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Arjun Singh Vs. Mohindra Kumar & Others

were thus linked together, the application made for the restoration of suit 20 of 1953 constituted a finding by a competent Court that there was no good or sufficient cause for the non-appearance of the appellant in Court for any suit on May 29, 1958. The suits were, no doubt, ordered to be tried jointly in the sense that the evidence recorded in one suit was to be treated as evidence in the other suits also, suit 134 of 1956 being treated as the main suit in which evidence was recorded, but that affords no basis for the contention that every application made in one suit for the relief which is pertinent only to that suit must be treated as an application made in every other suit. Thus, for instance, in the present case if no application were made for the restoration of suit 20 of 1953 which had been dismissed for default it could hardly be contended that because of the application made in suit 134 of 1956 it wold serve the purpose of an application for the restoration of that other suit. Similarly, if an application had been made for the restoration of suit 20 of 1953 and the Court found that there was sufficient cause for setting the dismissal aside that would by itself hardly be a ground for setting aside the ex parte decree in suit 134 of 1956. These features are sufficient to demonstrate that the circumstances that the suits were being tried jointly has no bearing on the matter now in controversy and that so far as regards the ex parte orders in the three suits each had to be considered independently and had to be disposed of also independently notwithstanding that the same grounds might have sufficed for the relief prayed for in the independent applications. There is another aspect from which this matter could be viewed. The point at issue in the application under O IX R. 9 filed to set aside the dismissal for default in suit 20 of 1953 was whether the plaintiff had sufficient cause for his non-appearance "when the suit was called on for hearing" (vide O. IX R. 9). The suit called on for hearing in that rule obviously refers to suit 20 of 1953. A decision, therefore, that there was no sufficient cause for the non-appearance of the plaintiff in that suit would not be eadem questio with the matter which arose for decision when the application under O. IX R. 7 was made in suit 134 of 1956 notwithstanding that the facts upon which the issue depended was similar and possibly identical. This is a further reason why we are unable to accept the submission of learned Counsel.22. The last of the points that was urged by Mr. Pathak was that the decree that was actually passed in suit 134 of 1956 was not in reality an ex parte decree but one on the merits. It was urged that the proceeding on May 29, 1958 satisfied the conditions of O. XVII R. 3 and not O. XVII R. 2. There are several reasons why this submission is entirely without substance. In the first place during the entire proceeding right up to the hearing of the present application which was made under O. IX R. 13 the Court as well as both the parties proceeded on the basis that the decree was passed ex parte. The order sheet on May 29, 1958 we have extracted earlier contained a direction by the Court that the case will proceed ex parte for the reason that Counsel for the defendant reported no instructions. And it must be noticed that by that date the entire hearing was over. The application that was made to set aside this order to proceed ex parte was filed on the basis that the previous hearing was ex parte and contested by the respondent on the same basis. The order of the High Court is revision on September 4, 1958 proceeds on the same basis. When finally judgment was pronounced by the Civil Judge in suit 134 of 1956 it expressly stated that it was a decree ex parte. In the face of these circumstances there should be overwhelming evidence of the proceedings not being ex parte if the respondent is to succeed in his present plea. In order that the decree passed was one under O. XVII R. 3 which is the submission of Mr. Pathak the opening words of that rule must be satisfied. That rule reads :"Where any party to a suit to whom time has been granted fails to produce his evidence, or to cause the attendance of his witnesses, or to perform any other act necessary to the further progress of the suit, for which time has been allowed, the Court may, notwithstanding such default, proceed to decide the suit forthwith."In regard to this the Civil Judge stated:"The ground on which this objection is based is that 29-5-58 was the date adjourned at the instance of the defendant-applicant. I do not think that this ground has any force. It appears from the record that on 28-5-58 the cases were adjourned to 29-5-58 on a joint application of the parties to the effect that a compromise would be filed. It was not, therefore, an adjournment sought by the defendant alone, moreover, that application was made by him in his own suit No. 20 of 1953 and the other two suits had also naturally to be adjourned as all the three of them were consolidated. The adjournment of those two suits, therefore, cannot be said to be at the instance of the defendant."Learned Counsel was unable to point any flaw in the facts here stated. It would, therefore, follow that the terms of O. XVII R. 3 were not attracted at all and that suit 134 of 1956 was decreed not on merits but really ex parte as had been expressly stated by the learned Civil Judge when he passed that decree.

1[ds]11. We agree that generally speaking these propositions are not open to objection. If the court which rendered the first decision was competent to entertain the suit or other proceeding, and had therefore competency to decide the issue or matter, the circumstance that it is a tribunal of exclusive jurisdiction or one from whose decision no appeal lay would not by themselves negative the finding on the issue by it being res judicata in laterdecision, therefore, that there was no sufficient cause for the non-appearance of the plaintiff in that suit would not be eadem questio with the matter which arose for decision when the application under O. IX R. 7 was made in suit 134 of 1956 notwithstanding that the facts upon which the issue depended was similar and possibly identical. This is a further reason why we are unable to accept the submission of learnedthe first place during the entire proceeding right up to the hearing of the present application which was made under O. IX R. 13 the Court as well as both the parties proceeded on the basis that the decree was passed ex parte. The order sheet on May 29, 1958 we have extracted earlier contained a direction by the Court that the case will proceed ex parte for the reason that Counsel for the defendant reported no instructions. And it must be noticed that by that date the entire hearing was over. The application that was made to set aside this order to proceed ex parte was filed on the basis that the previous hearing was ex parte and contested by the respondent on the same basis. The order of the High Court is revision on September 4, 1958 proceeds on the same basis. When finally judgment was pronounced by the Civil Judge in suit 134 of 1956 it expressly stated that it was a decree ex parte. In the face of these circumstances there should be overwhelming evidence of the proceedings not being ex parte if the respondent is to succeed in his present plea. In order that the decree passed was one under O. XVII R. 3 which is the submission of Mr. Pathak the opening words of that rule must be satisfied. That rule readsany party to a suit to whom time has been granted fails to produce his evidence, or to cause the attendance of his witnesses, or to perform any other act necessary to the further progress of the suit, for which time has been allowed, the Court may, notwithstanding such default, proceed to decide the suitregard to this the Civil Judgeground on which this objection is based is that 29-5-58 was the date adjourned at the instance of the defendant-applicant. I do not think that this ground has any force. It appears from the record that on 28-5-58 the cases were adjourned to 29-5-58 on a joint application of the parties to the effect that a compromise would be filed. It was not, therefore, an adjournment sought by the defendant alone, moreover, that application was made by him in his own suit No. 20 of 1953 and the other two suits had also naturally to be adjourned as all the three of them were consolidated. The adjournment of those two suits, therefore, cannot be said to be at the instance of theCounsel was unable to point any flaw in the facts here stated. It would, therefore, follow that the terms of O. XVII R. 3 were not attracted at all and that suit 134 of 1956 was decreed not on merits but really ex parte as had been expressly stated by the learned Civil Judge when he passed that decree.

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: were thus linked together, the application made for the restoration of suit 20 of 1953 constituted a finding by a competent Court that there was no good or sufficient cause for the non-appearance of the appellant in Court for any suit on May 29, 1958. The suits were, no doubt, ordered to be tried jointly in the sense that the evidence recorded in one suit was to be treated as evidence in the other suits also, suit 134 of 1956 being treated as the main suit in which evidence was recorded, but that affords no basis for the contention that every application made in one suit for the relief which is pertinent only to that suit must be treated as an application made in every other suit. Thus, for instance, in the present case if no application were made for the restoration of suit 20 of 1953 which had been dismissed for default it could hardly be contended that because of the application made in suit 134 of 1956 it wold serve the purpose of an application for the restoration of that other suit. Similarly, if an application had been made for the restoration of suit 20 of 1953 and the Court found that there was sufficient cause for setting the dismissal aside that would by itself hardly be a ground for setting aside the ex parte decree in suit 134 of 1956. These features are sufficient to demonstrate that the circumstances that the suits were being tried jointly has no bearing on the matter now in controversy and that so far as regards the ex parte orders in the three suits each had to be considered independently and had to be disposed of also independently notwithstanding that the same grounds might have sufficed for the relief prayed for in the independent applications. There is another aspect from which this matter could be viewed. The point at issue in the application under O IX R. 9 filed to set aside the dismissal for default in suit 20 of 1953 was whether the plaintiff had sufficient cause for his non-appearance "when the suit was called on for hearing" (vide O. IX R. 9). The suit called on for hearing in that rule obviously refers to suit 20 of 1953. A decision, therefore, that there was no sufficient cause for the non-appearance of the plaintiff in that suit would not be eadem questio with the matter which arose for decision when the application under O. IX R. 7 was made in suit 134 of 1956 notwithstanding that the facts upon which the issue depended was similar and possibly identical. This is a further reason why we are unable to accept the submission of learned Counsel.22. The last of the points that was urged by Mr. Pathak was that the decree that was actually passed in suit 134 of 1956 was not in reality an ex parte decree but one on the merits. It was urged that the proceeding on May 29, 1958 satisfied the conditions of O. XVII R. 3 and not O. XVII R. 2. There are several reasons why this submission is entirely without substance. In the first place during the entire proceeding right up to the hearing of the present application which was made under O. IX R. 13 the Court as well as both the parties proceeded on the basis that the decree was passed ex parte. The order sheet on May 29, 1958 we have extracted earlier contained a direction by the Court that the case will proceed ex parte for the reason that Counsel for the defendant reported no instructions. And it must be noticed that by that date the entire hearing was over. The application that was made to set aside this order to proceed ex parte was filed on the basis that the previous hearing was ex parte and contested by the respondent on the same basis. The order of the High Court is revision on September 4, 1958 proceeds on the same basis. When finally judgment was pronounced by the Civil Judge in suit 134 of 1956 it expressly stated that it was a decree ex parte. In the face of these circumstances there should be overwhelming evidence of the proceedings not being ex parte if the respondent is to succeed in his present plea. In order that the decree passed was one under O. XVII R. 3 which is the submission of Mr. Pathak the opening words of that rule must be satisfied. That rule reads :"Where any party to a suit to whom time has been granted fails to produce his evidence, or to cause the attendance of his witnesses, or to perform any other act necessary to the further progress of the suit, for which time has been allowed, the Court may, notwithstanding such default, proceed to decide the suit forthwith."In regard to this the Civil Judge stated:"The ground on which this objection is based is that 29-5-58 was the date adjourned at the instance of the defendant-applicant. I do not think that this ground has any force. It appears from the record that on 28-5-58 the cases were adjourned to 29-5-58 on a joint application of the parties to the effect that a compromise would be filed. It was not, therefore, an adjournment sought by the defendant alone, moreover, that application was made by him in his own suit No. 20 of 1953 and the other two suits had also naturally to be adjourned as all the three of them were consolidated. The adjournment of those two suits, therefore, cannot be said to be at the instance of the defendant."Learned Counsel was unable to point any flaw in the facts here stated. It would, therefore, follow that the terms of O. XVII R. 3 were not attracted at all and that suit 134 of 1956 was decreed not on merits but really ex parte as had been expressly stated by the learned Civil Judge when he passed that decree. ### Response: 1

Mandir S.Sita Ramji @ Shree Sitaramji B Vs. Land Acquisition Collector

Agreement is merely to allot some land out of the 35,000 acres being acquired. It is submitted that the Constitution Bench of this Court has approved such a course of action. 10. In support of this submission, it was also pointed out that the planned development can only be in accordance with the Delhi Development Act and that this permitted the authority to allot land to various co-operative societies for the purposes of development. 11. We have considered the submissions of both the sides. In our view, there is no merit in the challenge to the proposed acquisition on the ground that the acquisition was for the purposes of the society covered by Agreement dated 9th May, 1972. The subsequent Notification is merely a followup of the earlier Notification. The entire acquisition is for ?planned development of Delhi?. To be remembered that Appellants? land is in the midst of the 35,000 acres which have been acquired pursuant to the Notification under Section 4 issued in 1959. The Agreement dated 19th May, 1972 does not specify that it is the Appellants? land which is to be allotted to that Society. The society is to be allotted some land and even if Appellants? land is allotted to this society, after acquisition, it will not mean that the acquisition was for this society. Therefore, the provisions of Part VII of the Land Acquisition Act need not have been complied with. 12. It was next submitted, on behalf of the Appellants, that the Government has formulated a scheme by which parties are permitted to develop their own land. It was submitted that the acquisition of land of such parties was to be withdrawn as per the policy.In this behalf, reliance was placed upon a letter dated 3rd March, 1987 from the office of the Prime Minister, wherein it is stated that the Appellants may be permitted to develop the land in accordance with the norms given by Delhi Development Authority. Reliance was also placed upon a letter dated 4th April, 1991 from the Director, Delhi Development Authority, to one Shri Acharya Arun Dev (whom the Appellants claim to be their power of attorney holder) wherein also the Appellants? proposal to allot the land to them for development was stated to be approved. Reliance was also placed upon a letter dated 17th September, 1991 from the Additional Secretary to the Minister of Urban Development as well as minutes of a meeting held on 23rd September, 1991 in the chambers of the Lt. Governor to consider the Appellants? proposal to develop the lands themselves. Relying on these documents, it was submitted that the Governments had decided to withdraw from the acquisition. It was submitted that the Government should be held bound by its commitment to so withdraw. It was submitted that for this reason also the acquisition should be quashed. 13. As against this, on behalf of the Respondents, it is pointed out that this very ground had been considered by the Delhi High Court on an earlier occasion. It was pointed out that after looking into the relevant records the Delhi High Court had recorded in paras 18 and 19 of its judgments as follows: "18. It also appears that there was a decision relating to denotification of land in favour of one Sita Ram Bhandar Trust. File thereof had been called for by the Prime Minister who ordered that no land was to be denotified without the previous approval of the Cabinet/Prime Minister. When this file was sent to the Ministry, based on the decision contained in respect of Sita Ram Bhandar Trust, following noting was recorded in respect of the land in question on 17th June, 1999. ?Notes from page 38/N onwards may kindly be seen—The case of Denotification of village Kotla Mahigiran, Tehsil Mehrauli, New Delhi was examined without calling a fresh report up-to-date position of the case from DDA. The then Minister (UD) has ordered (P-41/N) for the denotification of the land. 2. Subsequently, DDA has informed that out of 615 Bighas acquired by the Government physical possession of land measuring 600 Bighas has already been taken over by the DDA. 3. In the meantime the file relating to denotification of land in favour of Sita Ram Bhandar Trust has been called for by the Prime Minister and the PM has ordered that no land is to be denotified without the previous approval of the Cabinet/PM. In view of this no further action is required in this case. Submitted please.? 19. This file was placed before the Minister. It may be mentioned that in the meantime new incumbent had taken charge. This new Minister took the following decision on the basis of aforesaid noting dated 17th June, 1999. ?The file of Sita Ram Bhandar Trust has since been received back from the PMO and PM?s instructions not to denotify the land have been noted. 2. On the Trust?s file, I have recorded my observations. These observations apply in this case as well. There is no justification for denotifying land, particularly when 600 bighas have already been acquired and taken over.? 14. This could not be denied by the Appellants. It is thus clear that letters and minutes relied upon are mere recommendations. No decision to release from acquisition had been taken. In any event the Prime Minister had turned out this proposal. 15. Even otherwise, we have seen the scheme sought to be relied upon. We find from the scheme that it only applies in respect of persons/agencies who own and possess the land. In this case possession of the land had already been taken. The scheme also categorically states that the scheme would not take away the rights of the Delhi Development Authority to acquire for development of Delhi. Thus the scheme was not applicable to lands of the Appellants. Even under Section 48 of the Land Acquisition Act once possession is taken the Government cannot withdraw from the acquisition. We thus see no substance in this contention also. 16.

0[ds]11. We have considered the submissions of both the sides. In our view, there is no merit in the challenge to the proposed acquisition on the ground that the acquisition was for the purposes of the society covered by Agreement dated 9th May, 1972. The subsequent Notification is merely a followup of the earlier Notification. The entire acquisition is for ?planned development of Delhi?. To be remembered that Appellants? land is in the midst of the 35,000 acres which have been acquired pursuant to the Notification under Section 4 issued in 1959. The Agreement dated 19th May, 1972 does not specify that it is the Appellants? land which is to be allotted to that Society. The society is to be allotted some land and even if Appellants? land is allotted to this society, after acquisition, it will not mean that the acquisition was for this society. Therefore, the provisions of Part VII of the Land Acquisition Act need not have been complied with14. This could not be denied by the Appellants. It is thus clear that letters and minutes relied upon are mere recommendations. No decision to release from acquisition had been taken. In any event the Prime Minister had turned out this proposal15. Even otherwise, we have seen the scheme sought to be relied upon. We find from the scheme that it only applies in respect of persons/agencies who own and possess the land. In this case possession of the land had already been taken. The scheme also categorically states that the scheme would not take away the rights of the Delhi Development Authority to acquire for development of Delhi. Thus the scheme was not applicable to lands of the Appellants. Even under Section 48 of the Land Acquisition Act once possession is taken the Government cannot withdraw from the acquisition. We thus see no substance in this contention also

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: Agreement is merely to allot some land out of the 35,000 acres being acquired. It is submitted that the Constitution Bench of this Court has approved such a course of action. 10. In support of this submission, it was also pointed out that the planned development can only be in accordance with the Delhi Development Act and that this permitted the authority to allot land to various co-operative societies for the purposes of development. 11. We have considered the submissions of both the sides. In our view, there is no merit in the challenge to the proposed acquisition on the ground that the acquisition was for the purposes of the society covered by Agreement dated 9th May, 1972. The subsequent Notification is merely a followup of the earlier Notification. The entire acquisition is for ?planned development of Delhi?. To be remembered that Appellants? land is in the midst of the 35,000 acres which have been acquired pursuant to the Notification under Section 4 issued in 1959. The Agreement dated 19th May, 1972 does not specify that it is the Appellants? land which is to be allotted to that Society. The society is to be allotted some land and even if Appellants? land is allotted to this society, after acquisition, it will not mean that the acquisition was for this society. Therefore, the provisions of Part VII of the Land Acquisition Act need not have been complied with. 12. It was next submitted, on behalf of the Appellants, that the Government has formulated a scheme by which parties are permitted to develop their own land. It was submitted that the acquisition of land of such parties was to be withdrawn as per the policy.In this behalf, reliance was placed upon a letter dated 3rd March, 1987 from the office of the Prime Minister, wherein it is stated that the Appellants may be permitted to develop the land in accordance with the norms given by Delhi Development Authority. Reliance was also placed upon a letter dated 4th April, 1991 from the Director, Delhi Development Authority, to one Shri Acharya Arun Dev (whom the Appellants claim to be their power of attorney holder) wherein also the Appellants? proposal to allot the land to them for development was stated to be approved. Reliance was also placed upon a letter dated 17th September, 1991 from the Additional Secretary to the Minister of Urban Development as well as minutes of a meeting held on 23rd September, 1991 in the chambers of the Lt. Governor to consider the Appellants? proposal to develop the lands themselves. Relying on these documents, it was submitted that the Governments had decided to withdraw from the acquisition. It was submitted that the Government should be held bound by its commitment to so withdraw. It was submitted that for this reason also the acquisition should be quashed. 13. As against this, on behalf of the Respondents, it is pointed out that this very ground had been considered by the Delhi High Court on an earlier occasion. It was pointed out that after looking into the relevant records the Delhi High Court had recorded in paras 18 and 19 of its judgments as follows: "18. It also appears that there was a decision relating to denotification of land in favour of one Sita Ram Bhandar Trust. File thereof had been called for by the Prime Minister who ordered that no land was to be denotified without the previous approval of the Cabinet/Prime Minister. When this file was sent to the Ministry, based on the decision contained in respect of Sita Ram Bhandar Trust, following noting was recorded in respect of the land in question on 17th June, 1999. ?Notes from page 38/N onwards may kindly be seen—The case of Denotification of village Kotla Mahigiran, Tehsil Mehrauli, New Delhi was examined without calling a fresh report up-to-date position of the case from DDA. The then Minister (UD) has ordered (P-41/N) for the denotification of the land. 2. Subsequently, DDA has informed that out of 615 Bighas acquired by the Government physical possession of land measuring 600 Bighas has already been taken over by the DDA. 3. In the meantime the file relating to denotification of land in favour of Sita Ram Bhandar Trust has been called for by the Prime Minister and the PM has ordered that no land is to be denotified without the previous approval of the Cabinet/PM. In view of this no further action is required in this case. Submitted please.? 19. This file was placed before the Minister. It may be mentioned that in the meantime new incumbent had taken charge. This new Minister took the following decision on the basis of aforesaid noting dated 17th June, 1999. ?The file of Sita Ram Bhandar Trust has since been received back from the PMO and PM?s instructions not to denotify the land have been noted. 2. On the Trust?s file, I have recorded my observations. These observations apply in this case as well. There is no justification for denotifying land, particularly when 600 bighas have already been acquired and taken over.? 14. This could not be denied by the Appellants. It is thus clear that letters and minutes relied upon are mere recommendations. No decision to release from acquisition had been taken. In any event the Prime Minister had turned out this proposal. 15. Even otherwise, we have seen the scheme sought to be relied upon. We find from the scheme that it only applies in respect of persons/agencies who own and possess the land. In this case possession of the land had already been taken. The scheme also categorically states that the scheme would not take away the rights of the Delhi Development Authority to acquire for development of Delhi. Thus the scheme was not applicable to lands of the Appellants. Even under Section 48 of the Land Acquisition Act once possession is taken the Government cannot withdraw from the acquisition. We thus see no substance in this contention also. 16. ### Response: 0

NATIONAL HIGHWAY AUTHORITY OF INDIA Vs. GAYATRI JHANSI RAODWAYS LIMITED

fact, the agreement provides for a fixed rate of fee of the AT as agreed by the parties. Oral submissions on this mater were made by boththe parties. The AT deliberated on the matter and has decided that in view of the latest provision in the amended Act, the AT is competent to fix the fees regardless of the agreement of the parties. This is as per judgment dated 11.09.2017 of the Hon?ble High Court in the matter of NHAI vs Gayatri Jhansi Roadways. The AT reiterated that the fees fixed in the 1 st hearing shall be followed. Accordingly, fees shall be regulated as per provisions of ‘the fourth schedule of the amended Arbitration and Conciliation Act, 1996.?7. Faced with this order, the respondent moved an application on 08.05.2018 under Section 14 of the Arbitration and Conciliation Act, 1996, to terminate the mandate of the arbitrators, inasmuch as, according to the respondent, the arbitrators had wilfully disregarded the agreement between the parties and were, therefore, de jure unable to act any further in the proceedings. 8. Meanwhile, the Arbitral Tribunal passed yet another order dated 19.07.2018 in which the Tribunal stated it had no objection to payment of any fees as would be decided in the pending proceedings by the High Court of Delhi. 9. The learned Single Judge, by the impugned judgment, set out clause 5 of the agreement between the parties and then stated that the Fourth Schedule of the Arbitration Act not being mandatory, whatever terms are laid down as to arbitrator?s fees in the agreement, must needs be followed. In so doing, he disagreed with the another learned Single Judge Bench judgment dated 11.09.2017 in National Highways Authority of India v. Gayatri Jhansi Roadways Limited in which, the learned Single Judge had held that Section 31(8) and Section 31A of the Arbitration Act would govern matters such as this and since the expression ‘unless otherwise agreed by the parties? had been omitted from Section 31A by the Amendment Act of 2015, arbitrator?s fees would have to be fixed in accordance with the Fourth Schedule of the Arbitration Act dehors the agreement between the parties. 10. The impugned judgment violently disagreed with this view holding the said judgment as per incuriam stating that:"25. A reading of the above would clearly show that the ?costs? under Section 31(8) and 31A of the Act are the costs which are awarded by the Arbitral Tribunal as part of its award in favour of one party to the proceedings and against the other. 26. The deletion of words ?unless otherwise agreed by the parties? in Section 31A only signifies that the parties, by an agreement, cannot contract out of payment of ‘costs? and denude the Arbitral Tribunal to award ‘costs? of arbitration in favour of the successful party. The Judgment of this Court in Gayatri Jhansi Roadways Limited (Supra) relied upon by the counsel for the respondent does not take note of the above decisions or the report of the Law Commission. The said judgment is, therefore, per incuriam. I am informed that the said decision is pending challenge before the Supreme Court by way of a Special Leave Petition. In any case, the said Judgment was passed on an appeal under Section 37 of the Act and did not consider the contours of Section 14 of the Act.?11. We have heard learned counsel for the both the sides. In our view, Shri Narasimha, learned senior counsel, is right in stating that in the facts of this case, the fee schedule was, in fact, fixed by the agreement between the parties. This fee schedule, being based on an earlier circular of 2004, was now liable to be amended from time to time in view of the long passage of time that has ensued between the date of the agreement and the date of the disputes that have arisen under the agreement. We, therefore, hold that the fee schedule that is contained in the Circular dated 01.06.2017, substituting the earlier fee schedule, will now operate and the arbitrators will be entitled to charge their fees in accordance with this schedule and not in accordance with the Fourth Schedule to the Arbitration Act. 12. We may, however, indicate that the application that was filed before the High Court to remove the arbitrators stating that their mandate must terminate, is wholly disingenuous and would not lie for the simple reason that an arbitrator does not become de jure unable to perform his functions if, by an order passed by such arbitrator(s), all that they have done is to state that, in point of fact, the agreement does govern the arbitral fees to be charged, but that they were bound to follow the Delhi High Court in Gayatri Jhansi Roadways Limited case which clearly mandated that the Fourth Schedule and not the agreement would govern. 13. The arbitrators merely followed the law laid down by the Delhi High Court and cannot, on that count, be said to have done anything wrong so that their mandate may be terminated as if they have now become de jure unable to perform their functions. The learned Single Judge, in allowing the Section 14 application, therefore, was in error and we set aside the judgment of the learned Single Judge on this count. 14. However, the learned Single Judge?s conclusion that the change in language of section 31(8) read with Section 31A which deals only with the costs generally and not with arbitrator?s fees is correct in law. It is true that the arbitrator?s fees may be a component of costs to be paid but it is a far cry thereafter to state that section 31(8) and 31A would directly govern contracts in which a fee structure has already been laid down. To this extent, the learned Single Judge is correct. We may also state that the declaration of law by the learned Single Judge in Gayatri Jhansi Roadways Limited is not a correct view of the law.

1[ds]In our view, Shri Narasimha, learned senior counsel, is right in stating that in the facts of this case, the fee schedule was, in fact, fixed by the agreement between the parties. This fee schedule, being based on an earlier circular of 2004, was now liable to be amended from time to time in view of the long passage of time that has ensued between the date of the agreement and the date of the disputes that have arisen under the agreement. We, therefore, hold that the fee schedule that is contained in the Circular dated 01.06.2017, substituting the earlier fee schedule, will now operate and the arbitrators will be entitled to charge their fees in accordance with this schedule and not in accordance with the Fourth Schedule to the Arbitration Act.We may, however, indicate that the application that was filed before the High Court to remove the arbitrators stating that their mandate must terminate, is wholly disingenuous and would not lie for the simple reason that an arbitrator does not become de jure unable to perform his functions if, by an order passed by such arbitrator(s), all that they have done is to state that, in point of fact, the agreement does govern the arbitral fees to be charged, but that they were bound to follow the Delhi High Court in Gayatri Jhansi Roadways Limited case which clearly mandated that the Fourth Schedule and not the agreement would govern.The arbitrators merely followed the law laid down by the Delhi High Court and cannot, on that count, be said to have done anything wrong so that their mandate may be terminated as if they have now become de jure unable to perform their functions. The learned Single Judge, in allowing the Section 14 application, therefore, was in error and we set aside the judgment of the learned Single Judge on this count.However, the learned Single Judge?s conclusion that the change in language of section 31(8) read with Section 31A which deals only with the costs generally and not with arbitrator?s fees is correct in law. It is true that the arbitrator?s fees may be a component of costs to be paid but it is a far cry thereafter to state that section 31(8) and 31A would directly govern contracts in which a fee structure has already been laid down. To this extent, the learned Single Judge is correct. We may also state that the declaration of law by the learned Single Judge in Gayatri Jhansi Roadways Limited is not a correct view of the law.

### Instruction: From the information provided in the case proceeding, infer whether the court's decision will be positive (1) or negative (0) for the appellant. ### Input: fact, the agreement provides for a fixed rate of fee of the AT as agreed by the parties. Oral submissions on this mater were made by boththe parties. The AT deliberated on the matter and has decided that in view of the latest provision in the amended Act, the AT is competent to fix the fees regardless of the agreement of the parties. This is as per judgment dated 11.09.2017 of the Hon?ble High Court in the matter of NHAI vs Gayatri Jhansi Roadways. The AT reiterated that the fees fixed in the 1 st hearing shall be followed. Accordingly, fees shall be regulated as per provisions of ‘the fourth schedule of the amended Arbitration and Conciliation Act, 1996.?7. Faced with this order, the respondent moved an application on 08.05.2018 under Section 14 of the Arbitration and Conciliation Act, 1996, to terminate the mandate of the arbitrators, inasmuch as, according to the respondent, the arbitrators had wilfully disregarded the agreement between the parties and were, therefore, de jure unable to act any further in the proceedings. 8. Meanwhile, the Arbitral Tribunal passed yet another order dated 19.07.2018 in which the Tribunal stated it had no objection to payment of any fees as would be decided in the pending proceedings by the High Court of Delhi. 9. The learned Single Judge, by the impugned judgment, set out clause 5 of the agreement between the parties and then stated that the Fourth Schedule of the Arbitration Act not being mandatory, whatever terms are laid down as to arbitrator?s fees in the agreement, must needs be followed. In so doing, he disagreed with the another learned Single Judge Bench judgment dated 11.09.2017 in National Highways Authority of India v. Gayatri Jhansi Roadways Limited in which, the learned Single Judge had held that Section 31(8) and Section 31A of the Arbitration Act would govern matters such as this and since the expression ‘unless otherwise agreed by the parties? had been omitted from Section 31A by the Amendment Act of 2015, arbitrator?s fees would have to be fixed in accordance with the Fourth Schedule of the Arbitration Act dehors the agreement between the parties. 10. The impugned judgment violently disagreed with this view holding the said judgment as per incuriam stating that:"25. A reading of the above would clearly show that the ?costs? under Section 31(8) and 31A of the Act are the costs which are awarded by the Arbitral Tribunal as part of its award in favour of one party to the proceedings and against the other. 26. The deletion of words ?unless otherwise agreed by the parties? in Section 31A only signifies that the parties, by an agreement, cannot contract out of payment of ‘costs? and denude the Arbitral Tribunal to award ‘costs? of arbitration in favour of the successful party. The Judgment of this Court in Gayatri Jhansi Roadways Limited (Supra) relied upon by the counsel for the respondent does not take note of the above decisions or the report of the Law Commission. The said judgment is, therefore, per incuriam. I am informed that the said decision is pending challenge before the Supreme Court by way of a Special Leave Petition. In any case, the said Judgment was passed on an appeal under Section 37 of the Act and did not consider the contours of Section 14 of the Act.?11. We have heard learned counsel for the both the sides. In our view, Shri Narasimha, learned senior counsel, is right in stating that in the facts of this case, the fee schedule was, in fact, fixed by the agreement between the parties. This fee schedule, being based on an earlier circular of 2004, was now liable to be amended from time to time in view of the long passage of time that has ensued between the date of the agreement and the date of the disputes that have arisen under the agreement. We, therefore, hold that the fee schedule that is contained in the Circular dated 01.06.2017, substituting the earlier fee schedule, will now operate and the arbitrators will be entitled to charge their fees in accordance with this schedule and not in accordance with the Fourth Schedule to the Arbitration Act. 12. We may, however, indicate that the application that was filed before the High Court to remove the arbitrators stating that their mandate must terminate, is wholly disingenuous and would not lie for the simple reason that an arbitrator does not become de jure unable to perform his functions if, by an order passed by such arbitrator(s), all that they have done is to state that, in point of fact, the agreement does govern the arbitral fees to be charged, but that they were bound to follow the Delhi High Court in Gayatri Jhansi Roadways Limited case which clearly mandated that the Fourth Schedule and not the agreement would govern. 13. The arbitrators merely followed the law laid down by the Delhi High Court and cannot, on that count, be said to have done anything wrong so that their mandate may be terminated as if they have now become de jure unable to perform their functions. The learned Single Judge, in allowing the Section 14 application, therefore, was in error and we set aside the judgment of the learned Single Judge on this count. 14. However, the learned Single Judge?s conclusion that the change in language of section 31(8) read with Section 31A which deals only with the costs generally and not with arbitrator?s fees is correct in law. It is true that the arbitrator?s fees may be a component of costs to be paid but it is a far cry thereafter to state that section 31(8) and 31A would directly govern contracts in which a fee structure has already been laid down. To this extent, the learned Single Judge is correct. We may also state that the declaration of law by the learned Single Judge in Gayatri Jhansi Roadways Limited is not a correct view of the law. ### Response: 1

TRIJUGI NARAIN (DEAD) THROUGH LEGAL REPRESENTATIVES AND OTHERS Vs. SANKOO (DEAD) THROUGH LEGAL REPRESENTATIVES AND OTHERS

(supra), Madhav Rao Jivaji Rao Scindia (supra), this Court has applied the rule of primogeniture to the estates of such Rulers by giving effect and protection to the personal law, that is, the rule of primogeniture as provided vide the covenant and merger agreement. Consequently, even after the erstwhile Rulers had surrendered their sovereign rights and their kingdoms/estates had merged with the Dominion of India, the succession and all its concomitant rights to their erstwhile sovereign property now held as private property, would devolve vide the merger agreement and the Constitution as per the customs applicable to the erstwhile Rulers. Relying on the Constitution, and sub-section (ii) to Section 5 of the Succession Act, this Court has, time and again, held that the law of the land is pervious to the rule of primogeniture. The recent decision of this Court in Talat Fatima Hasan Through Her Constituted Attorney Sh. Syed Mehdi Husain v. Nawab Syed Murtaza Ali Khan (D) By LRs. And Others in Civil Appeal No. 1773 of 2002 decided on July 31, 2019 pertains to the Muslim Personal Law (Shariat) Application Act, 1937 applicable to the State of Rampur. This is clear from paragraph 12 of the judgment in Talat Fatima Hasan (supra), which records that the only issue to be decided was whether the properties held by the Nawab would devolve on his eldest son by applying the rule of primogeniture or would be governed by the Muslim Personal Law (Shariat) Application Act, 1937 and devolve on all his legal heirs.40. It may be pertinent to state here that the succession on death of Brij Nath Singh had opened on 13th October 1968, which is before Article 362 relating to the rights and privileges of the Indian Rulers was repealed by the Constitution (26th Amendment) Act, 1971. Article 362, before it was repealed, stated that in exercise of the power of Parliament or of the Legislature of a State to make laws or in the exercise of the executive power of the Union or a State, due regard shall be had to the guarantee or the assurance given under any such covenant or agreement referred to in Article 291 with respect to the personal rights, privileges or dignities of the Ruler of an Indian State.41. Faced with the aforesaid position, learned counsel for the appellants had submitted that the property being a leasehold Nazul plot located in Allahabad and owned by the superior lessor, i.e. State of Uttar Pradesh, it could not be treated as a sovereign property in the hands of Raghubir Singh and also in the hands of Brij Nath Singh. The property should be treated as coparcenary property belonging to the joint Hindu family and not as impartible property to which the rule of primogeniture would be applicable. This contention must be rejected. Brij Nath Singh had taken over as a Ruler of the State of Maihar in the pre-independence era when the Rulers, though subject to British supremacy, were treated as absolute sovereign Rulers within their own territories. There was no distinction between public and private property of the Rulers since the distinction would be counter to the basic attribute of sovereignty. In Pratap Singh (supra), the subject matter included properties held by the ruling Chief of Nabha estate in the British territory, i.e. territory outside the Home State. One such property known as Sterling Castle in Shimla, was purchased in the name of the friend of the ruling Chief in view of the restriction put by the Britishers on acquisition, whether direct or indirect, by a sovereign or Feudatory Princes of lands in the British territory. After the Britishers had left, the friend of the ruling Chief had relinquished his title and conferred it upon the three sons and widow of the late ruling Chief. The ruling Chief had also acquired a property in Delhi. The contention that these two properties were private properties and not State properties was rejected by this Court.42. In Draupadi Devi and Others v. Union of India and Others, (2004) 11 SCC 425 the dispute pertained to perpetual leasehold rights of a property in Delhi called Kapurthala House which was purchased by Jagatjit Singh, the then Maharaja of Kapurthala by a registered sale deed 19th January 1935. The question whether it was personal or State/sovereign property was decided in favour of the Union of India holding that it was a State or sovereign property, notwithstanding the alleged command of the Maharaja in 1940 purportedly declaring Kapurthala House as his personal and private property. Reference was made to aide-memoire dated 1st March 1937 by Lieutenant Colonel Fisher declaring the Kapurthala House as a State property. Thus, leasehold properties situated outside the princely states have been held to be State or sovereign property. Therefore, the contention of the appellants that the property being leasehold Nazul land situated outside the princely state was personal property must be rejected in the absence of any other evidence or material to rebut the presumption that the property was a part of the impartible estate belonging to the sovereign Ruler. On the other hand, inheritance of the property post the death of Raghubir Singh by the new Ruler including Brij Nath Singh by application of the rule of primogeniture to the exclusion of others son(s) would indicate that it was treated as a State or sovereign property.43. In view of the aforesaid discussion, it has to be held that the property was a part of the impartible property i.e., the property though ancestral was not a part of the coparcenary property, but was a part of the estate of the sovereign Ruler, Brij Nath Singh. Further, Brij Nath Singh could transfer the property inter-vivos or make a bequest by way of a will. The contention that the property was a separate or personal property and, therefore, not a part of the impartible property has not been established and has not been proved by the appellants by leading evidence and material to dispel the presumption.

