuch as only a concessional rate of duty was levied on the liquor which was supposed to be exported out side the State of U.P. and if the entire quantity on which such concessional duty was paid did not reach its destination, and the 181 shortage is shown as wastage in transit, it surely meant that the short delivery was not exported.
The reason of the wastage would not be material so far as this conclusion is concerned.
Had this quantity been not exported but consumed locally the State would have derived higher duty of which it has been deprived.
The argument that countervailing duty is paid by the importers in the importing State on the quantity actually received, would also be immaterial for this conclusion though that may be of some importance for the purpose of revenue of the importing State as well as the consignee.
In case countervailing duty has been paid on the entire quanti ty of the consignment in the importing State there may be room for adjustment in accordance with the provisions of Rules 636, 637, 637 A and 637 B of the Rules.
The only material question may be whether the wastages was caused while the bottles were on transit but still within the territory of the exporting State or in transit inside the importing State.
If as a matter of fact it is found that the exported liquor actually crossed the territory of the ex porting State intact there may not be any justification for demanding differential duty.
That will of course be a ques tion of fact in no way affecting the right to demand the differential duty.
The decision in M/s. Ajudhia Distillery Rajaka, Sahaspur vs State of Uttar Pradesh and Anr., report ed in 1980 Taxation Law Reports 2262, quashing such a demand and holding that the exporting State had no jurisdiction to charge duty on the liquor wastage in transit cannot be said to have been correctly decided and the impugned judgment in the instant case suffers from the same infirmity, and has to be set aside.
Rule 814 envisages the levy of such differen tial duty.
There is no question of double charging or multi ple point charging in this case.
It is only a question of recovery of the difference on proof of the purposes for which lower duty was earlier levied having failed to be achieved entailing liability to make good the difference.
The Rules 636, 637 A and 637 are also relevant to this extent.
It was reiterated in M/s. Mc Dowell and Co. Ltd. vs Commercial Tax Officer, VH Circle, Hyderabad; , 14: ; , following Abdul Kadir (supra) that excise duty is a duty on the production or manufacture of goods produced or manufactured within the country though laws are to be found which impose a duty of excise at stages subsequent to the manufacture or production.
Similarly what was stated in Kalyani Stores vs The State of Orissa and Ors., ; , was reiterated in M/s Mohan Meakin Breweries Ltd. (supra) that a countervailing duty is meant "to counter balance; to avail 182 against with equal force or virtue; to compensate for some thing or serve as equivalent or substitute for".
A counter vailing duty is "meant to equalise the burden on alcoholic liquors manufactured or produced in the State.
" They may be imposed at the same rate as excise duty or at a lower rate so as to equalise the burden after taking into account the cost of transport from the place of manufacturing to the taxing State.
Countervailing duties are meant to equalise burden on alcoholic liquors imported from outside the State and the burden placed by excise duties on alcoholic liquors manufactured or produced in the State.
Countervailing duties can only be levied if similar goods are actually produced or manufactured in the State on which excise duties are being levied.
Thus, countervailing duty paid in the importing State does not ipso facto affect the excise revenue of the exporting State.
The fact that the importer is required to pay counter vailing duty on the imported military rum could, therefore, ipso facto be no ground for opposing the levy of differen tial duty on the excess wastage of exported rum that duty being levied with a view to safeguard the excise revenue of the exporting State.
If the excess wastage was actually lost to consumers while in the importing State no justification of such a duty may arise, that, however, would be an entire ly different question without in any way affecting the competence of the legislature of the exporting State to impose such a duty.
The fact that the exported rum was on payment of export duty or on bond would not again be materi al inasmuch as when the rum meant for export failed to be exported, there may be a presumption, may be rebuttable one, that what is shown as the excess has merged in mass of rum consumed within the State and was not separated from such a mass.
The imposition of differential duty was only deferred to this moment and it still continued to be a duty on pro duction or manufacture of rum.
It could not be regarded as a duty not connected with the taxable event of manufacture or production.
There is also no similarity with the excise duty sought to be levied only on the unlifted quantity of liquor by contractors which was held to be impermissible under Sec tions 28 and 29 of the Act in Excise Commissioner, U.P. vs Ram Kumar, and State of Madhya Pradesh vs Firm Gappulal; , In the instant case the military rum was obtained for the purpose of export and the lower export duty was paid and only when the rum did not result in export the question of imposing the differential duty arose.
The notion of the excise duty being changed or cancelled on account of what transpires later is not foreign to excise law.
Generally speaking 183 the imposing of the differential duty i.e. charging up the duty on the report of the excess wastage is the opposite of the system of drawback prevalent in some systems.
Drawback means the repayment of duties or taxes previously charged on commodities, from which they are relieved on exportation.
For example, in the customs laws of some countries an allow ance is made by the Government upon the duties due on im ported merchandise when the importer, instead of selling it within the country re exports it, and then the difference of duty is refunded, if already paid.
Similarly, in England there is a provision of refund of duties on British wine when the wine incidentally is spoilt or otherwise unfit for use or when delivered to another person has been returned to the maker as so spoilt or unfit.
The system of charging up the duty on the subsequent event of non export can not, therefore, be said to be irrespective of production or manufacture.
In the instant case if it is proved to the satisfaction of the appropriate authorities that countervailing duty had been paid on the entire consignment irrespective of the wastage then the question would arise as to whether the wastage could be ignored altogether by the exporting State as was done by the importing State.
Counsel for the parties had no objection to the idea that if the explanation for wastage was satisfactory and the countervailing duty was paid in the importing State on the entire consignment irre spective of the wastage, there would be room for adjustment by reducing the duty to similar extent.
For the foregoing reasons, the impugned Judgment is set aside and the appeal is allowed, but under the facts and circumstances of the case, without any order as to costs.
Y. Lal Appeal allowed.
| IN-Abs | The respondents are manufacturers of high strength spirit.
They also used to manufacture and bottle military rum under a licence and supply the same to the defence personnel inside and outside the State of U.P.
The excise duty on military rum for export was Rs.7 per L.P. Litre while the rate for consumption within the State was Rs.21 per L .P. Litre.
An allowance upto 0.5 per cent for wastage during transit by leakage, evaporation etc.
was provided.
Against a proper permit the respondents supplied rum to the Officer Commanding Rail Road Depot.
A.S.C., Pathankot at the distillery premises and the consignments were taken by the consignees under the seal of the railway authorities to their respective destinations.
By a notification dated March 26, 1979, issued in super session to earlier notification, the Governor was pleased to direct that with effect from April 1, 1970 duty shall be imposed on country spirit at the rates mentioned in the schedule and that the duty was payable before issue from the distillery or bonded warehouse concerned save in the case of issued under bond.
Accordingly a notice was issued to the respondents demanding Rs.4,295.55P on the wastage which was termed as "excess transit wastage" of rum calculated at the maximum rate of Rs.21 per L .P. Litre.
The representation against the demand having been rejected, they filed a writ petition before the High Court challenging the validity of the orders and praying for a mandamus commanding the State of U.P. not to realise or adjust any amount of duty towards wastage from the respondents ' advance duty account and restraining them from giving effect to the impugned orders.
The High Court allowed the respondents ' writ petition holding that the State of U.P. and the Excise authorities were not entitled to levy 169 excise duty on the wastage of liquor in transit.
Hence this appeal by the State.
On the question, whether differential duty is leviable.
under the Act and the Rules.
Allowing the appeal, this Court, HELD: The Act having provided for fixed wastage allow ance also in effect provided that the excess above the allowable wastage will be taxed.
It cannot therefore be said that no such charging up of excise duty on the excess wast age in transit could be validly made.
[179E] Absolute equality and justice is not attainable in taxing laws.
Legislature must be left to decide the State policy within constitutional limitations.
[179F] Rules 636 and 814 are of regulatory character and they are precautionary against perpetration of fraud on the excise revenue of the exporting State.
A statute has to be construed in the light of the mischief it was designed to remedy.
[180D] In the instant case, the military rum was obtained for the purpose of export and the lower export duty was paid and only when the rum did not result in export the question of imposing the differential duty arose.
The notion of the excise duty being changed or cancelled on account of what transpires later is not foreign to excise law.
[182H] Drawback means the repayment of duties or taxes previ ously charged on commodities, from which they are relieved on exportation.
[183B] The system of charging up the duty on the subsequent event of non export cannot, therefore, be said to be irre spective of production or manufacture.
[183C] In the instant case, if it is proved to the satisfaction of the appropriate authorities that counter vailing duty had been paid on the entire consignment irrespective of the wastage then the question would arise as to whether the wastage could be ignored altogether by the exporting State as was done by the importing State.
[183D] A.B. Abdulkadir vs State of Kerala, ; ; Bimal Chandra Banerjee vs State of Madhya Pradesh, 467; State of Mysore & Ors.
vs M/s. D. Cawasji and Co., ; ; M/s. Mohan Meakin Breweries Ltd. vs Excise M/s. Mc Dowell and Co. Ltd. vs Commercial Tax Officer, VII Circle, Hyderabad, ; ; Kalyani Stores vs State of Orissa and Ors., ; ; Excise Commissioner, U.P. vs Ram Kumar, and State of Madhya Pradesh vs Firm Gappulal, ; , referred to.
Ajudhia Distillery Rajaka, Sahaspur vs State of U.P. and Anr., [1980] Taxation Law Repons 2262, overruled.
|
Criminal Appeal No. 385 of 1991.
From the Judgment and Order dated 18.4.1988 of the Andhra Pradesh High Court in Crl.
Revision Petition No. 41 of 1987.
M.C. Bhandare and Ms. C.K. Sucharita for the Appellants.
C.N. Sreekumar and G. Prabhakar (for the State) for the Respondents.
The Judgment of the Court was delivered by SAWANT, J.
Leave is granted.
Appeal is taken oj board for final hearing by consent of parties.
The 1st appellant and the 1st respondent were married ar Tirupati on February 27, 1975.
They separated in July 1978.
The 1st appellant filed a petition for dissolution of marriage in the Circuit of St. Louis Country Missouri, USA.
The 1st respondent sent her reply from here under protest.
The Circuit Court passed a decree for dissolution of marriage on February 19, 1980 in the absence of the 1st respondent.
826 2.
The 1st appellant had earlier filed a petition for dissolution of marriage in the Sub Court of Tirupati being O.P. No. 87/86.
In that petition, the 1st appellant filed an application for dismissing the same as not pressed in view of the decree passed by the Missouri Court.
On August 14, 1991 the learned sub Judge of Tirupati dismissed the petition.
On November 2, 1981, the 1st appellant married the 2nd appellant in Yadgirigutta, 1st respondent filed a criminal complaint against the appellants for the offence of bigamy.
It is not necessary to refer to the details of the proceedings in the said complaint.
Suffice it to say that in that complaint, the appellants filed an application for their discharge in view of the decree for dissolution of marriage passed by Missouri Court.
By this judgment of October 21, 1986, the learned Magistrate discharged the appellants holding that the complainant, i.e., the 1st respondent had failed to make out a prima facie case against the appellants.
Against the said decision, the 1st respondent preferred a Criminal Revision Petition to the High Court and the High Court by the impugned decision of April 18, 1987 set aside the order of the magistrate holding that a photostat copy of the judgment of the Missouri Court was not admissible in evidence to prove the dissolution of marriage.
The Court further held that since the learned Magistrate acted on the photostat copy, he was in error in discharging the accused and directed the Magistrate to dispose of the petition filed by the accused, i.e., appellants herein for their discharge, afresh in accordance with law.
It is aggrieved by this decision that the present appeal is filed.
It is necessary to note certain facts relating to the decree of dissolution of marriage passed by the Circuit Court of St. Louis Country Missouri, USA.
In the first instance, the Court assumed jurisdiction over the matter on the ground that the 1st appellant had been a resident of the State of Missouri for 90 days next preceding the commencement of the action and that petition in that Court.
Secondly, the decree has been passed on the only ground that there remains no reasonable likelihood that the marriage between the parties can be preserved, and that the marriage is, therefore, irretrievably broken ' '.
Thirdly, the 1st respondent had not submitted to the jurisdiction of the Court.
From the record, it appears that to the petition she had filed two replies of the same date.
Both are identical in nature except that one of the replies begins with an additional averment as follows: ``without prejudice to the contention that this respondent is not submitting to the jurisdiction of this hon 'ble court, this respondent sub 827 mits as follows ' '.
She had also stated in the replies, among other things, that (i) the petition was not maintainable, (ii) she was not aware if the first appellant had been living in the State of Missouri for more than 90 days and that he was entitled to file the petition before the Court, (iii) the parties were Hindus and governed by Hindu Law, (iv) she was an Indian citizen and was not governed by laws in force in the State of Missouri and , therefore, the Court had no jurisdiction to entertain the petition, (v) the dissolution of the marriage between the parties was governed by the and that it could not be dissolved in any other way except as provided under the said Act, (vi) the Court had no jurisdiction to enforce the foreign laws and none of the grounds pleaded in the petition was sufficient to grant any divorce under the .
Fourthly, it is not disputed that the 1st respondent was neither present nor represented in the Court passed the decree in her absence.
In fact, the Court has in terms observed that it had no jurisdiction ``in personam ' ' over the respondent or minor child which was born out of the wed lock and both of them had domiciled in India.
Fifthly, in the petition which was filed by the 1st appellant in that Court on October 6, 1980, besides alleging that he had been a resident of the State of Missouri for 90 days or more immediately preceding the filing of the petition and he was then residing at 23rd Timber View Road, Kukwapood, in the Country of St. Louis, Missouri, he had also alleged that the 1st respondent had deserted him for one year or more next preceding the filing of the petition by refusal to continue to live with the appellant in the United States and particularly in the State of Missouri.
On the other hand, the averments made by him in his petition filed in the court of the Subordinate Judge, Tirupati in 1978 shows that he was a resident of Apartment No. 414, 6440, South Claiborn Avenue, New Orleans, Louisiana, United States and that he was a citizen of India.
He had given for the service of all notices and processes in the petition, the address of his counsel Shri PR Ramachandra Rao, Advocate, 16 11 1/3, Malakpet, Hyderabad 500 036.
Even according to his averments in the said petition, the 1st respondent had resided with him at Kuppanapudi for about 4 to 5 months after th marriage.
Thereafter she had gone to her parental house at Relangi, Tanuka Taluk, West Godawari District.
He was, thereafter, sponsored by his friend Prasad for a placement in the medical service in the United States and had first obtained employment in Chicago and thereafter in Oak Forest and Greenville Springs and ultimately in the Charity Hospital in Louisiana at New Orleans where he continued to be emp 828 loyed.
Again according to the averments in the said petition, when the 1st respondent joined him in the United States, both of them had stayed together as husband and wife at New Orleans.
The 1st respondent left his residence in New Orleans and went first to Jackson, Texas and, thereafter, to Chicago to stay at the residence of his friend, Prasad.
Thereafter she left Chicago for India.
Thus it is obvious from these averments in the petition that both the 1st respondent and the 1st petitioner had last resided together at New Orleans, Louisiana and never within the jurisdiction of the Circuit Court of St. Louis Country in the State of Missouri.
The averments to that effect in the petition filed before the St. Louis Court are obviously incorrect.
Under the provisions of the (hereinafter referred to as the ``Act ' ') only the District Court within the local limits of whose original civil jurisdiction (i) the marriage was solemnized, or (ii) the respondent, at the time of the presentation of the petition resides, or (iii) the parties to the marriage last resided together, or (iv) the petitioner is residing at the time of the presentation of the petition, in a case where the respondent is, at the time, residing outside the territories to which the Act extends, or has not been heard of as being alive for a period of seven years of more by those persons who would naturally have heard of him if he were alive, has jurisdiction to entertain the petition.
The Circuit Court of St. Louis Country, Missouri had, therefore, no jurisdiction to entertain the petition according to the Act under which admittedly the parties were married.
Secondly, irretrievable breakdown of marriage is not one of the grounds recognised by the Act for dissolution of marriage.
Hence, the decree of divorce passed by the foreign court was on a ground unavailable under the Act.
Under Section 13 of the Code of Civil Procedure 1908 (hereinafter referred to as the ``Code ' '), a foreign judgment is not conclusive as to any matter thereby directly adjudicated upon between the parties if (a) it has not been pronounced by a Court of competent jurisdiction; (b) it has not been given on the merits of the case; (c) it is founded on an incorrect view of international law or a refusal to recognize the law of India in cases in which such law is applicable; (d) the proceedings are opposed to natural justice, (e) it is obtained by fraud, (f) it sustains a claim founded on a breach of any law in force in India.
As pointed out above, the present decree dissolving the marriage passed by the foreign court is without jurisdiction according to the Act as neither the marriage was celebrated nor the parties last 829 resided together nor the respondent resided within the jurisdiction of that Court.
The decree is also passed on a ground which is not available under the Act which is applicable to the marriage.
What is further, the decree has been obtained by the 1st appellant by stating that he was the resident of the Missouri State when the record shows that he was only a bird of passage there and was ordinarily a resident of the State of Louisiana.
He had, if at all, only technically satisfied the requirement of residence of ninety days with the only purpose of obtaining the divorce.
He was neither domiciled in that State nor had he an intention to make it his home.
He had also no substantial connection with the forum.
The 1st appellant has further brought no rules on record under which the St. Louis Court could assume jurisdiction over the matter.
On the contrary, as pointed out earlier, he has in his petition made a false averment that the 1st respondent had refused to continue to stay with him in the State of Missouri where she had never been.
In the absence of the rules of jurisdiction of that court, we are not aware whether the residence of the 1st respondent within the State of Missouri was necessary to confer jurisdiction on that court, and if not, of the reasons for making the said averment.
Relying on a decision of this Court in Smt.
Satya vs Teja Singh, it is possible for us to dispose of this case on a narrow ground, viz., that the appellant played a fraud on the foreign court residence does not mean a temporary residence for the purpose of obtaining a divorce but habitual residence or residence which is intended to be permanent for future as well.
We remain from adopting that course in the present case because there is nothing on record to assure us that the Court of St. Louis does not assume jurisdiction only on the basis of a mere temporary residence of the appellant for 90 days even is such residence is for the purpose of obtaining divorce.
We would, therefore, presume that the foreign court by its own rules of jurisdiction had rightly entertained the dispute and granted a valid decree of divorce according to its law.
The larger question that we would like to address ourselves to is whether even in such cases, the Courts in this country should recognise the foreign divorce decrees.