0[ds]In the present case, we are not concerned with the concept of deemed partition of existing coparcenary property on death of a coparcener, execution of a will by coparcener of his undivided interest vide Section 30 of the Succession Act or the amendments made in the Succession Act vide Act No. 39 of 2005 applicable with effect from 9th September 200513. It is, therefore, well established that an impartible estate is clothed with the incidents of self-acquired and separate property. Impartible estate even if inherited and ancestral, is not held by the coparcenary as a part of the coparcenary property, as the coparceners or members of the joint Hindu family do not have the right to partition or right to restrain alienation. Though the right to survivorship is not inconsistent with the custom of impartible estate, albeit it is different from the ordinary rule of succession under the Mitakshara Hindu law where all sons of the father are entitled to equal share in his estate, for the law of succession when the rule of primogeniture applies, is that the first-born son succeeds to the entire estate to the exclusion of the other sonsThe legal position as explained in paragraphs 14 to 16 (supra) was highlighted in D.S. Meramwala (supra) stating that there was not even a single instance where the son(s) were recognized to have an interest in the estate for partitioning the estate during the lifetime of the Chief. It is, therefore, clear that when the rule of primogeniture is applicable, the principles of ancestral coparcenary property would not apply. In the case of an impartible estate, the son(s) would not get any interest by birth, as a son of Hindu has interest by birth in coparcenary property27. It is, therefore, clear that upon signing the merger agreement, the Rulers had lost their sovereignty and, in a way, had become ordinary citizens with certain special rights and privileges as mentioned in the Constitution28. The legal effect of the merger agreements and whether the customary rule of impartible estate would cease to be applicable by applying the doctrine of ‘cessante ratione legis, cessat ipsa lex? has been examined in several decisions. The argument against continuation of the customary rule is predicated on the plea that primogeniture and impartibility, though not attributes of sovereignty, were customs which existed because the rulership existed, and therefore when there was loss of rulership, there was no need for the custom to exist40. It may be pertinent to state here that the succession on death of Brij Nath Singh had opened on 13th October 1968, which is before Article 362 relating to the rights and privileges of the Indian Rulers was repealed by the Constitution (26th Amendment) Act, 1971. Article 362, before it was repealed, stated that in exercise of the power of Parliament or of the Legislature of a State to make laws or in the exercise of the executive power of the Union or a State, due regard shall be had to the guarantee or the assurance given under any such covenant or agreement referred to in Article 291 with respect to the personal rights, privileges or dignities of the Ruler of an Indian StateThis contention must be rejected. Brij Nath Singh had taken over as a Ruler of the State of Maihar in the pre-independence era when the Rulers, though subject to British supremacy, were treated as absolute sovereign Rulers within their own territories. There was no distinction between public and private property of the Rulers since the distinction would be counter to the basic attribute of sovereignty. In Pratap Singh (supra), the subject matter included properties held by the ruling Chief of Nabha estate in the British territory, i.e. territory outside the Home State. One such property known as Sterling Castle in Shimla, was purchased in the name of the friend of the ruling Chief in view of the restriction put by the Britishers on acquisition, whether direct or indirect, by a sovereign or Feudatory Princes of lands in the British territory. After the Britishers had left, the friend of the ruling Chief had relinquished his title and conferred it upon the three sons and widow of the late ruling Chief. The ruling Chief had also acquired a property in Delhi. The contention that these two properties were private properties and not State properties was rejected by this CourtTherefore, the contention of the appellants that the property being leasehold Nazul land situated outside the princely state was personal property must be rejected in the absence of any other evidence or material to rebut the presumption that the property was a part of the impartible estate belonging to the sovereign Ruler. On the other hand, inheritance of the property post the death of Raghubir Singh by the new Ruler including Brij Nath Singh by application of the rule of primogeniture to the exclusion of others son(s) would indicate that it was treated as a State or sovereign property43. In view of the aforesaid discussion, it has to be held that the property was a part of the impartible property i.e., the property though ancestral was not a part of the coparcenary property, but was a part of the estate of the sovereign Ruler, Brij Nath Singh. Further, Brij Nath Singh could transfer the property inter-vivos or make a bequest by way of a will. The contention that the property was a separate or personal property and, therefore, not a part of the impartible property has not been established and has not been proved by the appellants by leading evidence and material to dispel the presumptionThe ratio of the Constitution Bench in Vir Rajendra Singh (supra) is a binding precedent for it recognizes the personal law of succession of the Rulers and therefore, the rule/custom of primogeniture applicable to impartible estates belonging to erstwhile Rulers of the princely states. This custom/rule was not abrogated with the loss of sovereignty that the Rulers had forgone with the signing of the merger agreement.

### Instruction: Assess the case proceedings and provide a prediction: is the court likely to rule in favor of (1) or against (0) the appellant/petitioner? ### Input: (supra), Madhav Rao Jivaji Rao Scindia (supra), this Court has applied the rule of primogeniture to the estates of such Rulers by giving effect and protection to the personal law, that is, the rule of primogeniture as provided vide the covenant and merger agreement. Consequently, even after the erstwhile Rulers had surrendered their sovereign rights and their kingdoms/estates had merged with the Dominion of India, the succession and all its concomitant rights to their erstwhile sovereign property now held as private property, would devolve vide the merger agreement and the Constitution as per the customs applicable to the erstwhile Rulers. Relying on the Constitution, and sub-section (ii) to Section 5 of the Succession Act, this Court has, time and again, held that the law of the land is pervious to the rule of primogeniture. The recent decision of this Court in Talat Fatima Hasan Through Her Constituted Attorney Sh. Syed Mehdi Husain v. Nawab Syed Murtaza Ali Khan (D) By LRs. And Others in Civil Appeal No. 1773 of 2002 decided on July 31, 2019 pertains to the Muslim Personal Law (Shariat) Application Act, 1937 applicable to the State of Rampur. This is clear from paragraph 12 of the judgment in Talat Fatima Hasan (supra), which records that the only issue to be decided was whether the properties held by the Nawab would devolve on his eldest son by applying the rule of primogeniture or would be governed by the Muslim Personal Law (Shariat) Application Act, 1937 and devolve on all his legal heirs.40. It may be pertinent to state here that the succession on death of Brij Nath Singh had opened on 13th October 1968, which is before Article 362 relating to the rights and privileges of the Indian Rulers was repealed by the Constitution (26th Amendment) Act, 1971. Article 362, before it was repealed, stated that in exercise of the power of Parliament or of the Legislature of a State to make laws or in the exercise of the executive power of the Union or a State, due regard shall be had to the guarantee or the assurance given under any such covenant or agreement referred to in Article 291 with respect to the personal rights, privileges or dignities of the Ruler of an Indian State.41. Faced with the aforesaid position, learned counsel for the appellants had submitted that the property being a leasehold Nazul plot located in Allahabad and owned by the superior lessor, i.e. State of Uttar Pradesh, it could not be treated as a sovereign property in the hands of Raghubir Singh and also in the hands of Brij Nath Singh. The property should be treated as coparcenary property belonging to the joint Hindu family and not as impartible property to which the rule of primogeniture would be applicable. This contention must be rejected. Brij Nath Singh had taken over as a Ruler of the State of Maihar in the pre-independence era when the Rulers, though subject to British supremacy, were treated as absolute sovereign Rulers within their own territories. There was no distinction between public and private property of the Rulers since the distinction would be counter to the basic attribute of sovereignty. In Pratap Singh (supra), the subject matter included properties held by the ruling Chief of Nabha estate in the British territory, i.e. territory outside the Home State. One such property known as Sterling Castle in Shimla, was purchased in the name of the friend of the ruling Chief in view of the restriction put by the Britishers on acquisition, whether direct or indirect, by a sovereign or Feudatory Princes of lands in the British territory. After the Britishers had left, the friend of the ruling Chief had relinquished his title and conferred it upon the three sons and widow of the late ruling Chief. The ruling Chief had also acquired a property in Delhi. The contention that these two properties were private properties and not State properties was rejected by this Court.42. In Draupadi Devi and Others v. Union of India and Others, (2004) 11 SCC 425 the dispute pertained to perpetual leasehold rights of a property in Delhi called Kapurthala House which was purchased by Jagatjit Singh, the then Maharaja of Kapurthala by a registered sale deed 19th January 1935. The question whether it was personal or State/sovereign property was decided in favour of the Union of India holding that it was a State or sovereign property, notwithstanding the alleged command of the Maharaja in 1940 purportedly declaring Kapurthala House as his personal and private property. Reference was made to aide-memoire dated 1st March 1937 by Lieutenant Colonel Fisher declaring the Kapurthala House as a State property. Thus, leasehold properties situated outside the princely states have been held to be State or sovereign property. Therefore, the contention of the appellants that the property being leasehold Nazul land situated outside the princely state was personal property must be rejected in the absence of any other evidence or material to rebut the presumption that the property was a part of the impartible estate belonging to the sovereign Ruler. On the other hand, inheritance of the property post the death of Raghubir Singh by the new Ruler including Brij Nath Singh by application of the rule of primogeniture to the exclusion of others son(s) would indicate that it was treated as a State or sovereign property.43. In view of the aforesaid discussion, it has to be held that the property was a part of the impartible property i.e., the property though ancestral was not a part of the coparcenary property, but was a part of the estate of the sovereign Ruler, Brij Nath Singh. Further, Brij Nath Singh could transfer the property inter-vivos or make a bequest by way of a will. The contention that the property was a separate or personal property and, therefore, not a part of the impartible property has not been established and has not been proved by the appellants by leading evidence and material to dispel the presumption. ### Response: 0

GOVT. OF NCT DELHI Vs. PRADEEP KUMAR

Court considered the implication of the Circular dated 11.05.2011 issued by the Department of Personnel, government of Rajasthan, (A, Gr.II) bearing ref.no.No.F.7(1) DOP/A-II/99 that expressly allowed migration to the unreserved category irrespective of any concession availed by the candidate of the reserved category if he/she had secured more marks than the last Unreserved category candidate who is selected. But here the OMs dated 01.07.1998 and 04.04.2018 issued by the Department of Personnel & Training would bear consideration. Contrary to the circular dated 11.05.2011 in Vikas Sankhala (supra), the two OMs referred by Ms Divan, issued specific instructions to the effect that when a relaxed standard is applied in selecting a reserved category candidate, in age limit, experience, qualification, additional chances in written examination etc., such candidates will be counted against reserved vacancies. 21.2 For better understanding, the implications of the afore noted OM dated 01.07.1998 (ref.36011/1/98-Estt.(Res), Ministry of Personnel, Public Grievances and Pensions), the relevant portion is extracted below:- ....................................... 3. In this connection, it is clarified that only such SC/ST/OBC candidates who are selected on the same standard as applied to general candidates shall not be adjusted against reserved vacancies. In other words, when a relaxed standard is applied in selecting an SC/ST/OBC candidates, for example in the age limit, experience, qualification, permitted number of chances in written examination, extended zone of consideration larger than what is provided for general category candidates etc., the SC/ST/OBC candidates are to be counted against reserved vacancies. Such candidates would be deemed as unavailable for consideration against unreserved vacancies. ........................................ 21.3 In the same context, the relevant part of the second OM dated 04.04.2018 (Ref.No.F.No.43011/4/2018-Estt.(Res.)] issued by the Ministry of Personnel, Government of India), reiterating in substance, what was stated in the earlier O.M. of 01.07.1998, is extracted as below, for ready reference:- .......................................As per instructions issued vide this Departments OM No.36012/2/96-Estt.(Res) dated 02.07.1997, in direct recruitments to Central Government jobs and services, the reserve category candidates who are selected on the same standards as applied to general candidates will not be adjusted against reserved vacancies. As per instructions issued vide DOP & T OM No.36011/1/98-Estt.(Res) dated 01.07.1998, only when a relaxed standard is applied in selecting a reserved candidates, for example in the age limit, experience, qualification, permitted number of chances in written examination, etc., such candidates will be counted against reserved vacancies................................. 22. From the above extract of the two OMs, it is quite apparent that, unlike in Vikas Sankhala, there is an express bar on migration to the unreserved category of those reserved category candidates who had availed of relaxation including those for qualification. The prescription of the eligibility qua CTET, in the advertisement, will therefore have to be understood bearing in mind, the contents of the OM dated 01.07.1998. To apply the advertisement in the present facts will not be correct. The same OM dated 01.07.1998 was considered in Deepa EV v Union of India (2017) 12 SCC 680 and we feel that the Court was correct in the view, vis-à-vis the OM dated 01.07.1998. 23. The other distinguishing aspect in Vikas Sankhala (supra) is that the candidates who had applied under the reserved category belonged to Rajasthan. For the selection and aspirants from the same State i.e., Rajasthan, the Court allowed such candidates to migrate to the unreserved category. In the present case, however, the candidates (i.e. the respondents) belong to States other than Delhi. Being OBC (outsiders), they could have been considered only under the unreserved category if they secure at least 60% marks in the CTET. The respondents admittedly did not secure 60% and thus were ineligible. Moreover, an OBC candidate not certified in the State/Territory outside of Delhi cannot be eligible to avail of employment in reserved category posts earmarked for OBCs who are certified by the Delhi Government. 24. It is important to keep in mind that the respondents are competing for general category vacancies. All others in this group have obtained their CTET eligibility qualification, securing the normal pass marks without availing any relaxation of pass norms. On the other hand, the respondents despite their lesser marks in the CTET examination, could qualify only because they availed the relaxation benefits as OBC category examinees. Their eligibility qualification is secured under relaxed norms meant for OBC category and therefore we do not think it is proper to consider them to be eligible for the general category vacancies and contention to the contrary is unacceptable. 25. The respondents with their CTET qualification under relaxed norms would be eligible for OBC category posts provided their OBC status is certified and recognized by the Delhi government. But such not being the case, they are ineligible for the reserved category vacancies. To allow them to migrate and compete for the open category vacancies would not be permissible simply because, they have secured the CTET qualification with relaxation of pass marks meant for those belonging to the OBC category. As the respondents have not secured the normal pass marks for general category, their eligibility for the general category vacancies is not secured. Therefore, their performance in the selection examination would be of no relevance, in the present process. 26. As earlier discussed, this case concerns qualifications obtained with concession in pass marks. Such concession would have a direct impact on standards of competence and merit in the recruitment of Special Education Teachers. The principles of reservation under the Constitution of India are intended to be confined to a specifically earmarked category and the unreserved category must be protected, to avoid dilution of competence and merit. If Vikas Sankhala (supra) is interpreted shorn of its peculiar facts, as has been suggested by the respondents counsel, it would in our perception, considering that respondents secured the qualification under relaxed norms, would lead to dilution of merit in the unreserved category. The arguments made to the contrary by the respondents is therefore rejected. 27. In view of the forgoing, the High Court and the Tribunal erred in granting relief to the respondents.

1[ds]15. In the Delhi recruitment process, the respondents did not possess OBC (Delhi) certificate and thus they could not be considered for the OBC category vacancies. Further, as per the CTET guidelines, unreserved candidates are required to obtain 60% marks to qualify in the CTET. Since the Respondents obtained less than 60% in CTET, their candidature could be valid only under the OBC category. However due to absence of certificate of OBC status by Government of NCT, Delhi and by virtue of clause 6(iii), as above, which bars reservations to outsider OBC, the Respondents are ineligible for the applied post. They may however compete against the unreserved vacancies, if they pass CTET with minimum 60% marks. Admittedly, none of the Respondents are certified by the GNCT of Delhi as OBC and neither do they possess the requisite 60% marks in CTET for qualification for the one-tier exam, as per Advertisement 1/13 and therefore the contention of the Appellants do have acceptable basis19. The above excerpts reveal the Courts concern for maintaining equality in the recruitment process. However, in the present recruitment process, in the absence of a compensatory disadvantage or balancing factor, the ratio in Vikas Sankhala cannot be applied for the respondents who obtained CTET qualification by virtue of concession given to OBC categories. In other words, the concession benefit is not neutralized in the Delhi recruitment process. Thus, a level playing field and a fair treatment is not achieved, by inappropriately applying the ratio of Vikas Sankhala without having regard to the peculiarity of facts of that case where, a different selection yardstick was applied20. As noted above, although there was no balancing out of the relaxation for the selection process in Delhi unlike the process in Vikas Sankhalas decision, the CAT erroneously applied the ratio of the Rajasthan case for giving relief to the respondents21.1 In Vikas Sankhala, the Court considered the implication of the Circular dated 11.05.2011 issued by the Department of Personnel, government of Rajasthan, (A, Gr.II) bearing ref.no.No.F.7(1) DOP/A-II/99 that expressly allowed migration to the unreserved category irrespective of any concession availed by the candidate of the reserved category if he/she had secured more marks than the last Unreserved category candidate who is selected. But here the OMs dated 01.07.1998 and 04.04.2018 issued by the Department of Personnel & Training would bear consideration. Contrary to the circular dated 11.05.2011 in Vikas Sankhala (supra), the two OMs referred by Ms Divan, issued specific instructions to the effect that when a relaxed standard is applied in selecting a reserved category candidate, in age limit, experience, qualification, additional chances in written examination etc., such candidates will be counted against reserved vacancies22. From the above extract of the two OMs, it is quite apparent that, unlike in Vikas Sankhala, there is an express bar on migration to the unreserved category of those reserved category candidates who had availed of relaxation including those for qualification. The prescription of the eligibility qua CTET, in the advertisement, will therefore have to be understood bearing in mind, the contents of the OM dated 01.07.1998. To apply the advertisement in the present facts will not be correct. The same OM dated 01.07.1998 was considered in Deepa EV v Union of India(2017) 12 SCC 680 and we feel that the Court was correct in the view, vis-à-vis the OM dated 01.07.199823. The other distinguishing aspect in Vikas Sankhala (supra) is that the candidates who had applied under the reserved category belonged to Rajasthan. For the selection and aspirants from the same State i.e., Rajasthan, the Court allowed such candidates to migrate to the unreserved category. In the present case, however, the candidates (i.e. the respondents) belong to States other than Delhi. Being OBC (outsiders), they could have been considered only under the unreserved category if they secure at least 60% marks in the CTET. The respondents admittedly did not secure 60% and thus were ineligible. Moreover, an OBC candidate not certified in the State/Territory outside of Delhi cannot be eligible to avail of employment in reserved category posts earmarked for OBCs who are certified by the Delhi Government24. It is important to keep in mind that the respondents are competing for general category vacancies. All others in this group have obtained their CTET eligibility qualification, securing the normal pass marks without availing any relaxation of pass norms. On the other hand, the respondents despite their lesser marks in the CTET examination, could qualify only because they availed the relaxation benefits as OBC category examinees. Their eligibility qualification is secured under relaxed norms meant for OBC category and therefore we do not think it is proper to consider them to be eligible for the general category vacancies and contention to the contrary is unacceptable25. The respondents with their CTET qualification under relaxed norms would be eligible for OBC category posts provided their OBC status is certified and recognized by the Delhi government. But such not being the case, they are ineligible for the reserved category vacancies. To allow them to migrate and compete for the open category vacancies would not be permissible simply because, they have secured the CTET qualification with relaxation of pass marks meant for those belonging to the OBC category. As the respondents have not secured the normal pass marks for general category, their eligibility for the general category vacancies is not secured. Therefore, their performance in the selection examination would be of no relevance, in the present process26. As earlier discussed, this case concerns qualifications obtained with concession in pass marks. Such concession would have a direct impact on standards of competence and merit in the recruitment of Special Education Teachers. The principles of reservation under the Constitution of India are intended to be confined to a specifically earmarked category and the unreserved category must be protected, to avoid dilution of competence and merit. If Vikas Sankhala (supra) is interpreted shorn of its peculiar facts, as has been suggested by the respondents counsel, it would in our perception, considering that respondents secured the qualification under relaxed norms, would lead to dilution of merit in the unreserved category. The arguments made to the contrary by the respondents is therefore rejected27. In view of the forgoing, the High Court and the Tribunal erred in granting relief to the respondents.

### Instruction: Analyze the case proceeding and predict whether the appeal/petition will be accepted (1) or rejected (0). ### Input: Court considered the implication of the Circular dated 11.05.2011 issued by the Department of Personnel, government of Rajasthan, (A, Gr.II) bearing ref.no.No.F.7(1) DOP/A-II/99 that expressly allowed migration to the unreserved category irrespective of any concession availed by the candidate of the reserved category if he/she had secured more marks than the last Unreserved category candidate who is selected. But here the OMs dated 01.07.1998 and 04.04.2018 issued by the Department of Personnel & Training would bear consideration. Contrary to the circular dated 11.05.2011 in Vikas Sankhala (supra), the two OMs referred by Ms Divan, issued specific instructions to the effect that when a relaxed standard is applied in selecting a reserved category candidate, in age limit, experience, qualification, additional chances in written examination etc., such candidates will be counted against reserved vacancies. 21.2 For better understanding, the implications of the afore noted OM dated 01.07.1998 (ref.36011/1/98-Estt.(Res), Ministry of Personnel, Public Grievances and Pensions), the relevant portion is extracted below:- ....................................... 3. In this connection, it is clarified that only such SC/ST/OBC candidates who are selected on the same standard as applied to general candidates shall not be adjusted against reserved vacancies. In other words, when a relaxed standard is applied in selecting an SC/ST/OBC candidates, for example in the age limit, experience, qualification, permitted number of chances in written examination, extended zone of consideration larger than what is provided for general category candidates etc., the SC/ST/OBC candidates are to be counted against reserved vacancies. Such candidates would be deemed as unavailable for consideration against unreserved vacancies. ........................................ 21.3 In the same context, the relevant part of the second OM dated 04.04.2018 (Ref.No.F.No.43011/4/2018-Estt.(Res.)] issued by the Ministry of Personnel, Government of India), reiterating in substance, what was stated in the earlier O.M. of 01.07.1998, is extracted as below, for ready reference:- .......................................As per instructions issued vide this Departments OM No.36012/2/96-Estt.(Res) dated 02.07.1997, in direct recruitments to Central Government jobs and services, the reserve category candidates who are selected on the same standards as applied to general candidates will not be adjusted against reserved vacancies. As per instructions issued vide DOP & T OM No.36011/1/98-Estt.(Res) dated 01.07.1998, only when a relaxed standard is applied in selecting a reserved candidates, for example in the age limit, experience, qualification, permitted number of chances in written examination, etc., such candidates will be counted against reserved vacancies................................. 22. From the above extract of the two OMs, it is quite apparent that, unlike in Vikas Sankhala, there is an express bar on migration to the unreserved category of those reserved category candidates who had availed of relaxation including those for qualification. The prescription of the eligibility qua CTET, in the advertisement, will therefore have to be understood bearing in mind, the contents of the OM dated 01.07.1998. To apply the advertisement in the present facts will not be correct. The same OM dated 01.07.1998 was considered in Deepa EV v Union of India (2017) 12 SCC 680 and we feel that the Court was correct in the view, vis-à-vis the OM dated 01.07.1998. 23. The other distinguishing aspect in Vikas Sankhala (supra) is that the candidates who had applied under the reserved category belonged to Rajasthan. For the selection and aspirants from the same State i.e., Rajasthan, the Court allowed such candidates to migrate to the unreserved category. In the present case, however, the candidates (i.e. the respondents) belong to States other than Delhi. Being OBC (outsiders), they could have been considered only under the unreserved category if they secure at least 60% marks in the CTET. The respondents admittedly did not secure 60% and thus were ineligible. Moreover, an OBC candidate not certified in the State/Territory outside of Delhi cannot be eligible to avail of employment in reserved category posts earmarked for OBCs who are certified by the Delhi Government. 24. It is important to keep in mind that the respondents are competing for general category vacancies. All others in this group have obtained their CTET eligibility qualification, securing the normal pass marks without availing any relaxation of pass norms. On the other hand, the respondents despite their lesser marks in the CTET examination, could qualify only because they availed the relaxation benefits as OBC category examinees. Their eligibility qualification is secured under relaxed norms meant for OBC category and therefore we do not think it is proper to consider them to be eligible for the general category vacancies and contention to the contrary is unacceptable. 25. The respondents with their CTET qualification under relaxed norms would be eligible for OBC category posts provided their OBC status is certified and recognized by the Delhi government. But such not being the case, they are ineligible for the reserved category vacancies. To allow them to migrate and compete for the open category vacancies would not be permissible simply because, they have secured the CTET qualification with relaxation of pass marks meant for those belonging to the OBC category. As the respondents have not secured the normal pass marks for general category, their eligibility for the general category vacancies is not secured. Therefore, their performance in the selection examination would be of no relevance, in the present process. 26. As earlier discussed, this case concerns qualifications obtained with concession in pass marks. Such concession would have a direct impact on standards of competence and merit in the recruitment of Special Education Teachers. The principles of reservation under the Constitution of India are intended to be confined to a specifically earmarked category and the unreserved category must be protected, to avoid dilution of competence and merit. If Vikas Sankhala (supra) is interpreted shorn of its peculiar facts, as has been suggested by the respondents counsel, it would in our perception, considering that respondents secured the qualification under relaxed norms, would lead to dilution of merit in the unreserved category. The arguments made to the contrary by the respondents is therefore rejected. 27. In view of the forgoing, the High Court and the Tribunal erred in granting relief to the respondents. ### Response: 1

NAND KISHORE PRASAD Vs. MOHIB HAMIDI

the absence of any evidence that the surgery was the only option even with low blood platelets, the finding of negligence of the operating surgeon cannot be ignored.14. Thus, we find that it is a case of unreasonable decision of the Operating Surgeon to operate and not a case of “bit negligent” so as to absolve the surgeon from the allegation of medical negligence. Consequently, the finding of NCDRC to that extent is set aside.15. In respect of amount of compensation, the NCDRC held that sum of Rs.4,00,000/- awarded by the SCDRC against the Hospital is just compensation. The appellant relies upon judgment of this court reported as V. Krishnakumar v. State of Tamil Nadu and Others (2015) 9 SCC 388 to claim enhanced amount of compensation. In the said case of medical negligence at the time of delivery of a baby girl born to middle class family, this Court held as under:-19. The principle of awarding compensation that can be safely relied on is restitutio in integrum. This principle has been recognised and relied on in Malay Kumar Ganguly v. Sukumar Mukherjee (2009) 9 SCC 221 and in Balram Prasad case (2014) 1 SCC 384 , in the following passage from the latter: (Malay Kumar Ganguly case, SCC p. 282, para 170)“170. Indisputably, grant of compensation involving an accident is within the realm of law of torts. It is based on the principle of restitutio in integrum. The said principle provides that a person entitled to damages should, as nearly as possible, get that sum of money which would put him in the same position as he would have been if he had not sustained the wrong. (See Livingstone v. Rawyards Coal Co (1880) LR 5 AC 25 (HL) )”An application of this principle is that the aggrieved person should get that sum of money, which would put him in the same position if he had not sustained the wrong. It must necessarily result in compensating the aggrieved person for the financial loss suffered due to the event, the pain and suffering undergone and the liability that he/she would have to incur due to the disability caused by the event.”16. In a Judgment of this Court reported as National Insurance Company Limited v. Pranay Sethi and Others (2017) 16 SCC 680 , a Constitution Bench has laid down parameters for the grant of compensation in respect of claims arising out of Motor Vehicular accidents as just compensation has to be determined on the foundation of fairness, reasonableness and equitability on acceptable legal standard because such determination can never be in arithmetical exactitude. The Court held as under:-“55. Section 168 of the Act deals with the concept of "just compensation" and the same has to be determined on the foundation of fairness, reasonableness and equitability on acceptable legal standard because such determination can never be in arithmetical exactitude. It can never be perfect. The aim is to achieve an acceptable degree of proximity to arithmetical precision on the basis of materials brought on record in an individual case. The conception of "just compensation" has to be viewed through the prism of fairness, reasonableness and non- violation of the principle of equitability. In a case of death, the legal heirs of the claimants cannot expect a windfall. Simultaneously, the compensation granted cannot be an apology for compensation. It cannot be a pittance. Though the discretion vested in the tribunal is quite wide, yet it is obligatory on the part of the tribunal to be guided by the expression, that is, "just compensation". The determination has to be on the foundation of evidence brought on record as regards the age and income of the deceased and thereafter the apposite multiplier to be applied. The formula relating to multiplier has been clearly stated in Sarla Verma (2009) 6 SCC 121 and it has been approved in Reshma Kumari (2013) 9 SCC 65 . The age and income, as stated earlier, have to be established by adducing evidence. The tribunal and the courts have to bear in mind that the basic principle lies in pragmatic computation which is in proximity to reality. It is a well-accepted norm that money cannot substitute a life lost but an effort has to be made for grant of just compensation having uniformity of approach. There has to be a balance between the two extremes, that is, a windfall and the pittance, a bonanza and the modicum. In such an adjudication, the duty of the tribunal and the courts is difficult and hence, an endeavour has been made by this Court for standardisation which in its ambit includes addition of future prospects on the proven income at present. As far as future prospects are concerned, there has been standardisation keeping in view the principle of certainty, stability and consistency. We approve the principle of "standardisation" so that a specific and certain multiplicand is determined for applying the multiplier on the basis of age.”17. Thus, the compensation has to be calculated on the basis of twin criteria of age and income. But in the absence of income of the father or family, there is no legally acceptable norm available on record for the enhancement of compensation.18. The SCDRC has awarded a sum Rs.4,00,000/- as compensation payable by the Hospital and Rs.2,00,000/- by the Operating Surgeon. The NCDRC found a sum of Rs. 4,00,000/- as just compensation and absolved the Operating Surgeon from any liability. When the SCDRC has awarded a sum of Rs. 6,00,000/- as compensation, the NCDRC should not have interfered with the amount of compensation but could apportion the amount of compensation payable by the Operating Surgeon to the Hospital as the liability of Hospital to pay the amount of compensation is vicarious as the death has occurred during the course of employment of Operating Surgeon with the said Hospital.19. Therefore, we find that the entire amount of Rs.6,00,000/- is payable by the Hospital which would be just compensation in the facts and circumstances of the present case.

1[ds]12. At the time of admission, the recorded history of the patient is complaint of pain in abdomen, fever and haemorrhage in both eyes for the past five days. However, there is no evidence of critical condition of the patient to be operated upon even with low platelet count. The surgery to remove round worms is not proved to be of immediate necessity to save life of a patient who had critical platelet count. In the absence of any evidence that the surgery was the only life saving option available at that time, the action to operate upon the patient cannot be said to be prudent decision.14. Thus, we find that it is a case of unreasonable decision of the Operating Surgeon to operate and not a case ofso as to absolve the surgeon from the allegation of medical negligence. Consequently, the finding of NCDRC to that extent is set aside.Thus, the compensation has to be calculated on the basis of twin criteria of age and income. But in the absence of income of the father or family, there is no legally acceptable norm available on record for the enhancement of compensation.18. The SCDRC has awarded a sum Rs.4,00,000/- as compensation payable by the Hospital and Rs.2,00,000/- by the Operating Surgeon. The NCDRC found a sum of Rs. 4,00,000/- as just compensation and absolved the Operating Surgeon from any liability. When the SCDRC has awarded a sum of Rs. 6,00,000/- as compensation, the NCDRC should not have interfered with the amount of compensation but could apportion the amount of compensation payable by the Operating Surgeon to the Hospital as the liability of Hospital to pay the amount of compensation is vicarious as the death has occurred during the course of employment of Operating Surgeon with the said Hospital.19. Therefore, we find that the entire amount of Rs.6,00,000/- is payable by the Hospital which would be just compensation in the facts and circumstances of the present case.

### Instruction: Assess the case proceedings and provide a prediction: is the court likely to rule in favor of (1) or against (0) the appellant/petitioner? ### Input: the absence of any evidence that the surgery was the only option even with low blood platelets, the finding of negligence of the operating surgeon cannot be ignored.14. Thus, we find that it is a case of unreasonable decision of the Operating Surgeon to operate and not a case of “bit negligent” so as to absolve the surgeon from the allegation of medical negligence. Consequently, the finding of NCDRC to that extent is set aside.15. In respect of amount of compensation, the NCDRC held that sum of Rs.4,00,000/- awarded by the SCDRC against the Hospital is just compensation. The appellant relies upon judgment of this court reported as V. Krishnakumar v. State of Tamil Nadu and Others (2015) 9 SCC 388 to claim enhanced amount of compensation. In the said case of medical negligence at the time of delivery of a baby girl born to middle class family, this Court held as under:-19. The principle of awarding compensation that can be safely relied on is restitutio in integrum. This principle has been recognised and relied on in Malay Kumar Ganguly v. Sukumar Mukherjee (2009) 9 SCC 221 and in Balram Prasad case (2014) 1 SCC 384 , in the following passage from the latter: (Malay Kumar Ganguly case, SCC p. 282, para 170)“170. Indisputably, grant of compensation involving an accident is within the realm of law of torts. It is based on the principle of restitutio in integrum. The said principle provides that a person entitled to damages should, as nearly as possible, get that sum of money which would put him in the same position as he would have been if he had not sustained the wrong. (See Livingstone v. Rawyards Coal Co (1880) LR 5 AC 25 (HL) )”An application of this principle is that the aggrieved person should get that sum of money, which would put him in the same position if he had not sustained the wrong. It must necessarily result in compensating the aggrieved person for the financial loss suffered due to the event, the pain and suffering undergone and the liability that he/she would have to incur due to the disability caused by the event.”16. In a Judgment of this Court reported as National Insurance Company Limited v. Pranay Sethi and Others (2017) 16 SCC 680 , a Constitution Bench has laid down parameters for the grant of compensation in respect of claims arising out of Motor Vehicular accidents as just compensation has to be determined on the foundation of fairness, reasonableness and equitability on acceptable legal standard because such determination can never be in arithmetical exactitude. The Court held as under:-“55. Section 168 of the Act deals with the concept of "just compensation" and the same has to be determined on the foundation of fairness, reasonableness and equitability on acceptable legal standard because such determination can never be in arithmetical exactitude. It can never be perfect. The aim is to achieve an acceptable degree of proximity to arithmetical precision on the basis of materials brought on record in an individual case. The conception of "just compensation" has to be viewed through the prism of fairness, reasonableness and non- violation of the principle of equitability. In a case of death, the legal heirs of the claimants cannot expect a windfall. Simultaneously, the compensation granted cannot be an apology for compensation. It cannot be a pittance. Though the discretion vested in the tribunal is quite wide, yet it is obligatory on the part of the tribunal to be guided by the expression, that is, "just compensation". The determination has to be on the foundation of evidence brought on record as regards the age and income of the deceased and thereafter the apposite multiplier to be applied. The formula relating to multiplier has been clearly stated in Sarla Verma (2009) 6 SCC 121 and it has been approved in Reshma Kumari (2013) 9 SCC 65 . The age and income, as stated earlier, have to be established by adducing evidence. The tribunal and the courts have to bear in mind that the basic principle lies in pragmatic computation which is in proximity to reality. It is a well-accepted norm that money cannot substitute a life lost but an effort has to be made for grant of just compensation having uniformity of approach. There has to be a balance between the two extremes, that is, a windfall and the pittance, a bonanza and the modicum. In such an adjudication, the duty of the tribunal and the courts is difficult and hence, an endeavour has been made by this Court for standardisation which in its ambit includes addition of future prospects on the proven income at present. As far as future prospects are concerned, there has been standardisation keeping in view the principle of certainty, stability and consistency. We approve the principle of "standardisation" so that a specific and certain multiplicand is determined for applying the multiplier on the basis of age.”17. Thus, the compensation has to be calculated on the basis of twin criteria of age and income. But in the absence of income of the father or family, there is no legally acceptable norm available on record for the enhancement of compensation.18. The SCDRC has awarded a sum Rs.4,00,000/- as compensation payable by the Hospital and Rs.2,00,000/- by the Operating Surgeon. The NCDRC found a sum of Rs. 4,00,000/- as just compensation and absolved the Operating Surgeon from any liability. When the SCDRC has awarded a sum of Rs. 6,00,000/- as compensation, the NCDRC should not have interfered with the amount of compensation but could apportion the amount of compensation payable by the Operating Surgeon to the Hospital as the liability of Hospital to pay the amount of compensation is vicarious as the death has occurred during the course of employment of Operating Surgeon with the said Hospital.19. Therefore, we find that the entire amount of Rs.6,00,000/- is payable by the Hospital which would be just compensation in the facts and circumstances of the present case. ### Response: 1

Raisaheb Vs. State of Harayana

in what manner she touched the body or did not touch at all. At any rate these are all very minor things. The fact remains that the FIR was given in a short and reasonable time and nobody could have imagined and planned to set up these witnesses particularly PW 6 who is a student studying in the school. Therefore we are fully satisfied that these two witnesses were present in the bus at the time of occurrence.8. Now coming to the so-called inconsistencies between their evidence and the medical evidence, the foremost thing that has to be borne in mind is that the medical evidence established that the deceased died because of the firearm injuri es. The Doctor, PW 9, who conducted the postmortem, noted the following injuries: "1. Lacerated wound oval-shaped measuring 3 cm x 2 cm was present over left temporal region just lateral to left eye. Mar gins were inverted. The surrounding area of the face was tattooed. 2. Lacerated wound 2 cm x 4 cm with averted margins, was present over right side of face just lateral to up per lip. On probing, the probe passed from injury 1 to 2. On dissection, the orbital bone was pierced, the left eyeball was crushed, the palate roof was pierced, artificial denture of both jaws was broken. 3. Lacerated wound oval shaped measuring 5 cm x 3 cm was present over right side of chest, just above clavicle at mid-clavicular point. The margin s were blackened and inverted. The surrounding skin was tattooed. There were corresponding holes in the shirt and banyan and were blackened. 4. Lacerated wound with coverted margins measuring 2 cm x 2.5 cm with abrasions on lateral and lower borders, was present on the right side of chest of anterior axillary line and was 10 cm below the armpit. 5. Lacerated wound measuring 2 cm x 1 cm was present over front of right upper arm 15 cm below armpit. Margins were averted. 6. Lacerated wound 1 cm x 5 cm was present back at upper end of the scapula and was 15 cm lateral to midline. The margins were averted. On probing the wound, the probe passed from injury 3 in all directions of injuries 4, 5 and 6. The probe also passed into the chest wall at- upper border of second rib. On dissection, the tracks of the probe were confirmed. On opening the chest, there was lacerated wound in the chest wall. The upper apex was lacerated, there was a lacerated wound in the diaphragm. The liver was lacerated at its anterior border. There was a lacerated wound in the posterior chest wall and embedded pellet was recovered from the wound. The pellet was sealed. The thoracic cavity was full of blood andabdominal cavity also contained blood. The clavic le bone was broken into pieces at its lateral 1/3rd level. The brachial plexuses and vessels were badly lacerated." In the cross-examination, PW 9, the Doctor has clarified that injury I was the entry wound and injury 2 was its exit wound. Injury 3 was another entry wound and the injuries 4, 5 and 6 were the exit wounds of injury 3. He also found a bullet lodged in the body and removed the same. The report of the ballistic expert would show that two of the metallic pieces which were examined by him could have been fired from a country-made pistol. Therefore his report corroborates the prosecution version that a country made pistol could have been used and the evidence of the eyewitnesses shows that A- 5 used a country-made pistol. Their evidence also is to the effect that accused 1, 3 and 4 used their guns. The mere fact that there are no three entry wounds by itself is not a ground to show that three guns were not used. Maybe some of the shot s fired by the accused did not hit the deceased. Even otherwise there is evidence to show that all the accused came in a body and boarded the bus and when A-2 threw the deceased on the ground all the accused surrounded him and two or three of them fired at the deceased. Then all of them ran away together from the place of occurrence.These circumstances are enough to attract Section 149 or even Section 34 IPC. The other discrepancies pointed out are in respect of some omissions or contradictions elicited from PWs 5 and 6 after confronting them with their earlier statements. We have carefully examined them and we find them to be not at all material. One of the discrepancies pointed out is that PW 5 stated that the Inspector was writing her statement on papers and not in a book and on that statement she affixed her thumb impression on two papers. The question is whether the statement was written on papers or in a book. We are unable to see as to how this would be very material. It may be that she mistook the sheets of the book to be loose papers. She deposed that she reached police station, Fatehabad at about 9.15 p.m. after the occurrence and she further deposed that she has given all the details namely what time they started from Fatehabad and how they were sitting in the bus. It appears that in the FIR some of these minor details are not there. The earliest report need not contain all these minute details and on the other hand we find that all the material facts are mentioned in the earliest report. Their travelling in the bus and the accused getting into the bus and later attacking the deceased and the details of the occurrence, the presence of PW 6 and other necessary materials are all there. We have carefully scrutinised the evidence of PWs 5 and 6 and we find no traces of any false implication and we are satisfied that they were present at the scene of occurrence and have given a truthful version.