The rules of Private International Law in this country are not codified and are scattered in different enactments such as the Civil Procedure Code, the Contract Act, the Indian Succession Act, the Indian Divorce Act, the Special Marriage Act etc.
In addition, some rules have also been evolved by judicial decisions.
In matters of status or legal capacity of natural persons, matrimonial disputes, custody of 830 children, adoption, testamentary and intestate succession etc.
the problem in this country is complicated by the fact that there exist different personal laws and no uniform rule can be laid down for all citizens.
The distinction between matters which concern personal and family affairs and those which concern commercial relationships, civil wrongs etc.
is well recognised in other countries and legal systems.
The law in the former area tends to be primarily determined and influenced by social, moral and religious considerations, and public policy plays a special and important role in shaping it.
Hence, in almost all the countries the jurisdicational procedural and substantive rules which are applied to disputes arising in this area are significantly different from those applied to claims in other areas.
That is as it ought to be.
For, no country can afford to sacrifice its internal unity, stability and tranquility for the sake of uniformity of rules and comity of nations which considerations are important and appropriate to facilitate international trade, commerce, industry, communication, transport, exchange of services, technology, manpower etc.
This glaring fact of national life has been recognised both by the Hague Convention of 1968 on the Recognition of Divorce and Legal Seperations as well as by the Judgments Convention of the European Community of the same year.
Article 10 of the Hague Convention expressly provides that the contracting States may refuse to recognise a divorce or legal separation if such recognition is manifestly incompatible with their public policy.
The Judgments Convention of the European Community expressly excludes from its scope (a) status or legal capacity of natural persons, (b) rights in property arising out of a matrimonial relationship, (c) wills and succession, (d) social security and (e) bankruptcy.
A separate convention was contemplated for the last of the subjects.
We are in the present case concerned only with the matrimonial law and what we state here will apply strictly to matters arising out of and ancillary to matrimonial disputes.
The Courts in this country have so far tried to follow in these matters the English rules of Private International Law whether common law rules or statutory rules.
The dependence on English Law even in matters which are purely personal, has however time and again been regretted.
But nothing much has been done to remedy the situation.
The labours of the Law Commission poured in its 65th Report on this very subject have not fructified since April 1976, when the Report was submitted.
Even the British were circumspect and hesitant to apply their rules of law in such matters during their governance of this country and had left the family law to be governed by the customary rules of the diffe 831 rent communities.
It is only where was a void that they had stepped in by enactments such as the Special Marriage Act, Indian Divorce Act, Indian Succession Act etc.
In spite, however, of more than 43 years of independence we find that the legislature has not thought it fit to enact rules of Private International Law in this area and in the absence of such initiative from the legislature the courts in this country their inspiration, as stated earlier, from the English rules.
Even in doing so they have not been uniform in practice with the result that we have some conflicting decisions in the area.
We cannot also lose sight of the fact that today more than ever in the past, the need for definitive rules for recognition of foreign judgments in personal and family matters, and particularly in matrimonial disputes has surged to the surface.
Many a man and woman of this land with different personal laws have migrated and are migrating to different countries either to make their permanent abode there or for temporary residence.
Likewise there is also immigration of the nationals of other countries.
The advancement in communication and transportation has also made it easier for individuals to hop from one country to another.
It is also not unusual to come across cases where citizens of this country have been contracting marriages either in this country or abroad with nationals of the other countries or among themselves, or having married here, either both or one of them migrate to other countries.
There are also cases where parties having married here have been either domiciled or residing separately in different foreign countries.
This migration, temporary or permanent, has also been giving rise to various kinds of matrimonial disputes destroying in its turn the family and its peace.
A large number of foreign decrees in matrimonial matters is becoming the order of the recognition of the foreign judgments in these matters.
The minimum rules of guidance for securing the certainty need not await legislative initiative.
This Court can accomplish the modest job within the framework of the present statutory provisions if they are rationally interpreted and extended to achieve the purpose.
It is with this intention that we are undertaking this venture.
We aware that unaided and left solely to our resources the rules of guidance which we propose to lay down in this area may prove inadequate or miss some aspects which may not be present to us at this juncture.
But a begining has to be made as best as one can, the lacunae and the errors being left to be filled in and corrected by future judgments.
832 12.
We believe that the relevant provisions of Section 13 of the Code are capable of being interpreted to secure the required certainty in the sphere of this branch of law in conformity with public policy, justice, equity and good conscience, and the rules so evolved will protect th sanctity of the institution of marriage and the unity of family which are the corner stones of our societal life.
Clause (a) of Section 13 states that a foreign judgment shall not be recognised if it has not been pronounced by a court of competent jurisdiction.
We are of the view that this clause should be interpreted to mean that only that court will be a court of competent jurisdiction which the Act or the law under which the parties are married recognises as a court of competent jurisdiction to entertain the matrimonial dispute.
Any other court should be held to be a court without jurisdiction unless both parties voluntarily and unconditionally subject themselves to the jurisdiction of that court.
The expression ``competent court ' ' in Section 41 of the has also to be construed likewise.
Clause (b) of Section 13 states that if a foreign has not been given on the merits of the case, the courts in this country will not recognise such judgment.
This clause should be interpreted to mean (a) that the decision of the foreign court should be on a ground available under the law under which the parties are married, and (b) that the decision should be a result of the contest between the parties.
The latter requirement is fulfilled only when the respondent is duly served and voluntarily and unconditionally submits himself/herself to the jurisdiction of the court and contests the claim, or agrees to the passing of the decree with or without appearance.
A mere filing of the reply to the claim under protest and without submitting to the jurisdiction of the court, or an appearance in the Court either in person or through a representative for objecting to the jurisdiction of the Court, should not be considered as a decision on the merits of the case.
In this respect the general rules of the acquiescence to the jurisdiction of the Court which may be valid in other matters and areas should be ignored and deemed inappropriate.
The second part of clause (c) of Section 13 states that where the judgment is founded on a refusal to recognise the law of this country in cases in which such law is applicable, the judgment will not be recognised by the courts in this country.
The marriages which take place in this country can only be under either the customary or the statutory law in force in this country.
Hence, the only law that can be applicable 833 to the matrimonial disputes is the one under which the parties are married, and no other law.
When, therefore, a foreign judgment is founded on a jurisdiction or on ground not recognised by such law, it is a judgment which is in defiance of the Law.
Hence, it is not conclusive of the matters adjudicated therein and therefore, unenforceable in this country.
For the same reason, such a judgment will also be unenforceable under clause (f) of Section 13, since such a judgment would obviously be in breach of the matrimonial law in force in this country.
Clause (d) of Section 13 which makes a foreign judgment unenforceable on th ground that the proceedings in which it is obtained are opposed to natural justice, states no more than an elementary principle on which any civilised system of justice rests.
However, in matters concerning the family law such as the matrimonial disputes, this principle has to b extended to mean something more than mere compliance with the technical rules of procedure.
If the rule of audi alteram partem has any meaning with reference to the proceedings in a foreign court, for the purposes of the rule it should not be deemed sufficient that the respondent has been duly served with the process of the court.
It is necessary to ascertain whether the respondent was in a position to present or represent himself/herself and contest effectively the said proceedings.
This requirement should apply equally to the appellate proceedings if and when they are file by either party.
If the foreign court has not ascertained and ensured such effective contest by requiring the petitioner to make all necessary provisions for the respondent to defend including the costs of travel, residence and litigation where necessary, it should be held that the proceedings are in breach of the principles of natural justice.
It is for this reason that we find that the rules of Private International Law of some countries insist, even in commercial matters, that the action should be filed in the forum where the defendant is either domiciled or is habitually resident.
It is only in special cases which is called special jurisdiction where the claim has some real link with other forum that a judgment of such forum is recognised.
This jurisdiction principle is also recognised by the Judgments Convention of this European Community .
If, therefore, the courts in this country also insist as a matter of rule that foreign matrimonial judgment will be recognised only it it is of the forum where the respondent is domiciled or habitually and permanently resides, the provisions of clause (d) may be held to have been satisfied.
The provision of clause (e) of Section 13 which requires that the 834 courts in this country will not recognise a foreign judgment if it has been obtained by fraud, is self evident.
However, in view of the decision of this Court in Smt.
Satya vs Teja Singh, (supra) it must be understood that the fraud need not be only in relation to the merits of the mater but may also be in relation to jurisdictional facts.
From the aforesaid discussion the following rule can be deduced for recognising foreign matrimonial judgment in this country.
The jurisdiction assumed by the foreign court as well as the grounds on which the relief is granted must be in accordance with the matrimonial law under which the parties are married.
The exceptions to this rule may be as follows: (i) where the matrimonial action is filed in the forum where the respondent is domiciled or habitually and permanently resides and the relief is granted on a ground available in the matrimonial law under which the parties are married; (ii) where the respondent voluntarily and effectively submits to the jurisdiction of the forum as discussed above and contests the claim which is based on a ground available under the matrimonial law under which the parties are married; (iii) where the respondent consents to the grant of the relief although the jurisdiction of the forum is not in accordance with the provisions of the matrimonial law of the parties.
The aforesaid rule with its stated exceptions has the merit of being just and equitable.
It does no injustice to any of the parties.
The parties do and ought to know their rights and obligations when they marry under a particular law.
They cannot be heard to make a grievance about it later or allowed to bypass it by subterfuges as in the present case.
The rule also has an advantage of rescuing the institution of marriage from the uncertain maze of the rules of the Private International Law of the different countries with regard to jurisdiction and merits based variously on domicile, nationality, residence permanent or temporary or ad hoc forum, proper law etc.
and ensuring certainty in the most vital field of national life and conformity with public policy.
The rule further takes account of the needs of modern life and makes due allowance to accommodate them.
Above all, it gives protection to women, the most vulnerable section of our society, whatever the strata to which they may belong.
In particular it frees them from the bondage of the tyrannical and servile rule that wife 's domicile follows that of her husband and that it is the husband 's domicilliary law which determines the jurisdiction and judges the merits of the case.
Since with regard to the jurisdiction of the forum as well as the ground on which it is passed the foreign decree in the present case 835 is not in accordance with the Act under which the parties were married, and the respondent had not submitted to the jurisdiction of the court or consented to its passing, it cannot be recognised by the courts in this country and is, therefore, unenforceable.
The High Court, as stated earlier, set aside the order of the learned Magistrate only on the ground that the photostat copy of the decree was not admissible in evidence.
The High Court is not correct in its reasoning.
Under Section 74(1)(iii) of the (Hereinater referred to as the "Act") documents forming the acts or records of the acts of public judicial officers of a foreign country are public documents.
Under Section 76 read with Section 77 of the Act, certified copies of such documents may be produced in proof of their contents.
However, under Section 86 of the Act there is presumption with regard to the genuineness and accuracy of such certified copy only if it is also certified by the representative of our Central Government in or for that country that the manner in which it has been certified is commonly in use in that country for such certification.
Section 63(1) and (2) read with Section 65(e) and (f) of the Act permits certified copies and copies made from the original by mechanical process to be tendered as secondary evidence.
A photostat copy is prepared by a mechanical process which in itself ensures the accuracy of the original.
The present photostat copies of the judicial record of the Court of St. Louis is certified for the Circuit Clerk by the Deputy Clerk who is a public officer having the custody of the document within the meaning of Section 76 of the Act and also in the manner required by the provisions of the said section.
Hence the Photostat copy per se is not inadmissible in evidence.
It is inadmissible because it has not further been certified by the representative of our Central Government in the United States as required by Section 86 of the Act.
The expression "certified copy" of a foreign judgment in Section 14 of the Code has to be read consistent with the requirement of Section 86 of the Act.
While, therefore, holding that the document is not admissible in evidence for want of the certificate under Section 86 of the Act and not because it is a photostat copy of the original as held by the High Court, we uphold the order of the High Court also on a more substantial and larger ground as stated in paragraph 14 above.
Accordingly, we dismiss the appeal and direct the learned Magistrate to proceed with the matter pending before him according to law as expenditiously as possible, preferably within four months from now as the prosecution is already a decade old.
T.N.A. Appeal dismissed.
| IN-Abs | The first appellant and the first respondent were married at Tirupati on 27.2.1975 according to Hindu Law.
They separated in July 1978.
The appellant husband filed a petition for dissolution of the marriage in the Sub Court of Tirupati stating that he was a resident of South Claiborn Avenue, New Orleans, Louisiana, and that he was a citizen of India and that he and his wife last resided together at New Orleans, Louisiana.
Subsequently he filed another petition for dissolution of marriage in the Circuit Court St. Louis Country, Missouri, USA alleging that he has been a resident of the State of Missouri for 90 days or more immediately preceding th filing of the petition by refusing to continue to live with the appellant in the US and particularly in the State of Missouri.
But from the averments made by him in the petition before the Sub Judge, Tirupati it was obvious that he and his wife had last resided together at New Orleans, Louisiana and never within the jurisdiction of th Circuit Court of St. Louis Country in the State of Missouri.
The respondent wife filed her reply raising her objections to the maintainability of the petition.
She also clearly stated that her reply was without prejudice to her contention that she was not submitting to the jurisdiction of the foreign court.
The Circuit Court Missouri assumed jurisdiction on the ground that the 1st Appellant had been a resident of the State of Missouri for 90 days next preceding the commencement of the action in the Court.
In the absence of the respondent wife the Circuit Court, Missouri passed a decree for dissolution of marriage on the only ground that the marriage has irretrievably down.
Subsequent to the passing of the decree by the Circuit Court, Missouri, the appellant filed an application for dismissal of his earlier petition before the Sub Court of Tirupati and the same was dismissed.
823 On 2nd November 1981 the last appellant married appellant No. 2.
Thereafter, the 1st respondent filed a criminal complaint against the appellants for the offence of bigamy.
The appellants filed an application for their discharge in view of the decree for dissolution of marriage passed by the Circuit Court, Missouri.
The Magistrate discharged the appellants by holding that the complainant wife had failed to make out a prima facie case against the appellants.
The respondent preferred a Criminal Revision Petition before the High Court which set aside the order of the Magistrate by holding (i) that a photostat copy of the judgment of Missouri Court was not admissible in evidence; (ii) since the Learned Magistrate acted on the photostat copy of the judgment, he was in error in discharging the accused.
Accordingly the High Court directed the Magistrate to dispose of the petition filed by the appellants for their discharge afresh in accordance with law.
Aggrieved by the decision of the High Court the appellants filed appeal in this Court.
Dismissing the appeal, this Court, HELD: 1.
The decree dissolving the marriage passed by the foreign court is without jurisdiction according to the as neither the marriage was celebrated nor the parties last resided together nor the respondent resided within the jurisdiction of that Court.
Further, irretrievable breakdown of marriage is not one of the grounds recognised by the Act of dissolution of marriage.
Hence, the decree of the divorce passed by the foreign court was on a ground unavailable under the Act which is applicable to the marriage.
Since with regard to the jurisdiction of the forum as well as the ground on which it is passed the foreign decree in the present case is not in accordance with the Act under which the parties were married, and the respondent had not submitted to the jurisdiction of the court or consented to its passing, it cannot be recognised by the courts in this country and is therefore, unenforceable.
[828H, 829A, 828E, 834H, 835A] 2.
Residence does not mean a temporary residence for the purpose of obtaining a divorce but habitual residence or residence which is intended to be permanent for future as well.
[829E] Smt.
Satya vs Teja Singh, , referred to.
The rules of Private International Law in this country are not codified and are scattered in different enactments such as the Civil Procedure Code, the Contract ACt, the Indian Succession Act, the Indian Divorce Act, the Special Marriage Act etc.
In addition, some 824 rules have also been evolved by judicial decisions.
In matters of status or legal capacity of natural persons, matrimonial disputes, custody of children, adoption, testamentary and intestate succession etc.
the problem in this country is complicated by the fact that there exist different personal laws and no uniform rule can be laid down for all citizens.
Today more than ever in the past, the need for definitive rules for recognition of foreign judgments in personal and family matters, and particularly in matrimonial disputes has surged to the surface.
A large number of foreign decrees in matrimonial matters is becoming the order of the day.
A time has, therefore, come to ensure certainty in the recognition of the foreign judgments in these matters.
The minimum rules of guidance for securing the certainty need not await legislative initiative.
This Court can accomplish the modest job within the frame work of the present statutory provisions if they are rationally interpreted and extended to achieve the purpose.
Though the proposed rules of guidance in this area may prove inadequate or miss some aspects which may not be present to us at this juncture, yet a begining has to be made as best as one can, the lacunae and the errors being left to be filled in and corrected by future judgments.
[829H, 830A, 831C, F H] 4.
The relevant provisions of Section 13 of the CPC are capable of being interpreted to secure the required certainty in the sphere of this branch of law in conformity with public policy, justice, equity and good conscience, and the rules so evolved will protect the sanctity of the institution of marriage and the unity of family which are the corner stones of our social life.
[832A] 4.1 On an analysis and interpretation of Section 13 of CPC the following rule can be deduced for recognising a foreign matrimonial judgment in this country.
The jurisdiction assumed by the foreign court as well as the grounds on which the relief is granted must be in accordance with the matrimonial law under which the parties are married.
The exceptions to this rule may be as follows; (i) where the matrimonial action is filed in the forum where the respondent is domiciled or habitually and permanently resides and the relief is granted on a ground available in the matrimonial law under which the parties are married; (ii) where the respondent voluntarily and effectively submits to the jurisdiction of the forum and contests the claim which is based on a ground available under the matrimonial law under which the parties are married; (iii) where the respondent consents to the grant of the relief although the jurisdiction of the forum is not in accordance with the provisions of the matrimonial law of the parties.
[834B D] 825 5.
The High Court erred in setting aside the order of the learned Magistrate only on the ground that the photostat copy of the decree was not admissible in evidence.
In the instant case photostat copies of the judicial record of the Court of St. Louis is certified for th Circuit Clerk by the Deputy clerk who is a public officer having the custody of the document within the meaning of Section 76 of the also in the manner required by the provisions of the said section.
Hence the photostat copy per se is not inadmissible in evidence.
It is inadmissible because it has not further been certified by the representative of our Central Government in the United States as required by Section 86 of the Act.
Therefore the document is not admissible in evidence for want of the certificate under Section 86 of the Act and not because it is a photostat copy of the original as held by the High Court.
[835B, E, F G] 6.
The Magistrate is directed to proceed with th matter pending before him according to law as expeditiously as possible, preferably within four months.
[835G]
|
ivil Appeal No. 4236 of 1988.
From the Judgment and Order dated 13.4.1988 of the Bombay High Court in W.P. No. 1689 of 1987.