0[ds]5. So far as the motive is concerned, there is evidence of PW 8 to show that there were cases pending and there was also bitter enmity between the deceased and his close relations on one side and the accused on the other side. However, when there are direct witnesses, the motive is not very important. The next submission that other important independent witnesses were not examined by itself, in our view, is not fatal to the prosecution case. In a case of this nature and particularly in these areas where firearms are being used freely and indiscriminately, nobody would dare to come and give evidence. On the mere ground that the others who were in the bus, were not examined, the evidence of PWs 5 and 6 cannot be rejected. Since they are inte rested witnesses their evidence has to be scrutinised with great care andby itself is not a ground to doubt their presence.However, the investigating officer has recovered threefrom PW 6 which would go to show that PWs 5 and 6 traveled along with the deceased in the bus having purchased the tickets on the fateful day. That apart, the place and time of occurrence cannot be doubted. The fact that the deceased was traveling in the bus also is not in dispute and even in th e earliest report which was given at about 9.45 p.m. i.e. within reasonable time, all these facts are mentioned. We are unable to agree with the learned counsel that there was inordinate delay in giving the FIR. According to the prosecution witnesses they boarded the bus at Fatehabad and some time later the occurrence took place in the bus. The police station was at some distance from the place of occurrence and after the members of the family of the deceased came to the scene of occurrence in a tractor, PW 5 was sent immediately to the police station in the same tractor and she gave the report to the police by 9.45 p.m. Therefore there is no undue delay..7. Now we shall consider whether the version given by the two eyewitnesses is consistent with the medical5 and 6 have deposed that when the bus covered a distance of one mile from the place from where the accused boarded the bus, it stopped and that accused 1, 3 and 4 alighted from the bus andtook the deceased in his grip and threw him from the bus and as soon as the deceased fell on the ground, accused 1, 3 and 4 fired at him andwho was carrying a pistol also fired at the deceased and that the deceased died on the spot because of the firearm injuries.Both of them have deposed thattook away the gun of the deceased which fell on the ground. The first criticism against the evidence of these two witnesses is that no blood was found on their clothes. It is submitted that if PWs 5 and 6, who are no other than the wife and son of the deceased, were present when the occurrence took place, they would have fallen on the body of the deceased and touched the same and their clothes would have got blood stain s but noclothes were seized and their evidence also did not disclose that there were any blood stains. PW 5, when questioned in this context, categorically stated that she remained in the bus raising cries and did not fall upon her husband to rescue him. Even after the occurrence, it cannot definitely be said as to in what manner she touched the body or did not touch at all. At any rate these are all very minor things. The fact remains that the FIR was given in a short and reasonable time and nobody could have imagined and planned to set up these witnesses particularly PW 6 who is a student studying in the school. Therefore we are fully satisfied that these two witnesses were present in the bus at the time of occurrence.8. Now coming to theinconsistencies between their evidence and the medical evidence, the foremost thing that has to be borne in mind is that the medical evidence established that the deceased died because of the firearm injurin, PW 9, the Doctor has clarified that injury I was the entry wound and injury 2 was its exit wound. Injury 3 was another entry wound and the injuries 4, 5 and 6 were the exit wounds of injury 3. He also found a bullet lodged in the body and removed the same. The report of the ballistic expert would show that two of the metallic pieces which were examined by him could have been fired from apistol. Therefore his report corroborates the prosecution version that a country made pistol could have been used and the evidence of the eyewitnesses shows that A5 used apistol. Their evidence also is to the effect that accused 1, 3 and 4 used their guns. The mere fact that there are no three entry wounds by itself is not a ground to show that three guns were not used. Maybe some of the shot s fired by the accused did not hit the deceased. Even otherwise there is evidence to show that all the accused came in a body and boarded the bus and whenthrew the deceased on the ground all the accused surrounded him and two or three of them fired at the deceased. Then all of them ran away together from the place of occurrence.These circumstances are enough to attract Section 149 or even Section 34 IPC. The other discrepancies pointed out are in respect of some omissions or contradictions elicited from PWs 5 and 6 after confronting them with their earlier statements. We have carefully examined them and we find them to be not at all material. One of the discrepancies pointed out is that PW 5 stated that the Inspector was writing her statement on papers and not in a book and on that statement she affixed her thumb impression on two papers. The question is whether the statement was written on papers or in a book. We are unable to see as to how this would be very material. It may be that she mistook the sheets of the book to be loose papers. She deposed that she reached police station, Fatehabad at about 9.15 p.m. after the occurrence and she further deposed that she has given all the details namely what time they started from Fatehabad and how they were sitting in the bus. It appears that in the FIR some of these minor details are not there. The earliest report need not contain all these minute details and on the other hand we find that all the material facts are mentioned in the earliest report. Their travelling in the bus and the accused getting into the bus and later attacking the deceased and the details of the occurrence, the presence of PW 6 and other necessary materials are all there. We have carefully scrutinised the evidence of PWs 5 and 6 and we find no traces of any false implication and we are satisfied that they were present at the scene of occurrence and have given a truthful version.

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: in what manner she touched the body or did not touch at all. At any rate these are all very minor things. The fact remains that the FIR was given in a short and reasonable time and nobody could have imagined and planned to set up these witnesses particularly PW 6 who is a student studying in the school. Therefore we are fully satisfied that these two witnesses were present in the bus at the time of occurrence.8. Now coming to the so-called inconsistencies between their evidence and the medical evidence, the foremost thing that has to be borne in mind is that the medical evidence established that the deceased died because of the firearm injuri es. The Doctor, PW 9, who conducted the postmortem, noted the following injuries: "1. Lacerated wound oval-shaped measuring 3 cm x 2 cm was present over left temporal region just lateral to left eye. Mar gins were inverted. The surrounding area of the face was tattooed. 2. Lacerated wound 2 cm x 4 cm with averted margins, was present over right side of face just lateral to up per lip. On probing, the probe passed from injury 1 to 2. On dissection, the orbital bone was pierced, the left eyeball was crushed, the palate roof was pierced, artificial denture of both jaws was broken. 3. Lacerated wound oval shaped measuring 5 cm x 3 cm was present over right side of chest, just above clavicle at mid-clavicular point. The margin s were blackened and inverted. The surrounding skin was tattooed. There were corresponding holes in the shirt and banyan and were blackened. 4. Lacerated wound with coverted margins measuring 2 cm x 2.5 cm with abrasions on lateral and lower borders, was present on the right side of chest of anterior axillary line and was 10 cm below the armpit. 5. Lacerated wound measuring 2 cm x 1 cm was present over front of right upper arm 15 cm below armpit. Margins were averted. 6. Lacerated wound 1 cm x 5 cm was present back at upper end of the scapula and was 15 cm lateral to midline. The margins were averted. On probing the wound, the probe passed from injury 3 in all directions of injuries 4, 5 and 6. The probe also passed into the chest wall at- upper border of second rib. On dissection, the tracks of the probe were confirmed. On opening the chest, there was lacerated wound in the chest wall. The upper apex was lacerated, there was a lacerated wound in the diaphragm. The liver was lacerated at its anterior border. There was a lacerated wound in the posterior chest wall and embedded pellet was recovered from the wound. The pellet was sealed. The thoracic cavity was full of blood andabdominal cavity also contained blood. The clavic le bone was broken into pieces at its lateral 1/3rd level. The brachial plexuses and vessels were badly lacerated." In the cross-examination, PW 9, the Doctor has clarified that injury I was the entry wound and injury 2 was its exit wound. Injury 3 was another entry wound and the injuries 4, 5 and 6 were the exit wounds of injury 3. He also found a bullet lodged in the body and removed the same. The report of the ballistic expert would show that two of the metallic pieces which were examined by him could have been fired from a country-made pistol. Therefore his report corroborates the prosecution version that a country made pistol could have been used and the evidence of the eyewitnesses shows that A- 5 used a country-made pistol. Their evidence also is to the effect that accused 1, 3 and 4 used their guns. The mere fact that there are no three entry wounds by itself is not a ground to show that three guns were not used. Maybe some of the shot s fired by the accused did not hit the deceased. Even otherwise there is evidence to show that all the accused came in a body and boarded the bus and when A-2 threw the deceased on the ground all the accused surrounded him and two or three of them fired at the deceased. Then all of them ran away together from the place of occurrence.These circumstances are enough to attract Section 149 or even Section 34 IPC. The other discrepancies pointed out are in respect of some omissions or contradictions elicited from PWs 5 and 6 after confronting them with their earlier statements. We have carefully examined them and we find them to be not at all material. One of the discrepancies pointed out is that PW 5 stated that the Inspector was writing her statement on papers and not in a book and on that statement she affixed her thumb impression on two papers. The question is whether the statement was written on papers or in a book. We are unable to see as to how this would be very material. It may be that she mistook the sheets of the book to be loose papers. She deposed that she reached police station, Fatehabad at about 9.15 p.m. after the occurrence and she further deposed that she has given all the details namely what time they started from Fatehabad and how they were sitting in the bus. It appears that in the FIR some of these minor details are not there. The earliest report need not contain all these minute details and on the other hand we find that all the material facts are mentioned in the earliest report. Their travelling in the bus and the accused getting into the bus and later attacking the deceased and the details of the occurrence, the presence of PW 6 and other necessary materials are all there. We have carefully scrutinised the evidence of PWs 5 and 6 and we find no traces of any false implication and we are satisfied that they were present at the scene of occurrence and have given a truthful version. ### Response: 0

State of Uttar Pradesh and Others Vs. M.V. Siddiqui

service. On January 3, 1968, the Director of Education (appellant 2) passed an order reverting the respondent and posting him as Deputy Inspector, Urdu Medium Schools, Allahabad region, in the Subordinate Education service. It appears this order was passed by the Director of Education by way of implementing an earlier order of reversion dated May 19, 1967 passed by the State Government (appellant I) reverting him from the U.P. Education Service to the Subordinate Service. The respondent filed a suit for quashing the order dated January 3, 1968 and for a permanent injunction against the reversion and on April 2, 1968, he obtained an interim injunction restraining the appellants from giving effect to the order of reversion dated January 3, 1968 and directing that the respondent should be kept on the teaching side presumably in the U.P. Education Service. The suit was fixed for hearing on October 11, 1968 but on the previous day after obtaining the consent of the respondents counsel the District Government made an application for an adjournment of the suit. On October 14, 1968 as both parties and their counsel were absent the suit was dismissed and the application for adjournment was also dismissed. On October 14, 1968 the respondent moved an application for restoration of his suit but no order was passed thereon. It appears that the Directorate of Education was informed about the dismissal of the suit that had taken place on October 11, 1968 and thinking that as the suit had been dismissed the interim injunction had also come to an end the Director felt that he was free to act and on October 15, 1968 he passed an order reverting the respondent and asking him to go over to the reverted post. On October 16, 1968 that order was served on the respondent but he left the office without giving an application for leave. In the meantime appellant 3, the Principal of the Institute, asked some other officer to take charge of the respondents post. Respondent thereupon moved the court on October 17, 1968 for setting aside the order dated October 15, 1968 on which the court merely passed an order directing the maintenance of status quo. On October 18, 1968 respondent showed the courts order dated October 17, 1968 appellant 3 and desired appellant 3 to take him back but appellant 3 told him that the order of the court only required maintenance of the status quo and since the order of the Director of Education had served on him and he had already open relieved of the post he could and he allowed to take over charge of his post. The order of the court did and give any direction for reinstatement of the respondent but merely directed the maintenance of status quo presumably as on October 17, 1968. On these facts an application was made by the respondent for contempt of court in the High Court and the High Court as stated above took the view that the appellant had defied the courts order but after making certain observations felt that no action be taken against the appellants. 3. In the above circumstances, it is clear to us that after the suit was dismissed on October 11, 1968 there was no injunction operating in favour of the respondent and against the appellants. It is true that an application for restoration of the suit had been made by the respondent on October 14, 1968 but no order had been made by the court till October 17, 1968 and in the meantime on October 15, 1968 action was taken against the respondent by serving a fresh order on him and he was also relieved of his charge. There was no material brought on record to show that the appellants had been apprised of the circumstances in which the suit came to be dismissed. In the absence of any material bringing home knowledge to the appellants about the manner in which the suit came to be dismissed it would be difficult to take the view that the government had acted in haste or that it wanted to take advantage of the fact that the interim injunction had lapsed. On October 16, 1968 when when the respondent was relieved of his post there was no injunction operating against the appellants not had the respondent obtained any order from the court on his application for restoration of his suit but it was only on October 17, 1968 that an order was passed by the court directing the status quo to be maintained. The status quo which obtained then was that the respondent had already been relieved of his charge and we feel that in the absence of an order from the court directing the respondent being put back to his earlier position no contempt can be said to have been committed by the government or its officers. 4. It appears that the High Court proceeded to consider the question whether the order passed by the Director of Education on 15, 1968 and served on the respondent on October 16, 1968 was legal or not and it has taken the view that that order was illegal and an invalid one. In the first place, the legality or otherwise of that order dated October 15, 1968 was strictly not relevant to the question of contempt. Such an order, whether legal or otherwise, could issue when no injunction was operating. Besides, that order was not the order by which the respondent had been reverted. It was by way of implementation of the original order of reversion dated May 19, 1967 that he was directed to had over the charge. We are satisfied that at the time when the appellants took the action against the respondent in directing him to be posted as the Deputy Inspector, Urdu Medium Schools in the Subordinate Education Service there was no order of a civil court obtaining in the field and consequently, there can be no contempt being committed by the appellants.

1[ds]4. It appears that the High Court proceeded to consider the question whether the order passed by the Director of Education on 15, 1968 and served on the respondent on October 16, 1968 was legal or not and it has taken the view that that order was illegal and an invalid one. In the first place, the legality or otherwise of that order dated October 15, 1968 was strictly not relevant to the question of contempt. Such an order, whether legal or otherwise, could issue when no injunction was operating. Besides, that order was not the order by which the respondent had been reverted. It was by way of implementation of the original order of reversion dated May 19, 1967 that he was directed to had over the charge. We are satisfied that at the time when the appellants took the action against the respondent in directing him to be posted as the Deputy Inspector, Urdu Medium Schools in the Subordinate Education Service there was no order of a civil court obtaining in the field and consequently, there can be no contempt being committed by the appellants.

### Instruction: Given the specifics of the case proceeding, anticipate the court's ruling: will it favor (1) or oppose (0) the appellant’s request? ### Input: service. On January 3, 1968, the Director of Education (appellant 2) passed an order reverting the respondent and posting him as Deputy Inspector, Urdu Medium Schools, Allahabad region, in the Subordinate Education service. It appears this order was passed by the Director of Education by way of implementing an earlier order of reversion dated May 19, 1967 passed by the State Government (appellant I) reverting him from the U.P. Education Service to the Subordinate Service. The respondent filed a suit for quashing the order dated January 3, 1968 and for a permanent injunction against the reversion and on April 2, 1968, he obtained an interim injunction restraining the appellants from giving effect to the order of reversion dated January 3, 1968 and directing that the respondent should be kept on the teaching side presumably in the U.P. Education Service. The suit was fixed for hearing on October 11, 1968 but on the previous day after obtaining the consent of the respondents counsel the District Government made an application for an adjournment of the suit. On October 14, 1968 as both parties and their counsel were absent the suit was dismissed and the application for adjournment was also dismissed. On October 14, 1968 the respondent moved an application for restoration of his suit but no order was passed thereon. It appears that the Directorate of Education was informed about the dismissal of the suit that had taken place on October 11, 1968 and thinking that as the suit had been dismissed the interim injunction had also come to an end the Director felt that he was free to act and on October 15, 1968 he passed an order reverting the respondent and asking him to go over to the reverted post. On October 16, 1968 that order was served on the respondent but he left the office without giving an application for leave. In the meantime appellant 3, the Principal of the Institute, asked some other officer to take charge of the respondents post. Respondent thereupon moved the court on October 17, 1968 for setting aside the order dated October 15, 1968 on which the court merely passed an order directing the maintenance of status quo. On October 18, 1968 respondent showed the courts order dated October 17, 1968 appellant 3 and desired appellant 3 to take him back but appellant 3 told him that the order of the court only required maintenance of the status quo and since the order of the Director of Education had served on him and he had already open relieved of the post he could and he allowed to take over charge of his post. The order of the court did and give any direction for reinstatement of the respondent but merely directed the maintenance of status quo presumably as on October 17, 1968. On these facts an application was made by the respondent for contempt of court in the High Court and the High Court as stated above took the view that the appellant had defied the courts order but after making certain observations felt that no action be taken against the appellants. 3. In the above circumstances, it is clear to us that after the suit was dismissed on October 11, 1968 there was no injunction operating in favour of the respondent and against the appellants. It is true that an application for restoration of the suit had been made by the respondent on October 14, 1968 but no order had been made by the court till October 17, 1968 and in the meantime on October 15, 1968 action was taken against the respondent by serving a fresh order on him and he was also relieved of his charge. There was no material brought on record to show that the appellants had been apprised of the circumstances in which the suit came to be dismissed. In the absence of any material bringing home knowledge to the appellants about the manner in which the suit came to be dismissed it would be difficult to take the view that the government had acted in haste or that it wanted to take advantage of the fact that the interim injunction had lapsed. On October 16, 1968 when when the respondent was relieved of his post there was no injunction operating against the appellants not had the respondent obtained any order from the court on his application for restoration of his suit but it was only on October 17, 1968 that an order was passed by the court directing the status quo to be maintained. The status quo which obtained then was that the respondent had already been relieved of his charge and we feel that in the absence of an order from the court directing the respondent being put back to his earlier position no contempt can be said to have been committed by the government or its officers. 4. It appears that the High Court proceeded to consider the question whether the order passed by the Director of Education on 15, 1968 and served on the respondent on October 16, 1968 was legal or not and it has taken the view that that order was illegal and an invalid one. In the first place, the legality or otherwise of that order dated October 15, 1968 was strictly not relevant to the question of contempt. Such an order, whether legal or otherwise, could issue when no injunction was operating. Besides, that order was not the order by which the respondent had been reverted. It was by way of implementation of the original order of reversion dated May 19, 1967 that he was directed to had over the charge. We are satisfied that at the time when the appellants took the action against the respondent in directing him to be posted as the Deputy Inspector, Urdu Medium Schools in the Subordinate Education Service there was no order of a civil court obtaining in the field and consequently, there can be no contempt being committed by the appellants. ### Response: 1

National Textile Corpn.(Guj) Ltd Vs. State Bank Of India

the textile undertaking before the appointed day. Moreover, the statement in the preamble on which reliance has been placed by the learned counsel for the appellant, regarding giving protection to the interests of the workmen employed therein, also indicates that what was intended was to reorganise and rehabilitate the textile undertakings whose management was being taken over with a view to prevent the closure of such undertakings and consequent unemployment of workmen and thereby protect the interests of the workmen who were employed in the textile undertaking at the time of the taking over of the management of the said undertaking. The said statement in the preamble does not refer to persons who had ceased to be in employment of the textile undertaking on the date of such taking over of the management. We are, therefore, unable to hold that sub-section (7) of Section 3, must be so construed as to exclude its applicability in respect of liability for payment of gratuity under the Payment of Gratuity Act." 35. The liability of the owner continues even during the take-over period. Indisputably, however, that would not mean that any act done by the statutory authority or the State would be binding on the owner. The Gujarat Financial Corporation or the State of Gujarat having furnished guarantee on their own behalf, the same indisputably would continue to remain binding on them. Such guarantees which were furnished by the Gujarat Financial Corporation or the State of Gujarat would, thus, be enforceable against them. We, however, may clarify that we, at present advised, have not gone into the question of effect of abatement of claims against the owner. 1958 Act : 36. The question now arises for consideration is as to whether the provisions of the Bombay Relief Undertaking (Special Provision) Act, 1958 would be applicable in the instant case. The 1958 Act was a temporary Act. Clause (iv) Sub-section (1) of Section 4 of the said Act provided : "4(iv) any right, privilege, obligation or liability accrued or incurred before the undertaking was declared a relief undertaking and any remedy for the enforcement thereof shall be suspended and all proceedings relative thereto pending before any court, tribunal, officer or authority shall be stayed;" 37. The provisions of the said Act, however, do not bar adjustment of any account; but what was suspended was a declaration of relief undertaking and suspension of any remedy for the enforcement thereof. What was stayed was the proceedings pending before any court, tribunal, officer or authority, but the same had nothing to do with the adjustment of accounts in terms of the provisions of the Indian Contract Act, 1872. Section 59 of the Indian Contract Act provides for application of payment where debt to be discharged is indicated. Since 60 thereof provides for application of payment where debt to be discharged is not indicated. Section 61, however, provides that in absence of any party making appropriation, the payment shall be applied in discharge of the debts in order of time, whether they are or are not barred by the law in force for the time being as to the limitations of suits. 38. If the High Court was not correct in holding that the Authorized Controller had renewed the loan taken by the owner, the facilities continued and in that view of the matter Sections 60 and 61 of the Indian Contract Act would become applicable. 39. In The Union of India v. Kishorilal Gupta and Bros. [AIR 1960 SCR 493], upon which Mr. Sundaravardan placed strong reliance, wherein the question which arose for consideration was as to where the parties to an original contract could by mutual agreement enter into a new contract in substitution of an old one, which does not contain an arbitration clause, wherein the dispute resolution mechanism occurring in an earlier contract could be taken recourse to. 40. Subba Rao, J., speaking for the majority, in the fact situation obtaining therein, stated the principle thus : "The following principles relevant to the present case emerge from the aforesaid discussion: (1) An arbitration clause is a collateral term of a contract as distinguished from its substantive terms; but nonetheless it is an integral part of it; (2) however comprehensive the terms of an arbitration clause may be, the existence of the contract is a necessary condition for its operation; it perishes with the contract; (3) the contract may be non est in the sense that it never came legally into existence or it was void ab initio; (4) though the contract was validly executed, the parties may put an end to it as if it had never existed and substitute a new contract for it solely governing their rights and liabilities thereunder; (5) in the former case, if the original contract has no legal existence, the arbitration clause also cannot operate, for along with the original contract, it is also void; in the latter case, as the original contract is extinguished by the substituted one, the arbitration clause of the original contract perishes with it; and (6) between the two falls many categories of disputes in connection with a contract, such as the question of repudiation, frustration, breach etc. In those cases, it is the performance of the contract that has come to an end, but the contract is still in existence for certain purposes in respect of disputes arising under it or in connection with it. As the contract subsists for certain purposes, the arbitration clause operates in respect of these purposes." The said decision would apply in the instant case. 41. In Lalit Mohan Pandey v. Pooran Singh and Others [(2004) 6 SCC 626] , whereupon also the learned counsel placed reliance, this Court emphasized the need to construe the statute having in mind the object underlying the same by stating the principle of purposive construction. Thus, the remedies available to the Bank under the Indian Contract Act would continue to remain available to the respondent-Bank even if the 1958 Act applies.

1[ds]21. In terms of the provisions of the Act, the liability of the owner has not ceased to run. The entire claim of the bank, if not capable of being disbursed from the amount deposited by the Central Government, the same would abate. The claimants, therefore, are entitled to realize their remaining claims from the owners22. The Authorized Controller and the State of Gujarat furnished guarantees. Guarantees furnished by the State of Gujarat were dehors the provisions of the Act. In terms of the provisions of the Act, the State of Gujarat had no role to pay. It might have encouraged the Authorized Controller to review the functioning of the mills upon continuing to obtain the facilities of the erstwhile owners from the banks and other industrial institutions for revival of the mill as a part of social welfare measure. Under the Act, however, it could not have intermeddled with the affairs of the functioning of the mills by the Authorized Controller. Any action taken pursuant to or in furtherance of any representation made by the State of Gujarat would, thus, be of its own liability. Such liabilities can be enforced by the claimants. For the self same reasons any guarantee furnished by the Gujarat Financial Corporation would also be an act on its own behalf. It, while carrying out the management of the mill, could have incurred loan on behalf of the owner but if it had furnished any guarantee, the same would constitute an independent act, although furnished for obtaining loan or continue to obtain the facilities for running the mills. It could not act both as a loaner and a guarantor. The liability of the owner and guarantor would depend upon the terms of the documents executed in favour of the Bank and/or provisions of the Indian Contract Act. Similarly if a claim comes within the purview of Section 27 of the Act, the Central Government would continue to be liable therefor. A similar guarantee furnished by the Gujarat State Financial Corporation on its own behalf subject to the terms of the guarantee may become enforceable against it23. We are in these appeals, however, only concerned with the interpretation of the relevant provisions of the Second Schedule of the Act. Continuing the credit facilities given by the banks to the owner, in our opinion, would not amount to a fresh agreement24. For the purpose of attracting the provisions of the Second Schedule, the amount mentioned in Category I must be confined to loans advanced by the banks or other financial institution, or any other loan or any credit availed of for the purpose of trade or manufacturing operations. A distinction, therefore, exists between a loan given to the Controller and availing of the credit facilities which were available to the owner of the textile mills so as to enable it to carry on the manufacture operation thereof after its take over. The textile undertakings were sick ones. The managements of such mills were taken over for the purpose of revival thereof. If in that process the Authorized Controller was required to raise loan either from a bank or from a financial institution other than a bank or from any other person or availed any other credit, indisputably, the same would come within the purview of Category-I liability being a post-takeover management period35. The liability of the owner continues even during the take-over period. Indisputably, however, that would not mean that any act done by the statutory authority or the State would be binding on the owner. The Gujarat Financial Corporation or the State of Gujarat having furnished guarantee on their own behalf, the same indisputably would continue to remain binding on them. Such guarantees which were furnished by the Gujarat Financial Corporation or the State of Gujarat would, thus, be enforceable against them. We, however, may clarify that we, at present advised, have not gone into the question of effect of abatement of claims against the owner37. The provisions of the said Act, however, do not bar adjustment of any account; but what was suspended was a declaration of relief undertaking and suspension of any remedy for the enforcement thereof. What was stayed was the proceedings pending before any court, tribunal, officer or authority, but the same had nothing to do with the adjustment of accounts in terms of the provisions of the Indian Contract Act, 187238. If the High Court was not correct in holding that the Authorized Controller had renewed the loan taken by the owner, the facilities continued and in that view of the matter Sections 60 and 61 of the Indian Contract Act would become applicable.

### Instruction: Assess the case proceedings and provide a prediction: is the court likely to rule in favor of (1) or against (0) the appellant/petitioner? ### Input: the textile undertaking before the appointed day. Moreover, the statement in the preamble on which reliance has been placed by the learned counsel for the appellant, regarding giving protection to the interests of the workmen employed therein, also indicates that what was intended was to reorganise and rehabilitate the textile undertakings whose management was being taken over with a view to prevent the closure of such undertakings and consequent unemployment of workmen and thereby protect the interests of the workmen who were employed in the textile undertaking at the time of the taking over of the management of the said undertaking. The said statement in the preamble does not refer to persons who had ceased to be in employment of the textile undertaking on the date of such taking over of the management. We are, therefore, unable to hold that sub-section (7) of Section 3, must be so construed as to exclude its applicability in respect of liability for payment of gratuity under the Payment of Gratuity Act." 35. The liability of the owner continues even during the take-over period. Indisputably, however, that would not mean that any act done by the statutory authority or the State would be binding on the owner. The Gujarat Financial Corporation or the State of Gujarat having furnished guarantee on their own behalf, the same indisputably would continue to remain binding on them. Such guarantees which were furnished by the Gujarat Financial Corporation or the State of Gujarat would, thus, be enforceable against them. We, however, may clarify that we, at present advised, have not gone into the question of effect of abatement of claims against the owner. 1958 Act : 36. The question now arises for consideration is as to whether the provisions of the Bombay Relief Undertaking (Special Provision) Act, 1958 would be applicable in the instant case. The 1958 Act was a temporary Act. Clause (iv) Sub-section (1) of Section 4 of the said Act provided : "4(iv) any right, privilege, obligation or liability accrued or incurred before the undertaking was declared a relief undertaking and any remedy for the enforcement thereof shall be suspended and all proceedings relative thereto pending before any court, tribunal, officer or authority shall be stayed;" 37. The provisions of the said Act, however, do not bar adjustment of any account; but what was suspended was a declaration of relief undertaking and suspension of any remedy for the enforcement thereof. What was stayed was the proceedings pending before any court, tribunal, officer or authority, but the same had nothing to do with the adjustment of accounts in terms of the provisions of the Indian Contract Act, 1872. Section 59 of the Indian Contract Act provides for application of payment where debt to be discharged is indicated. Since 60 thereof provides for application of payment where debt to be discharged is not indicated. Section 61, however, provides that in absence of any party making appropriation, the payment shall be applied in discharge of the debts in order of time, whether they are or are not barred by the law in force for the time being as to the limitations of suits. 38. If the High Court was not correct in holding that the Authorized Controller had renewed the loan taken by the owner, the facilities continued and in that view of the matter Sections 60 and 61 of the Indian Contract Act would become applicable. 39. In The Union of India v. Kishorilal Gupta and Bros. [AIR 1960 SCR 493], upon which Mr. Sundaravardan placed strong reliance, wherein the question which arose for consideration was as to where the parties to an original contract could by mutual agreement enter into a new contract in substitution of an old one, which does not contain an arbitration clause, wherein the dispute resolution mechanism occurring in an earlier contract could be taken recourse to. 40. Subba Rao, J., speaking for the majority, in the fact situation obtaining therein, stated the principle thus : "The following principles relevant to the present case emerge from the aforesaid discussion: (1) An arbitration clause is a collateral term of a contract as distinguished from its substantive terms; but nonetheless it is an integral part of it; (2) however comprehensive the terms of an arbitration clause may be, the existence of the contract is a necessary condition for its operation; it perishes with the contract; (3) the contract may be non est in the sense that it never came legally into existence or it was void ab initio; (4) though the contract was validly executed, the parties may put an end to it as if it had never existed and substitute a new contract for it solely governing their rights and liabilities thereunder; (5) in the former case, if the original contract has no legal existence, the arbitration clause also cannot operate, for along with the original contract, it is also void; in the latter case, as the original contract is extinguished by the substituted one, the arbitration clause of the original contract perishes with it; and (6) between the two falls many categories of disputes in connection with a contract, such as the question of repudiation, frustration, breach etc. In those cases, it is the performance of the contract that has come to an end, but the contract is still in existence for certain purposes in respect of disputes arising under it or in connection with it. As the contract subsists for certain purposes, the arbitration clause operates in respect of these purposes." The said decision would apply in the instant case. 41. In Lalit Mohan Pandey v. Pooran Singh and Others [(2004) 6 SCC 626] , whereupon also the learned counsel placed reliance, this Court emphasized the need to construe the statute having in mind the object underlying the same by stating the principle of purposive construction. Thus, the remedies available to the Bank under the Indian Contract Act would continue to remain available to the respondent-Bank even if the 1958 Act applies. ### Response: 1

AMBALAL SARABHAI ENTERPRISES LTD Vs. K.S. INFRASPACE LLP

statute or the provision, the literal and strict interpretation has to be applied. It may be noted that important words used in the relevant provisions are immovable property used exclusively in trade or commerce. If the submission on behalf of the original plaintiff is accepted in that case it would be adding something in the statute which is not there in the statute, which is not permissible. On plain reading of the relevant clause it is clear that the expression used must mean actually used or being used. If the intention of the legislature was to expand the scope, in that case the phraseology used would have been different as for example, likely to be used or to be used. The word used denotes actually used and it cannot be said to be either ready for use or likely to be used; or to be used. Similar view has been taken by the Bombay High Court (Nagpur Bench) in the case of Dineshkumar Gulabchand Agrawal (Supra) and it is observed and held that the word used denotes actually used and not merely ready for use. It is reported that SLP against the said decision has been dismissed by the Honble Supreme Court. 12. Though we are informed that the said decision is assailed before this Court in a Special Leave Petition we are inclined to agree with the view expressed therein. This is for the reason that this Court while examining the issue relating to exclusive land use, though in the different context has laid emphasis on the present user of the land either for agriculture or non-agriculture purpose being relevant. In that regard, the decision relied on by the learned senior advocate for the respondent in the case of Federation of A.P. Chambers of Commerce & Industry and Ors. vs. State of A.P. and Ors., (2000) 6 SCC 550 is noticed, wherein it is observed as under: 6. Section 3 of the said Act speaks of land is used for any industrial purpose, land is used for any commercial purpose and land is used for any other non-agricultural purpose. The emphasis is on the word is used. For the purpose of levy of assessment on non-agricultural lands at the rate specified in the Schedule for land used for industrial purposes, therefore, there has to be a finding as a fact that the land is in fact in praesenti in use for an industrial purpose. The same would apply to a commercial purpose or any other non-agricultural purpose. 9. We are in no doubt whatever, therefore, that it is only land which is actually in use for an industrial purpose as defined in the said Act that can be assessed to non-agricultural assessment at the rate specified for land used for industrial purposes. The wider meaning given to the word used in the judgment under challenge is untenable. Having regard to the fact that the said Act is a taxing statute, no Court is justified in imputing to the legislature an intention that it has not clearly expressed in the language it has employed. (emphasis supplied) 13. The learned senior advocate for the appellant would however, contend that a strict interpretation as in the case of taxing statutes would not be appropriate in the instant case where the issue relates to jurisdiction. In that regard, the learned senior advocate has referred to the statement of objects and reasons with which the Commercial Courts Act, 2015 is enacted so as to provide speedy disposal of high value commercial disputes so as to create the positive image to the investors world about the independent and responsive Indian Legal System. Hence, he contends that a purposive interpretation be made. It is contended that a wider purport and meaning is to be assigned while entertaining the suit and considering the dispute to be a commercial dispute. Having taken note of the submission we feel that the very purpose for which the CC Act of 2015 has been enacted would be defeated if every other suit merely because it is filed before the Commercial Court is entertained. This is for the reason that the suits which are not actually relating to commercial dispute but being filed merely because of the high value and with the intention of seeking early disposal would only clog the system and block the way for the genuine commercial disputes which may have to be entertained by the Commercial Courts as intended by the law makers. In commercial disputes as defined a special procedure is provided for a class of litigation and a strict procedure will have to be followed to entertain only that class of litigation in that jurisdiction. If the same is strictly interpreted it is not as if those excluded will be non-suited without any remedy. The excluded class of litigation will in any event be entertained in the ordinary Civil Courts wherein the remedy has always existed. 14. In that view it is also necessary to carefully examine and entertain only disputes which actually answers the definition commercial disputes as provided under the Act. In the instant case, as already taken note neither the agreement between the parties refers to the nature of the immovable property being exclusively used for trade or commerce as on the date of the agreement nor is there any pleading to that effect in the plaint. Further the very relief sought in the suit is for execution of the Mortgage Deed which is in the nature of specific performance of the terms of Memorandum of Understanding without reference to nature of the use of the immovable property in trade or commerce as on the date of the suit. Therefore, if all these aspects are kept in view, we are of the opinion that in the present facts the High Court was justified in its conclusion arrived through the order dated 01.03.2019 impugned herein. The Commercial Court shall therefore return the plaint indicating a date for its presentation before the Court having jurisdiction.

0[ds]10. Be that as it may, the learned senior advocates on both sides have sought to rely on the legal position decided by the various High Courts in the absence of the pronouncement of this Court. The learned senior advocate in that regard have referred to the various decisions on the same point. However, we do not find it appropriate to refer to each of them and over burden this order since we notice that the High Court in fact has referred to various decisions while deciding the instant case and has thereafter arrived at its conclusion. The discussion as made by the High Court with reference to the various decisions is also justified.11. On the other hand, the learned senior advocate for the respondents has relied on the decision of a Division Bench of the Gujarat High Court in the case of Vasu Healthcare Private Limited vs. Gujarat Akruti TCG Biotech Limited, AIR 2017 Gujarat 153 wherein a detailed consideration has been made and the conclusion reached therein by taking note of an earlier decision is that on a plain reading of Clause 2(1)(c) of CC Act, 2015 the expression used must mean actually used or being used. It is further explained that if the intention of the legislature was to expand the scope, in that case the phraseology likely to be used or to be used would have been employed. The verbatim consideration therein is as hereunder;Therefore, if the dispute falls within any of the clause 2(c) the dispute can be said to be commercial dispute for which the Commercial Court would have jurisdiction. It is required to be noted that before the learned Commercial Court the original plaintiff relied upon section 2(c)(i), 2(c)(ii) and 2(c)(xx) of the Commercial Courts Act only. Learned Counsel appearing on behalf of the original plaintiff has candidly admitted and/or conceded that the case shall not fall within clause 2(c)(i); 2(c)(ii) or 2(c)(xx) of the Commercial Courts Act. It is required to be noted that before the learned Commercial Court it was never the case on behalf of the original plaintiff that case would fall within section 2(c)(vii) of the learned Commercial Court. Despite the above we have considered on merits whether even considering section 2(c)(vii) of the Commercial Courts Act, the dispute between the parties can be said to be commercial dispute within the definition of section 2(c) of the Commercial Courts Act or not? Considering section 2(c)(vii), commercial dispute means a dispute arising out of the agreements relating to immovable property used exclusively in trade or commerce. As observed hereinabove, at the time of filing of the suit and even so pleaded in the plaint, the immovable property/plots the agreements between the parties cannot be said to be agreements relating to immovable property used exclusively in trade or commerce. As per the agreement between the party after getting the plots on lease from the GIDC, the same was required to be thereafter developed by the original defendant No. 1 and after providing all infrastructural facilities and sub-plotting it, the same is required to be given to other persons like the original plaintiff. It is the case on behalf of the original plaintiff that as the original defendant No. 1 has failed to provide any infrastructural facilities and develop the plots and therefore, a civil suit for specific performance of the agreement has been filed. There are other alternative prayers also. Therefore, it cannot be said that the agreement is as such relating to immovable property used exclusively in trade or commerce. It is the case on behalf of the original plaintiff that as in clause (vii) of section 2(c), the pharseology used is not actually used or being used and therefore, even if at present the plot is not used and even if it is likely to be used even in future, in that case also, section 2(c)(vii) shall be applicable and therefore, the Commercial Court would have jurisdiction. The aforesaid has no substance. As per the cardinal principle of law while interpreting a particular statute or the provision, the literal and strict interpretation has to be applied. It may be noted that important words used in the relevant provisions are immovable property used exclusively in trade or commerce. If the submission on behalf of the original plaintiff is accepted in that case it would be adding something in the statute which is not there in the statute, which is not permissible. On plain reading of the relevant clause it is clear that the expression used must mean actually used or being used. If the intention of the legislature was to expand the scope, in that case the phraseology used would have been different as for example, likely to be used or to be used. The word used denotes actually used and it cannot be said to be either ready for use or likely to be used; or to be used. Similar view has been taken by the Bombay High Court (Nagpur Bench) in the case of Dineshkumar Gulabchand Agrawal (Supra) and it is observed and held that the word used denotes actually used and not merely ready for use. It is reported that SLP against the said decision has been dismissed by the Honble Supreme Court12. Though we are informed that the said decision is assailed before this Court in a Special Leave Petition we are inclined to agree with the view expressed therein. This is for the reason that this Court while examining the issue relating to exclusive land use, though in the different context has laid emphasis on the present user of the land either for agriculture or non-agriculture purpose being relevantHaving taken note of the submission we feel that the very purpose for which the CC Act of 2015 has been enacted would be defeated if every other suit merely because it is filed before the Commercial Court is entertained. This is for the reason that the suits which are not actually relating to commercial dispute but being filed merely because of the high value and with the intention of seeking early disposal would only clog the system and block the way for the genuine commercial disputes which may have to be entertained by the Commercial Courts as intended by the law makers. In commercial disputes as defined a special procedure is provided for a class of litigation and a strict procedure will have to be followed to entertain only that class of litigation in that jurisdiction. If the same is strictly interpreted it is not as if those excluded will be non-suited without any remedy. The excluded class of litigation will in any event be entertained in the ordinary Civil Courts wherein the remedy has always existed

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: statute or the provision, the literal and strict interpretation has to be applied. It may be noted that important words used in the relevant provisions are immovable property used exclusively in trade or commerce. If the submission on behalf of the original plaintiff is accepted in that case it would be adding something in the statute which is not there in the statute, which is not permissible. On plain reading of the relevant clause it is clear that the expression used must mean actually used or being used. If the intention of the legislature was to expand the scope, in that case the phraseology used would have been different as for example, likely to be used or to be used. The word used denotes actually used and it cannot be said to be either ready for use or likely to be used; or to be used. Similar view has been taken by the Bombay High Court (Nagpur Bench) in the case of Dineshkumar Gulabchand Agrawal (Supra) and it is observed and held that the word used denotes actually used and not merely ready for use. It is reported that SLP against the said decision has been dismissed by the Honble Supreme Court. 12. Though we are informed that the said decision is assailed before this Court in a Special Leave Petition we are inclined to agree with the view expressed therein. This is for the reason that this Court while examining the issue relating to exclusive land use, though in the different context has laid emphasis on the present user of the land either for agriculture or non-agriculture purpose being relevant. In that regard, the decision relied on by the learned senior advocate for the respondent in the case of Federation of A.P. Chambers of Commerce & Industry and Ors. vs. State of A.P. and Ors., (2000) 6 SCC 550 is noticed, wherein it is observed as under: 6. Section 3 of the said Act speaks of land is used for any industrial purpose, land is used for any commercial purpose and land is used for any other non-agricultural purpose. The emphasis is on the word is used. For the purpose of levy of assessment on non-agricultural lands at the rate specified in the Schedule for land used for industrial purposes, therefore, there has to be a finding as a fact that the land is in fact in praesenti in use for an industrial purpose. The same would apply to a commercial purpose or any other non-agricultural purpose. 9. We are in no doubt whatever, therefore, that it is only land which is actually in use for an industrial purpose as defined in the said Act that can be assessed to non-agricultural assessment at the rate specified for land used for industrial purposes. The wider meaning given to the word used in the judgment under challenge is untenable. Having regard to the fact that the said Act is a taxing statute, no Court is justified in imputing to the legislature an intention that it has not clearly expressed in the language it has employed. (emphasis supplied) 13. The learned senior advocate for the appellant would however, contend that a strict interpretation as in the case of taxing statutes would not be appropriate in the instant case where the issue relates to jurisdiction. In that regard, the learned senior advocate has referred to the statement of objects and reasons with which the Commercial Courts Act, 2015 is enacted so as to provide speedy disposal of high value commercial disputes so as to create the positive image to the investors world about the independent and responsive Indian Legal System. Hence, he contends that a purposive interpretation be made. It is contended that a wider purport and meaning is to be assigned while entertaining the suit and considering the dispute to be a commercial dispute. Having taken note of the submission we feel that the very purpose for which the CC Act of 2015 has been enacted would be defeated if every other suit merely because it is filed before the Commercial Court is entertained. This is for the reason that the suits which are not actually relating to commercial dispute but being filed merely because of the high value and with the intention of seeking early disposal would only clog the system and block the way for the genuine commercial disputes which may have to be entertained by the Commercial Courts as intended by the law makers. In commercial disputes as defined a special procedure is provided for a class of litigation and a strict procedure will have to be followed to entertain only that class of litigation in that jurisdiction. If the same is strictly interpreted it is not as if those excluded will be non-suited without any remedy. The excluded class of litigation will in any event be entertained in the ordinary Civil Courts wherein the remedy has always existed. 14. In that view it is also necessary to carefully examine and entertain only disputes which actually answers the definition commercial disputes as provided under the Act. In the instant case, as already taken note neither the agreement between the parties refers to the nature of the immovable property being exclusively used for trade or commerce as on the date of the agreement nor is there any pleading to that effect in the plaint. Further the very relief sought in the suit is for execution of the Mortgage Deed which is in the nature of specific performance of the terms of Memorandum of Understanding without reference to nature of the use of the immovable property in trade or commerce as on the date of the suit. Therefore, if all these aspects are kept in view, we are of the opinion that in the present facts the High Court was justified in its conclusion arrived through the order dated 01.03.2019 impugned herein. The Commercial Court shall therefore return the plaint indicating a date for its presentation before the Court having jurisdiction. ### Response: 0

Sonali Mukherjee Vs. Union Of India

tone of letters written by PW-1 suggests that parents of Biswajit have accepted his marriage and everything was alright with them. Even if everything in his evidence is accepted, all the letters written by him belie the claim made by the witness that Biswajit was murdered. It is for the first time that he told that he came to know from the Ashram people that there was illegal intimacy between Sonali Mukherjee (A-1) and Assadid Poddar (A-2). He has very specifically admitted that he could not tell the name of persons who told him about the illegal intimacy between A-1 and A-2. It is his claim that he came to know about this illegal intimacy way back in February, 1984. However, in his letter Exhibit D-28, he does not seem to have referred to any such illegal intimacy, which was extremely strange. His complete silence in the letter Exhibit P-12 dated 26.5.1984 about his having been told by Subbash Dass (PW-5) about the happenings, raises doubts. He clearly admitted that when he wrote the letter Exhibit P-12, he was not sure whether the death of Biswajit was homicidal or suicidal. He made an assertion that the Police officers, investigating the case, stayed in the flat belonging to the family of A-1, which was flatly denied by both the police officers, namely, Ramalingam (CW-1) and S. Shanmugasundaram (CW-3). There is nothing to suggest that these police officers were working under the influence of anybody else, muchless the accused persons and their relatives. The witness was candid in accepting his relationship with Sarogi. It is obvious that Exhibits P-10 and P-12 were the wild guesses made and therein some suspicious statements have been made which belie the claim that this was a murder. The witness went to the extent of saying that he had not given any statements to Ramalingam (CW-1) or S. Shanmugasundaram (CW-3). In his evidence, S. Shanmugasundaram (CW-3) has specifically admitted that he had examined Dr. Battacharya (PW-1) on 17.7.1984. On that basis, the witness refused to answer any question about his having made any disclosures to S. Shanmugasundaram (CW-3). In short, the evidence of Dr. Battacharya (PW-1) does not inspire any confidence and has to be rejected. 28. That leaves us with the other witnesses like Dr. Baker Fenn (PW-2), and Geetha Battacharya (PW-3), the wife of Dr. Battacharya (PW-1) and the mother of the deceased, which is of no use. Evidence of PW-3 relates to as to how Sonali Mukherjee (A-1) and Biswajit came closer. She has very specifically admitted that they (she and her husband - PW-1) had accepted Sonali Mukherjee (A-1) as their daughter-in-law. Her claims regarding Sonali Mukherjee (A-1) and Assadid Poddar (A-2) depended only on one circumstance that Assadid Poddar (A-2) was seen in the house with flowers, gifts and photos of Sonali Mukherjee (A-1) for celebrating the birthday of Sonali Mukherjee (A-1). We do not think that this is sufficient enough to establish any illegal intimacy between A-1 and A-2. Her evidence does not really take the prosecution any further. 29. Having discussed all these witnesses, we are of the firm opinion that the whole prosecution rests on suspicions and it is trite law that mere suspicion is not enough to convict the accused persons. 30. In fact, in this case, the whole basis of the complaint was the dishonest investigation on the part of Ramalingam (CW-1) and S. Shanmugasundaram (CW-3). Seeing their evidence closely, we do not think that such an inference was possible. These two witnesses have been examined as Court Witnesses and, therefore, they could have been cross-examined by the prosecution. Their cross-examination does not reveal anything to suggest that investigation was guided investigation, so as to exonerate the accused persons. 31. The impugned judgment turns more or the less on the inferences, the basic inference being that there was an illegal intimacy between Sonali Mukherjee (A-1) and Assidid Poddar (A-2), for which there is very little or no evidence. Once that basis is shaken or is held not to be established, the further case of the prosecution must fail. 32. We also cannot agree with the High Court that the death of Biswajit was homicide. We have already pointed out as to how the tablets could not have been administered by a single lady or how could there not be the accidental administration of the tablets leaving the only possibility of suicide. All the circumstances should have been addressed to by High Court, as well as, the Trial Court which is absent in both the judgments and conviction stood solely on the basis of evidence of Subbash Dass (PW-5), whom we have found an extremely unreliable witness. He was always under the thumb of Dr. Battacharya (PW-1), as well as, his friend Sarogi, with whom the witness admittedly lived and served for some time. 33. The dubbing of the investigation as "dishonest" or "guided investigation" would be very difficult in this case and no clear finding has been given by the High Court in that behalf. 34. The High Court has also not given sufficient attention to the fact that Sonali Mukherjee (A-1) also tried to commit suicide and was convicted for the offence punishable under Section 309 IPC alongwith offence punishable under Section 324 IPC for having caused simple injuries to Biswajit. True it is that such conviction would not come in the way of the accused being tried for the offence under Section 302 IPC, but this circumstance had to be examined, as it was a very crucial circumstance in the whole story. 35. The whole prosecution story is shrouded with mystery and is suspicious and, therefore, the benefit of doubt must go to the accused persons. 36. The High court has also not explained as to how the offence could come within the parameters of Section 304 Part I IPC. The view taken by the High Court that the offence could amount to one under Section 304 Part I IPC, is in our opinion, erroneous.

1[ds]29. Having discussed all these witnesses, we are of the firm opinion that the whole prosecution rests on suspicions and it is trite law that mere suspicion is not enough to convict the accused persons32. We also cannot agree with the High Court that the death of Biswajit was homicide. We have already pointed out as to how the tablets could not have been administered by a single lady or how could there not be the accidental administration of the tablets leaving the only possibility of suicide. All the circumstances should have been addressed to by High Court, as well as, the Trial Court which is absent in both the judgments and conviction stood solely on the basis of evidence of Subbash Dass (PW-5), whom we have found an extremely unreliable witness. He was always under the thumb of Dr. Battacharya (PW-1), as well as, his friend Sarogi, with whom the witness admittedly lived and served for some time33. The dubbing of the investigation as "dishonest" or "guided investigation" would be very difficult in this case and no clear finding has been given by the High Court in that behalf34. The High Court has also not given sufficient attention to the fact that Sonali Mukherjee (A-1) also tried to commit suicide and was convicted for the offence punishable under Section 309 IPC alongwith offence punishable under Section 324 IPC for having caused simple injuries to Biswajit. True it is that such conviction would not come in the way of the accused being tried for the offence under Section 302 IPC, but this circumstance had to be examined, as it was a very crucial circumstance in the whole story35. The whole prosecution story is shrouded with mystery and is suspicious and, therefore, the benefit of doubt must go to the accused persons36. The High court has also not explained as to how the offence could come within the parameters of Section 304 Part I IPC. The view taken by the High Court that the offence could amount to one under Section 304 Part I IPC, is in our opinion, erroneous

### Instruction: From the information provided in the case proceeding, infer whether the court's decision will be positive (1) or negative (0) for the appellant. ### Input: tone of letters written by PW-1 suggests that parents of Biswajit have accepted his marriage and everything was alright with them. Even if everything in his evidence is accepted, all the letters written by him belie the claim made by the witness that Biswajit was murdered. It is for the first time that he told that he came to know from the Ashram people that there was illegal intimacy between Sonali Mukherjee (A-1) and Assadid Poddar (A-2). He has very specifically admitted that he could not tell the name of persons who told him about the illegal intimacy between A-1 and A-2. It is his claim that he came to know about this illegal intimacy way back in February, 1984. However, in his letter Exhibit D-28, he does not seem to have referred to any such illegal intimacy, which was extremely strange. His complete silence in the letter Exhibit P-12 dated 26.5.1984 about his having been told by Subbash Dass (PW-5) about the happenings, raises doubts. He clearly admitted that when he wrote the letter Exhibit P-12, he was not sure whether the death of Biswajit was homicidal or suicidal. He made an assertion that the Police officers, investigating the case, stayed in the flat belonging to the family of A-1, which was flatly denied by both the police officers, namely, Ramalingam (CW-1) and S. Shanmugasundaram (CW-3). There is nothing to suggest that these police officers were working under the influence of anybody else, muchless the accused persons and their relatives. The witness was candid in accepting his relationship with Sarogi. It is obvious that Exhibits P-10 and P-12 were the wild guesses made and therein some suspicious statements have been made which belie the claim that this was a murder. The witness went to the extent of saying that he had not given any statements to Ramalingam (CW-1) or S. Shanmugasundaram (CW-3). In his evidence, S. Shanmugasundaram (CW-3) has specifically admitted that he had examined Dr. Battacharya (PW-1) on 17.7.1984. On that basis, the witness refused to answer any question about his having made any disclosures to S. Shanmugasundaram (CW-3). In short, the evidence of Dr. Battacharya (PW-1) does not inspire any confidence and has to be rejected. 28. That leaves us with the other witnesses like Dr. Baker Fenn (PW-2), and Geetha Battacharya (PW-3), the wife of Dr. Battacharya (PW-1) and the mother of the deceased, which is of no use. Evidence of PW-3 relates to as to how Sonali Mukherjee (A-1) and Biswajit came closer. She has very specifically admitted that they (she and her husband - PW-1) had accepted Sonali Mukherjee (A-1) as their daughter-in-law. Her claims regarding Sonali Mukherjee (A-1) and Assadid Poddar (A-2) depended only on one circumstance that Assadid Poddar (A-2) was seen in the house with flowers, gifts and photos of Sonali Mukherjee (A-1) for celebrating the birthday of Sonali Mukherjee (A-1). We do not think that this is sufficient enough to establish any illegal intimacy between A-1 and A-2. Her evidence does not really take the prosecution any further. 29. Having discussed all these witnesses, we are of the firm opinion that the whole prosecution rests on suspicions and it is trite law that mere suspicion is not enough to convict the accused persons. 30. In fact, in this case, the whole basis of the complaint was the dishonest investigation on the part of Ramalingam (CW-1) and S. Shanmugasundaram (CW-3). Seeing their evidence closely, we do not think that such an inference was possible. These two witnesses have been examined as Court Witnesses and, therefore, they could have been cross-examined by the prosecution. Their cross-examination does not reveal anything to suggest that investigation was guided investigation, so as to exonerate the accused persons. 31. The impugned judgment turns more or the less on the inferences, the basic inference being that there was an illegal intimacy between Sonali Mukherjee (A-1) and Assidid Poddar (A-2), for which there is very little or no evidence. Once that basis is shaken or is held not to be established, the further case of the prosecution must fail. 32. We also cannot agree with the High Court that the death of Biswajit was homicide. We have already pointed out as to how the tablets could not have been administered by a single lady or how could there not be the accidental administration of the tablets leaving the only possibility of suicide. All the circumstances should have been addressed to by High Court, as well as, the Trial Court which is absent in both the judgments and conviction stood solely on the basis of evidence of Subbash Dass (PW-5), whom we have found an extremely unreliable witness. He was always under the thumb of Dr. Battacharya (PW-1), as well as, his friend Sarogi, with whom the witness admittedly lived and served for some time. 33. The dubbing of the investigation as "dishonest" or "guided investigation" would be very difficult in this case and no clear finding has been given by the High Court in that behalf. 34. The High Court has also not given sufficient attention to the fact that Sonali Mukherjee (A-1) also tried to commit suicide and was convicted for the offence punishable under Section 309 IPC alongwith offence punishable under Section 324 IPC for having caused simple injuries to Biswajit. True it is that such conviction would not come in the way of the accused being tried for the offence under Section 302 IPC, but this circumstance had to be examined, as it was a very crucial circumstance in the whole story. 35. The whole prosecution story is shrouded with mystery and is suspicious and, therefore, the benefit of doubt must go to the accused persons. 36. The High court has also not explained as to how the offence could come within the parameters of Section 304 Part I IPC. The view taken by the High Court that the offence could amount to one under Section 304 Part I IPC, is in our opinion, erroneous. ### Response: 1

Hansa Inds.Pvt.Ltd. Vs. Kidarsons Inds.P.Ltd

settlement reached between the parties. Even at the time when the settlement was reached the parties were well aware of the strained relationship which existed and the unfortunate events that occurred between the branch of appellant No.2 and the remaining members of the family. Despite this, it was agreed by all of them that the portion in occupation of appellant No.2 shall be allotted to him and the value thereof adjusted against his share. The respondents cannot now be heard to say that it would be inconvenient for them to reside with appellant No.2 and his family members in the same house, though in separate portions. The question as to how the parties will manage their affairs is a matter with which they only are primarily concerned and the Court cannot advise them in the matter. It may be that the architects may provide a solution for their problems, or it may be that in view of the circumstances one party may agree to sell its share or buy the share of the other party with a view to purchase peace, if that becomes necessary. These are matters in which the Court may have nothing to say.17. Clause 14 of the settlement being unambiguous, clear and categoric, it must be given effect because one cannot term the said Clause 14 as vitiated by fraud, or illegal being in breach of any statutory provision, or against public policy, or hit by the principle of impossibility of performance. The settlement was made bona fide by the parties to resolve all their disputes and all facts were known to the parties when they reached the settlement. With their eyes open and fully aware of their experiences of the past, they agreed to share the Golf Links property. The relevant clause in the settlement is not vitiated by any consideration which may impel the court not to give effect to that clause in the settlement. The question of practical inconvenience should have concerned the respondents when they entered into the settlement. They cannot at the stage of implementation of the settlement avoid a covenant in the settlement solemnly incorporated with their consent on the pretext of practical inconvenience of living in the same house, albeit in separate portions, in the unfortunate background of bickerings and acrimony. This issue must, therefore, be decided in favour of the appellants. 18. The next question is whether the judgment of the High Court could be suitably modified to provide for challenge by respondent -Company to any order that may be passed in future by the tax authority imposing capital gains tax on the hypothetical transfers made under the settlement. We find from the judgment of the High Court that the matter was discussed at length and the Court was of the view, prima facie, that the transfers may attract capital gains tax. There was, therefore, justification for deduction of the anticipated capital gains tax liability from the total value of assets. 19. Before us learned counsel for the respondent did not want to join issue on this question and left it to us to pass an appropriate order. Learned counsel for the appellants argued before us that no capital gains tax is payable in the instant case because the transfers are by virtue of an order of the Court and, therefore, Sections 100 to 104 of the Companies Act are attracted. There is in reality no transfer or sale that may attract capital gains tax, in view of the pre-existing right and title of the parties which gets crystalised under a family arrangement. He further submitted that so far as respondent - Company is concerned it does not get any consideration and, therefore, there is no question of any capital gains tax liability so far as respondent - Company is concerned. In any event even if the capital gains tax liability is imposed that will be the liability of the appellants herein, and they will be obliged to discharge that liability in accordance with law. Learned counsel for the appellant made a clear and categoric statement before us that if any liability arises out of the valuation of the assets or capital gains relating to properties covered by the settlement, the appellants shall be liable to discharge that liability. The appellants are willing to execute an undertaking to this effect and to creating a charge on the assets which may fall to their share for discharge of such tax liability, if any, imposed. It was submitted that there was no need to deduct this amount from the value of the assets of the Company and this Court may direct that in case such a liability arises in future and any demand is raised against respondent - Company of capital gains tax, the appellants shall be liable to discharge that liability. Respondent No.1 shall be entitled to challenge the tax demand, if any, for which necessary funds will be made available by the appellants. All this has been stated on the assumption that on a future date there is a demand of capital gains tax by the tax authority on the alleged transfers made under the settlement.20. We are of the view that since no demand of capital gains tax has been made so far, if any such demand is made in future in respect of the transfer of assets under the settlement for which 20% has been deducted by the Chartered Accountants, the respondent - Company shall challenge the demand provided the appellants shall place at its disposal necessary funds for the purpose. In any event the liability under the head "capital gains", if any, shall be that of the appellants who shall furnish an undertaking to this effect accepting their liability, and create a charge over the aforesaid assets to secure payment of capital gains tax, if any, imposed in future. Subject to this being done, there shall be no deduction from the value of the assets of the company of the anticipated liability of capital gains.

1[ds]16. It is true that the High Court has taken note of the practicalities of the situation and has proceeded on the basis that the appellants and the respondents cannot peacefully live in the same premises. The High Court has, therefore, not favoured allotment of a portion of the house in favour of appellant No.2 and has approved the allotment of the house to the respondents who owned the majority shares in the respondent No.1 Company. This was done with a view to ensure that the parties live separately but in peace and harmony. We cannot find fault with the concern shown by the High Court, but the problem which arises in the instant case is that the High Court was not considering a matter in which it could have exercised its discretion to make allotment one way or the other as in a case of family partition. The decree of the Court is based upon a settlement reached between the parties. Even at the time when the settlement was reached the parties were well aware of the strained relationship which existed and the unfortunate events that occurred between the branch of appellant No.2 and the remaining members of the family. Despite this, it was agreed by all of them that the portion in occupation of appellant No.2 shall be allotted to him and the value thereof adjusted against his share. The respondents cannot now be heard to say that it would be inconvenient for them to reside with appellant No.2 and his family members in the same house, though in separate portions. The question as to how the parties will manage their affairs is a matter with which they only are primarily concerned and the Court cannot advise them in the matter. It may be that the architects may provide a solution for their problems, or it may be that in view of the circumstances one party may agree to sell its share or buy the share of the other party with a view to purchase peace, if that becomes necessary. These are matters in which the Court may have nothing to say.17. Clause 14 of the settlement being unambiguous, clear and categoric, it must be given effect because one cannot term the said Clause 14 as vitiated by fraud, or illegal being in breach of any statutory provision, or against public policy, or hit by the principle of impossibility of performance. The settlement was made bona fide by the parties to resolve all their disputes and all facts were known to the parties when they reached the settlement. With their eyes open and fully aware of their experiences of the past, they agreed to share the Golf Links property. The relevant clause in the settlement is not vitiated by any consideration which may impel the court not to give effect to that clause in the settlement. The question of practical inconvenience should have concerned the respondents when they entered into the settlement. They cannot at the stage of implementation of the settlement avoid a covenant in the settlement solemnly incorporated with their consent on the pretext of practical inconvenience of living in the same house, albeit in separate portions, in the unfortunate background of bickerings and acrimony. This issue must, therefore, be decided in favour of thefind from the judgment of the High Court that the matter was discussed at length and the Court was of the view, prima facie, that the transfers may attract capital gains tax. There was, therefore, justification for deduction of the anticipated capital gains tax liability from the total value ofcounsel for the appellant made a clear and categoric statement before us that if any liability arises out of the valuation of the assets or capital gains relating to properties covered by the settlement, the appellants shall be liable to discharge that liability. The appellants are willing to execute an undertaking to this effect and to creating a charge on the assets which may fall to their share for discharge of such tax liability, if any,No.1 shall be entitled to challenge the tax demand, if any, for which necessary funds will be made available by the appellants. All this has been stated on the assumption that on a future date there is a demand of capital gains tax by the tax authority on the alleged transfers made under the settlement.20. We are of the view that since no demand of capital gains tax has been made so far, if any such demand is made in future in respect of the transfer of assets under the settlement for which 20% has been deducted by the Chartered Accountants, the respondent - Company shall challenge the demand provided the appellants shall place at its disposal necessary funds for the purpose. In any event the liability under the head "capital gains", if any, shall be that of the appellants who shall furnish an undertaking to this effect accepting their liability, and create a charge over the aforesaid assets to secure payment of capital gains tax, if any, imposed in future. Subject to this being done, there shall be no deduction from the value of the assets of the company of the anticipated liability of capital gains

### Instruction: Analyze the case proceeding and predict whether the appeal/petition will be accepted (1) or rejected (0). ### Input: settlement reached between the parties. Even at the time when the settlement was reached the parties were well aware of the strained relationship which existed and the unfortunate events that occurred between the branch of appellant No.2 and the remaining members of the family. Despite this, it was agreed by all of them that the portion in occupation of appellant No.2 shall be allotted to him and the value thereof adjusted against his share. The respondents cannot now be heard to say that it would be inconvenient for them to reside with appellant No.2 and his family members in the same house, though in separate portions. The question as to how the parties will manage their affairs is a matter with which they only are primarily concerned and the Court cannot advise them in the matter. It may be that the architects may provide a solution for their problems, or it may be that in view of the circumstances one party may agree to sell its share or buy the share of the other party with a view to purchase peace, if that becomes necessary. These are matters in which the Court may have nothing to say.17. Clause 14 of the settlement being unambiguous, clear and categoric, it must be given effect because one cannot term the said Clause 14 as vitiated by fraud, or illegal being in breach of any statutory provision, or against public policy, or hit by the principle of impossibility of performance. The settlement was made bona fide by the parties to resolve all their disputes and all facts were known to the parties when they reached the settlement. With their eyes open and fully aware of their experiences of the past, they agreed to share the Golf Links property. The relevant clause in the settlement is not vitiated by any consideration which may impel the court not to give effect to that clause in the settlement. The question of practical inconvenience should have concerned the respondents when they entered into the settlement. They cannot at the stage of implementation of the settlement avoid a covenant in the settlement solemnly incorporated with their consent on the pretext of practical inconvenience of living in the same house, albeit in separate portions, in the unfortunate background of bickerings and acrimony. This issue must, therefore, be decided in favour of the appellants. 18. The next question is whether the judgment of the High Court could be suitably modified to provide for challenge by respondent -Company to any order that may be passed in future by the tax authority imposing capital gains tax on the hypothetical transfers made under the settlement. We find from the judgment of the High Court that the matter was discussed at length and the Court was of the view, prima facie, that the transfers may attract capital gains tax. There was, therefore, justification for deduction of the anticipated capital gains tax liability from the total value of assets. 19. Before us learned counsel for the respondent did not want to join issue on this question and left it to us to pass an appropriate order. Learned counsel for the appellants argued before us that no capital gains tax is payable in the instant case because the transfers are by virtue of an order of the Court and, therefore, Sections 100 to 104 of the Companies Act are attracted. There is in reality no transfer or sale that may attract capital gains tax, in view of the pre-existing right and title of the parties which gets crystalised under a family arrangement. He further submitted that so far as respondent - Company is concerned it does not get any consideration and, therefore, there is no question of any capital gains tax liability so far as respondent - Company is concerned. In any event even if the capital gains tax liability is imposed that will be the liability of the appellants herein, and they will be obliged to discharge that liability in accordance with law. Learned counsel for the appellant made a clear and categoric statement before us that if any liability arises out of the valuation of the assets or capital gains relating to properties covered by the settlement, the appellants shall be liable to discharge that liability. The appellants are willing to execute an undertaking to this effect and to creating a charge on the assets which may fall to their share for discharge of such tax liability, if any, imposed. It was submitted that there was no need to deduct this amount from the value of the assets of the Company and this Court may direct that in case such a liability arises in future and any demand is raised against respondent - Company of capital gains tax, the appellants shall be liable to discharge that liability. Respondent No.1 shall be entitled to challenge the tax demand, if any, for which necessary funds will be made available by the appellants. All this has been stated on the assumption that on a future date there is a demand of capital gains tax by the tax authority on the alleged transfers made under the settlement.20. We are of the view that since no demand of capital gains tax has been made so far, if any such demand is made in future in respect of the transfer of assets under the settlement for which 20% has been deducted by the Chartered Accountants, the respondent - Company shall challenge the demand provided the appellants shall place at its disposal necessary funds for the purpose. In any event the liability under the head "capital gains", if any, shall be that of the appellants who shall furnish an undertaking to this effect accepting their liability, and create a charge over the aforesaid assets to secure payment of capital gains tax, if any, imposed in future. Subject to this being done, there shall be no deduction from the value of the assets of the company of the anticipated liability of capital gains. ### Response: 1

M/s. Hind Tobacco & Cigarette Company Limited Vs. Union of India & Others

December 11, 1954 (Ex. B-4), the first offer to supply cigarettes and contended that this was the only contract in which in the column of Price, sales-tax was mentioned and reference was made in the "Remarks" Column to Schedule B for excluding the sales-tax. In the subsequent contracts, according to the respondents counsel, there was no such mention. He drew our attention to the subsequent offers to support his submission. The learned counsel also relied on the Tata Iron and Steel Co. Ltd. v. State of Bihar, 1958 SCR 1355 = (AIR 1959 SC 452) for the contention that the buyer is under no liability to pay sales-tax in addition to the agreed sales price : there could, therefore, be no question of any agreement on the part of the defendant to reimburse the plaintiff, argued the counsel. Finally it was submitted that the High Court had certified the case to be fit for appeal only because of its high valuation and because of the judgment of the High Court being one of reversal : the grant of certificate by the High Court does not in the circumstances mean that the case involves any important question of law. This Court is, therefore, not obliged to interfere with the decision of the High Court, even if it is considered to be erroneous contended Shri Sanghi.9. Dealing with the last argument first, Article 133 (1) confers a right of appeal on an aggrieved party when the case satisfies the requirement of Clause (a) and the judgment of the High Court is one of reversal. In such a case it is not necessary that, a substantial or important question of law should also be involved.This Court, therefore, cannot justifiably decline to go into the merits of the appeal on the ground that no substantial question of law is involved. But this apart, it cannot be said that this appeal does not involve any substantial question of law.10. Turning to the merits it is clear and indeed it is not disputed that Clause 7 in Schedule B governs the various contracts of sale between the parties. This clause expressly provides that the price quoted is exclusive of sales-tax.But sales-tax was expressly agreed to be paid at the rates prescribed by the State Government concerned. This liability appears to us to be the real core of one of the fundamental terms of the obligation undertaken by the purchaser. The term that the sales-tax, if payable, should be shown as a separate item is merely a matter of procedure and the condition that if the sales-tax intended to be claimed is not distinctly shown then no such claim would be admitted at a later stage is more akin to exemption from this liability. In the case in hand in the very first tender, as already noticed, the plaintiff had actually separately shown in distinct terms that the price per unit stated in column No. 4 was subject to sales-tax at the rate of 1 anna per rupee. In the Remarks Column it was again expressly mentioned that no sales-tax was leviable as per Schedule B. This tender fully complies with Clause 7 both in letter and in spirit even though in our opinion in view of the Note to Clause 7 this mention was scarcely necessary, the sales-tax not being leviable according to the defendants representation. In subsequent tenders, if there is no mention of sales-tax or of the fact that it was not leviable as per Schedule this was due to the fact that it was considered redundant. This, as already noticed, was also admitted by the defendant in the written statement. The separate mention of sales-tax which, in our opinion, does not relate to the fundamental term or core of the contract, cannot be considered to deprive the plaintiff of its right to realise the sales-tax actually held by the sales-tax department to be leviable and which the defendant had in express terms undertaken to pay. The express and unqualified representation by the defendant in the Note to Clause 7 in Schedule B that sales-tax was not leviable on these sales was, in our opinion, sufficient to justify the omission on the part of the plaintiff to distinctly show it with the price quoted to be intended to be claimed. This omission could by no means deprive the plaintiff company of the right under the contract to claim from the defendant sales tax at the prescribed rate actually paid.11. A faint contention was raised on behalf of the defendant-respondent that there was no agreement by the defendant to pay sales-tax because the cigarettes supplied by the plaintiff were of an inferior quality and therefore, the company must be deemed to have agreed not to charge sales-tax from the purchaser as is the normal practice in the market. In support of this submission reference was made to Ex. B-1, a letter dated July 6, 1954, written by the Deputy Director of Purchase, Government of India, Ministry of Food and Agriculture to the plaintiff company. All that this letter suggests is that since none of the plaintiffs "Brands" had been approved, the plaintiff was requested to get its Brands approved from the Director of Supplies and Transport so as to enable the company to quote against the Ministrys future tender enquiries. This letter does not support the counsels submission. Apparently after July, 1954 the plaintiff must have got their Brands approved which enabled them to quote against the Ministrys future tender enquiries. It is not and was never the defendants case that the Brand of cigarettes for which the tenders were actually accepted were of an inferior quality. This contention is an afterthought and is unacceptable. It is somewhat surprising that the State Government should have advanced this plea. Indeed even the main plea which was plainly contrary to the clear and explicit representation of the State Government does not reflect the expected fairness on the part of the defendant in their dealings with the citizens.