V.M. Tarkunde, Mrs. Nandini Gore, Ms. Aditi Chaudhary and Mrs. M. Karanjawala (NP) for the appellant.
Dr. Y.S. Chitale, Shishir Sharma and P.H. Parekh for the Respondents.
The Judgment of the Court was delivered by RAY, J.
This appeal leave is directed against the judgment and order passed by the High Court at Bombay in Writ Petition No. 1689 of 1987 allowing the writ petition, setting aside the judgment and decree passed by the Trial Court and affirmed by the lower appellate court and thereby dismissing the suit by filed by the plaintiff (appellant in this appeal) for eviction of the tenant respondents.
The matrix of the case as appears from the pleadings of the parties is as follows: The plaintiff appellant, Gulabbai instituted Regular Civil Suit No. 19 of 1979 in the court of Shri S.S. Patil, III Jt.
Civil Judge, J.D., Ahmednagar at Ahmednagar for vacant possession of the suit property consisting of part of survey No. 3576 in the city of Ahmednagar and also for the arrears of rent and the costs of the suit.
Originally the said property belonged to the Imarat Company Private Limited.
The plaintiff purchased the said property from Imarat Company Private 945 Limited bearing numbers on the front on the eastern as 81 to 83 and rear part on the West 89 to 91, for a consideration of Rs. 34,000 on August 12, 1976.
At the time of purchase of the premises the said Amritlal Mutha in the name of his wife.
Gulabbai, the plaintiff.
The defendants were in possession of a part of the said premises bearing Nos.
81 to 83 on eastern side whereas the western part on the ground floor bearing Nos. 89 to 91 was possessed by the brother of Amritlal Mutha i.e. kanhyalal Mutha who has been running a provision store under the name and style of `Mutha Provision Store ' for the last 15 years.
The defendant Nos. 1 and 4 i.e. Nalin Narsi Vohra and Mulji Narsi Vohra are the brothers whereas defendant Nos. 2 and 3 are the wife and son of the defendant No. 1 respectively.
According to the plaintiff, the defendants are in possession of the suit shop Nos.
81 to 83 and measuring 21ft.
x 15ft.
on the monthly rent of Rs. 21.28 ps.
plus education cess Rs. 2.55 ps.
The tenancy commences from the first day of every month and ends on the last day of the said month according to the English calendar.
Prior to the purchase of the suit premises, the tenancy is in the name of defendant No. 1 i.e. Nalin Narsi Vohra and the rent receipts too were in the name of the defendant No. 1 only.
According to the plaintiff, the original agreement of defendant with Imarat Company Pvt. Ltd. is to pay rent from month to month.
After purchase of the said property.
Imarat Company intimated to the tenant defendant No. 1 about the said purchase by the plaintiff.
It has been pleaded by the plaintiff that the defendant No. 1 assured the plaintiff after purchase of the suit house, that he would vacate the said premises.
However, the defendants demanded `Pagadi ' amounting to Rs. 25000 in order to vacate the suit premises.
It was alleged by the plaintiff that the defendants were in arrears of rent since 12.8.1975 till 15.12.1977.
The plaintiff, therefore, issued a notice dated 15.12.1977 of ejectment and thereby demanded No. 1 after receipt of the notice sent Rs. 571.92 ps.
by Money Order.
But it was refused by the plaintiff as the rent was not correctly calculated.
The defendants again sent Rs. 960 by Demand Draft which was also refused by the plaintiff as miscalculated.
The defendants sent thereafter Rs. 658.55 ps.
by Money Order which was accepted by the plaintiff.
According to the plaintiff the defendants are monthly tenants and so according to her, defendants are defaulter for non paying the rent of the suit premises for more than six months.
The plaintiff also stated that her husband, Amritlal Mutha is a 946 Taxation Consultant and the suit premises are required for the purpose of office for her husband as her husband has no other suitable accommodation except the suit premises to open his office.
It has also been pleaded in the plaint that the defendants no longer require the suit premises for the purpose of business because the defendant Nos. 1 to 3 are at present residing at Pune and doing the business at Pune under the name and style of `Ashok and Company ' which deals with the sale and purchase of machine tools.
It has further pleaded by the plaintiff that the defendants are in possession of three other business at Nagar which are situated near the suit premises.
The defendants have purchased one shop in front of Kohinoor Cloth Store in the year 1964 and defendant Nos. 1 to 4 are partners in the shop `Liberty Dresses ' which deals with Reddy made garments and Hosiery.
The defendant Nos. 1 to 4 have also purchased the premises for Rs. 13,000 in the year 1972 from Imarat Company Private Ltd. which is also situated in front of the suit premises.
The defendants have also purchased one premises from Imarat Company Private Ltd.
In the year 1974 for 12,000.
The defendants have removed the middle wall in between the two properties mentioned above and opened a big shop and are carrying the business of readymade garments and woolen hosiery called as `Madura Stores '.
It is the case of the plaintiff that the defendants no more require the suit premises for business purposes and prayed for an order of eviction of the defendants from the suit premises on the ground of bona fide requirement.
It has also been pleaded that greater hardship would be caused to the plaintiff if the possession did not hand over the suit premises to the plaintiff after the receipt of the notice and the instant suit was filed on January 8, 1979.
The defendant respondent Nos. 1 to 4 filed a written statement exhibit 10 denying all the material allegations made by the plaintiff.
According to the defendants, the description of the suit house was not made properly in the plaint and hence on that ground the suit is liable to be dismissed.
The defendants has stated that the suit property is in their possession since the last 20 years at the annual rent of Rs. 255.36 ps.
They have further stated that the rent of the suit premises is to be given after every 1 year which the defendants had been regularly paying to Imarat Company Pvt.
Ltd. The defendants admit that the suit premises has been purchased by the plaintiff in the year 1975 and the defendants offered the rent to the plaintiff on several occasions but the plaintiff refused to accept the same.
Ultimately, they sent the rent by Money Order which was also refused by the plaintiff.
Again, in order to show their willingness the defendants sent an amount of 947 Rs. 960 by Demand Draft but it was also refused by the plaintiff.
The defendants thereafter have sent Rs. 658.58 ps.
which was accepted by the plaintiff on December 27, 1977.
Thus, the rent was paid upto 30.11.1977 and again from 1.12.1977 to 30.9.1978, the defendants paid the rent of the suit premises to the plaintiff and husband of the plaintiff accepted the same, but he did not give the receipt of the same.
The defendants further remitted an amount of Rs. 238.35 ps.
by Money Order to the plaintiff and it was accepted by the plaintiff.
The defendants submit that they were always ready and willing to pay the rent to the plaintiff but the plaintiff was not accepting the same.
The defendants also replied to the said notice.
According to the defendants the requirement of the plaintiff is neither bona fide nor reasonable.
The defendants further pleaded that the husband of the plaintiff is Income tax and State tax Practitioner and working with S.B. Gandhi as one of his partners and also having his own office which is situated in Ghas Gali, now called as Shahaji Road on the first floor and the said premises is suitable for plaintiff 's husband to open to his office there.
The plaintiff is in possession of area 15 fts.
x 25 fts.
on the ground floor facing towards west, adjacent to the suit premises and also complete first floor 15 fts.
x 15 fts.
The said area is suitable for plaintiff 's husband for his office if he so desires.
It has been pleaded by the defendant No. 1 that greater hardship would be caused to him if premises are vacated and handed over to the plaintiff.
The defendants submit that they are residing at Ahmednagar and carrying the business of Ready made garments in the suit shop.
It has been further pleaded that accommodation is not easily available in the Ahmednagar City for the purpose of business and Kapad Bazar area where the suit premises exist is the only good market of hosiery and so prayed for dismissal of the plaintiff 's suit.
On the above pleadings ten issues were framed of which the relevant issues are: Issue No. 2 : Whether the plaintiff proves that the is lawful defaulter in payment of monthly rent? Issue No. 3 : Whether the plaintiff proves that she bona fide requires possession of the suit premises for the office of her husband Amritlal? Issue No. 4 : To whom the greater hardship would be caused by passing the decree for eviction than by refusing to pass it? 948 Issue No. 7 : Whether the defendant No. 1 proves that suit premises were leased to him at annual rent of Rs. 255.36 ps.? The Trial Court held with regard to Issue No. that at the time of purchases there was ground floor and first floor to the suit premises.
The defendant were in possession of shop Nos.
81 to 83 on the eastern side and on the western side of the ground floor shops bearing Nos. 89 to 91 were in possession of the brother of the plaintiff 's husband, Kanhyalal Mutha were he had been running a provision store since the last 13 years.
The family of Amritlal Mutha, i.e. husband of the plaintiff considered of his wife, his 3 children, the eldest son aged about 16 years was studying in the 12th standard in the year 1981.
His second son aged about 13 years was in 7th standard and 3rd son in 3rd standard in the year 1981.
The plaintiff had been residing on the first floor of the suit premises, which consisted of 4 rooms, first one bed room towards west admeasuring 7 fts.
x 12 fts.
and next room kitchen admeasuring 7 fts.
x 11 fts.
and 3rd room admeasuring 7 fts.
x 11 fts.
which is used for the studies of the children.
One other room admeasuring 15 fts.
x 15 fts.
was used as a bed room.
It has been found that first floor premises is not sufficient for his office purposes because he requires at least 25 fts.
x 30 fts.
area for the purpose of office in order to keep the records and for the sitting arrangement for his clients and also for his cabin.