1[ds]9. Dealing with the last argument first, Article 133 (1) confers a right of appeal on an aggrieved party when the case satisfies the requirement of Clause (a) and the judgment of the High Court is one of reversal. In such a case it is not necessary that, a substantial or important question of law should also be involved.This Court, therefore, cannot justifiably decline to go into the merits of the appeal on the ground that no substantial question of law is involved. But this apart, it cannot be said that this appeal does not involve any substantial question of law.10. Turning to the merits it is clear and indeed it is not disputed that Clause 7 in Schedule B governs the various contracts of sale between the parties. This clause expressly provides that the price quoted is exclusive ofx was expressly agreed to be paid at the rates prescribed by the State Government concerned. This liability appears to us to be the real core of one of the fundamental terms of the obligation undertaken by the purchaser. The term that theif payable, should be shown as a separate item is merely a matter of procedure and the condition that if theintended to be claimed is not distinctly shown then no such claim would be admitted at a later stage is more akin to exemption from this liability. In the case in hand in the very first tender, as already noticed, the plaintiff had actually separately shown in distinct terms that the price per unit stated in column No. 4 was subject toat the rate of 1 anna per rupee. In the Remarks Column it was again expressly mentioned that nowas leviable as per Schedule B. This tender fully complies with Clause 7 both in letter and in spirit even though in our opinion in view of the Note to Clause 7 this mention was scarcely necessary, thenot being leviable according to the defendants representation. In subsequent tenders, if there is no mention ofor of the fact that it was not leviable as per Schedule this was due to the fact that it was considered redundant. This, as already noticed, was also admitted by the defendant in the written statement. The separate mention ofwhich, in our opinion, does not relate to the fundamental term or core of the contract, cannot be considered to deprive the plaintiff of its right to realise theactually held by thedepartment to be leviable and which the defendant had in express terms undertaken to pay. The express and unqualified representation by the defendant in the Note to Clause 7 in Schedule B thatwas not leviable on these sales was, in our opinion, sufficient to justify the omission on the part of the plaintiff to distinctly show it with the price quoted to be intended to be claimed. This omission could by no means deprive the plaintiff company of the right under the contract to claim from the defendant sales tax at the prescribed rate actually paid.11.A faint contention was raised on behalf of thet there was no agreement by the defendant to paye the cigarettes supplied by the plaintiff were of an inferior quality and therefore, the company must be deemed to have agreed not to chargefrom the purchaser as is the normal practice in the market. In support of this submission reference was made to Ex.a letter dated July 6, 1954, written by the Deputy Director of Purchase, Government of India, Ministry of Food and Agriculture to the plaintiff company.All that this letter suggests is that since none of the plaintiffs "Brands" had been approved, the plaintiff was requested to get its Brands approved from the Director of Supplies and Transport so as to enable the company to quote against the Ministrys future tender enquiries. This letter does not support the counsels submission. Apparently after July, 1954 the plaintiff must have got their Brands approved which enabled them to quote against the Ministrys future tender enquiries. It is not and was never the defendants case that the Brand of cigarettes for which the tenders were actually accepted were of an inferior quality. This contention is an afterthought and is unacceptable. It is somewhat surprising that the State Government should have advanced this plea. Indeed even the main plea which was plainly contrary to the clear and explicit representation of the State Government does not reflect the expected fairness on the part of the defendant in their dealings with the citizens.

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: December 11, 1954 (Ex. B-4), the first offer to supply cigarettes and contended that this was the only contract in which in the column of Price, sales-tax was mentioned and reference was made in the "Remarks" Column to Schedule B for excluding the sales-tax. In the subsequent contracts, according to the respondents counsel, there was no such mention. He drew our attention to the subsequent offers to support his submission. The learned counsel also relied on the Tata Iron and Steel Co. Ltd. v. State of Bihar, 1958 SCR 1355 = (AIR 1959 SC 452) for the contention that the buyer is under no liability to pay sales-tax in addition to the agreed sales price : there could, therefore, be no question of any agreement on the part of the defendant to reimburse the plaintiff, argued the counsel. Finally it was submitted that the High Court had certified the case to be fit for appeal only because of its high valuation and because of the judgment of the High Court being one of reversal : the grant of certificate by the High Court does not in the circumstances mean that the case involves any important question of law. This Court is, therefore, not obliged to interfere with the decision of the High Court, even if it is considered to be erroneous contended Shri Sanghi.9. Dealing with the last argument first, Article 133 (1) confers a right of appeal on an aggrieved party when the case satisfies the requirement of Clause (a) and the judgment of the High Court is one of reversal. In such a case it is not necessary that, a substantial or important question of law should also be involved.This Court, therefore, cannot justifiably decline to go into the merits of the appeal on the ground that no substantial question of law is involved. But this apart, it cannot be said that this appeal does not involve any substantial question of law.10. Turning to the merits it is clear and indeed it is not disputed that Clause 7 in Schedule B governs the various contracts of sale between the parties. This clause expressly provides that the price quoted is exclusive of sales-tax.But sales-tax was expressly agreed to be paid at the rates prescribed by the State Government concerned. This liability appears to us to be the real core of one of the fundamental terms of the obligation undertaken by the purchaser. The term that the sales-tax, if payable, should be shown as a separate item is merely a matter of procedure and the condition that if the sales-tax intended to be claimed is not distinctly shown then no such claim would be admitted at a later stage is more akin to exemption from this liability. In the case in hand in the very first tender, as already noticed, the plaintiff had actually separately shown in distinct terms that the price per unit stated in column No. 4 was subject to sales-tax at the rate of 1 anna per rupee. In the Remarks Column it was again expressly mentioned that no sales-tax was leviable as per Schedule B. This tender fully complies with Clause 7 both in letter and in spirit even though in our opinion in view of the Note to Clause 7 this mention was scarcely necessary, the sales-tax not being leviable according to the defendants representation. In subsequent tenders, if there is no mention of sales-tax or of the fact that it was not leviable as per Schedule this was due to the fact that it was considered redundant. This, as already noticed, was also admitted by the defendant in the written statement. The separate mention of sales-tax which, in our opinion, does not relate to the fundamental term or core of the contract, cannot be considered to deprive the plaintiff of its right to realise the sales-tax actually held by the sales-tax department to be leviable and which the defendant had in express terms undertaken to pay. The express and unqualified representation by the defendant in the Note to Clause 7 in Schedule B that sales-tax was not leviable on these sales was, in our opinion, sufficient to justify the omission on the part of the plaintiff to distinctly show it with the price quoted to be intended to be claimed. This omission could by no means deprive the plaintiff company of the right under the contract to claim from the defendant sales tax at the prescribed rate actually paid.11. A faint contention was raised on behalf of the defendant-respondent that there was no agreement by the defendant to pay sales-tax because the cigarettes supplied by the plaintiff were of an inferior quality and therefore, the company must be deemed to have agreed not to charge sales-tax from the purchaser as is the normal practice in the market. In support of this submission reference was made to Ex. B-1, a letter dated July 6, 1954, written by the Deputy Director of Purchase, Government of India, Ministry of Food and Agriculture to the plaintiff company. All that this letter suggests is that since none of the plaintiffs "Brands" had been approved, the plaintiff was requested to get its Brands approved from the Director of Supplies and Transport so as to enable the company to quote against the Ministrys future tender enquiries. This letter does not support the counsels submission. Apparently after July, 1954 the plaintiff must have got their Brands approved which enabled them to quote against the Ministrys future tender enquiries. It is not and was never the defendants case that the Brand of cigarettes for which the tenders were actually accepted were of an inferior quality. This contention is an afterthought and is unacceptable. It is somewhat surprising that the State Government should have advanced this plea. Indeed even the main plea which was plainly contrary to the clear and explicit representation of the State Government does not reflect the expected fairness on the part of the defendant in their dealings with the citizens. ### Response: 1

Shri Benoy Mazumdar (Dead) By Lrs Vs. The Collector Of Cachar

lands were requisitioned. On the other hand, the objectors witnesses, some of whom are official witnesses, said that at the time of requisition the lands were lying patty. I, therefore, find no substance in the argument that the lands were not fallow, uncultivated or not utilised at the time when these were requisitioned." * 4. After elaborate consideration, it was held that the land was fallow, uncultivated and not unutilised at the time when the property was requisitioned. The Division Bench of the High Court again elaborately considered the nature of the grant, nature of the acquisition and the nature of the factual possession of the land as on the date of the requisition and it relied upon another Division Bench judgment of that Court in First Appeals Nos. 67-68 of 1969 decided on 23-2-1982 and concluded thus. "The expression in the case of land with respect to which any settlement has been made for special cultivation or which is included in any grant, if such land is lying fallow or uncultivated or is not utilised for the purpose for which the grant or settlement was made or for the purposes unidentical thereto, has to be given coherent and pragmatic interpretation, the words fallow or cultivated also being understood in the context of the concept of special cultivation for which the grant was meant. Fallow according to the Websters New Twentieth Century Dictionary, means land that has been lying a year or more untilled or unseeded to kill weeds, make the soil richer etc., land which has been ploughed or tilled without sowing it for a season. It means left uncultivated or unplanted. According to the same dictionary, utilisation means utilising or being utilised. To utilise is to profitably account or use, to make useful, as to utilise natural resources. Thus, all the three expressions, namely, fallow, uncultivated and not utilised have to be understood in the context of special cultivation for which the grant was made. Cultivation of the land for a purpose foreign to special cultivation or utilisation of the land for a purpose different from that which the grant was made, would be as much cultivation or unutilisationApplying the above principle we do not find any infirmity in the findings of the Reference Court that the land involved in this case was covered by Section 7(1-A) of the Act and it would not fall under Section 7(1) of the Act. In this view of the matter the sale deeds and the Jamabandi classification which does not indicate the use of the land become irrelevant. Besides, the Jamabandi is dated 5-11-1959 while the land was requisitioned in 1954 and subsequently acquired in 1959 by notification dated 13-2-1959." 5. The said ratio was applied to the facts in this case and it was held that since the lands were fallow uncultivated lands they got attracted and accordingly it was held that Section 7(1-A) was inapplicable. Though Shri Choudhary sought to impress upon us that the land is fallow and therefore, the land falls within Section 7(1-A), that would be seen under the recital and the grant that would establish that the lands were assigned by a grant for special cultivation. Under the Assam Act of 1964, with a view to remove the ambiguity as to the "special cultivation" under sub-section (2) of Section 11, the expression has been defined to mean cultivation which involves, either owing to the nature of the crop or owing to the process of cultivation, a much larger expenditure of capital per acre than is incurred by most of the cultivators in the State and includes cultivation of tea. It would be seen that the special cultivation was meant to include cultivation involving higher capital outlay per acre than the expenditure incurred for cultivation by the cultivators in the State and also a cultivation of the tea which against the special cultivation involves higher investment of higher capital outlay. In view of the concurrent findings recorded by the Reference Court as well as the High Court that the land remained as fallow, uncultivated or barren land, necessarily the conclusion would be that the grant contained that the land was meant for special cultivation. Consequently, Section 7(1) has no application to the determination of the compensation as per the prevailing market value as on the date of the acquisition under the Act. We do not find that the Act is arbitrary. The Full Bench of five Judges in the above judgment, per majority, has elaborately gone into the question and concluded that Section 7(1-A) is not arbitrary. The reason appears to be that the land having been assigned by the Government, when it is needed for a public purpose, what the assignee would get in return is the land revenue; after use and enjoyment thereof, he would be compensated with the payment of the land revenue envisaged under Section 7(1-A) of the Act. It is settled law by a catena of judgments of this Court including one by the Constitution Bench that the prescription of the principle for determination of the compensation is not violative of Article 14 of the Constitution. Even in Bhim Singhji v. Union of India, the Constitution Bench of this Court has held that the payment of compensation for the surplus vacant land acquired under the Ceiling Act under Section 6(11) in the sum of Rs 2, 00, 000 was not illusory. Considered from this perspective, we hold that the determination of the compensation under Section 7(1-A) is not violative of Article 14 of the Constitution. The majority of the Full Bench of five Judges of the Assam High Court has rightly concluded the issue. Accordingly, we hold that there is no illegality in the impugned judgment. Moreover, when the High Court has consistently interpreted a local law in a particular way, this Court would be slow to disturb their interpretation unless compelling circumstances so warrant. The High Court has not applied wrong principle of law in determining the compensation warranting interference.

0[ds]5. The said ratio was applied to the facts in this case and it was held that since the lands were fallow uncultivated lands they got attracted and accordingly it was held that Section 7(1-A) was inapplicable. Though Shri Choudhary sought to impress upon us that the land is fallow and therefore, the land falls within Section 7(1-A), that would be seen under the recital and the grant that would establish that the lands were assigned by a grant for special cultivation. Under the Assam Act of 1964, with a view to remove the ambiguity as to the "special cultivation" under sub-section (2) of Section 11, the expression has been defined to mean cultivation which involves, either owing to the nature of the crop or owing to the process of cultivation, a much larger expenditure of capital per acre than is incurred by most of the cultivators in the State and includes cultivation of tea. It would be seen that the special cultivation was meant to include cultivation involving higher capital outlay per acre than the expenditure incurred for cultivation by the cultivators in the State and also a cultivation of the tea which against the special cultivation involves higher investment of higher capital outlay. In view of the concurrent findings recorded by the Reference Court as well as the High Court that the land remained as fallow, uncultivated or barren land, necessarily the conclusion would be that the grant contained that the land was meant for special cultivation. Consequently, Section 7(1) has no application to the determination of the compensation as per the prevailing market value as on the date of the acquisition under the Act. We do not find that the Act is arbitrary. The Full Bench of five Judges in the above judgment, per majority, has elaborately gone into the question and concluded that Section 7(1-A) is not arbitrary. The reason appears to be that the land having been assigned by the Government, when it is needed for a public purpose, what the assignee would get in return is the land revenue; after use and enjoyment thereof, he would be compensated with the payment of the land revenue envisaged under Section 7(1-A) of the Act. It is settled law by a catena of judgments of this Court including one by the Constitution Bench that the prescription of the principle for determination of the compensation is not violative of Article 14 of the Constitution. Even in Bhim Singhji v. Union of India, the Constitution Bench of this Court has held that the payment of compensation for the surplus vacant land acquired under the Ceiling Act under Section 6(11) in the sum of Rs 2, 00, 000 was not illusory. Considered from this perspective, we hold that the determination of the compensation under Section 7(1-A) is not violative of Article 14 of the Constitution. The majority of the Full Bench of five Judges of the Assam High Court has rightly concluded the issue. Accordingly, we hold that there is no illegality in the impugned judgment. Moreover, when the High Court has consistently interpreted a local law in a particular way, this Court would be slow to disturb their interpretation unless compelling circumstances so warrant. The High Court has not applied wrong principle of law in determining the compensation warranting interference

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: lands were requisitioned. On the other hand, the objectors witnesses, some of whom are official witnesses, said that at the time of requisition the lands were lying patty. I, therefore, find no substance in the argument that the lands were not fallow, uncultivated or not utilised at the time when these were requisitioned." * 4. After elaborate consideration, it was held that the land was fallow, uncultivated and not unutilised at the time when the property was requisitioned. The Division Bench of the High Court again elaborately considered the nature of the grant, nature of the acquisition and the nature of the factual possession of the land as on the date of the requisition and it relied upon another Division Bench judgment of that Court in First Appeals Nos. 67-68 of 1969 decided on 23-2-1982 and concluded thus. "The expression in the case of land with respect to which any settlement has been made for special cultivation or which is included in any grant, if such land is lying fallow or uncultivated or is not utilised for the purpose for which the grant or settlement was made or for the purposes unidentical thereto, has to be given coherent and pragmatic interpretation, the words fallow or cultivated also being understood in the context of the concept of special cultivation for which the grant was meant. Fallow according to the Websters New Twentieth Century Dictionary, means land that has been lying a year or more untilled or unseeded to kill weeds, make the soil richer etc., land which has been ploughed or tilled without sowing it for a season. It means left uncultivated or unplanted. According to the same dictionary, utilisation means utilising or being utilised. To utilise is to profitably account or use, to make useful, as to utilise natural resources. Thus, all the three expressions, namely, fallow, uncultivated and not utilised have to be understood in the context of special cultivation for which the grant was made. Cultivation of the land for a purpose foreign to special cultivation or utilisation of the land for a purpose different from that which the grant was made, would be as much cultivation or unutilisationApplying the above principle we do not find any infirmity in the findings of the Reference Court that the land involved in this case was covered by Section 7(1-A) of the Act and it would not fall under Section 7(1) of the Act. In this view of the matter the sale deeds and the Jamabandi classification which does not indicate the use of the land become irrelevant. Besides, the Jamabandi is dated 5-11-1959 while the land was requisitioned in 1954 and subsequently acquired in 1959 by notification dated 13-2-1959." 5. The said ratio was applied to the facts in this case and it was held that since the lands were fallow uncultivated lands they got attracted and accordingly it was held that Section 7(1-A) was inapplicable. Though Shri Choudhary sought to impress upon us that the land is fallow and therefore, the land falls within Section 7(1-A), that would be seen under the recital and the grant that would establish that the lands were assigned by a grant for special cultivation. Under the Assam Act of 1964, with a view to remove the ambiguity as to the "special cultivation" under sub-section (2) of Section 11, the expression has been defined to mean cultivation which involves, either owing to the nature of the crop or owing to the process of cultivation, a much larger expenditure of capital per acre than is incurred by most of the cultivators in the State and includes cultivation of tea. It would be seen that the special cultivation was meant to include cultivation involving higher capital outlay per acre than the expenditure incurred for cultivation by the cultivators in the State and also a cultivation of the tea which against the special cultivation involves higher investment of higher capital outlay. In view of the concurrent findings recorded by the Reference Court as well as the High Court that the land remained as fallow, uncultivated or barren land, necessarily the conclusion would be that the grant contained that the land was meant for special cultivation. Consequently, Section 7(1) has no application to the determination of the compensation as per the prevailing market value as on the date of the acquisition under the Act. We do not find that the Act is arbitrary. The Full Bench of five Judges in the above judgment, per majority, has elaborately gone into the question and concluded that Section 7(1-A) is not arbitrary. The reason appears to be that the land having been assigned by the Government, when it is needed for a public purpose, what the assignee would get in return is the land revenue; after use and enjoyment thereof, he would be compensated with the payment of the land revenue envisaged under Section 7(1-A) of the Act. It is settled law by a catena of judgments of this Court including one by the Constitution Bench that the prescription of the principle for determination of the compensation is not violative of Article 14 of the Constitution. Even in Bhim Singhji v. Union of India, the Constitution Bench of this Court has held that the payment of compensation for the surplus vacant land acquired under the Ceiling Act under Section 6(11) in the sum of Rs 2, 00, 000 was not illusory. Considered from this perspective, we hold that the determination of the compensation under Section 7(1-A) is not violative of Article 14 of the Constitution. The majority of the Full Bench of five Judges of the Assam High Court has rightly concluded the issue. Accordingly, we hold that there is no illegality in the impugned judgment. Moreover, when the High Court has consistently interpreted a local law in a particular way, this Court would be slow to disturb their interpretation unless compelling circumstances so warrant. The High Court has not applied wrong principle of law in determining the compensation warranting interference. ### Response: 0

M/s. SRD Nutrients Private Limited Vs. Commissioner of Central Excise Guwahati

under any other law for the time being in force. Sub-section (3) of Section 93 provides that the provisions of the Central Excise Act, 1944 and the rules made thereunder, including those related to refunds and duties etc. shall as far as may be applied in relation to levy and collection of Education Cess on excisable goods. A conjoint reading of these provisions would amply demonstrate that Education Cess as a surcharge, is levied @ 2% on the duties of excise which are payable under the Act. It can, therefore, be clearly inferred that when there is no excise duty payable, as it is exempted, there would not be any Education Cess as well, inasmuch as Education Cess @ 2% is to be calculated on the aggregate of duties of excise. There cannot be any surcharge when basic duty itself is Nil.22. It is rightly pointed out by the learned counsel for the appellants that the CESTAT in the earlier two judgments given in Bharat Box Factory Ltd. and Cyrus Surfactants Pvt. Ltd. held that Education Cess and Higher Education Cess would also refundable along with excise duty and in view thereof, another co-ordinate Bench of CESTAT could not take a contrary view in Jindal Drugs Ltd. Judicial discipline warranted reference of the matter to the Larger Bench which it did not do. In the impugned judgment, while preferring to follow the view taken in Jindal Drugs Ltd., the Tribunal has not given any reasons for adopting this course of action. The Rajasthan High Court in the case of Banswara Syntex Ltd. while holding that surcharge taken in the form of Education Cess shall also be refundable has given the following reasons in support of the said view:"15. The very fact that the surcharge is collected as part of levy under three different enactments goes to show that scheme of levy of Education Cess was by way of collecting special funds for the purpose of Government project towards providing and financing universalised quality of basic education by enhancing the burden of Central Excise Duty, Customs Duty, and Service Tax by way of charging surcharge to be collected for the purpose of Union. But, it was made clear that in respect of all the three taxes, the surcharge collected along with the tax will bear the same character of respective taxes to which surcharge was appended and was to be governed by the respective enactments under which Education Cess in the form of surcharge is levied & collected.16. Apparently, when at the time of collection, surcharge has taken the character of parent levy, whatever may be the object behind it, it becomes subject to the provision relating to the Excise Duty applicable to it in the manner of collecting the same obligation of the tax payer in respect of its discharge as well as exemption concession by way of rebate attached with such levies. This aspect has been made clear by combined reading of sub-sections (1), (2) & (3) of Section 93.xxx xxx xxx18. The Explanation appended to Notification dated 26.6.2001 included within the ambit of Excise Duty any special Excise Duty collected under any Finance Act when under Finance Act, 2004 it was ordained that Education Cess to be collected as surcharge on Excise Duty payable on excisable goods and shall be a Duty of Excise, it became a special Duty of Excise by way of Education Cess chargeable and collected under Finance Act, 2004 and fell within the ambit of clause (3) of Explanation appended to Notification dated 26/6/2001. Consequently, rebate became available on collection of surcharge on Excise Duty under Finance Act, 2004 in terms of existing Notification dated 26/6/2001 immediately. Later Notification including the Education Cess in enumerative definition in the circumstances was only clarificatory and by way of abandoned caution, but not a new rebate in relation to Excise Duty or any part thereof as statutorily pronounced as well as specified Excise Duty levied and collected under the Finance Act."We are in agreement with the aforesaid reasons accorded by the Rajasthan High Court, since it is in consonance with the legal principle enunciated by this Court. For this purpose, we may refer to the judgment in the case of Collector of Central Excise, Patna v. Tata Engineering and Locomotive Co., 1997 (92) ELT 303 (SC) In that case, issue pertained to valuation of cess which was levied @ 1/8 per cent of ad valorem `value of the central excise duty. The Court held that the calculation of 1/8 per cent ad valorem of the motor vehicle for the purposes of the levy and collection of the automobile cess must be made that was being calculated since automobile cess was to be levied and calculated as if it was excise duty. As a fortiorari, the Education Cess and Higher Education Cess levied @ 2% of the excise duty would partake the character of excise duty itself.Insofar as judgment of Calcutta High Court in Biswanath Hosiery Mills Ltd. case is concerned, we find that the same would have no bearing in the present case. In the said case, cess was payable under Section 5A of the Textiles Committee Act, 1963. After going through the provisions of Textiles Committee Act, 1963 and the Textiles Committee (Cess) Rules, 1975, the High Court found that as per the scheme of Textiles Committee Act and the rules framed therein, levy of cess was independent of excise under the Act which was a complete code containing all the provisions relating to levy, collection, exemption and application of cess. Therefore, even the legislative intendment underlying Textiles Committee (Amendment) Act and rules read with the preamble, aims and objects of the Act was clearly discernable, namely, the legislature intended to levy the cess under the Act independent of and in addition to the excise duty which was payable under the Central Excise and Salt Act, 1944.23. It is also trite that when two views are possible, one which favours the assessees has to be adopted.

1[ds]16. It is clear from the arguments of the counsel for the parties that divergent views are expressed by the CESTAT as well as High Courts. Even one Bench of the same Tribunal has differed from its earlier Division Bench decision. In this scenario, it becomes important as to how the Department has viewed the position regarding Education Cess and Higher Education Cess which is payable as surcharge on the excise duty, once the excise duty is exempted.No doubt, it clarified the position in relation to the exemption from payment of service tax that was given vide Notification No.dated August 06, 2007. We have gone through that Notification as well, which is pari material with Notification dated April 25, 2007. What is important is that this Circular dated April 08, 2011 refers to the judgment of the Tribunal in Balasore Alloys Ltd. v. CCE, Customs and Service Tax,) which was a decision rendered in favour of the Revenue as it was held therein that the Education Cess and Higher Education Cess would not be refunded while giving back the exempted service tax. Notwithstanding the same, the Circular mentions that the said order of the Tribunal is in consistent with the policy intention of the Government to exempt Education Cess in addition to service tax, `whole on service tax stands exempted.One aspect that clearly emerges from the reading of these two circulars is that the Government itself has taken the position that where whole of excise duty or service tax is exempted, even the Education Cess as well as Secondary and Higher Education Cess would not be payable. These circulars are binding on the Department.21. Even otherwise, we are of the opinion that it is more rational to accept the aforesaid position as clarified by the Ministry of Finance in the aforesaid circulars. Education Cess is on excise duty. It means that those assessees who are required to pay excise duty have to shell out Education Cess as well. This Education Cess is introduced by Sections 91 to 93 of the Finance (No.2) Act, 2004. As per Section 91 thereof, Education Cess is the surcharge which the assessee is to pay. Section 93 makes it clear that this Education Cess is payable on `excisable goods i.e. in respect of goods specified in the first Schedule to the Central Excise Tariff Act, 1985. Further, this Education Cess is to be levied @ 2% and calculated on the aggregate of all duties of excise which are levied and collected by the Central Government under the provisions of Central Excise Act, 1944 or under any other law for the time being in force.(3) of Section 93 provides that the provisions of the Central Excise Act, 1944 and the rules made thereunder, including those related to refunds and duties etc. shall as far as may be applied in relation to levy and collection of Education Cess on excisable goods. A conjoint reading of these provisions would amply demonstrate that Education Cess as a surcharge, is levied @ 2% on the duties of excise which are payable under the Act. It can, therefore, be clearly inferred that when there is no excise duty payable, as it is exempted, there would not be any Education Cess as well, inasmuch as Education Cess @ 2% is to be calculated on the aggregate of duties of excise. There cannot be any surcharge when basic duty itself is Nil.22. It is rightly pointed out by the learned counsel for the appellants that the CESTAT in the earlier two judgments given in Bharat Box Factory Ltd. and Cyrus Surfactants Pvt. Ltd. held that Education Cess and Higher Education Cess would also refundable along with excise duty and in view thereof, anotherBench of CESTAT could not take a contrary view in Jindal Drugs Ltd. Judicial discipline warranted reference of the matter to the Larger Bench which it did not do. In the impugned judgment, while preferring to follow the view taken in Jindal Drugs Ltd., the Tribunal has not given any reasons for adopting this course ofare in agreement with the aforesaid reasons accorded by the Rajasthan High Court, since it is in consonance with the legal principle enunciated by this Court. For this purpose, we may refer to the judgment in the case of Collector of Central Excise, Patna v. Tata Engineering and Locomotive Co., 1997 (92) ELT 303 (SC) In that case, issue pertained to valuation of cess which was levied @ 1/8 per cent of ad valorem `value of the central excise duty. The Court held that the calculation of 1/8 per cent ad valorem of the motor vehicle for the purposes of the levy and collection of the automobile cess must be made that was being calculated since automobile cess was to be levied and calculated as if it was excise duty. As a fortiorari, the Education Cess and Higher Education Cess levied @ 2% of the excise duty would partake the character of excise duty itself.Insofar as judgment of Calcutta High Court in Biswanath Hosiery Mills Ltd. case is concerned, we find that the same would have no bearing in the present case. In the said case, cess was payable under Section 5A of the Textiles Committee Act, 1963. After going through the provisions of Textiles Committee Act, 1963 and the Textiles Committee (Cess) Rules, 1975, the High Court found that as per the scheme of Textiles Committee Act and the rules framed therein, levy of cess was independent of excise under the Act which was a complete code containing all the provisions relating to levy, collection, exemption and application of cess. Therefore, even the legislative intendment underlying Textiles Committee (Amendment) Act and rules read with the preamble, aims and objects of the Act was clearly discernable, namely, the legislature intended to levy the cess under the Act independent of and in addition to the excise duty which was payable under the Central Excise and Salt Act, 1944.23. It is also trite that when two views are possible, one which favours the assessees has to be adopted.

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: under any other law for the time being in force. Sub-section (3) of Section 93 provides that the provisions of the Central Excise Act, 1944 and the rules made thereunder, including those related to refunds and duties etc. shall as far as may be applied in relation to levy and collection of Education Cess on excisable goods. A conjoint reading of these provisions would amply demonstrate that Education Cess as a surcharge, is levied @ 2% on the duties of excise which are payable under the Act. It can, therefore, be clearly inferred that when there is no excise duty payable, as it is exempted, there would not be any Education Cess as well, inasmuch as Education Cess @ 2% is to be calculated on the aggregate of duties of excise. There cannot be any surcharge when basic duty itself is Nil.22. It is rightly pointed out by the learned counsel for the appellants that the CESTAT in the earlier two judgments given in Bharat Box Factory Ltd. and Cyrus Surfactants Pvt. Ltd. held that Education Cess and Higher Education Cess would also refundable along with excise duty and in view thereof, another co-ordinate Bench of CESTAT could not take a contrary view in Jindal Drugs Ltd. Judicial discipline warranted reference of the matter to the Larger Bench which it did not do. In the impugned judgment, while preferring to follow the view taken in Jindal Drugs Ltd., the Tribunal has not given any reasons for adopting this course of action. The Rajasthan High Court in the case of Banswara Syntex Ltd. while holding that surcharge taken in the form of Education Cess shall also be refundable has given the following reasons in support of the said view:"15. The very fact that the surcharge is collected as part of levy under three different enactments goes to show that scheme of levy of Education Cess was by way of collecting special funds for the purpose of Government project towards providing and financing universalised quality of basic education by enhancing the burden of Central Excise Duty, Customs Duty, and Service Tax by way of charging surcharge to be collected for the purpose of Union. But, it was made clear that in respect of all the three taxes, the surcharge collected along with the tax will bear the same character of respective taxes to which surcharge was appended and was to be governed by the respective enactments under which Education Cess in the form of surcharge is levied & collected.16. Apparently, when at the time of collection, surcharge has taken the character of parent levy, whatever may be the object behind it, it becomes subject to the provision relating to the Excise Duty applicable to it in the manner of collecting the same obligation of the tax payer in respect of its discharge as well as exemption concession by way of rebate attached with such levies. This aspect has been made clear by combined reading of sub-sections (1), (2) & (3) of Section 93.xxx xxx xxx18. The Explanation appended to Notification dated 26.6.2001 included within the ambit of Excise Duty any special Excise Duty collected under any Finance Act when under Finance Act, 2004 it was ordained that Education Cess to be collected as surcharge on Excise Duty payable on excisable goods and shall be a Duty of Excise, it became a special Duty of Excise by way of Education Cess chargeable and collected under Finance Act, 2004 and fell within the ambit of clause (3) of Explanation appended to Notification dated 26/6/2001. Consequently, rebate became available on collection of surcharge on Excise Duty under Finance Act, 2004 in terms of existing Notification dated 26/6/2001 immediately. Later Notification including the Education Cess in enumerative definition in the circumstances was only clarificatory and by way of abandoned caution, but not a new rebate in relation to Excise Duty or any part thereof as statutorily pronounced as well as specified Excise Duty levied and collected under the Finance Act."We are in agreement with the aforesaid reasons accorded by the Rajasthan High Court, since it is in consonance with the legal principle enunciated by this Court. For this purpose, we may refer to the judgment in the case of Collector of Central Excise, Patna v. Tata Engineering and Locomotive Co., 1997 (92) ELT 303 (SC) In that case, issue pertained to valuation of cess which was levied @ 1/8 per cent of ad valorem `value of the central excise duty. The Court held that the calculation of 1/8 per cent ad valorem of the motor vehicle for the purposes of the levy and collection of the automobile cess must be made that was being calculated since automobile cess was to be levied and calculated as if it was excise duty. As a fortiorari, the Education Cess and Higher Education Cess levied @ 2% of the excise duty would partake the character of excise duty itself.Insofar as judgment of Calcutta High Court in Biswanath Hosiery Mills Ltd. case is concerned, we find that the same would have no bearing in the present case. In the said case, cess was payable under Section 5A of the Textiles Committee Act, 1963. After going through the provisions of Textiles Committee Act, 1963 and the Textiles Committee (Cess) Rules, 1975, the High Court found that as per the scheme of Textiles Committee Act and the rules framed therein, levy of cess was independent of excise under the Act which was a complete code containing all the provisions relating to levy, collection, exemption and application of cess. Therefore, even the legislative intendment underlying Textiles Committee (Amendment) Act and rules read with the preamble, aims and objects of the Act was clearly discernable, namely, the legislature intended to levy the cess under the Act independent of and in addition to the excise duty which was payable under the Central Excise and Salt Act, 1944.23. It is also trite that when two views are possible, one which favours the assessees has to be adopted. ### Response: 1

Bharat Petroleum Corpn. Ltd.&Anr Vs. Balakrishnan Nambiar (Dead) By Lrs

its order dated 17.8.1993. The decision is reported as Bharat Petroleum Corpn. Ltd. Ex-Employees Association and others v. Chairman and Managing Director, Bharat Petroleum Corporation Ltd., Bombay and others, 1993(4) SCC 37. Although this judgment dealt with the clerical cadre, the appellant-corporation decided to extend the benefit of this judgment also to the managerial cadre. As a result, the respondent was given monthly pension calculated as follows :- The pension was calculated in this manner for all employees.5. The respondent, however, contends that the increase of 56.03% which was given with effect from 1.7.1993, should be given on the pension of Rs. 1278/- + the commuted pension of Rs. 439/-. As a result, the 56.03% increase would come to Rs. 964/-, and the respondent should get a total pension of Rs. 2684/- per month.6. The High Court has granted the relief claimed by the respondent. Hence the present appeal has been filed by the appellant. 7. The appellants have submitted that the decision to give a voluntary increase of 56.03% on existing pension was taken on 30th of June, 1993, much prior to the decision of this Court in Bharat Petroleum Corpn. Ltd. Ex-Employees Association and others v. Chairman and Managing Director Bharat Petroleum Corporation Ltd., Bombay and others (supra) which was delivered only on 17.8.1993. When the appellants took the decision to give an increase of 56.03%, they had in mind only the existing pension which was being paid to its employees. The financial burden on the appellants was calculated on the basis of the increase of 56.03% being given on the then existing pension. The decision was purely voluntary and there was no legal obligation to give such an increase. Since the decision was to calculate the percentage of increase only on the then existing pension, they have correctly implemented this decision by calculating 56.03% increase on the existing pension. Thereafter, they have also added to this figure the commuted value of the pension as per the subsequent decision of this Court. Therefore, the respondent does not have any right to claim an increase of 56.03% on the existing pension plus the commuted value of pension, since this was not the decision taken by the appellant-company. 8. We find much force in this contention. Clearly, the increase which was given by the appellant-company was a purely voluntary increase. The percentage of increase was on the then existing pension on the date when the decision was taken. On the date of the decision, the existing pension was the pension as commuted. It is true that under the decision of this Court set out earlier, the benefit of restoration of commuted portion of the pension has been given with effect from 1.4.1993. However, the decision which was taken prior to the judgment of this Court was to give the increase at the rate of 56.03% on the then existing pension. It was not contemplated at that time, that the commuted portion of the pension would also be retrospectively added to the pension by virtue a judgment which was to be delivered in future. Since the increase was purely voluntary, the decision is required to be implemented in the manner in which it was contemplated to be implemented.9. In the writ petition, the respondent made a bare averment to the effect that not taking into account the commuted value of the pension for the purpose of calculating the increase would violate Article 14 of the Constitution. There is, however, no factual foundation laid either in the petition or thereafter which would support the plea under Article 14. The pension of all persons has been calculated in the manner in which it was contemplated under the decision of 30th of June, 1993. The appellants have pointed out that the entire clerical cadre as also the managerial cadre have accepted the calculations so made and it is only the respondent who is objecting to such a calculation. The appellants have also drawn our attention to an old decision of this Court in The State of Bombay and another v. F.N. Balsara, 1951 SCR 682 at page 708-709 where this Court has observed, inter alia, that under Article 14 a reasonable classification is permissible. In the present case, if at all any distinction is made between different categories of pensioners, the pensioners who have commuted their pension and who have subsequently got the benefit of the judgment of this Court (supra) can be legitimately considered as a separate class. Reliance was also placed by the appellants on the decision in Ameerunnissa Begum and others v. Mahboob Begum and others, 1953 SCR 404 at 414. In the present case, in the absence of any factual basis for the plea, it is not possible to consider the application of Article 14 to the present case. 10. The appellants have also submitted that calculating the increase in pension in the manner in which the respondent claims, would impose a substantial additional financial burden on it, which was not contemplated when the decision to grant an increase was taken on 30th of June, 1993. Since the decision of the appellant-company was purely voluntary, it was legitimate for the appellants to take into consideration the financial implications of their proposed decision. Learned counsel for the respondent, however, has placed reliance on a judgment of this Court in Gopal Krishna Sharma and others v. State of Rajasthan and others, 1993 Supp.(2) SCC 375 : 1992(3) SCT 726 (SC) at 385 where this Court has observed that when the court grants to the employees what is due to them in law, financial considerations cannot be a ground for denying the benefit legally due to them. In the present case, since the increase was purely voluntary, the financial burden was an important factor which went into the decision-making process and it cannot, therefore, be ignored. Undoubtedly, as submitted by the respondent, pension is not a bounty. Nevertheless, any increase voluntarily given has to be calculated in the manner contemplated under the decision.

1[ds]When the appellants took the decision to give an increase of 56.03%, they had in mind only the existing pension which was being paid to its employees. The financial burden on the appellants was calculated on the basis of the increase of 56.03% being given on the then existing pension. The decision was purely voluntary and there was no legal obligation to give such an increase. Since the decision was to calculate the percentage of increase only on the then existing pension, they have correctly implemented this decision by calculating 56.03% increase on the existing pension. Thereafter, they have also added to this figure the commuted value of the pension as per the subsequent decision of this Court. Therefore, the respondent does not have any right to claim an increase of 56.03% on the existing pension plus the commuted value of pension, since this was not the decision taken by thethe increase which was given by thewas a purely voluntary increase. The percentage of increase was on the then existing pension on the date when the decision was taken. On the date of the decision, the existing pension was the pension as commuted. It is true that under the decision of this Court set out earlier, the benefit of restoration of commuted portion of the pension has been given with effect from 1.4.1993. However, the decision which was taken prior to the judgment of this Court was to give the increase at the rate of 56.03% on the then existing pension. It was not contemplated at that time, that the commuted portion of the pension would also be retrospectively added to the pension by virtue a judgment which was to be delivered in future. Since the increase was purely voluntary, the decision is required to be implemented in the manner in which it was contemplated to be implemented.9. In the writ petition, the respondent made a bare averment to the effect that not taking into account the commuted value of the pension for the purpose of calculating the increase would violate Article 14 of the Constitution. There is, however, no factual foundation laid either in the petition or thereafter which would support the plea under Article 14. The pension of all persons has been calculated in the manner in which it was contemplated under the decision of 30th of June, 1993. The appellants have pointed out that the entire clerical cadre as also the managerial cadre have accepted the calculations so made and it is only the respondent who is objecting to such a calculation. The appellants have also drawn our attention to an old decision of this Court in The State of Bombay and another v. F.N. Balsara, 1951 SCR 682 at pagewhere this Court has observed, inter alia, that under Article 14 a reasonable classification is permissible. In the present case, if at all any distinction is made between different categories of pensioners, the pensioners who have commuted their pension and who have subsequently got the benefit of the judgment of this Court (supra) can be legitimately considered as a separate class. Reliance was also placed by the appellants on the decision in Ameerunnissa Begum and others v. Mahboob Begum and others, 1953 SCR 404 at 414. In the present case, in the absence of any factual basis for the plea, it is not possible to consider the application of Article 14 to the present case.the present case, since the increase was purely voluntary, the financial burden was an important factor which went into theprocess and it cannot, therefore, be ignored. Undoubtedly, as submitted by the respondent, pension is not a bounty. Nevertheless, any increase voluntarily given has to be calculated in the manner contemplated under the decision.

### Instruction: From the information provided in the case proceeding, infer whether the court's decision will be positive (1) or negative (0) for the appellant. ### Input: its order dated 17.8.1993. The decision is reported as Bharat Petroleum Corpn. Ltd. Ex-Employees Association and others v. Chairman and Managing Director, Bharat Petroleum Corporation Ltd., Bombay and others, 1993(4) SCC 37. Although this judgment dealt with the clerical cadre, the appellant-corporation decided to extend the benefit of this judgment also to the managerial cadre. As a result, the respondent was given monthly pension calculated as follows :- The pension was calculated in this manner for all employees.5. The respondent, however, contends that the increase of 56.03% which was given with effect from 1.7.1993, should be given on the pension of Rs. 1278/- + the commuted pension of Rs. 439/-. As a result, the 56.03% increase would come to Rs. 964/-, and the respondent should get a total pension of Rs. 2684/- per month.6. The High Court has granted the relief claimed by the respondent. Hence the present appeal has been filed by the appellant. 7. The appellants have submitted that the decision to give a voluntary increase of 56.03% on existing pension was taken on 30th of June, 1993, much prior to the decision of this Court in Bharat Petroleum Corpn. Ltd. Ex-Employees Association and others v. Chairman and Managing Director Bharat Petroleum Corporation Ltd., Bombay and others (supra) which was delivered only on 17.8.1993. When the appellants took the decision to give an increase of 56.03%, they had in mind only the existing pension which was being paid to its employees. The financial burden on the appellants was calculated on the basis of the increase of 56.03% being given on the then existing pension. The decision was purely voluntary and there was no legal obligation to give such an increase. Since the decision was to calculate the percentage of increase only on the then existing pension, they have correctly implemented this decision by calculating 56.03% increase on the existing pension. Thereafter, they have also added to this figure the commuted value of the pension as per the subsequent decision of this Court. Therefore, the respondent does not have any right to claim an increase of 56.03% on the existing pension plus the commuted value of pension, since this was not the decision taken by the appellant-company. 8. We find much force in this contention. Clearly, the increase which was given by the appellant-company was a purely voluntary increase. The percentage of increase was on the then existing pension on the date when the decision was taken. On the date of the decision, the existing pension was the pension as commuted. It is true that under the decision of this Court set out earlier, the benefit of restoration of commuted portion of the pension has been given with effect from 1.4.1993. However, the decision which was taken prior to the judgment of this Court was to give the increase at the rate of 56.03% on the then existing pension. It was not contemplated at that time, that the commuted portion of the pension would also be retrospectively added to the pension by virtue a judgment which was to be delivered in future. Since the increase was purely voluntary, the decision is required to be implemented in the manner in which it was contemplated to be implemented.9. In the writ petition, the respondent made a bare averment to the effect that not taking into account the commuted value of the pension for the purpose of calculating the increase would violate Article 14 of the Constitution. There is, however, no factual foundation laid either in the petition or thereafter which would support the plea under Article 14. The pension of all persons has been calculated in the manner in which it was contemplated under the decision of 30th of June, 1993. The appellants have pointed out that the entire clerical cadre as also the managerial cadre have accepted the calculations so made and it is only the respondent who is objecting to such a calculation. The appellants have also drawn our attention to an old decision of this Court in The State of Bombay and another v. F.N. Balsara, 1951 SCR 682 at page 708-709 where this Court has observed, inter alia, that under Article 14 a reasonable classification is permissible. In the present case, if at all any distinction is made between different categories of pensioners, the pensioners who have commuted their pension and who have subsequently got the benefit of the judgment of this Court (supra) can be legitimately considered as a separate class. Reliance was also placed by the appellants on the decision in Ameerunnissa Begum and others v. Mahboob Begum and others, 1953 SCR 404 at 414. In the present case, in the absence of any factual basis for the plea, it is not possible to consider the application of Article 14 to the present case. 10. The appellants have also submitted that calculating the increase in pension in the manner in which the respondent claims, would impose a substantial additional financial burden on it, which was not contemplated when the decision to grant an increase was taken on 30th of June, 1993. Since the decision of the appellant-company was purely voluntary, it was legitimate for the appellants to take into consideration the financial implications of their proposed decision. Learned counsel for the respondent, however, has placed reliance on a judgment of this Court in Gopal Krishna Sharma and others v. State of Rajasthan and others, 1993 Supp.(2) SCC 375 : 1992(3) SCT 726 (SC) at 385 where this Court has observed that when the court grants to the employees what is due to them in law, financial considerations cannot be a ground for denying the benefit legally due to them. In the present case, since the increase was purely voluntary, the financial burden was an important factor which went into the decision-making process and it cannot, therefore, be ignored. Undoubtedly, as submitted by the respondent, pension is not a bounty. Nevertheless, any increase voluntarily given has to be calculated in the manner contemplated under the decision. ### Response: 1

Oil & Natural Gas Commission Vs. State of Bihar & Others

the principle that all of its crude was being sold to Barauni refinery. 4. The Commission is described by the Solicitor-General to be a statutory body which has no option either with regard to the production or supply and the directions and decisions of the Government leave no choice with the Commission in regard to supplies. 5. This court in Salar Jung Sugar Mills Ltd. v. State of Mysore [[1972] 29 S.T.C. 246 (S.C.); [1972] 2 S.C.R. 228] laid down the following propositions : First, statutory orders regulating the supply and distribution of goods by and between the parties under Control Orders in a State do not absolutely impinge on the freedom to enter into contract. Second, directions, decisions and orders of agencies of the Government to control production and supply of commodities, may fix the parties to whom the goods are to be supplied, the price at which these are to be supplied, the time during which these are to be supplied and the person who has to carry out these directions. In such cases it cannot be said that compulsive directions rob the transactions of the character of agreement. The reason is that the transfer of property which constitutes the agreement in spite of the compulsion of law is neither void nor voidable. It is not as a result of coercion. The statute supplies the consensus and the modality of consensus is furnished by the statute. There is privity of contract between the parties.The other third, fourth, fifth and sixth propositions are these : Third, such a transaction is neither a gift nor an exchange nor a hypothecation nor a loan. It is a transfer of property from one person to another. There is consideration for the transfer. There is assent. The law presumes the assent when there is transfer of goods from one to the other. Fourth, a sale may not require the consensual element and that there may, in truth, be a compulsory sale of property with which the owner is compelled to part for a price against his will and the effect of the statute in such a case is to say that the absence of the transferors consent does not matter and the sale is to proceed without it. In truth, transfer is brought into being which ex facie in all its essential characteristics is a transfer of sale. Fifth, delimiting areas for transactions or denoting parties or denoting price for transactions are all within the area of individual freedom of contract with limited choice by reason of ensuring the greatest good for the greatest number of achieving proper supply at standard or fair price to eliminate the evils of hoarding and scarcity on the one hand and ensuring availability on the other. Sixth, after all the transactions in substance represent the outgoing of the business and the price would come into the computation of profits. 6. Judged by the principles laid down by this court in Salar Jung Sugar Mills case [[1972] 29 S.T.C. 246 (S.C.); [1972] 2 S.C.R. 228], which is a decision by a seven-Judge Bench, there is no doubt that the transactions in the present case amounted to a sale of crude oil by the Commission to the Corporation. It is true that the Government decided and directed the Commission to supply to the Indian Oil Corporation at a price to be fixed, but the transaction is in the course of business conducted by the Commission.It is the business of the petitioner under the statute to plan, promote, organise and implement programmes for the development of petroleum resources and the production and sale of petroleum products produced by it and to perform such functions as the Central Government may, from time to time, assign to the Commission. These are the functions of the Commission under section 14 of the Oil and Natural Gas Commission Act, 1959. Further, section 29 of the Act states that "the Commission shall be deemed to be a company within the meaning of any enactment for the time being in force providing for the levy of any tax or fee by the Central Government or a State Government and shall be liable to pay such fax or fee accordingly". Section 31 contemplates power of the Central Government to make rules inter alia prescribing the conditions subject to which, and the mode in which, contracts may be entered into by or on behalf of the Commission. The provisions of the Oil and Natural Gas Commission Act show that the Commission is engaged in the business of producing crude oil in Assam and the supply of crude oil. The supply to the Corporation is a sale transaction fulfilling all the ingredients of a sale. The supply of crude oil by the Commission to the Barauni refinery of the Corporation is also a sale in the course of inter-State trade. The movement of crude oil from Assam to Barauni is pursuant to the contract for sale of crude oil. 7. The directions given by the Government are because of the character and constitution of the Commission. Directions and decisions do not detract from the sale of crude oil by the Commission to the Corporation. These statutory Corporations work in collaboration with the Central Government particularly the Ministries of Petroleum and Finance for policy and planning.The State of Bihar raised a feeble contention that it was not an inter-State sale. The delivery may be in Assam or in Bihar at Barauni but the movement of goods is the result of contract and as an incident to the agreement between the Commission and the Corporation. The State of Assam has lawfully levied the Central sales tax on the petitioner. The State of Assam is entitled to levy Central sales tax on the petitioner. The Commission has been paying sales tax since the commencement of sales. It is made clear that it is open to the Commission to make applications for refund, if any, in accordance with the sales tax law. 8.

0[ds]This court in Salar Jung Sugar Mills Ltd. v. State of Mysore [[1972] 29 S.T.C. 246 (S.C.); [1972] 2 S.C.R. 228] laid down the following propositions : First, statutory orders regulating the supply and distribution of goods by and between the parties under Control Orders in a State do not absolutely impinge on the freedom to enter into contract. Second, directions, decisions and orders of agencies of the Government to control production and supply of commodities, may fix the parties to whom the goods are to be supplied, the price at which these are to be supplied, the time during which these are to be supplied and the person who has to carry out these directions. In such cases it cannot be said that compulsive directions rob the transactions of the character of agreement. The reason is that the transfer of property which constitutes the agreement in spite of the compulsion of law is neither void nor voidable. It is not as a result of coercion. The statute supplies the consensus and the modality of consensus is furnished by the statute. There is privity of contract between the parties.The other third, fourth, fifth and sixth propositions are these : Third, such a transaction is neither a gift nor an exchange nor a hypothecation nor a loan. It is a transfer of property from one person to another. There is consideration for the transfer. There is assent. The law presumes the assent when there is transfer of goods from one to the other. Fourth, a sale may not require the consensual element and that there may, in truth, be a compulsory sale of property with which the owner is compelled to part for a price against his will and the effect of the statute in such a case is to say that the absence of the transferors consent does not matter and the sale is to proceed without it. In truth, transfer is brought into being which ex facie in all its essential characteristics is a transfer of sale. Fifth, delimiting areas for transactions or denoting parties or denoting price for transactions are all within the area of individual freedom of contract with limited choice by reason of ensuring the greatest good for the greatest number of achieving proper supply at standard or fair price to eliminate the evils of hoarding and scarcity on the one hand and ensuring availability on the other. Sixth, after all the transactions in substance represent the outgoing of the business and the price would come into the computation of profitsThe directions given by the Government are because of the character and constitution of the Commission. Directions and decisions do not detract from the sale of crude oil by the Commission to the Corporation. These statutory Corporations work in collaboration with the Central Government particularly the Ministries of Petroleum and Finance for policy and planning.The State of Bihar raised a feeble contention that it was not an inter-State sale. The delivery may be in Assam or in Bihar at Barauni but the movement of goods is the result of contract and as an incident to the agreement between the Commission and the Corporation. The State of Assam has lawfully levied the Central sales tax on the petitioner. The State of Assam is entitled to levy Central sales tax on the petitioner. The Commission has been paying sales tax since the commencement of sales. It is made clear that it is open to the Commission to make applications for refund, if any, in accordance with the sales tax law.

### Instruction: Delve into the case proceeding and predict the outcome: is the judgment expected to be in support (1) or in denial (0) of the appeal? ### Input: the principle that all of its crude was being sold to Barauni refinery. 4. The Commission is described by the Solicitor-General to be a statutory body which has no option either with regard to the production or supply and the directions and decisions of the Government leave no choice with the Commission in regard to supplies. 5. This court in Salar Jung Sugar Mills Ltd. v. State of Mysore [[1972] 29 S.T.C. 246 (S.C.); [1972] 2 S.C.R. 228] laid down the following propositions : First, statutory orders regulating the supply and distribution of goods by and between the parties under Control Orders in a State do not absolutely impinge on the freedom to enter into contract. Second, directions, decisions and orders of agencies of the Government to control production and supply of commodities, may fix the parties to whom the goods are to be supplied, the price at which these are to be supplied, the time during which these are to be supplied and the person who has to carry out these directions. In such cases it cannot be said that compulsive directions rob the transactions of the character of agreement. The reason is that the transfer of property which constitutes the agreement in spite of the compulsion of law is neither void nor voidable. It is not as a result of coercion. The statute supplies the consensus and the modality of consensus is furnished by the statute. There is privity of contract between the parties.The other third, fourth, fifth and sixth propositions are these : Third, such a transaction is neither a gift nor an exchange nor a hypothecation nor a loan. It is a transfer of property from one person to another. There is consideration for the transfer. There is assent. The law presumes the assent when there is transfer of goods from one to the other. Fourth, a sale may not require the consensual element and that there may, in truth, be a compulsory sale of property with which the owner is compelled to part for a price against his will and the effect of the statute in such a case is to say that the absence of the transferors consent does not matter and the sale is to proceed without it. In truth, transfer is brought into being which ex facie in all its essential characteristics is a transfer of sale. Fifth, delimiting areas for transactions or denoting parties or denoting price for transactions are all within the area of individual freedom of contract with limited choice by reason of ensuring the greatest good for the greatest number of achieving proper supply at standard or fair price to eliminate the evils of hoarding and scarcity on the one hand and ensuring availability on the other. Sixth, after all the transactions in substance represent the outgoing of the business and the price would come into the computation of profits. 6. Judged by the principles laid down by this court in Salar Jung Sugar Mills case [[1972] 29 S.T.C. 246 (S.C.); [1972] 2 S.C.R. 228], which is a decision by a seven-Judge Bench, there is no doubt that the transactions in the present case amounted to a sale of crude oil by the Commission to the Corporation. It is true that the Government decided and directed the Commission to supply to the Indian Oil Corporation at a price to be fixed, but the transaction is in the course of business conducted by the Commission.It is the business of the petitioner under the statute to plan, promote, organise and implement programmes for the development of petroleum resources and the production and sale of petroleum products produced by it and to perform such functions as the Central Government may, from time to time, assign to the Commission. These are the functions of the Commission under section 14 of the Oil and Natural Gas Commission Act, 1959. Further, section 29 of the Act states that "the Commission shall be deemed to be a company within the meaning of any enactment for the time being in force providing for the levy of any tax or fee by the Central Government or a State Government and shall be liable to pay such fax or fee accordingly". Section 31 contemplates power of the Central Government to make rules inter alia prescribing the conditions subject to which, and the mode in which, contracts may be entered into by or on behalf of the Commission. The provisions of the Oil and Natural Gas Commission Act show that the Commission is engaged in the business of producing crude oil in Assam and the supply of crude oil. The supply to the Corporation is a sale transaction fulfilling all the ingredients of a sale. The supply of crude oil by the Commission to the Barauni refinery of the Corporation is also a sale in the course of inter-State trade. The movement of crude oil from Assam to Barauni is pursuant to the contract for sale of crude oil. 7. The directions given by the Government are because of the character and constitution of the Commission. Directions and decisions do not detract from the sale of crude oil by the Commission to the Corporation. These statutory Corporations work in collaboration with the Central Government particularly the Ministries of Petroleum and Finance for policy and planning.The State of Bihar raised a feeble contention that it was not an inter-State sale. The delivery may be in Assam or in Bihar at Barauni but the movement of goods is the result of contract and as an incident to the agreement between the Commission and the Corporation. The State of Assam has lawfully levied the Central sales tax on the petitioner. The State of Assam is entitled to levy Central sales tax on the petitioner. The Commission has been paying sales tax since the commencement of sales. It is made clear that it is open to the Commission to make applications for refund, if any, in accordance with the sales tax law. 8. ### Response: 0

The Ahmedabad Manufacturers & Calico Vs. The Workmen

Article 226 challenging the award without disclosing the fact that the earlier application for leave by the Trade Union was rejected. Mr. Justice Abhyankar who delivered the judgment held that the petitioners were guilty of suppressing the fact of the earlier application for special leave having been rejected by the Supreme Court. He further held following the Western India Match Co.s case that in view of the refusal by the Supreme Court to grant special leave it was not a case in which Court should be inclined to adjudicate the merits of the award but that in exercise of its discretion the Court should refuse to issue the writ. The Division Bench, therefore, dismissed the petition on both the above grounds. 17. In our opinion, the ratio of the Indian Hume Pipe Co.s case, so far as the exercise of discretionary power under Article 226 is concerned, is applicable to the facts of the present case and Kania J. was, with respect, right in considering himself bound by it. Mr. Sorabjee, however, has assailed this authority. He urges that the decision in this case was given per incuriam because the question was not raised whether the Court in exercise of its discretion should refuse the writ without going into the merits of the case, but it was assumed that the Court had such discretion. He pointed out that an authority will be binding on a point only if the point was raised and considered and relied upon a decision of this Court in Parappa Ningappa v. Mallappa Kallappa (1955) 58 Bom. L.R. 404, F.B. and an English case in Morelle Ld. v. Wakeling. [1955] L.R. 2 Q.B. 379, at p. 406 He also contended that the ratio of the decision in Western India Match Co. s case is erroneous as it does not take into account the position that though a refusal by the Supreme Court to grant leave under Article 136 does not operate as res judicata so far as a writ application under Article 226 is concerned, still the High Court in exercise of its discretionary power under Article 226 will refuse to issue the writ on that ground without going into the merits of the case. He next tried to argue that the attention of the Division Bench was not drawn to the Supreme Court eases cited above in regard to exercise of discretionary power where alternative remedy is available or gross delay occurs. 18. In our view, there is no force in the above contentions. The question whether in the exercise of its discretionary jurisdiction under Article 226 the Court should refuse to grant a writ without going into merits was specifically raised in India Hume Pipe Co.s case. A perusal of the judgment leaves no doubt on this point. In para. 3 of the judgment at p. 329 are set out the preliminary objections raised by the respondent-Company, including the following: that the petition was in any case no longer tenable in view of the highest Court in the land having refused to exercise its discretionary jurisdiction in entertaining an appeal against the award. Further in para, 6 Abhyankar J. observed (p. 330) : We also are unable to hold that we should entertain this petition now and adjtudicate it on merits when the Supreme Court has thought fit not to admit the petition for special leave-- HINDI 19. The learned Judge then proceeded to quote a passage from the above Madras case in regard to the propriety or desirability of entertaining the petition and concluded as follows (p. 331) : Thus, in our opinion, this is not a petition which could have been entertained or in any case these are not the circumstances in which we should be inclined to adjudicate on the merits of the award in view of the petition filed on behalf of the Union which represented the petitioners also was filed before the Supreme Court and was rejected. (HINDI) From the above passages it is quite clear that the question of exercise of discretionary power under Article 226 to refuse a writ without going into the merits was specifically raised and considered and was answered in the affirmative. It may be that in that case there was not as elaborate or as full an argument on the question as we had before us in the instant case. But this might have been due to the fact that in the Madras case which was followed by this Court, principle of natural justice was violated and the case called for issue of a writ of certiorari and yet the Court in the exercise of its discretion refused to quash the award on the sole ground that Companys application for special leave under Article 136 was rejected by the Supreme Court. In any case the fact that the matter was not fully argued does not affect the binding nature of the precedent provided the point was raised and decided by the Court. 20. Lastly, the ratio of eases relating to exercise of discretionary power in cases where alternative remedy exists or gross delay occurs is not binding in the present case where we have to consider the effect of rejection by the Supreme Court of an application for special leave as it involves different consideration of finality of litigation. It may be relevant here to point out that it is not always the case that before dismissing the writ petition in exercise of its discretionary jurisdiction under Article 226 the merits also must be considered; for instance the Court, in the exercise of its discretion will dismiss the writ petition in limine on ground of suppression of any fact relating to the petition without going into the merits of the case. 21. In our opinion, the decision in Indian Hume Pipe Co.s case was not given per incuriam and the same is binding upon us. We, therefore, hold that the learned Judge has properly exercised his discretion in refusing to issue the writ.

0[ds]10. Now, the first point about the competence of the Court to entertain the petition is admittedly raised by respondents No. 1 for the first time before us. Moreover, after hearing the parties we have come to the conclusion that the other point must be answered against the Company. We therefore do not consider it necessary to decide the first question and we express no opinion on the same17. In our opinion, the ratio of the Indian Hume Pipe Co.s case, so far as the exercise of discretionary power under Article 226 is concerned, is applicable to the facts of the present case and Kania J. was, with respect, right in considering himself bound by it. Mr. Sorabjee, however, has assailed this authority. He urges that the decision in this case was given per incuriam because the question was not raised whether the Court in exercise of its discretion should refuse the writ without going into the merits of the case, but it was assumed that the Court had such discretion. He pointed out that an authority will be binding on a point only if the point was raised and considered and relied upon a decision of this Court in Parappa Ningappa v. Mallappa Kallappa (1955) 58 Bom. L.R. 404, F.B. and an English case in Morelle Ld. v. Wakeling. [1955] L.R. 2 Q.B. 379, at p. 406 He also contended that the ratio of the decision in Western India Match Co. s case is erroneous as it does not take into account the position that though a refusal by the Supreme Court to grant leave under Article 136 does not operate as res judicata so far as a writ application under Article 226 is concerned, still the High Court in exercise of its discretionary power under Article 226 will refuse to issue the writ on that ground without going into the merits of the case. He next tried to argue that the attention of the Division Bench was not drawn to the Supreme Court eases cited above in regard to exercise of discretionary power where alternative remedy is available or gross delay occurs18. In our view, there is no force in the above contentions. The question whether in the exercise of its discretionary jurisdiction under Article 226 the Court should refuse to grant a writ without going into merits was specifically raised in India Hume Pipe Co.s case. A perusal of the judgment leaves no doubt on this point. In para. 3 of the judgment at p. 329 are set out the preliminary objections raised by the, including the following: that the petition was in any case no longer tenable in view of the highest Court in the land having refused to exercise its discretionary jurisdiction in entertaining an appeal against the award. Further in para, 6 Abhyankar J. observed (p. 330) :19. The learned Judge then proceeded to quote a passage from the above Madras case in regard to the propriety or desirability of entertaining the petition and concluded as follows (p. 331) :From the above passages it is quite clear that the question of exercise of discretionary power under Article 226 to refuse a writ without going into the merits was specifically raised and considered and was answered in the affirmative. It may be that in that case there was not as elaborate or as full an argument on the question as we had before us in the instant case. But this might have been due to the fact that in the Madras case which was followed by this Court, principle of natural justice was violated and the case called for issue of a writ of certiorari and yet the Court in the exercise of its discretion refused to quash the award on the sole ground that Companys application for special leave under Article 136 was rejected by the Supreme Court. In any case the fact that the matter was not fully argued does not affect the binding nature of the precedent provided the point was raised and decided by the Court20. Lastly, the ratio of eases relating to exercise of discretionary power in cases where alternative remedy exists or gross delay occurs is not binding in the present case where we have to consider the effect of rejection by the Supreme Court of an application for special leave as it involves different consideration of finality of litigation. It may be relevant here to point out that it is not always the case that before dismissing the writ petition in exercise of its discretionary jurisdiction under Article 226 the merits also must be considered; for instance the Court, in the exercise of its discretion will dismiss the writ petition in limine on ground of suppression of any fact relating to the petition without going into the merits of the case21. In our opinion, the decision in Indian Hume Pipe Co.s case was not given per incuriam and the same is binding upon us. We, therefore, hold that the learned Judge has properly exercised his discretion in refusing to issue the writ.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: Article 226 challenging the award without disclosing the fact that the earlier application for leave by the Trade Union was rejected. Mr. Justice Abhyankar who delivered the judgment held that the petitioners were guilty of suppressing the fact of the earlier application for special leave having been rejected by the Supreme Court. He further held following the Western India Match Co.s case that in view of the refusal by the Supreme Court to grant special leave it was not a case in which Court should be inclined to adjudicate the merits of the award but that in exercise of its discretion the Court should refuse to issue the writ. The Division Bench, therefore, dismissed the petition on both the above grounds. 17. In our opinion, the ratio of the Indian Hume Pipe Co.s case, so far as the exercise of discretionary power under Article 226 is concerned, is applicable to the facts of the present case and Kania J. was, with respect, right in considering himself bound by it. Mr. Sorabjee, however, has assailed this authority. He urges that the decision in this case was given per incuriam because the question was not raised whether the Court in exercise of its discretion should refuse the writ without going into the merits of the case, but it was assumed that the Court had such discretion. He pointed out that an authority will be binding on a point only if the point was raised and considered and relied upon a decision of this Court in Parappa Ningappa v. Mallappa Kallappa (1955) 58 Bom. L.R. 404, F.B. and an English case in Morelle Ld. v. Wakeling. [1955] L.R. 2 Q.B. 379, at p. 406 He also contended that the ratio of the decision in Western India Match Co. s case is erroneous as it does not take into account the position that though a refusal by the Supreme Court to grant leave under Article 136 does not operate as res judicata so far as a writ application under Article 226 is concerned, still the High Court in exercise of its discretionary power under Article 226 will refuse to issue the writ on that ground without going into the merits of the case. He next tried to argue that the attention of the Division Bench was not drawn to the Supreme Court eases cited above in regard to exercise of discretionary power where alternative remedy is available or gross delay occurs. 18. In our view, there is no force in the above contentions. The question whether in the exercise of its discretionary jurisdiction under Article 226 the Court should refuse to grant a writ without going into merits was specifically raised in India Hume Pipe Co.s case. A perusal of the judgment leaves no doubt on this point. In para. 3 of the judgment at p. 329 are set out the preliminary objections raised by the respondent-Company, including the following: that the petition was in any case no longer tenable in view of the highest Court in the land having refused to exercise its discretionary jurisdiction in entertaining an appeal against the award. Further in para, 6 Abhyankar J. observed (p. 330) : We also are unable to hold that we should entertain this petition now and adjtudicate it on merits when the Supreme Court has thought fit not to admit the petition for special leave-- HINDI 19. The learned Judge then proceeded to quote a passage from the above Madras case in regard to the propriety or desirability of entertaining the petition and concluded as follows (p. 331) : Thus, in our opinion, this is not a petition which could have been entertained or in any case these are not the circumstances in which we should be inclined to adjudicate on the merits of the award in view of the petition filed on behalf of the Union which represented the petitioners also was filed before the Supreme Court and was rejected. (HINDI) From the above passages it is quite clear that the question of exercise of discretionary power under Article 226 to refuse a writ without going into the merits was specifically raised and considered and was answered in the affirmative. It may be that in that case there was not as elaborate or as full an argument on the question as we had before us in the instant case. But this might have been due to the fact that in the Madras case which was followed by this Court, principle of natural justice was violated and the case called for issue of a writ of certiorari and yet the Court in the exercise of its discretion refused to quash the award on the sole ground that Companys application for special leave under Article 136 was rejected by the Supreme Court. In any case the fact that the matter was not fully argued does not affect the binding nature of the precedent provided the point was raised and decided by the Court. 20. Lastly, the ratio of eases relating to exercise of discretionary power in cases where alternative remedy exists or gross delay occurs is not binding in the present case where we have to consider the effect of rejection by the Supreme Court of an application for special leave as it involves different consideration of finality of litigation. It may be relevant here to point out that it is not always the case that before dismissing the writ petition in exercise of its discretionary jurisdiction under Article 226 the merits also must be considered; for instance the Court, in the exercise of its discretion will dismiss the writ petition in limine on ground of suppression of any fact relating to the petition without going into the merits of the case. 21. In our opinion, the decision in Indian Hume Pipe Co.s case was not given per incuriam and the same is binding upon us. We, therefore, hold that the learned Judge has properly exercised his discretion in refusing to issue the writ. ### Response: 0

MATA PRASAD Vs. THE STATE OF U.P. & ANR

1. Admit. 2. The petitioner has taken recourse to Article 32 of the Constitution of India for a direction for consideration of his case for premature release from prison as per the policy dated 01.8.2018 and consequently to release the petitioner forthwith. 3. The petitioner along with his younger brother and father were tried for offences under Section 302/307/323/34 of the IPC and post-trial were convicted in sentence to maximum imprisonment for life with a judgment dated 30.9.2004 passed in Session Trial No.208 of 1999 arising from FIR No.380/1999 at P.S. Gosaiganj, Sultanpur. The petitioner aggrieved by the said judgment filed the appeal before the High Court of Judicature at Allahabad in Crl. Appeal No.2247/2004. 17 years hence the appeal is still pending adjudication. 4. The appellant on completion of 14 years of imprisonment claimed eligibility for release under the provisions of the U.P. Prisoners Release on Probation Act, 1938 and submitted the duly filled Form-A but the same was rejected on 28.4.2017. 5. It is the case of the petitioner that the Governor of Uttar Pradesh exercising powers under Article 161 of the Constitution of India issued a G.O dated 01.8.2018, a policy for prisoners in respect of pre-mature release on occasion of Republic Day every year. One of the categories of such prisoners is all male convicted prisoners sentenced to suffer life-imprisonment whose crime is not covered by any sub-rule or restricted category pointed out at Section 3 and who have served 16 years of actual imprisonment without remission and 20 years of imprisonment inclusive of remission along with the pending period. However, this petition of the petitioner was also rejected on 04.11.2019. 6. It is the case of the petitioner, that the Government in the years 2018-2021 released 1000 of prisoners from the various jails of U.P. under the aforesaid policy and the petitioner despite having satisfied all terms and conditions for pre-mature release under the said policy, his proposal for release was recommended on the occasion of 26.1.2020 i.e., two years back but he has still not been released. The fate of the petitioner is stated to have been same even on 26.1.2021 without assigning any reasons. 7. In the conspectus of the aforesaid facts, we had issued notice and counter affidavit has been filed by the State. 8. One of the aspects pointed out in the counter affidavit is by annexing the Policy for pre-mature release by submitting that the same stands amended on 28.7.2021. The significant change as applicable in the case of the petitioner is that all such convicts are required to be considered who have completed age of 60 years and have undergone custody of 20 years without remission and 25 years with remission. In this behalf learned counsel for the respondent fairly states that as per the policy of the 2018 the case of the petitioner would be covered though as per the 2021 policy he is not of the requisite age of 60 years. However, he also accepts that in terms of a recent judgment of this Court in State of Haryana & Ors. V. Raj Kumar @ Bittu reported as 2021 (9) SCC 292 it has been clearly opined taking note of the consistent view of this Court that the policy prevalent at time of conviction shall be taken into consideration for considering the pre-mature release of a prisoner. He, thus, submits that 2021 policy prescribing the age of 60 years as the minimum age could not apply to the case of the petitioner. 9. We are really not required to go into this aspect in view of the aforesaid but would like to express a great doubt on the validity of this clause prescribing a minimum age of 60 years which would imply that a young offender of 20 years will have to serve 40 years before his case for remission can be considered. Though we are not required to test this aspect, we call upon the State Government to re-examine this part of the Policy which prima-facie does not seems to be sustainable more so in view of the illustration we have just noted above and thus we call upon the State Government to take a fresh look at the insertion of this clause. The needful be done within four months from today. 10. Now once again coming to the facts of the present case, learned counsel for the respondent submits that the appeal of the petitioner pending before the High Court, in view of the long incarceration, he could have moved the High Court for suspension of sentence. We have no doubt about this proposition but the remedy of seeking suspension of sentence and that in view of long incarceration remission is provided, are different release. 11. It cannot be said that the State Government is precluded from examining the case of the petitioner for remission if an appeal is pending before the High Court and from the submissions of the learned counsel for the petitioner it does appear that petitioner seems to have lost interest even in possibly prosecuting the appeal.