It has further been found that the ground floor shop Nos. 89 to 91 adjacent to the suit premises is not available for the plaintiff 's husband for opening his office as Kanhyalal Mutha, brother of the plaintiff 's husband, has been running there Mutha Provision Store for the last about 15 years, the evidence of Amritlal is also consistent with the evidence of Kanyalal Mutha on this point.
The Trial Court therefore, found that as the plaintiff has no other accommodation at Ahmednagar except the suit premises and the partnership of the plaintiff 's husband with S.B. Gnadhi has been dissolved, the plaintiff reasonably requires the suit premises for the purpose of opening of office of her husband as Tax Consultant.
The demand of the plaintiff is therefore, reasonable and bona fide.
It was also found that the defendant No. 1 was in possession of a number of premises which are near the suit premises and the defendants were carrying on the hosiery business in those premises under the name and style of `Liberty Dresses ' and `Madura Stores '.
It has been further held that the defendant No. 1 was shown as partner in the firm M/s Vohra and Company, 94/97 Budhwar Peth, Pune 2, and the residence of defendant No. 1 is known as Krishnakripa, Mukund Nagar, Pune 9 where the suit summons were served on the defendant No. 1.
It was 949 also found that it was evident from exhibit 105 that the son of defendant No. 1 and wife of son of defendant No. 1 are the partners in M/s Ashok and Company and both are residing at 7/3 C Vanshree Apartment, Rambag Colony, Sadashiv peth.
It has also been found that the defendant No. 1 has admitted in his cross examination that he has vacated his residential premises at Ahmednagar and he is in search of other residential accommodation.
It was, therefore, held that the plaintiff has proved his bona fide requirement of the suit premises and thus issue No. 3 had been decided in the affirmative.
As regards Issue No. 4, the Trial Court held that except the suit premises and first floor on it, no other premises was available to the plaintiff at Ahmednagar.
The Trial Court held further that the first floor premises is not suitable for the plaintiff 's husband to open his office and greater hardship will be caused to the plaintiff if the suit premises be not handed over to the plaintiff than by denying him the vacant possession of the suit premises.
Issue No. 4 was thus held in favour of the plaintiff.
It was further held that the suit premises were properly described in the plaint.
As regards Issue Nos. 2 and 7 it was held that the defendant No. 1 is a monthly tenant and the monthly rent in respect of such premises is Rs. 21.28 ps.
plus education cess Rs. 2.55 ps.
i.e. Rs. 23.83 ps.
It was also held that the tenancy commenced from the first day of every month and ended on last day of the same month as per the English calendar.
The Trial Court held that the defendants failed to prove that the suit premises were leased to them at annual rent of Rs. 255.36 and hence that issue was decided against the defendants.
The defendants were also to be held as defaulters as the deposits of rent were not made within the meaning of Section 12(3)(a) and 12(3)(b) of the Rent Act.
The Trial Court thus decreed the suit and directed the defendants to hand over vacant possession of the suit premises within one month of the date of order.
Against the said Judgment and decree, the defendant No. 1 Nalin Narsi Vohra filed an appeal being Regular Civil Appeal No. 430 of 1985 in the court of Addl.
Distt.
Judge, Ahmednagar, The learned Additional District Judge held that the Trial Court was right in holding that the defendant No. 1 was paying the rent monthly and he was a monthly tenant.
It was further held that there are no arrears for the statutory period in order to hold that the defendants are defaulters for which their tenancy is liable to be determined.
As such the Addl.
District Judge found against the plaintiff holding that the defendants 950 had not defaulted in payment of rent and there could not be any decree of ejectment on this ground.
The learned Addl.
District Judge further held that there was nothing which shattered the evidence of Amritlal when he speaks about the bona fide requirement of the plaintiff for having the suit property to open his office and the argument that plaintiff can acquire the premises of Kanhyalal could not be accepted as it was neither possible nor feasible in the near future to expect that Kanhyalal would surrender the premises to plaintiff.
The construction on the second floor of the suit premises was a temporary one and as such the same could not be used for residential purposes.
The Addled.
District Judge also considered the application for additional evidence which disclosed that the plaintiff 's husband had purchased a plot at Chahurana Bk.
at the T.P. Scheme No. 3 within the municipal limit of Ahmednagar and constructed a big bungalow covering about 2000 sq.
The Addl.
District Judge held that it was not known whether the Municipality has given permission for habitation and furthermore the requirement of the plaintiff was especially for conducting her husband 's profession of Tax Practitioner at the required suit premises, which is not for residential purposes.
The suit premises are situated in Kapad Bazar area where the trading communities have their shops and business establishments, and is fit for the opening of Tax Consultant 's office.
The bungalow constructed by the plaintiff 's husband was not suitable for starting the office of Tax Practitioner as it is at a remote place.
It was, therefore, held that the subsequent circumstances have not much relevance and the requirement of the plaintiff was a bona fide and genuine one.
As such, the Additional District Judge affirmed the judgment and decree passed by the Trial Court.
It was further held by the learned Additional District Judge that there was no possibility of any hardship being caused to the defendants in case the possession of the suit premises was granted to the plaintiff.
The Addl.
District Judge therefore, dismissed the appeal and affirmed the judgment and decree of the Trial Court.
Feeling aggrieved the respondent tenant, Nalin Narsi Vohra filed a writ petition under Article 227 of the Constitution being registered as Writ Petition No. 1689 of 1987 in the High Court of Judicature at Bombay.
The High Court issued a Rule on the said writ petition and after hearing the parties and considering the facts and circumstances including the evidences on record, the High Court held that in a petition under Article 227 of the Constitution of India the High Court does not generally interfere with regard to the concurrent findings of facts 951 arrived at by the courts below but in appropriate cases the High Court has jurisdiction under Article 227 of the Constitution to consider facts subsequent to the filing of an application for eviction which have a great bearing on the question of bona fide and reasonable requirement of the landlord for a decree for eviction of the suit premises.
The High Court has referred to some decisions rendered by this Court in this respect.
It has been held by the High Court that of the subsequent facts which are relevant and admissible can be taken into considerations by the High Court in order to come to a finding as to the reasonable and bona fide requirement of the landlord for passing a decree of eviction from the suit premises.
The High Court has held on a consideration of the additional evidences which have been expressly mentioned in the application for additional evidence stating in detail that the plaintiff 's husband, Amritlal Mutha after passing of the decree for eviction under section 13(1)(a) of the Bombay Rents.
Hotel and Lodging House Rates Control Act, 1947 has acquired a plot being No. 47/1 situated in T.P. Scheme No. III at Ahmednagar.
The total area of the plot is 3025 sq.
and after getting the permission from the Municipal Council of Ahmednagar, the plaintiff 's husband constructed a big bungalow thereon during the pendency of the appeal and had been residing there.
The said premises consists of a covered area of 2000 sq.
and the plaintiff is using the same for residence and office purpose also.
These facts were not properly considered by the lower appellate court while finding about the reasonable and bona fide requirement of the plaintiff in passing a decree of eviction of the defendants from the suit premises.
The High Court held that the said bungalow can be conveniently used for the residence of the plaintiff and her family members as well as for the purpose of opening of office of Tax Consultant by her husband.
That apart, the entire first floor of the suit premises can be conveniently utilised for opening the office of Tax Consultant by the plaintiff 's husband, Amritlal Mutha.
The lower appellate court totally failed to consider this aspect of the case.
It has, therefore, been held that: ``. .
Even otherwise the finding is manifestly so unjust and unsupported by the evidence that its validity cannot be sustained even in this limited field, more so, since there is utter mis reading of the evidence and non application of mind on material features and there is also an error apparent on the face of the record. ' ' The High Court, therefore, allowed the writ petition and made the rule absolute and set aside the judgments and decrees made by the courts below.
952 It is against this judgment and order, the instant appeal on special leave has been filed at the instance of the plaintiff in this court.
Three question were raised before the courts below.
The first question was whether the suit property was properly described in the plaint or not.
On this point, both the Trial Court as well as the lower appellate court have concurrently found that the suit premises being part of Survey No. 3576 which was previously owned by one Imarat Company Private Limited from whom the plaintiff 's husband Amritlal Mutha purchased for a sum of Rs. 34, 000 was properly described in the plaint and the respondents defendants have been occupying an area admittedly 20fts.
x 15fts.
being shop Nos.
81 to 83 on the eastern side of the said premises.
This finding of the courts below has neither been challenged before the High Court nor before this Court in the instant appeal.
The next point that was urged by the plaintiff in the courts below was that on the ground of default in payment of arrears of rent the defendant No. 1 was liable to be ejected from the suit premises in accordance with the provisions of Section 12(2) read with Section 12(3)(a) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 hereinafter to be referred in short as the said Act.
On this point, the Trial Court held that: ``. the defendant by depositing rent for the first time on 8.6.80, for the period 1.10.78 to 31.12.80 committed breach of above mentioned ruling and is defaulter within the meaning of Section 12(3)(a) and 12(3)(b) of the Rent Act. ' ' The lower Appellate Court, however, after considering the evidences held that the defendant are not defaulters as there were no arrears for the statutory period.
Thus, the question of default on the part of the defendants in the payment of rent was not at all raised nor agitated before the Court of Appeal below by the plaintiff.
The only question that was agitated with great vehemence by the learned counsel on behalf of the appellant is about the finding arrived at by the High Court to the effect that there was no reasonable bona fide requirement for the plaintiff appellant to obtain a decree for eviction of the defendants respondents from the suit premises for the 953 purpose of opening of office of Tax Consultant by the appellant 's husband, Amritlal Mutha on the ground floor of the said premises.
Mr. Tarkunde, learned counsel appearing in support of the case of the appellant has with great vehemence urged before us that the bungalow that has been constructed by the appellant 's husband within Ahmednagar Municipal area is at a distance of about 1 2 Kms.
from the suit premises whereas the suit premises is situated in the Kapad Bazar area where the traders have their shops and establishments and as such the ejectment of the respondents from the suit premises was necessary for opening the office of Tax Consultancy in the suit premises by the husband of the appellant.
It has been further urged in this connection by Mr. Tarkunde that the bungalow that has been constructed and comprises of a covered area of 2000 sq.
ft. is entirely necessary for occupation of the appellant 's eldest son, Abhey Amritlal Mutha who passed MBBS in 1988 and obtained certificate of registration.
It has also been submitted in this connection that permission to start dispensary and consulting clinic/residence in the said premises has been obtained from the Town Planner and Chief Officer, Ahmednagar Municipal Council.
It has also been urged with great vehemence by Shri Tarkunde that the respondent has not been residing at all in Ahmednagar but has shifted to Pune as will be evident from the fact that the summons of the suit were served on the respondent No. 1 at his residence at Krishnakripa, Galli No. 3, 3rd Floor, Mukund Nagar, Pune 411009.
It has been further stated that the respondent No. 1, Nalin Narsi Vohra has started a business under the name and style of M/s Vohra and Company since February, 94/97, Budhwar Peth, Pune 2.
It is a partnership firm business and the partners, are Nalin Narsi Vohra, Krishnakripa, Mukand Nagar, Pune 9 and Mrs. Bhanu Ashok Vora, 41/166, Lokamanya Nagar, Pune 30.
This business has been started since July, 1979 as per the partnership deed and the copy of the register of firms.
It has also been stated that the respondent No. 1, Ashok Nalin also started a business of machine tools known as M/s Ashok & Company at 94/97, Budhwar Peth, Pune 2 vide partnership deed dated 12.2.1982.
It has further been urged on behalf of the appellant tha the suit premises remained under lock and key for about ten years and no business was transacted in the said premises.
It has also been urged in this connection that besides the suit premises the respondents purchased the Municipal Premises No. 2733/6 and has been running `Madura Stores ' for selling ready made garments.
In 1972, the respondent No. 1 Nalin Narsi Vohra and his brother, respondent No. 4, Mulji Narsi Vohra jointly purchased the ownership rights from Imarat Company Pvt. ltd.
the premises No. 733/9 and open `Liberty Dresses ' therein for sale of 954 hosiery goods.
Similarly the respondent No. 1 also purchased another premises opposite to Kohinoor Cloth Store and after removing the wall in between two shops, has been running the business of ready made garments known as `Madura Stores '.
It has, therefore, been contended that the suit premises being closed for a period of ten years and no business being carried on there, the appellant is entitled to get decree of ejectment of the respondents from the suit premises under the provisions of the said Act.
The contention that the respondents kept the suit premises under lock and key for about ten years without opening the shop, running the business of ready made garments therein, has not at all been proved by any evidence whatsoever as has been held by the High Court.
Therefore, this contention is wholly untenable.
Moreover the ground of ejectment of the ground of non payment of rent for over six months under Section 12(2) and 12(3)(a) of the Bombay Rent Act has not been mentioned in the eviction suit nor any issue was framed on this score.
It has been on the other hand contended by the learned counsel appearing on behalf of the respondents that the submissions made in the application for additional evidence bring further materials before the lower appellate court on the question that the appellant has alternative accommodation and as such she did not reasonably and bona fide require the suit premises for the opening of the office of Tax Consultant for her husband, Amritalal Mutha therein.
It is convenient to note in this connection that the statements as well as the subsequent facts that have been brought to the notice of the court by the application for additional evidence under Order 41, Rule 27 of the Code of Civil Procedure and filed before the lower appellate court have not been controverted at all.
As such, the appellant or her husband, Amritlal Mutha did not deny those subsequent facts brought before the court by the said application.
The lower appellate court that admitted the application for additional evidence failed to consider at all the fact that a very specious bungalow comprising of about 2000 sq.
covered area had already been built within the Ahmednagar Municipal Area by the plaintiff 's husband, Amritlal Mutha.
After purchasing the plot and constructing the bungalow during the pendency of the appeal before the lower appellate court, the appellant with the members of her family had been residing there and the husband of the appellant had started the office of Tax Consultancy in that bungalow.
The lower appellate court merely by passed this relevant fact on the plea that that bungalow is at a distance from the Kapad Bazar area where the shops 955 of the traders are situated.
The lower appellate court also did not at all consider whether the first floor of the suit premises as well as the second floor which though claimed to be a shed, could be conveniently utilised for the purpose of the said Tax Consultancy Office.
The lower appellate Court simply considered that the second floor being a temporary shed could not properly be used for opening the Tax Consultancy Office and the first floor which consisted of 4 rooms of which 2 are used as bed rooms and 1 is used as a kitchen and 1 as study room of the sons of the appellant, cannot be conveniently utilised for the said office as there was no space for the same without considering at all that the appellant with members of his family had been residing already in the spacious bungalow referred to hereinbefore.
It has been urged with great vehemence on behalf of the appellant that both the Trial Court as well as the Lower Appellate Court having found that the appellant reasonably and bona fide required the suit premises for the opening of the office of Tax Consultant of the appellant 's husband, Amritlal Mutha, the decree of eviction of the suit premises should not have been set aside by the High Court under Article 227 of the Constitution by taking into consideration subsequent facts and evidences.
This submission, in our considered opinion, is without any substance and same is to be rejected.
Reference may be made in this connection to the decision in the case of M/s Variety Emporium vs V.R.M. Mohd. Ibrahim Naina; , wherein it has been observed that: "No authority is needed for the proposition that, in appropriate cases, the Court must have regard to events as they present themselves at the time when it is hearing the proceeding before it and mould the relief in the list of those events.
We may, however, draw attention to a decision of this Court in Hasmat Rai vs Raghunath Prasad, ; the ratio of which may be stated thus: When an action is brought by a landlord for the eviction of a tenant on the ground of personal requirements, the landlord 's need must not only be shown to exist at the date of the suit, but it must exist on the date of the appellate decree, or the date when a higher Court deals with the matter.
During the progress and passage of proceedings from court to court, if subsequent events occur which, if noticed, would non suit the landlord, the court has to examine and evaluate those events and mould the decree accordingly.
The tenant is entitled to show that the need or requirement of the landlord no more exists by pointing out such subse 956 quent events, to the court, including the appellate court.
In such a situation, it would be incorrect to say that as a decree or order for eviction is passed against the tenant, he cannot invite the Court to take into consideration subsequent events.
The tenant can be precluded from so contending only when 3 decree or order for eviction has become final.
(Pages 606 607).
Justice R.S. Pathak, who concurree with Justice D.A. Desai and Justice Venkataramiah, expressed the same view thus: It is well settled now that in a proceeding for the ejectment of a tenant on the ground of personal requirement under a statute controlling the eviction of tenants, unless the statute prescribes to the contrary, the requirement must continue to exist on the date when the proceeding is finally disposed of either in appeal or revision, by the relevant authority.
That position is indisputable.
(Page 624).
In Chandavarkar Sita Ratna Rao vs Ashalata section Guram, ; it has been observed that: "In exercise of jurisdiction under Article 227 of the Constitution, the High Court can go into the question of facts or look into the evidence if justice so requires it.
But it should decline to exercise that jurisdiction in the absence of clear cut down reasons where the question depends upon the appreciation of evidence.
It also should not interfere with a finding within the jurisdiction of the inferior tribunal or court except where the finding is perverse in law in the sense that no reasonable person properly instructed in law could have come to such a finding or there is any misdirection in law or a view of fact has been taken in the teeth of preponderance of evidence or the finding is not based on any material evidence or it has resulted in manifest injustice.
Except to that limited extent the High Court has no jurisdiction.
" In Pasupuleti Venkateswarlu vs The Motor & General Traders, ; it has been observed by this Court that: "For making the right or remedy, claimed by the party just 957 and meaningful as also legally and factually in accord with the current realities, the court can, and in many cases must, take cautious cognizance of events and development subsequent tot he institution of the proceeding provided the rules of fairness to both sides are scrupulously obeyed.
On both occasions the High Court, in revision, correctly took this view.
The later recovery of another accommodation by the landlord, during the pendency of the case, has as the High Court twice pointed out, a material bearing on the right to evict, in view of the inhibition written into section 10(3)(iii) itself.
The High Court was right in taking into consideration the facts which came into being subsequent to the commencement of the proceedings.
" Similar observation has been made in Hasmat Rai & Anr.
vs Raghunath Prasad, "It is immaterial that the amendment was sought more than three years after possession of the portion had passed to the respondent.
The High Court was bound to take the fact into consideration because, as is well settled now, in a proceeding for the ejectment of a tenant on the ground of personal requirement under a statute controlling the eviction of tenants, unless the statute prescribes to the contrary the requirement must continue to exist on the date when the proceeding is finally disposed of either in appeal or revision, by the relevant authority.