1[ds]9. We are really not required to go into this aspect in view of the aforesaid but would like to express a great doubt on the validity of this clause prescribing a minimum age of 60 years which would imply that a young offender of 20 years will have to serve 40 years before his case for remission can be considered. Though we are not required to test this aspect, we call upon the State Government to re-examine this part of the Policy which prima-facie does not seems to be sustainable more so in view of the illustration we have just noted above and thus we call upon the State Government to take a fresh look at the insertion of this clause. The needful be done within four months from today.We have no doubt about this proposition but the remedy of seeking suspension of sentence and that in view of long incarceration remission is provided, are different release.11. It cannot be said that the State Government is precluded from examining the case of the petitioner for remission if an appeal is pending before the High Court and from the submissions of the learned counsel for the petitioner it does appear that petitioner seems to have lost interest even in possibly prosecuting the appeal.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: 1. Admit. 2. The petitioner has taken recourse to Article 32 of the Constitution of India for a direction for consideration of his case for premature release from prison as per the policy dated 01.8.2018 and consequently to release the petitioner forthwith. 3. The petitioner along with his younger brother and father were tried for offences under Section 302/307/323/34 of the IPC and post-trial were convicted in sentence to maximum imprisonment for life with a judgment dated 30.9.2004 passed in Session Trial No.208 of 1999 arising from FIR No.380/1999 at P.S. Gosaiganj, Sultanpur. The petitioner aggrieved by the said judgment filed the appeal before the High Court of Judicature at Allahabad in Crl. Appeal No.2247/2004. 17 years hence the appeal is still pending adjudication. 4. The appellant on completion of 14 years of imprisonment claimed eligibility for release under the provisions of the U.P. Prisoners Release on Probation Act, 1938 and submitted the duly filled Form-A but the same was rejected on 28.4.2017. 5. It is the case of the petitioner that the Governor of Uttar Pradesh exercising powers under Article 161 of the Constitution of India issued a G.O dated 01.8.2018, a policy for prisoners in respect of pre-mature release on occasion of Republic Day every year. One of the categories of such prisoners is all male convicted prisoners sentenced to suffer life-imprisonment whose crime is not covered by any sub-rule or restricted category pointed out at Section 3 and who have served 16 years of actual imprisonment without remission and 20 years of imprisonment inclusive of remission along with the pending period. However, this petition of the petitioner was also rejected on 04.11.2019. 6. It is the case of the petitioner, that the Government in the years 2018-2021 released 1000 of prisoners from the various jails of U.P. under the aforesaid policy and the petitioner despite having satisfied all terms and conditions for pre-mature release under the said policy, his proposal for release was recommended on the occasion of 26.1.2020 i.e., two years back but he has still not been released. The fate of the petitioner is stated to have been same even on 26.1.2021 without assigning any reasons. 7. In the conspectus of the aforesaid facts, we had issued notice and counter affidavit has been filed by the State. 8. One of the aspects pointed out in the counter affidavit is by annexing the Policy for pre-mature release by submitting that the same stands amended on 28.7.2021. The significant change as applicable in the case of the petitioner is that all such convicts are required to be considered who have completed age of 60 years and have undergone custody of 20 years without remission and 25 years with remission. In this behalf learned counsel for the respondent fairly states that as per the policy of the 2018 the case of the petitioner would be covered though as per the 2021 policy he is not of the requisite age of 60 years. However, he also accepts that in terms of a recent judgment of this Court in State of Haryana & Ors. V. Raj Kumar @ Bittu reported as 2021 (9) SCC 292 it has been clearly opined taking note of the consistent view of this Court that the policy prevalent at time of conviction shall be taken into consideration for considering the pre-mature release of a prisoner. He, thus, submits that 2021 policy prescribing the age of 60 years as the minimum age could not apply to the case of the petitioner. 9. We are really not required to go into this aspect in view of the aforesaid but would like to express a great doubt on the validity of this clause prescribing a minimum age of 60 years which would imply that a young offender of 20 years will have to serve 40 years before his case for remission can be considered. Though we are not required to test this aspect, we call upon the State Government to re-examine this part of the Policy which prima-facie does not seems to be sustainable more so in view of the illustration we have just noted above and thus we call upon the State Government to take a fresh look at the insertion of this clause. The needful be done within four months from today. 10. Now once again coming to the facts of the present case, learned counsel for the respondent submits that the appeal of the petitioner pending before the High Court, in view of the long incarceration, he could have moved the High Court for suspension of sentence. We have no doubt about this proposition but the remedy of seeking suspension of sentence and that in view of long incarceration remission is provided, are different release. 11. It cannot be said that the State Government is precluded from examining the case of the petitioner for remission if an appeal is pending before the High Court and from the submissions of the learned counsel for the petitioner it does appear that petitioner seems to have lost interest even in possibly prosecuting the appeal. ### Response: 1

Guramma Bhratar Chanbasappa Deshmukh & Others Vs. Mallappa Chanbasappa & Others

Judicial Committee based its conclusion mainly on the following ground :"...... the rule of the Dattaka Chandrika that on a partition of the joint family property of a Sudra family an adopted son is entitled to share equally with the legitimate son born to the adoptive father subsequently to the adoption had been accepted and acted upon for at least more than a century in the Presidency of Madras, as the law applicable in such cases to Sudras until the law on that subject was disturbed in 1915 by the decision of the High Court at Madras in Gopalam v. Venkataraghavulu ((1915) I.L.R. 40 Mad. 632)." It will be seen that the decision rested on the fact that Dattaka Chandrika was the recognized authority in the Madras Presidency and that the rule that an adopted son and an afterborn natural son take in equal shares the family property had been followed for over a century. On this decision Sarkar Sastri commented in his valuable book on Hindu Law, 8th Edn., at p. 211, thus :"Another novel rule enunciated for the first time by the Dattaka Chandrika is that a Sudras adopted son should share equally with his begotten son, on the ground that a Sudras illegitimate son may by the fathers choice get an equal share with his legitimate sons. It is difficult to understand the cogency of his argument. This rule, however, has been followed by the Calcutta and Madras High Court, for this book is said to be of special authority in Bengal and Madras. But the Madras High Court, after consideration of the authorities on the subject, came to the conclusion, following an earlier decision of the same Court, that an adopted son of a Sudra was entitled to only a fifth share of what a natural born son gets. But in the case of Arumilli Perrazu ((1921) 48 I.A. 280) the above decision has been overruled and it has been finally settled by the Privy Council that an adopted son shares equally on partition with an after-born son of a Sudra." In Bengal where Dattaka Chandrika is given same importance as in the Madras Presidency, the same rule has been followed in the matter of partition between an adopted son and an after-born natural son among Sudras : see Asita v. Nirode ((1916) 20 C.W.N. 901). It is not necessary to pursue that matter. It may be adopted that in Bengal and Madras the said rule governs the shares between them. But in Bombay, Dattaka Chandrika is not given the place of honour as in Madras and Calcutta. As early as 1892, a division Bench of the Bombay High Court in Giriapa v. Hingappa ((1892) I.L.R. 17 Bom. 100) had to consider the question of shares inter se between an adopted son and an after-born aurasa son. It held that in Western India, both in the districts governed by the Mitakshara and those specially under the authority of Vyavahara Mayukha, the right of the adopted son, where there was a legitimate son born after the adoption, extended only to a fifth share of the fathers estate. The question therein was whether the adopted son takes one-fourth of the estate or one-fourth of the natural born sons share in the property. After considering all the relevant texts the division bench came to the conclusion that he takes one-fourth of a natural born sons share. After the decision of the Judicial Committee in Perrazu v. Subbrayadu ((1921) 48 I.A. 280) another division Bench of the Bombay High Court, in Tukaram Mahadu v. Ramachandra Mahadu ((1925) I.L.R. 49 Bom. 672, 679, 680, 684) reviewed the law and came to the same conclusion. Adverting to the Privy Council decision, the learned Judges of the Bombay High Court observed :"No doubt this case Perrazu v. Subbarayudu ((1921) 48 I.A. 280) is an authority for holding that in Madras and in Bengal among Sudras the rule is that for which the appellants counsel contends." Then the learned Judges posed the following question :"Assuming that the parties here are Sudras ought we to apply to this Presidency the rule which their Lordships of the Privy Council have laid down as prevailing in the Madras and Bengal Presidencies ?" After citing the relevant extracts from the decision of the Judicial Committee, the learned Judges proceeded to answer thus :"In this Presidency where the rule of Dattaka Chandrika upon the question at issue has have been followed, for no case, and no kind to judicial or other pronouncement is forthcoming, (and as I have said the leading case is against it), ought we to accept the rule upon the authority of the Dattaka Chandrika alone ? In my opinion we should err if we did so. The authority of the Dattaka Chandrika has never been placed so high in Western India as in Bengal and Madras ....... The case is one where the principle of stare decisis should be maintained." 27. Coyajee J., said much to the same effect :"We have no reason to believe that the rule propounded in paras. 29 and 32 of sections V of the Dattaka Chandrika has been so accepted and acted upon in this Presidency; and there is therefore no justification for holding that the decision in Giriappas case ((1892) I.L.R. 17 Bom. 100) is not applicable to the parties to this suit even if they were Sudras." 28. Steele in his valuable book on Hindu Law and Customs compiled as far back as 1868, did not find any justification for excepting the Sudras from the general rule. It is, therefore, manifest that in Bombay Presidency the rule accepted in Dattaka Chandrika has never been followed and the share of an adopted son in competition with a natural born son among Sudras has always been 1/5th in the family property, i.e., 1/4th of the natural born sons share. Nothing has been placed before us to compel us to depart from the long established rule prevalent in the Bombay State.

1[ds]We should be very reluctant to extend it to adoption, as it would lead to many anomalies and in some events defeat the object of the conferment of the power itself. The scope of the power must be reasonably construed so as to enable the donee of the power to discharge his religious duty. We, therefore, hold that the existence of a son in embryo does not invalidate an adoption.The next contention of Mr. Viswanatha Sastri is that the High Court, having set aside the alienations made by Chanbasappa, should have brought into hotchpot the property covered by the said alienations for the purpose of partition. The particulars of the alienations may be noticed at this stage.we advert to the legal aspects of the argument, it may be stated at once that no question of consent of the 4th defendant can possibly arise in this case, as he was not born when the alienations were made and he was a minor at the time the suit was filed. We must, therefore, proceed on the basis that the alienations were made by one of the members of the joint family without the consent of the other members of the family. If so, at the time the alienations were made Chanbasappa had not the absolute power to alienate the family property, but only a limited one to do so for the purpose of necessity or benefit of the estate. The relevant principles are well settled. A coparcener, whether he is natural born or adopted into the family, acquires an interest by birth or adoption, as the case may be, in the ancestral property of the family. A managing member of the family has power to alienate for value joint family property either for family necessity or for the benefit of the estate. An alienation can also be made by a managing member with the consent of all the coparceners of the family. The sole surviving member of a coparcenary has an absolute power to alienate the family property as at the time of alienation there is no other member who has joint interest in the family. If another member was in existence or in the womb of his mother at the time of the alienation, the power of the manager was circumscribed as aforesaid and his alienation would be voidable at the instance of the existing member or the member who was in the womb but was subsequently born, as the case may be, unless it was made for purpose binding on the member of the family or the existing member consented to it or the subsequently born member ratified it after he attained majority. If another member was conceived in the family or inducted therein by adoption before such consent or ratification, his right to avoid the alienation will not be affected : See Avdesh Kumar v. Zakaul Hassain (I.L.R. [1944] All. 612); Chandramani v. Jambeswara (A.I.R. 1931 Mad. 550 .); and Bhagwat Prasad Bahidar v. Debichand Bogra ((1941) I.L.R. 20 Pat. 727). In the instant case the impugned alienation were made at a time when the 4th defendant was in the womb i.e., at a time when Chanbasappa had only a limited right of disposal over the joint family property. The 4th defendant being in the womb, he could not obviously give his consent, nor ratify the alienations before the adoption of the 3rd defendant took place and he was inducted into the family. If the alienations were made by the father for a purpose not binding on the estate, they would be voidable at the instance of the 3rd or 4th defendant.The next question is whether the two gifts were binding on the family. We shall now take the two gift deeds Exs. 370 and 371 executed by Chanbasappa - the former in favour of the 7th defendant and the latter in favour of the 8th defendant. The High Court, agreeing with the learned Civil Judge, set aside the gifts on the ground that the donor had no power to make a gift of the family property. Learned counsel for the legal representatives of the said defendants seeks to sustain the validity of the said two gifts. We shall consider the validity of the two gift deeds separatelyBut what we are concerned with in this case is the power of a manager to make a gift to an outside of a joint family property. The scope of the limitations on that power has been fairly well settled by the decisions interpreting the relevant texts of Hindu law. The decisions of Hindu law sanctioned gifts to strangers by a manager of a joint Hindu family of a small extent of property for pious purposes. But no authority went so far, and none has been placed before us, to sustain such a gift to a stranger however much the donor was beholden to him on the ground that it was made out of charity. It must be remembered that the manager has no absolute power of disposal over joint Hindu family property. The Hindu law permits him to do so only within strict limits. We cannot extend the scope of the power on the basis of the wide interpretation given to the words "pious purposes" in Hindu law in a different context. In the circumstances, we hold that a gift to a stranger of a joint family property by the manager of the family is void.The second document is Ex. 371, dated July 4, 1944. Under that document, Chanbasappa created a life-interest in a property of the value of about Rs. 5, 000/- in favour of his widowed daughter, the 8th defendantWe agree with the learned Judge that sympathy is out of place in laying down the law. If the Hindu law texts clearly and expressly prohibit the making of such a gift of the family property by the father to the widowed daughter in indigent circumstances, it is no doubt the duty of the Court to accept the law, leaving it to the Legislature to change the law. We shall, therefore, consider the relevant Hindu law texts bearing on the subjectThe legal position may be summarized thus : The Hindu law texts conferred a right upon a daughter or a sister, as the case may be, to have a share in the family property at the time of partition. That right was lost by efflux of time. But it became crystallized into a moral obligation. The father or his representative can make a valid gift, by way of reasonable provision for the maintenance of the daughter, regard being had to the financial and other relevant circumstances of the family. By custom or by convenience, such gifts are made at the time of marriage, but the right of the father or his representative to make such a gift is not confined to the marriage occasion. It is a moral obligation and it continues to subsist till it is discharged. Marriage is only a customary occasion for such a gift. But the obligation can be discharged at any time, either during the lifetime of the father or thereafter. It is not possible to lay down a hard and fast rule, prescribing the quantitative limits of such a gift as that would depend on the facts of each case and it can only be decided by Court, regard being had to the overall picture of the extent of the family estate, the number of daughters to be provided for and other paramount charges and other similar circumstances. If the father is within his rights to make a gift of a reasonable extent of the family property for the maintenance of a daughter, it cannot be said that the said gift must be made only by one document or only at a single point of time. The validity or the reasonableness of a gift does not depend upon the plurality of document but on the power of the father to make a gift and the reasonableness of the gift so made. If once the power is granted and the reasonableness of the gift is not disputed, the fact that two gift deeds were executed instead of one, cannot make the gift anytheless a valid one.Applying the aforesaid principles, we have no doubt that in the present case, the gift made by the father was within his right and certainly reasonable. The family had extensive properties. The father gave the daughter only a life-estate in a small extent of land in addition to what had already been given for her maintenance. It has not been stated that the gift made by the father was unreasonable in the circumstances of the case. We, therefore, hold that the said document is valid to the extent of the right conferred on the 8th defendantIn this case it is not necessary to express our opinion on the question whether Lingayats are Sudras or not, for we proceed on the assumption that they are, or at any rate that the Hindu law applicable to Sudras applies to themIn Arumilli Perrazu v. Arumilli Subbrayadu ((1921) 48 I.A. 280) it was held by the Judicial Committee that among Sudras in the Madras Presidency an adopted son on partition of the family property would share equally with a son or sons born to the adoptive father after the adoption. The Judicial Committee based its conclusion mainly on the following ground. the rule of the Dattaka Chandrika that on a partition of the joint family property of a Sudra family an adopted son is entitled to share equally with the legitimate son born to the adoptive father subsequently to the adoption had been accepted and acted upon for at least more than a century in the Presidency of Madras, as the law applicable in such cases to Sudras until the law on that subject was disturbed in 1915 by the decision of the High Court at Madras in Gopalam v. Venkataraghavulu ((1915) I.L.R. 40 Mad. 632)."It will be seen that the decision rested on the fact that Dattaka Chandrika was the recognized authority in the Madras Presidency and that the rule that an adopted son and an afterborn natural son take in equal shares the family property had been followed for over a century. On this decision Sarkar Sastri commented in his valuable book on Hindu Law, 8th Edn., at p. 211, thus :"Another novel rule enunciated for the first time by the Dattaka Chandrika is that a Sudras adopted son should share equally with his begotten son, on the ground that a Sudras illegitimate son may by the fathers choice get an equal share with his legitimate sons. It is difficult to understand the cogency of his argument. This rule, however, has been followed by the Calcutta and Madras High Court, for this book is said to be of special authority in Bengal and Madras. But the Madras High Court, after consideration of the authorities on the subject, came to the conclusion, following an earlier decision of the same Court, that an adopted son of a Sudra was entitled to only a fifth share of what a natural born son gets. But in the case of Arumilli Perrazu ((1921) 48 I.A. 280) the above decision has been overruled and it has been finally settled by the Privy Council that an adopted son shares equally on partition with an after-born son of an Bengal where Dattaka Chandrika is given same importance as in the Madras Presidency, the same rule has been followed in the matter of partition between an adopted son and an after-born natural son among Sudras : see Asita v. Nirode ((1916) 20 C.W.N. 901). It is not necessary to pursue that matter. It may be adopted that in Bengal and Madras the said rule governs the shares between them. But in Bombay, Dattaka Chandrika is not given the place of honour as in Madras and Calcutta. As early as 1892, a division Bench of the Bombay High Court in Giriapa v. Hingappa ((1892) I.L.R. 17 Bom. 100) had to consider the question of shares inter se between an adopted son and an after-born aurasa son. It held that in Western India, both in the districts governed by the Mitakshara and those specially under the authority of Vyavahara Mayukha, the right of the adopted son, where there was a legitimate son born after the adoption, extended only to a fifth share of the fathers estate. The question therein was whether the adopted son takes one-fourth of the estate or one-fourth of the natural born sons share in the property. After considering all the relevant texts the division bench came to the conclusion that he takes one-fourth of a natural born sons share. After the decision of the Judicial Committee in Perrazu v. Subbrayadu ((1921) 48 I.A. 280) another division Bench of the Bombay High Court, in Tukaram Mahadu v. Ramachandra Mahadu ((1925) I.L.R. 49 Bom. 672, 679, 680, 684) reviewed the law and came to the same conclusion. Adverting to the Privy Council decision, the learned Judges of the Bombay High Court observed :"No doubt this case Perrazu v. Subbarayudu ((1921) 48 I.A. 280) is an authority for holding that in Madras and in Bengal among Sudras the rule is that for which the appellants counseln the learned Judges posed the following question :"Assuming that the parties here are Sudras ought we to apply to this Presidency the rule which their Lordships of the Privy Council have laid down as prevailing in the Madras and Bengal Presidencies ?"After citing the relevant extracts from the decision of the Judicial Committee, the learned Judges proceeded to answer thus :"In this Presidency where the rule of Dattaka Chandrika upon the question at issue has have been followed, for no case, and no kind to judicial or other pronouncement is forthcoming, (and as I have said the leading case is against it), ought we to accept the rule upon the authority of the Dattaka Chandrika alone ? In my opinion we should err if we did so. The authority of the Dattaka Chandrika has never been placed so high in Western India as in Bengal and Madras ....... The case is one where the principle of stare decisis should be maintained."Coyajee J., said much to the same effect :"We have no reason to believe that the rule propounded in paras. 29 and 32 of sections V of the Dattaka Chandrika has been so accepted and acted upon in this Presidency; and there is therefore no justification for holding that the decision in Giriappas case ((1892) I.L.R. 17 Bom. 100) is not applicable to the parties to this suit even if they were Sudras."Steele in his valuable book on Hindu Law and Customs compiled as far back as 1868, did not find any justification for excepting the Sudras from the general rule. It is, therefore, manifest that in Bombay Presidency the rule accepted in Dattaka Chandrika has never been followed and the share of an adopted son in competition with a natural born son among Sudras has always been 1/5th in the family property, i.e., 1/4th of the natural born sons share. Nothing has been placed before us to compel us to depart from the long established rule prevalent in the Bombay Stat

### Instruction: Assess the case proceedings and provide a prediction: is the court likely to rule in favor of (1) or against (0) the appellant/petitioner? ### Input: Judicial Committee based its conclusion mainly on the following ground :"...... the rule of the Dattaka Chandrika that on a partition of the joint family property of a Sudra family an adopted son is entitled to share equally with the legitimate son born to the adoptive father subsequently to the adoption had been accepted and acted upon for at least more than a century in the Presidency of Madras, as the law applicable in such cases to Sudras until the law on that subject was disturbed in 1915 by the decision of the High Court at Madras in Gopalam v. Venkataraghavulu ((1915) I.L.R. 40 Mad. 632)." It will be seen that the decision rested on the fact that Dattaka Chandrika was the recognized authority in the Madras Presidency and that the rule that an adopted son and an afterborn natural son take in equal shares the family property had been followed for over a century. On this decision Sarkar Sastri commented in his valuable book on Hindu Law, 8th Edn., at p. 211, thus :"Another novel rule enunciated for the first time by the Dattaka Chandrika is that a Sudras adopted son should share equally with his begotten son, on the ground that a Sudras illegitimate son may by the fathers choice get an equal share with his legitimate sons. It is difficult to understand the cogency of his argument. This rule, however, has been followed by the Calcutta and Madras High Court, for this book is said to be of special authority in Bengal and Madras. But the Madras High Court, after consideration of the authorities on the subject, came to the conclusion, following an earlier decision of the same Court, that an adopted son of a Sudra was entitled to only a fifth share of what a natural born son gets. But in the case of Arumilli Perrazu ((1921) 48 I.A. 280) the above decision has been overruled and it has been finally settled by the Privy Council that an adopted son shares equally on partition with an after-born son of a Sudra." In Bengal where Dattaka Chandrika is given same importance as in the Madras Presidency, the same rule has been followed in the matter of partition between an adopted son and an after-born natural son among Sudras : see Asita v. Nirode ((1916) 20 C.W.N. 901). It is not necessary to pursue that matter. It may be adopted that in Bengal and Madras the said rule governs the shares between them. But in Bombay, Dattaka Chandrika is not given the place of honour as in Madras and Calcutta. As early as 1892, a division Bench of the Bombay High Court in Giriapa v. Hingappa ((1892) I.L.R. 17 Bom. 100) had to consider the question of shares inter se between an adopted son and an after-born aurasa son. It held that in Western India, both in the districts governed by the Mitakshara and those specially under the authority of Vyavahara Mayukha, the right of the adopted son, where there was a legitimate son born after the adoption, extended only to a fifth share of the fathers estate. The question therein was whether the adopted son takes one-fourth of the estate or one-fourth of the natural born sons share in the property. After considering all the relevant texts the division bench came to the conclusion that he takes one-fourth of a natural born sons share. After the decision of the Judicial Committee in Perrazu v. Subbrayadu ((1921) 48 I.A. 280) another division Bench of the Bombay High Court, in Tukaram Mahadu v. Ramachandra Mahadu ((1925) I.L.R. 49 Bom. 672, 679, 680, 684) reviewed the law and came to the same conclusion. Adverting to the Privy Council decision, the learned Judges of the Bombay High Court observed :"No doubt this case Perrazu v. Subbarayudu ((1921) 48 I.A. 280) is an authority for holding that in Madras and in Bengal among Sudras the rule is that for which the appellants counsel contends." Then the learned Judges posed the following question :"Assuming that the parties here are Sudras ought we to apply to this Presidency the rule which their Lordships of the Privy Council have laid down as prevailing in the Madras and Bengal Presidencies ?" After citing the relevant extracts from the decision of the Judicial Committee, the learned Judges proceeded to answer thus :"In this Presidency where the rule of Dattaka Chandrika upon the question at issue has have been followed, for no case, and no kind to judicial or other pronouncement is forthcoming, (and as I have said the leading case is against it), ought we to accept the rule upon the authority of the Dattaka Chandrika alone ? In my opinion we should err if we did so. The authority of the Dattaka Chandrika has never been placed so high in Western India as in Bengal and Madras ....... The case is one where the principle of stare decisis should be maintained." 27. Coyajee J., said much to the same effect :"We have no reason to believe that the rule propounded in paras. 29 and 32 of sections V of the Dattaka Chandrika has been so accepted and acted upon in this Presidency; and there is therefore no justification for holding that the decision in Giriappas case ((1892) I.L.R. 17 Bom. 100) is not applicable to the parties to this suit even if they were Sudras." 28. Steele in his valuable book on Hindu Law and Customs compiled as far back as 1868, did not find any justification for excepting the Sudras from the general rule. It is, therefore, manifest that in Bombay Presidency the rule accepted in Dattaka Chandrika has never been followed and the share of an adopted son in competition with a natural born son among Sudras has always been 1/5th in the family property, i.e., 1/4th of the natural born sons share. Nothing has been placed before us to compel us to depart from the long established rule prevalent in the Bombay State. ### Response: 1

International Advanced Research Centre for Powder Metallurgy and New Materials and Ors Vs. Nimra Cerglass Technics Ltd. and Ors

a civil nature, has been given a cloak of criminal offence. Criminal proceedings are not a short cut of other remedies available in law. Before issuing process a criminal court has to exercise a great deal of caution. For the accused it is a serious matter. This Court has laid certain principles on the basis of which the High Court is to exercise its jurisdiction under Section 482 of the Code. Jurisdiction under this section has to be exercised to prevent abuse of the process of any court or otherwise to secure the ends of justice.”14. While no one with a legitimate cause or grievance should be prevented from seeking remedies available in criminal law, a complainant who initiates or persists with a prosecution, being fully aware that the criminal proceedings are unwarranted and his remedy lies only in civil law, should himself be made accountable, at the end of such misconceived criminal proceedings, in accordance with law. One positive step that can be taken by the courts, to curb unnecessary prosecutions and harassment of innocent parties, is to exercise their power under Section 250 CrPC more frequently, where they discern malice or frivolousness or ulterior motives on the part of the complainant. Be that as it may.” 22. Learned counsel for the respondent submitted that any defence to be taken by the appellants is to be raised only during the course of trial and is not to be raised in the initial stage of the prosecution. In support of his contention, the learned counsel placed reliance upon Trisuns Chemical Industry vs. Rajesh Agarwal & Ors. (1999) 8 SCC 686 ; Rajesh Bajaj vs. State NCT of Delhi and Ors. (1999) 3 SCC 259 ; P. Swaroopa Rani vs. M.Hari Narayana Alias Hari Babu (2008) 5 SCC 765 and Iridium India Telecom Ltd. vs. Motorola Incorporated & Ors. (2011) 1 SCC 74. Learned counsel for the respondent further submitted that when the Magistrate has taken cognizance of an offence and the power of the High Court to interfere is only to a limited extent, the High Court cannot substitute its view for the summoning order passed by the Magistrate. In support of this contention, learned counsel placed reliance upon the decisions of this Court in Fiona Shrikhande vs. State of Maharashtra & Anr. (2013) 14 SCC 44 ; Bhushan Kumar & Anr. vs. State (NCT) of Delhi & Anr. (2012) 5 SCC 424 and Smt. Nagawwa vs. Veeranna Shivalingappa Konjalgi & Ors. (1976) 3 SCC 736. 23. The above decisions reiterate the well-settled principles that while exercising inherent jurisdiction under Section 482 Cr.P.C., it is not for the High Court to appreciate the evidence and its truthfulness or sufficiency inasmuch as it is the function of the trial court. High Court’s inherent powers, be it, civil or criminal matters, is designed to achieve a salutary public purpose and that a court proceeding ought not to be permitted to degenerate into a weapon of harassment or persecution. If the averments in the complaint do not constitute an offence, the court would be justified in quashing the proceedings in the interest of justice. 24. Second appellant-Dr. S.V. Joshi was the Associate Director. Third appellant Dr. G. Sunderarajan was the Director of ARCI and both of them were acting in their official capacity. Appellants No. 2 and 3 neither acted in their personal capacity nor stood to receive any personal monetary benefits from the transfer of said technology. Appellants No.2 and 3 were representatives of ARCI which is a grant-in-aid research and development institute under the Ministry of Science and Technology, Government of India and hence previous sanction as mandated under Section 197 Cr.P.C. must have been obtained before proceeding against them as their act was only in discharge of their official duties. In this regard, our attention was drawn to a communication from Ministry of Science and Technology indicating that for initiating criminal proceeding against appellants No. 2 and 3, permission is required and the said communication reads as under: “ ….. They have both been appointed by the Government of India and are governed by all rules and regulations of the Government of India….It is further stated that we have examined all the actions taken by Dr. G. Sundararajan and S.V. Joshi in relation to the activities pertaining to the Technology Transfer Agreement dated 18/06/1999 between ARCI and M/s Nimra Cerglass, Hyderabad and are of firm view that these actions were taken by the above officers while discharging their official duty in good faith and in the best interest of ARCI.Therefore, for initiating criminal proceeding against Dr. G. Sundararajan and Dr. S.V.Joshi, Government of India permission is required.” The alleged acts of the appellants No. 2 and 3 were committed while acting in discharge of their official duties, sanction from the competent authority was necessary before initiating the criminal prosecution against them. Since we have held that from the averments in the complaint, the essential ingredients of dishonest intention is not made out, we are not inclined to further elaborate upon this point. 25. As per the terms of the technology transfer agreement, ARCI has to conduct performance guarantee tests and in those tests when ARCI was unsuccessful in achieving the targeted specifications, ARCI cannot be said to have acted with dishonest intention to cheat the respondent. Appellants-ARCI is a structure of Scientists, Team Leader and Associate Director and it is the team leader who actually executes the project, the job of Associate Director and Director is to monitor/review progress of the project. Appellants No.2 and 3 who were the Associate Director and Director of ARCI respectively were only monitoring the progress of the project cannot be said to have committed the offence of cheating. In the facts of the present case, in our view, the allegations in the complaint do not constitute the offence alleged and continuation of the criminal proceeding is not just and proper and in the interest of the justice, the same is liable to be quashed.

1[ds]25. As per the terms of the technology transfer agreement, ARCI has to conduct performance guarantee tests and in those tests when ARCI was unsuccessful in achieving the targeted specifications, ARCI cannot be said to have acted with dishonest intention to cheat the respondent. Appellants-ARCI is a structure of Scientists, Team Leader and Associate Director and it is the team leader who actually executes the project, the job of Associate Director and Director is to monitor/review progress of the project. Appellants No.2 and 3 who were the Associate Director and Director of ARCI respectively were only monitoring the progress of the project cannot be said to have committed the offence of cheating. In the facts of the present case, in our view, the allegations in the complaint do not constitute the offence alleged and continuation of the criminal proceeding is not just and proper and in the interest of the justice, the same is liable to be quashed.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: a civil nature, has been given a cloak of criminal offence. Criminal proceedings are not a short cut of other remedies available in law. Before issuing process a criminal court has to exercise a great deal of caution. For the accused it is a serious matter. This Court has laid certain principles on the basis of which the High Court is to exercise its jurisdiction under Section 482 of the Code. Jurisdiction under this section has to be exercised to prevent abuse of the process of any court or otherwise to secure the ends of justice.”14. While no one with a legitimate cause or grievance should be prevented from seeking remedies available in criminal law, a complainant who initiates or persists with a prosecution, being fully aware that the criminal proceedings are unwarranted and his remedy lies only in civil law, should himself be made accountable, at the end of such misconceived criminal proceedings, in accordance with law. One positive step that can be taken by the courts, to curb unnecessary prosecutions and harassment of innocent parties, is to exercise their power under Section 250 CrPC more frequently, where they discern malice or frivolousness or ulterior motives on the part of the complainant. Be that as it may.” 22. Learned counsel for the respondent submitted that any defence to be taken by the appellants is to be raised only during the course of trial and is not to be raised in the initial stage of the prosecution. In support of his contention, the learned counsel placed reliance upon Trisuns Chemical Industry vs. Rajesh Agarwal & Ors. (1999) 8 SCC 686 ; Rajesh Bajaj vs. State NCT of Delhi and Ors. (1999) 3 SCC 259 ; P. Swaroopa Rani vs. M.Hari Narayana Alias Hari Babu (2008) 5 SCC 765 and Iridium India Telecom Ltd. vs. Motorola Incorporated & Ors. (2011) 1 SCC 74. Learned counsel for the respondent further submitted that when the Magistrate has taken cognizance of an offence and the power of the High Court to interfere is only to a limited extent, the High Court cannot substitute its view for the summoning order passed by the Magistrate. In support of this contention, learned counsel placed reliance upon the decisions of this Court in Fiona Shrikhande vs. State of Maharashtra & Anr. (2013) 14 SCC 44 ; Bhushan Kumar & Anr. vs. State (NCT) of Delhi & Anr. (2012) 5 SCC 424 and Smt. Nagawwa vs. Veeranna Shivalingappa Konjalgi & Ors. (1976) 3 SCC 736. 23. The above decisions reiterate the well-settled principles that while exercising inherent jurisdiction under Section 482 Cr.P.C., it is not for the High Court to appreciate the evidence and its truthfulness or sufficiency inasmuch as it is the function of the trial court. High Court’s inherent powers, be it, civil or criminal matters, is designed to achieve a salutary public purpose and that a court proceeding ought not to be permitted to degenerate into a weapon of harassment or persecution. If the averments in the complaint do not constitute an offence, the court would be justified in quashing the proceedings in the interest of justice. 24. Second appellant-Dr. S.V. Joshi was the Associate Director. Third appellant Dr. G. Sunderarajan was the Director of ARCI and both of them were acting in their official capacity. Appellants No. 2 and 3 neither acted in their personal capacity nor stood to receive any personal monetary benefits from the transfer of said technology. Appellants No.2 and 3 were representatives of ARCI which is a grant-in-aid research and development institute under the Ministry of Science and Technology, Government of India and hence previous sanction as mandated under Section 197 Cr.P.C. must have been obtained before proceeding against them as their act was only in discharge of their official duties. In this regard, our attention was drawn to a communication from Ministry of Science and Technology indicating that for initiating criminal proceeding against appellants No. 2 and 3, permission is required and the said communication reads as under: “ ….. They have both been appointed by the Government of India and are governed by all rules and regulations of the Government of India….It is further stated that we have examined all the actions taken by Dr. G. Sundararajan and S.V. Joshi in relation to the activities pertaining to the Technology Transfer Agreement dated 18/06/1999 between ARCI and M/s Nimra Cerglass, Hyderabad and are of firm view that these actions were taken by the above officers while discharging their official duty in good faith and in the best interest of ARCI.Therefore, for initiating criminal proceeding against Dr. G. Sundararajan and Dr. S.V.Joshi, Government of India permission is required.” The alleged acts of the appellants No. 2 and 3 were committed while acting in discharge of their official duties, sanction from the competent authority was necessary before initiating the criminal prosecution against them. Since we have held that from the averments in the complaint, the essential ingredients of dishonest intention is not made out, we are not inclined to further elaborate upon this point. 25. As per the terms of the technology transfer agreement, ARCI has to conduct performance guarantee tests and in those tests when ARCI was unsuccessful in achieving the targeted specifications, ARCI cannot be said to have acted with dishonest intention to cheat the respondent. Appellants-ARCI is a structure of Scientists, Team Leader and Associate Director and it is the team leader who actually executes the project, the job of Associate Director and Director is to monitor/review progress of the project. Appellants No.2 and 3 who were the Associate Director and Director of ARCI respectively were only monitoring the progress of the project cannot be said to have committed the offence of cheating. In the facts of the present case, in our view, the allegations in the complaint do not constitute the offence alleged and continuation of the criminal proceeding is not just and proper and in the interest of the justice, the same is liable to be quashed. ### Response: 1

Hari Singh Mann Vs. State of Punjab & Others

Ray, C.J.1. This is an appeal by special leave from the judgment D/-5-11-1969 of the High Court of Punjab and Haryana. The only question is whether the order of termination of the service of the appellant who was a probationer is in violation of R.9 of the Punjab Civil Services (Punishment and Appeal) Rules, 1952.2. The appellant was selected by the Public Service Commission as a direct recruit in May, 1965. He was appointed on 26 May, 1965. He joined as probationer. The period of probation was two years.3. Rule 8(b) of the Punjab Police Service Rules, 1959 states that the services of a member recruited by direct appointment may be dispensed with by the Government on his failing to pass the final examination at the end of his period of training, or on his being reported on during or at the end of his period of probation, as unfit for appointment.4. The order terminating the services of the appellant was as follows :"The President of India is pleased to dispense with the service of Shri Hari Singh Mann, Probationary Deputy Superintendent of Police, Amritsar on the expiry of his extended period of probation with effect from 2-2-1969 (A. N.) under R. 8 (b) of the Punjab Police Service Rules. 1959, having considered him unfit for appointment to the State Police Service. The period from 20-5-68 to 2-8-68 which has been treated as leave of the kind dues has been excluded from the period of trial (Probation)"5. The two contentions which have been advanced before the High Court were repeated here. First, the order of termination was passed on 30 January, 1969 when the petitioner by reason of expiry of three years stood confirmed on 19-20 November, 1968. Second the order of termination was one of punishment and the appellant should, therefore, under Rule 9 of the Punjab Civil Services (Punishment and Appeal) Rules have been given opportunity to show cause against the order of termination.6. Under the aforesaid (Police Service) Rule 8 (b) proviso, the Government could extend the period of probation by not more than one year. The appellant was appointed on 20 May, 1965 on two years probation. On 1 July, 1967, there was an order extending the period of probation by one year. On 20 May, 1968, there was an order terminating the services of the petitioner. On 20 July, 1968 there was an order revoking the order of termination and extending the period of probation for six months from 20 May, 1968. The order of termination was (passed) on 30-1-1969. The appellant was on leave from 20 May, 1968 to 2 August, 1968. The Government excluded the period of leave from the period of probation.7. The object of extending the period of probation is to find out whether the appellant was a fit person. The appellant could not be confirmed till the period of probation to find out the fitness of the appellant expired. It cannot therefore be held that the appellant stood confirmed on 19-20 November, 1968 before the period of probation expired in January, 1969.8. The appellant relied on R. 9 of the Punjab Civil Services (Punishment and Appeal) Rules, 1952.Rule 9 is as follows :"Where it is proposed to terminate the employment of a probationer, whether during or at the end of the period of probation for any specific fault or on account of the unsatisfactory record or unfavourable reports implying the unsuitability for the service, the probationer shall be apprised of the grounds of such proposal and given an opportunity to show cause against it, before orders are passed by the authority competent to terminate the appointment".9. If (Punishment) Rule 9 applies the services of the appellant could not be terminated without complying with the provisions thereof.10. The appellant contended that the order of termination stated that the appellant was considered unfit for appointment and therefore it amounts to punishment to attract R. 9. The appellant extracted a statement from the affidavit of the Inspector General of Police in answer to the appellants petition in the High Court that the appellants record during the period of probation was unsatisfactory. Reliance is placed on Rule 9 where it is said that if the termination of the Services of a probationer be on account of unsatisfactory record he shall be given an opportunity to show cause against it.11. The respondent relied on rule 11 of the Punjab Police Service Rules where it is stated that in matters relating to discipline, penalties and appeals, members of the Service shall be governed by the Punjab Civil Services (Punishment and Appeal) Rules. Therefore, it is said by the respondent that Rules 8 and 11 of the Punjab Police Service Rules show that termination of probation which is dealt with in Rule 8 is different from matters relating to penalties which are dealt with in rule 11 of the Punjab Police Service Rules.12. Termination on account of unsatisfactory record will attract R. 9 of the Punishment Rules. It is obvious that at the time of confirmation fitness is a matter to be considered. The order terminating the services is unfitness for appointment at the time of confirmation, it is not passed on the ground of any turpitude like misconduct or inefficiency. To hold that the words "unfit to be appointed" are a stigma would rob the authorities of the power to judge fitness for work or suitability to the post at the time of confirmation. Termination of services on account of inadequacy for the job or for any temperamental or other defect not involving moral turpitude is not a stigma which can be called discharge by punishment. Fitness for the job is one of the most important reasons for confirmation. The facts and circumstance do not show that there is any stigma attached to the order of termination.