The position, to my mind, is indisputable.
The High Court should have allowed the amendment." In Amarjit Singh vs Smt.
Khatoon Quamarain, ; it has been observed by this Court that: "Administration of justice demands that any changes either in fact or in law must be taken cognizance of by the Court but that must be done in a cautious manner of relevant facts.
Therefore, subsequent events can be taken cognizance of if they are relevant and materiel.
" On a conspectus of all these decisions rendered by this Court, it is now beyond the pale of any doubt that in appropriate cases events subsequent to the filing of the suit can be taken notice of and can be duly considered provided the same is relevant in determining the sues 958 tion of bona fide requirement.
Therefore, the High Court was right in duly considering the new facts and circumstances that have been brought to the notice of the Court by the application for additional evidence filed under Order 41 Rule 27 of the Code of Civil Procedure and in coming to a firm finding that the plaintiff appellant having constructed a spacious bungalow where she with the members of her family had been residing, there is no reasonable and bona fide requirement for the plaintiff to get a decree of ejectment of the defendants from the suit premises in as much as the first floor of the suit premises as well as the second floor could be conveniently used for opening the office of Tax Consultancy of plaintiff 's husband who previously worked with one Mr. Gandhi in a partnership firm which partnership had been dissolved after Mr. Gandhi 's son came to practice with his father.
It is also relevant to consider in this connection the observations of this Court in Bega Begum and Ors.
vs Abdul Ahad Khan and Ors., ; as regards the meaning of the words `reasonable requirement and own occupation ' as used in Section 11(h) of the Jammu and Kashmir Houses and Shops Rent Control Act, 1966.
It has been held that the words `reasonable requirement undoubtedly postulate that there must be an element of need as opposed to a mere desire or wish.
The distinction between desire and need should doubtless be kept in mind but not so as to make even the genuine need as nothing but a desire.
In the instant appeal it has been rightly held by the High Court after considering the subsequent facts and materials brought out by the application for additional evidence that the plaintiff failed to prove reasonable and bona fide need for her occupation of the suit premises for the purpose of opining the Tax Consultancy Office of her husband, Amritlal Mutha.
Considering the facts and circumstances as well as the subsequent materials brought out by the application for additional evidence, we have no hesitation in our mind to hold that the aforesaid findings arrived at by the High Court is totally unexceptionable and so the same cannot be interfered with in this appeal.
It will not be out of place to mention in this connection that Amritlal Mutha, husband of the appellant has stated in the additional affidavit filed in this Court that Dr. Abhey A. Mutha, son of the appellant had purchased a flat on ownership basis in Co partnership Society, named Amrita Kunj Cooperative Housing Society Ltd. situated at 324/5 Shivaji Nagar, Pune 410005.
This, if taken notice of, will affirm the finding of the High Court that the appellant failed to prove her bona fide and reason 959 able need for the suit premises for opening the Tax Consultancy Office for her husband.
Besides the contentions referred to hereinbefore, no other contention has been advanced before this Court.
Therefore, this appeal fails and is hereby dismissed.
The judgment and order of the High Court is upheld.
In the facts and circumstances of the case, the parties will bear their own costs.
Y.Llal Appeal failed.
| IN-Abs | The appellant plaintiff instituted a Regular Civil Suit in the court of Joint Civil Judge, J.D., Ahmednagar for vacant possession of the suit property and also for arrears of rent.
It was pleaded by the appellant that the defendants were in possession of the suit shop on the monthly rent and the tenancy commenced from the first day of every month and ended on the last day of the said month according to English calender.
The plaintiff based his suit primarily on two grounds viz., that the defendants had committed default in the payment of statutory rent and were thus defaulters and secondly the appellant required the premises for bona fide need for setting up an office for her husband, who is tax consultant.
It was asserted by the plaintiff that the defendants had acquired alternative business placed both in the vicinity of the suit premises, being partners of the firms named in the plaint and also elsewhere and they no longer required the premises.
It was also added that the suit premises remained mostly locked and no business was carried on there; defendants 1 to 3 having shifted from Ahmednagar to Pune were doing business there.
The defendants denied the allegations contained in the plaint, stating that the suit property was in their possession since last 20 years at the annual rent of Rs.255.36 ps; that an receipt of the notice they had sent the rent amounting to Rs.517 92 ps.
by Money Order which the appellant refused being not correctly calculated; then again the defendants sent Rs.960 by Demand Draft which was also refused by the appellant as miscalculated.
Thereafter the defendants sent Rs.658.55 ps.
by Money Order which was accepted by the appellant.
According to the tenants they are always to pay the rent and in fact the appellant 's husband had been accepting the rent without issuing any receipt therefore.
According to the defendants, the requirement of the plaintiff was neither bona fide nor reasonable; her husband, an 942 Income Tax and Sales/Tax Practitioner was working with Mr. Gandhi as one of his partners and also having his own office.
Further the plaintiff was in possession of an area 15ft.
x 25ft.
on the ground floor facing towards west, adjacent to the suit premises and also complete first floor 45ft.
x 15ft.
The Trial Court held that the defendants failed to prove that the suit premises were leased to them at annual rent and as such they were held to be defaulters as the deposits of rent were not made within the meaning of Section 12(3)(a) and 12(3)(b) of the Rent Act.
The Trial Court further found that as the plaintiff has no other accomodation at Ahmednagar except the suit premises and the partnership of the plaintiff 's husband with with S.B. Gandhi had been dissolved, the plaintiff reasonably required the suit premises for the purpose of opening office of her husband as Tax Consultant.
Accordingly the Trial Court decreed the suit and directed the defendants to hand over the vacant possession of the suit premises within one month of the date of order.
Being aggrieved, the defendants filed an appeal before the Additional District Judge, Ahmednagar.
The Additional District Judge, held that the trial court was right in holding that the defendant No. 1 was paying the rent monthly and he was a monthly tenant but there were no arrears for the statutory period in order to hold that the defendants were defaulters for which their tenancy was liable to be determined.
On the question of bona fide requirement of the appellant, the Additional District Judge also considered the application for additional evidence which disclosed that the plaintiff 's husband had purchased a plot and constructed a big bungalow covering about 2000 sq.
and held that it was not known whether the Municipality had given permission for habitation and furthermore the requirement of the plaintiff was especially for conducting her husband 's profession of Tax Practitioner at the required suit premises, which is not for residential purposes.
On this reasoning the Additional District Judge held that the subsequent circumstances have not much relevance and the requirement of the plaintiff appellant was a bona fide and genuine one.
Accordingly he affirmed the decree passed by the Trial Court.
The Respondent tenant being aggrieved filed a writ petition under Article 227 of the Constitution praying for setting aside the decree of ejectment passed against him.
The High Court, on a consideration of the additional evidences which have been expressly mentioned in the application for additional evidence, held that the husband of the appellant had required a plot in T.P. Scheme No. III, Ahmednagar and constructed a big bungalow thereon during the pendency of the appeal 943 and has been residing there.
The said premises consisted of a 2000 sq.
covered area and the appellant was using the same for residence and office purpose also.
The High Court held that the said bungalow can be conveniently used for the residence of the plaintiff and her family members as well as for the purpose of opening of office of Tax Consultant by her husband.
That apart, the entire first floor of the suit premises can be conveniently utilised for opening the office of Tax Consultant by the plaintiff 's husband.
The High Court therefore on that reasoning allowed the writ petition and set aside the judgments and decrees passed by the Courts below.
Hence this appeal by the appellant landlord by special leave.
Dismissing the appeal, this Court HELD: The lower Appellate Court, after considering the evidences held that the defendant are not defaulters as there were no arrears for the statutory period.
Thus, the question of the default on the part of the defendants in the payment of rent was not at all raised nor agitated before the Court of Appeal below by the plaintiff.
[952F G] It is now beyond the pale of any doubt that in appropriate cases events subsequent to the filing of the suit can be taken notice of and can be duly considered provided the same is relevant in determining the question of bona fide requirement.
The High Court was right in duly considering the new facts and circumstances that have been brought to the notice of the Court by the application for additional evidence filed under Order 41 Rule 27 of the Code of Civil Procedure.
[957H 958A] In the appeal it has been rightly held by the High Court after considering the subsequent facts and materials brought out by the application for additional evidence that the plaintiff failed to prove reasonable and bona fide need for her occupation of the suit premises for the purpose of opening the Tax Consultancy office of her husband, Amritlal Mutha.
Considering the facts and circumstances as well as the subsequent materials brought out by the application for additional evidence, we have no hesitation in our mind to hold that the aforesaid findings arrived at by the High Court is totally unexceptionable and so the same cannot be interfered with in this appeal.
[958F G] The words ``reasonable requirement ' ' undoubtedly postulatethat there must be an element of need desire or wish.
The distinction between desire and need should doubtless be kept in 944 mind but not so as to make even the genuine need as nothing that a desire.
M/s. Variety Emporium vs
V. R.M. Mohd. Ibrahim Naina; , ; Chandavarkar Sita Ratna Rao vs Ashalata section Guram, ; ; Pasupuleti Venkateswarlu vs The Motor & General Traders, ; ; Hasmat Rai & Anr.
vs Raghunath Prasad, ; Amarjit Singh vs Smt.
Khatoon Quamarain; , ; and Begum and Ors.
vs Abdul Ahad Khan and Ors., ; ;
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