0[ds]6. Under the aforesaid (Police Service) Rule 8 (b) proviso, the Government could extend the period of probation by not more than one year. The appellant was appointed on 20 May, 1965 on two years probation. On 1 July, 1967, there was an order extending the period of probation by one year. On 20 May, 1968, there was an order terminating the services of the petitioner. On 20 July, 1968 there was an order revoking the order of termination and extending the period of probation for six months from 20 May, 1968. The order of termination was (passed) onThe appellant was on leave from 20 May, 1968 to 2 August, 1968. The Government excluded the period of leave from the period of probation.7. The object of extending the period of probation is to find out whether the appellant was a fit person. The appellant could not be confirmed till the period of probation to find out the fitness of the appellant expired. It cannot therefore be held that the appellant stood confirmed onNovember, 1968 before the period of probation expired in January, 1969.If (Punishment) Rule 9 applies the services of the appellant could not be terminated without complying with the provisions thereof.Termination on account of unsatisfactory record will attract R. 9 of the Punishment Rules. It is obvious that at the time of confirmation fitness is a matter to be considered. The order terminating the services is unfitness for appointment at the time of confirmation, it is not passed on the ground of any turpitude like misconduct or inefficiency. To hold that the words "unfit to be appointed" are a stigma would rob the authorities of the power to judge fitness for work or suitability to the post at the time of confirmation. Termination of services on account of inadequacy for the job or for any temperamental or other defect not involving moral turpitude is not a stigma which can be called discharge by punishment. Fitness for the job is one of the most important reasons for confirmation. The facts and circumstance do not show that there is any stigma attached to the order of termination.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: Ray, C.J.1. This is an appeal by special leave from the judgment D/-5-11-1969 of the High Court of Punjab and Haryana. The only question is whether the order of termination of the service of the appellant who was a probationer is in violation of R.9 of the Punjab Civil Services (Punishment and Appeal) Rules, 1952.2. The appellant was selected by the Public Service Commission as a direct recruit in May, 1965. He was appointed on 26 May, 1965. He joined as probationer. The period of probation was two years.3. Rule 8(b) of the Punjab Police Service Rules, 1959 states that the services of a member recruited by direct appointment may be dispensed with by the Government on his failing to pass the final examination at the end of his period of training, or on his being reported on during or at the end of his period of probation, as unfit for appointment.4. The order terminating the services of the appellant was as follows :"The President of India is pleased to dispense with the service of Shri Hari Singh Mann, Probationary Deputy Superintendent of Police, Amritsar on the expiry of his extended period of probation with effect from 2-2-1969 (A. N.) under R. 8 (b) of the Punjab Police Service Rules. 1959, having considered him unfit for appointment to the State Police Service. The period from 20-5-68 to 2-8-68 which has been treated as leave of the kind dues has been excluded from the period of trial (Probation)"5. The two contentions which have been advanced before the High Court were repeated here. First, the order of termination was passed on 30 January, 1969 when the petitioner by reason of expiry of three years stood confirmed on 19-20 November, 1968. Second the order of termination was one of punishment and the appellant should, therefore, under Rule 9 of the Punjab Civil Services (Punishment and Appeal) Rules have been given opportunity to show cause against the order of termination.6. Under the aforesaid (Police Service) Rule 8 (b) proviso, the Government could extend the period of probation by not more than one year. The appellant was appointed on 20 May, 1965 on two years probation. On 1 July, 1967, there was an order extending the period of probation by one year. On 20 May, 1968, there was an order terminating the services of the petitioner. On 20 July, 1968 there was an order revoking the order of termination and extending the period of probation for six months from 20 May, 1968. The order of termination was (passed) on 30-1-1969. The appellant was on leave from 20 May, 1968 to 2 August, 1968. The Government excluded the period of leave from the period of probation.7. The object of extending the period of probation is to find out whether the appellant was a fit person. The appellant could not be confirmed till the period of probation to find out the fitness of the appellant expired. It cannot therefore be held that the appellant stood confirmed on 19-20 November, 1968 before the period of probation expired in January, 1969.8. The appellant relied on R. 9 of the Punjab Civil Services (Punishment and Appeal) Rules, 1952.Rule 9 is as follows :"Where it is proposed to terminate the employment of a probationer, whether during or at the end of the period of probation for any specific fault or on account of the unsatisfactory record or unfavourable reports implying the unsuitability for the service, the probationer shall be apprised of the grounds of such proposal and given an opportunity to show cause against it, before orders are passed by the authority competent to terminate the appointment".9. If (Punishment) Rule 9 applies the services of the appellant could not be terminated without complying with the provisions thereof.10. The appellant contended that the order of termination stated that the appellant was considered unfit for appointment and therefore it amounts to punishment to attract R. 9. The appellant extracted a statement from the affidavit of the Inspector General of Police in answer to the appellants petition in the High Court that the appellants record during the period of probation was unsatisfactory. Reliance is placed on Rule 9 where it is said that if the termination of the Services of a probationer be on account of unsatisfactory record he shall be given an opportunity to show cause against it.11. The respondent relied on rule 11 of the Punjab Police Service Rules where it is stated that in matters relating to discipline, penalties and appeals, members of the Service shall be governed by the Punjab Civil Services (Punishment and Appeal) Rules. Therefore, it is said by the respondent that Rules 8 and 11 of the Punjab Police Service Rules show that termination of probation which is dealt with in Rule 8 is different from matters relating to penalties which are dealt with in rule 11 of the Punjab Police Service Rules.12. Termination on account of unsatisfactory record will attract R. 9 of the Punishment Rules. It is obvious that at the time of confirmation fitness is a matter to be considered. The order terminating the services is unfitness for appointment at the time of confirmation, it is not passed on the ground of any turpitude like misconduct or inefficiency. To hold that the words "unfit to be appointed" are a stigma would rob the authorities of the power to judge fitness for work or suitability to the post at the time of confirmation. Termination of services on account of inadequacy for the job or for any temperamental or other defect not involving moral turpitude is not a stigma which can be called discharge by punishment. Fitness for the job is one of the most important reasons for confirmation. The facts and circumstance do not show that there is any stigma attached to the order of termination. ### Response: 0

State Of Karnataka Vs. Kgsd Canteen Employees Welfare Asson&Ors

Court vis-a-vis the Civil Court highlighted the object of the Industrial Disputes Act stating: "The object of the Industrial Disputes Act, as its preamble indicates, is to make provision for the investigation and settlement of industrial disputes, which means adjudication of such disputes also. The Act envisages collective bargaining, contracts between union representing the workmen and the management, a matter which is outside the realm of the common law or the Indian law of contract" 48. Keeping in view of the facts and circumstances of this case as also the principle of law enunciated in the above referred decisions of this Court, we are, thus, of the opinion that recourse to writ remedy was not apposite in this case. REGULARISATION 49. The question which now arises for consideration is as to whether the High Court was justified in directing regularization of the services of the Respondents. It was evidently not. In a large number of decisions, this Court has categorically held that it is not open to a High Court to exercise its discretion under Article 226 of the Constitution of India either to frame a scheme by itself or to direct the State to frame a scheme for regularising the services of ad hoc employees or daily wages employees who had not been appointed in terms of the extant service rules framed either under a statute or under the proviso to Article 309 of the Constitution of India. Such a scheme, even if framed by the State, would not meet the requirements of law as the executive order made under Article 162 of the Constitution of India cannot prevail over a statute or statutory rules framed under proviso to Article 309 thereof. The State is obligated to make appointments only in fulfilment of its constitutional obligation as laid down in Articles 14, 15 and 16 of the Constitution of India and not by way of any regularization scheme. In our constitutional schemes, all eligible persons similarly situated must be given opportunity to apply for and receive considerations for appointments at the hands of the authorities of the State. Denial of such a claim by some officers of the State times and again had been deprecated by this Court. In any view, in our democratic polity, an authority howsoever high it may be cannot act in breach of an existing statute or the rules which hold the field. 50. It is not necessary for us to dilate further on the issue as recently in State of U.P. v. Neeraj Awasthi and Ors. [2005 (10) SCALE 286 ], it has been clearly held that the High Court has no jurisdiction to frame a scheme by itself or direct framing of such a scheme by the State. 51. In Mahendra L. Jain and Others v. Indore Development Authority and Others [(2005) 1 SCC 639] , it was categorically held: "The question, therefore, which arises for consideration is as to whether they could lay a valid claim for regularisation of their services. The answer thereto must be rendered in the negative. Regularisation cannot be claimed as a matter of right. An illegal appointment cannot be legalised by taking recourse to regularisation. What can be regularised is an irregularity and not an illegality. The constitutional scheme which the country has adopted does not contemplate any back-door appointment. A State before offering public service to a person must comply with the constitutional requirements of Articles 14 and 16 of the Constitution. All actions of the State must conform to the constitutional requirements. A daily-wager in the absence of a statutory provision in this behalf would not be entitled to regularisation. (See State of U.P. v. Ajay Kumar and Jawaharlal Nehru Krishi Vishwa Vidyalaya v. Bal Kishan Soni.)" 52. In Zakir Hussain (supra), even in relation to the temporary employee, it was stated: "The respondent is a temporary employee of the Corporation and a probationer and not a government servant and, therefore, is not entitled for any protection under Article 311 of the Constitution. He was a party to the contract. In view of the fact that the respondent was appointed on probation and the services were terminated during the period of probation simpliciter as the same were not found to be satisfactory, the appellant Corporation is not obliged to hold an enquiry before terminating the services. The respondent being a probationer has got no substantive right to hold the post and was not entitled to a decree of declaration as erroneously granted by the lower courts and also of the High Court." PARITY IN THE SCALE OF PAY 53. The contention that at least for the period they have worked they were entitled to the remuneration in the scale of pay as that of the government employees cannot be accepted for more than one reason. They did not hold any post. No post for the canteen was sanctioned by the State. According to the State, they were not its employees. Salary on a regular scale of pay, it is trite, is payable to an employee only when he holds a status. [See Mahendra L. Jain and Others (supra)] 54. The High Court was, thus, not correct in holding that the members of the First Respondent could be treated at par with the Hospitality Organization of the State of Karnataka. Such equation is impermissible in law. In the Hospitality Organization of the State, the posts might have been sanctioned. Only because, food is prepared and served, the same would not mean that a canteen run by a Committee can be equated thereto. SUBSEQUENT EVENT 55. Subsequent events which had taken place is also worth taking note of. The fact remains that the canteen now is closed. The judgment and order of the High Court, thus, otherwise also cannot be implemented. The employees concerned, therefore, cannot be directed to be reinstated in service. We have noticed, hereinbefore, that other proceedings have been initiated by them. The said proceedings may be disposed of in accordance with law. CONCLUSION

1[ds]19. In an affidavit filed before us, it is stated that the Karnataka Government Secretariat Employees Association which was running the canteen from 04.08.2000 to 31.03.2003 by a letter dated 10.03.2003, expressed its inability to run the canteen beyond 31.03.2003 and, thus, the canteen services were closed from 01.04.2003. It is further stated that the State Government demolished the main canteen building pursuant to the Government Note dated 04.08.2003. Certain litigations had thereafter been initiated before several authorities. A writ petition had also been filed by the Association before the High Court, which was marked as Writ Petition No.41207 of 2004 seeking direction to make the balance payment of LIC premium and contribution towards EPF for the period from 01.01.2003 to 31.03.200320. This Court evidently is not concerned with the pending litigation but we have noticed the said fact only for the purpose of showing that the State intended to run the canteen departmentally through a committee, but according to the State, the committee has a distinct and different existence or different entity than the Government21. The fact situation obtaining in this case already suggests that the State had no intention to run and maintain the canteen as a department. Had the intention of the State been to run the said canteen as one of its departments, the question of giving any grant or for that matter making of a provision for return of the furniture and equipments would not have arisen36. It was specifically noticed that the workmen of the Canteen and the contractor had entered into independent settlements without impleading the owner or occupier of the factory as a party therein which also went to show that the workmen were treating themselves the workmen of the contractor and not that of the owners37. We have referred to the aforementioned decisions in order to show that in each of the aforementioned cases the industrial adjudicator was required to apply the relevant tests laid down by this Court in the fact situation obtaining therein. Most of the cases referred to hereinbefore were considered by this Court in the peculiar facts and circumstances obtaining therein and, thus, it is even not proper for the industrial adjudicator to apply the ratio of one decision to the exclusion of other without considering the facts and circumstances involved therein. The law, however, does not appear to be settled as to whether even in a case where the employer is required to run and maintain a canteen in terms of the provisions of the statute, the employees of the canteen would automatically be held to be the workers of the principal employer for all intent and purport and not for the purpose of the Factories Act alone. We, however, are not concerned with the said question in this matter and refrain ourselves from making any observation in respect thereof38. We, however, intend to point out that in a case of this nature even an industrial adjudicator may have some difficulty in coming to the conclusion that employees of a canteen for all intent and purport are employees of the principal employer40. In a case of this nature, where serious disputed questions fact were raised, in our opinion, it was not proper for the High Court for embark thereupon an exercise under Article 226 of the Constitution. The High Court in its judgment relied upon a large number of decisions of this Court, inter alia, in Reserve Bank of India (supra) and State Bank of India & Ors. v. State Bank of India Canteen Employees Union (Bengal Circle) and Ors. [AIR 2000 SC 1518 ] ignoring the fact that all such disputes were adjudicated in an industrial adjudication49. The question which now arises for consideration is as towhether the High Court was justified in directing regularization of the services of the. It was evidently not. In a large number of decisions, this Court has categorically held that it is not open to a High Court to exercise its discretion under Article 226 of the Constitution of India either to frame a scheme by itself or to direct the State to frame a scheme for regularising the services of ad hoc employees or daily wages employees who had not been appointed in terms of the extant service rules framed either under a statute or under the proviso to Article 309 of the Constitution of India. Such a scheme, even if framed by the State, would not meet the requirements of law as the executive order made under Article 162 of the Constitution of India cannot prevail over a statute or statutory rules framed under proviso to Article 309 thereof. The State is obligated to make appointments only in fulfilment of its constitutional obligation as laid down in Articles 14, 15 and 16 of the Constitution of India and not by way of any regularization scheme. In our constitutional schemes, all eligible persons similarly situated must be given opportunity to apply for and receive considerations for appointments at the hands of the authorities of the State. Denial of such a claim by some officers of the State times and again had been deprecated by this Court. In any view, in our democratic polity, an authority howsoever high it may be cannot act in breach of an existing statute or the rules which hold the field50. It is not necessary for us to dilate further on the issue as recently in State of U.P. v. Neeraj Awasthi and Ors. [2005 (10) SCALE 286 ], it has been clearly held that the High Court has no jurisdiction to frame a scheme by itself or direct framing of such a scheme by the State53. The contention that at least for the period they have worked they were entitled to the remuneration in the scale of pay as that of the government employees cannot be accepted for more than one reason. They did not hold any post. No post for the canteen was sanctioned by the State. According to the State, they were not its employees. Salary on a regular scale of pay, it is trite, is payable to an employee only when he holds a status. [See Mahendra L. Jain and Others (supra)]54. The High Court was, thus, not correct in holding that the members of the First Respondent could be treated at par with the Hospitality Organization of the State of Karnataka. Such equation is impermissible in law. In the Hospitality Organization of the State, the posts might have been sanctioned. Only because, food is prepared and served, the same would not mean that a canteen run by a Committee can be equated thereto55. Subsequent events which had taken place is also worth taking note of. The fact remains that the canteen now is closed. The judgment and order of the High Court, thus, otherwise also cannot be implemented. The employees concerned, therefore, cannot be directed to be reinstated in service. We have noticed, hereinbefore, that other proceedings have been initiated by them. The said proceedings may be disposed of in accordance with law.

### Instruction: Assess the case proceedings and provide a prediction: is the court likely to rule in favor of (1) or against (0) the appellant/petitioner? ### Input: Court vis-a-vis the Civil Court highlighted the object of the Industrial Disputes Act stating: "The object of the Industrial Disputes Act, as its preamble indicates, is to make provision for the investigation and settlement of industrial disputes, which means adjudication of such disputes also. The Act envisages collective bargaining, contracts between union representing the workmen and the management, a matter which is outside the realm of the common law or the Indian law of contract" 48. Keeping in view of the facts and circumstances of this case as also the principle of law enunciated in the above referred decisions of this Court, we are, thus, of the opinion that recourse to writ remedy was not apposite in this case. REGULARISATION 49. The question which now arises for consideration is as to whether the High Court was justified in directing regularization of the services of the Respondents. It was evidently not. In a large number of decisions, this Court has categorically held that it is not open to a High Court to exercise its discretion under Article 226 of the Constitution of India either to frame a scheme by itself or to direct the State to frame a scheme for regularising the services of ad hoc employees or daily wages employees who had not been appointed in terms of the extant service rules framed either under a statute or under the proviso to Article 309 of the Constitution of India. Such a scheme, even if framed by the State, would not meet the requirements of law as the executive order made under Article 162 of the Constitution of India cannot prevail over a statute or statutory rules framed under proviso to Article 309 thereof. The State is obligated to make appointments only in fulfilment of its constitutional obligation as laid down in Articles 14, 15 and 16 of the Constitution of India and not by way of any regularization scheme. In our constitutional schemes, all eligible persons similarly situated must be given opportunity to apply for and receive considerations for appointments at the hands of the authorities of the State. Denial of such a claim by some officers of the State times and again had been deprecated by this Court. In any view, in our democratic polity, an authority howsoever high it may be cannot act in breach of an existing statute or the rules which hold the field. 50. It is not necessary for us to dilate further on the issue as recently in State of U.P. v. Neeraj Awasthi and Ors. [2005 (10) SCALE 286 ], it has been clearly held that the High Court has no jurisdiction to frame a scheme by itself or direct framing of such a scheme by the State. 51. In Mahendra L. Jain and Others v. Indore Development Authority and Others [(2005) 1 SCC 639] , it was categorically held: "The question, therefore, which arises for consideration is as to whether they could lay a valid claim for regularisation of their services. The answer thereto must be rendered in the negative. Regularisation cannot be claimed as a matter of right. An illegal appointment cannot be legalised by taking recourse to regularisation. What can be regularised is an irregularity and not an illegality. The constitutional scheme which the country has adopted does not contemplate any back-door appointment. A State before offering public service to a person must comply with the constitutional requirements of Articles 14 and 16 of the Constitution. All actions of the State must conform to the constitutional requirements. A daily-wager in the absence of a statutory provision in this behalf would not be entitled to regularisation. (See State of U.P. v. Ajay Kumar and Jawaharlal Nehru Krishi Vishwa Vidyalaya v. Bal Kishan Soni.)" 52. In Zakir Hussain (supra), even in relation to the temporary employee, it was stated: "The respondent is a temporary employee of the Corporation and a probationer and not a government servant and, therefore, is not entitled for any protection under Article 311 of the Constitution. He was a party to the contract. In view of the fact that the respondent was appointed on probation and the services were terminated during the period of probation simpliciter as the same were not found to be satisfactory, the appellant Corporation is not obliged to hold an enquiry before terminating the services. The respondent being a probationer has got no substantive right to hold the post and was not entitled to a decree of declaration as erroneously granted by the lower courts and also of the High Court." PARITY IN THE SCALE OF PAY 53. The contention that at least for the period they have worked they were entitled to the remuneration in the scale of pay as that of the government employees cannot be accepted for more than one reason. They did not hold any post. No post for the canteen was sanctioned by the State. According to the State, they were not its employees. Salary on a regular scale of pay, it is trite, is payable to an employee only when he holds a status. [See Mahendra L. Jain and Others (supra)] 54. The High Court was, thus, not correct in holding that the members of the First Respondent could be treated at par with the Hospitality Organization of the State of Karnataka. Such equation is impermissible in law. In the Hospitality Organization of the State, the posts might have been sanctioned. Only because, food is prepared and served, the same would not mean that a canteen run by a Committee can be equated thereto. SUBSEQUENT EVENT 55. Subsequent events which had taken place is also worth taking note of. The fact remains that the canteen now is closed. The judgment and order of the High Court, thus, otherwise also cannot be implemented. The employees concerned, therefore, cannot be directed to be reinstated in service. We have noticed, hereinbefore, that other proceedings have been initiated by them. The said proceedings may be disposed of in accordance with law. CONCLUSION ### Response: 1

Indo Asahi Glass Company Limited and Another Vs. Income Tax Officer and Others

This appeal arises from the judgment of the Calcutta High Court which had dismissed the writ petition filed by the appellants wherein challenge was made to the show-cause notice dated May 16, 1996. The aforesaid show-cause notice was issued on the allegation that salary had been paid to four employees who were working with the appellants in India. These employees were Japanese and the salary in question had been paid by a Japanese-company in Japan. In addition thereto, the appellants had also paid salaries to these four employees but tax had been deducted at source. The show-cause notice stated that what was paid to these four employees in Yen currency was also taxable under section 9 of the Income-tax Act and tax should have been deducted at source. Instead of filing a reply to the show-cause notice, the appellants chose to file a writ petition. The single judge dismissed the writ petition on the ground that alternative remedy was available to the appellants. In appeal, the Division Bench took the same view. Hence, this appeal by special leave. It is contended by Dr. Pal, on behalf of the appellants, that during the pendency of this appeal, taking advantage of the Voluntary Disclosure Scheme, Asahi Glass Co. Ltd., Japan, had filed returns of income in respect of the four employees in question and had paid the entire amount of income-tax payable in respect of what was paid to these four employees in Yen currency. This and the other facts cannot be taken up for consideration by this court for the first time. In our opinion, the High Court was right in coming to the conclusion that it is appropriate for the appellants to file a reply to the show-cause notice and take whatever defence is open to them.

1[ds]This and the other facts cannot be taken up for consideration by this court for the first time. In our opinion, the High Court was right in coming to the conclusion that it is appropriate for the appellants to file a reply to thee notice and take whatever defence is open to them.

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: This appeal arises from the judgment of the Calcutta High Court which had dismissed the writ petition filed by the appellants wherein challenge was made to the show-cause notice dated May 16, 1996. The aforesaid show-cause notice was issued on the allegation that salary had been paid to four employees who were working with the appellants in India. These employees were Japanese and the salary in question had been paid by a Japanese-company in Japan. In addition thereto, the appellants had also paid salaries to these four employees but tax had been deducted at source. The show-cause notice stated that what was paid to these four employees in Yen currency was also taxable under section 9 of the Income-tax Act and tax should have been deducted at source. Instead of filing a reply to the show-cause notice, the appellants chose to file a writ petition. The single judge dismissed the writ petition on the ground that alternative remedy was available to the appellants. In appeal, the Division Bench took the same view. Hence, this appeal by special leave. It is contended by Dr. Pal, on behalf of the appellants, that during the pendency of this appeal, taking advantage of the Voluntary Disclosure Scheme, Asahi Glass Co. Ltd., Japan, had filed returns of income in respect of the four employees in question and had paid the entire amount of income-tax payable in respect of what was paid to these four employees in Yen currency. This and the other facts cannot be taken up for consideration by this court for the first time. In our opinion, the High Court was right in coming to the conclusion that it is appropriate for the appellants to file a reply to the show-cause notice and take whatever defence is open to them. ### Response: 1

Hill View Colony Vs. State Of Nagaland

Abhay Manohar Sapre, J.1. This appeal is filed against the final judgment and order dated 05.08.2011 passed by the High Court of Gauhati, Kohima Bench in Writ Appeal (c) No. 23(K) of 2010 whereby the Division Bench of the High Court dismissed the writ appeal filed by the appellants herein and affirmed the order dated 01.09.2010 of the Single Judge in W.P.(c) No.117(K) of 2010.2. We need not burden the order by setting out the facts in detail except to the extent necessary to appreciate the short controversy involved in the appeal.3. Respondent No.2 herein (Industrial Village Razhuphe, Dimapur) filed a writ petition against respondent Nos. 1, 3, 4 and 5 in the High Court of Gauhati (Kohima Bench) and sought the following reliefs therein:"(a) directing the Dimapur Municipal Council, Dimapur, to cancel and/or reject the census record collected by its staff from the Industrial Village Razhuphe, Dimapur and(b) direct the respondents, in particular the respondent No.3, not to accept the census record submitted by the Dimapur Municipal Council, in so far as it relates to the census record collected from the industrial village Razhuphe."4. The respondents to the writ petition (State of Nagaland and other agencies of the State) filed their counter affidavits and contested the writ petition on various grounds.5. The learned Single Judge of the High Court, by order dated 01.09.2010, in substance allowed the writ petition and issued a writ of certiorari and mandamus against the State and its agencies (respondents therein) in relation to the subject matter of the writ petition. The eventual direction issued by the writ Court reads as under:"In the facts situation, the Extra Assistant Commissioner (Gen.) Charge Officer of the Census, respondent No.3 herein is directed to cancel the Census records collected by the staff of the DMC, Dimapur with a further direction to conduct Census in the Petitioner village through official enumerators appointed by him.With the above directions, Writ Petition stands disposed of."6. Appellant Nos. 1 to 4 herein, who were not parties to the writ petition and they having come to know of the aforesaid order of the writ Court, felt aggrieved of the eventual writs issued by the writ Court sought leave to file appeal before the Division Bench and challenged the legality and the correctness of the order of the writ Court. The leave was granted and accordingly the appellants filed writ appeal.7. The Division Bench, by impugned order, dismissed the appeal and affirmed the order of the learned Single Judge giving rise to filing of this appeal by way of special leave by the appellants before this Court.8. Heard Dr. Rajeev Dhavan, learned senior counsel for the appellants and Ms. Vibha Datta Makhija and Mr. Vikramjit Banerjee, learned senior counsel for the respondents.9. Having heard learned senior counsel for the parties at length and having perused the record of the case as also the written submissions filed by the learned counsel as directed, we are inclined to allow the appeal in part and while setting aside of the impugned order as also of the order passed by the learned Single Judge restore the writ petition, out of which this appeal arises, to its file and request the writ Court to decide the writ petition afresh on merits in accordance with law.10. In substance, the issue involved in the writ petition and carried to this Court in the appeal arises out of Census Act as also certain State laws applicable to the State of Nagaland. The challenge inter alia therein is to orders issued by the State Authorities in relation to census.11. In our considered opinion, the need to remand the case to the writ Court has occasioned due to the following reasons as detailed herein:12. First, since the appellants herein were not parties to the original writ petition but became parties in appeal for the first time, the writ Court decided the writ petition without taking into consideration the stand of the appellants.13. Second, once the Appellate Court granted leave to the appellants to file appeal thereby recognizing their locus in the subject matter of the writ petition then, in our view, instead of deciding the issues in its appellate jurisdiction, the Appellate Court should have remanded the case to the writ Court for deciding the writ petition afresh after granting an opportunity to the appellants to file their counter affidavits in answer to the writ petition. It was, however, not done.14. Third, having regard to the nature of the controversy and various issues raised therein by all the parties concerned and also keeping in view the subsequent events which have come into existence during the pendency of this appeal, we are of the opinion that it would be in the interest of all the parties concerned that the writ Court (Single Judge) should decide the writ petition afresh.

1[ds]9. Having heard learned senior counsel for the parties at length and having perused the record of the case as also the written submissions filed by the learned counsel as directed, we are inclined to allow the appeal in part and while setting aside of the impugned order as also of the order passed by the learned Single Judge restore the writ petition, out of which this appeal arises, to its file and request the writ Court to decide the writ petition afresh on merits in accordance with law.10. In substance, the issue involved in the writ petition and carried to this Court in the appeal arises out of Census Act as also certain State laws applicable to the State of Nagaland. The challenge inter alia therein is to orders issued by the State Authorities in relation to census.11. In our considered opinion, the need to remand the case to the writ Court has occasioned due to the following reasons as detailed herein:12. First, since the appellants herein were not parties to the original writ petition but became parties in appeal for the first time, the writ Court decided the writ petition without taking into consideration the stand of the appellants.13. Second, once the Appellate Court granted leave to the appellants to file appeal thereby recognizing their locus in the subject matter of the writ petition then, in our view, instead of deciding the issues in its appellate jurisdiction, the Appellate Court should have remanded the case to the writ Court for deciding the writ petition afresh after granting an opportunity to the appellants to file their counter affidavits in answer to the writ petition. It was, however, not done.14. Third, having regard to the nature of the controversy and various issues raised therein by all the parties concerned and also keeping in view the subsequent events which have come into existence during the pendency of this appeal, we are of the opinion that it would be in the interest of all the parties concerned that the writ Court (Single Judge) should decide the writ petition afresh.We, however, make it clear that we have refrained from recording any finding on all the issues argued by the parties before this Court in support of their respective stand which, inter alia, included that the writ petition is now rendered infructuous in the light of certain subsequent events. It is now for the writ Court to decide all such issues. The writ Court would, therefore, decide the writ petition uninfluenced by any of our observations.

### Instruction: Examine the details of the case proceeding and forecast if the appeal/petition stands a chance of being upheld (1) or dismissed (0). ### Input: Abhay Manohar Sapre, J.1. This appeal is filed against the final judgment and order dated 05.08.2011 passed by the High Court of Gauhati, Kohima Bench in Writ Appeal (c) No. 23(K) of 2010 whereby the Division Bench of the High Court dismissed the writ appeal filed by the appellants herein and affirmed the order dated 01.09.2010 of the Single Judge in W.P.(c) No.117(K) of 2010.2. We need not burden the order by setting out the facts in detail except to the extent necessary to appreciate the short controversy involved in the appeal.3. Respondent No.2 herein (Industrial Village Razhuphe, Dimapur) filed a writ petition against respondent Nos. 1, 3, 4 and 5 in the High Court of Gauhati (Kohima Bench) and sought the following reliefs therein:"(a) directing the Dimapur Municipal Council, Dimapur, to cancel and/or reject the census record collected by its staff from the Industrial Village Razhuphe, Dimapur and(b) direct the respondents, in particular the respondent No.3, not to accept the census record submitted by the Dimapur Municipal Council, in so far as it relates to the census record collected from the industrial village Razhuphe."4. The respondents to the writ petition (State of Nagaland and other agencies of the State) filed their counter affidavits and contested the writ petition on various grounds.5. The learned Single Judge of the High Court, by order dated 01.09.2010, in substance allowed the writ petition and issued a writ of certiorari and mandamus against the State and its agencies (respondents therein) in relation to the subject matter of the writ petition. The eventual direction issued by the writ Court reads as under:"In the facts situation, the Extra Assistant Commissioner (Gen.) Charge Officer of the Census, respondent No.3 herein is directed to cancel the Census records collected by the staff of the DMC, Dimapur with a further direction to conduct Census in the Petitioner village through official enumerators appointed by him.With the above directions, Writ Petition stands disposed of."6. Appellant Nos. 1 to 4 herein, who were not parties to the writ petition and they having come to know of the aforesaid order of the writ Court, felt aggrieved of the eventual writs issued by the writ Court sought leave to file appeal before the Division Bench and challenged the legality and the correctness of the order of the writ Court. The leave was granted and accordingly the appellants filed writ appeal.7. The Division Bench, by impugned order, dismissed the appeal and affirmed the order of the learned Single Judge giving rise to filing of this appeal by way of special leave by the appellants before this Court.8. Heard Dr. Rajeev Dhavan, learned senior counsel for the appellants and Ms. Vibha Datta Makhija and Mr. Vikramjit Banerjee, learned senior counsel for the respondents.9. Having heard learned senior counsel for the parties at length and having perused the record of the case as also the written submissions filed by the learned counsel as directed, we are inclined to allow the appeal in part and while setting aside of the impugned order as also of the order passed by the learned Single Judge restore the writ petition, out of which this appeal arises, to its file and request the writ Court to decide the writ petition afresh on merits in accordance with law.10. In substance, the issue involved in the writ petition and carried to this Court in the appeal arises out of Census Act as also certain State laws applicable to the State of Nagaland. The challenge inter alia therein is to orders issued by the State Authorities in relation to census.11. In our considered opinion, the need to remand the case to the writ Court has occasioned due to the following reasons as detailed herein:12. First, since the appellants herein were not parties to the original writ petition but became parties in appeal for the first time, the writ Court decided the writ petition without taking into consideration the stand of the appellants.13. Second, once the Appellate Court granted leave to the appellants to file appeal thereby recognizing their locus in the subject matter of the writ petition then, in our view, instead of deciding the issues in its appellate jurisdiction, the Appellate Court should have remanded the case to the writ Court for deciding the writ petition afresh after granting an opportunity to the appellants to file their counter affidavits in answer to the writ petition. It was, however, not done.14. Third, having regard to the nature of the controversy and various issues raised therein by all the parties concerned and also keeping in view the subsequent events which have come into existence during the pendency of this appeal, we are of the opinion that it would be in the interest of all the parties concerned that the writ Court (Single Judge) should decide the writ petition afresh. ### Response: 1

M/S. National Insurance Co. Ltd Vs. Baljit Kaur

remedy; and then the office of all the judges is always to make such construction as shall: (a) suppress the mischief and advance the remedy; and (b) suppress subtle inventions and evasions for the continuance of the mischief pro privato commodo (for private benefit); and (c) add force and life to the cure and remedy according to the true intent of the makes of the Act pro publico (for the public good). 16. Heydons Rule has been applied by this Court in a large number of cases in order to suppress the mischief which was intended to be remedied as against the literal rule which could have otherwise covered the field. (See for example, Smt. PEK Kalliani Amma and others vs. K. Devi and others, (AIR 1996 SC 1963 : Bengal Immunity Co. Ltd. vs. State of Bihar and Others, AIR 1955 SC 661 ; and Goodyear India Ltd. vs. State of Haryana and Another, AIR 1990 SC 781 ). 17. By reason of the 1994 Amendment what was added as including the owner of the goods or his authorised representative carried in the vehicle. The liability of the owner of the vehicle to insure it compulsorily, thus, by reason of the aforementioned amendment included only the owner of the goods or his authorised representative carried in the vehicle besides of the third parties. The intention of the Parliament, therefore, could not have been that the words any person occurring in Section 147 would cover all persons who were travelling in a goods carriage in any capacity whatsoever. If such was the intention there was no necessity of the Parliament to carry out an amendment inasmuch as expression any person contained in sub-clause (i) of clause (b) of sub-section (1) of Section 147 would have included the owner of the goods or his authorised representative besides the passengers who are gratuitous or otherwise. 18. The observations made in this connection by the Court in Asha Rani case (supra) to which one of us, Sinha, J, was a party, however, bear repetition: 26. In view of the changes in the relevant provisions in the 1988 Act vis-a-vis the 1939 Act, we are of the opinion that the meaning of the words any person must also be attributed having regard to the context in which they have been used i.e. a third party. Keeping in view the provisions of the 1988 Act, we are of the opinion that as the provisions thereof do not enjoin any statutory liability on the owner of a vehicle to get his vehicle insured for any passenger travelling in a goods vehicle, the insurers would not be liable therefor. 19. In Asha Rani (supra), it has been noticed that sub-clause (i) of clause (b) of sub-section (1) of Section 147 of the 1988 Act speaks of liability which may be incurred by the owner of a vehicle in respect of death of or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place. Furthermore, an owner of a passenger-carrying vehicle must pay premium for covering the risk of the passengers travelling in the vehicle. The premium in view of the 1994 Amendment would only cover a third party as also the owner of the goods or his authorised representative and not any passenger carried in a goods vehicle whether for hire or reward or otherwise. 20. It is therefore, manifest that in spite of the amendment of 1994, the effect of the provision contained in Section 147 with respect to persons other than the owner of the goods or his authorized representative remains the same. Although the owner of the goods or his authorized representative would now be covered by the policy of insurance in respect of a goods vehicle, it was not the intention of the legislature to provide for the liability of the insurer with respect to passengers, especially gratuitous passengers, who were neither contemplated at the time the contract of insurance was entered into, nor any premium was paid to the extent of the benefit of insurance to such category of people. 21. The upshot of the aforementioned discussions is that instead and in place of the insurer the owner of the vehicle shall be liable to satisfy the decree. The question, however, would be as to whether keeping in view the fact that the law was not clear so long such a direction would be fair and equitable. We do not think so. We, therefore, clarify the legal position which shall have prospective effect. The Tribunal as also the High Court had proceeded in terms of the decisions of this Court in Satpal Sing (supra). The said decision has been overruled only in Asha Rani (supra). We, therefore, are of the opinion that the interest of justice will be sub-served if the appellant herein is directed to satisfy the awarded amount in favour of the claimant if not already satisfied and recover the same from the owner of the vehicle. For the purpose of such recovery, it would not be necessary for the insurer to file a separate suit but it may initiate a proceeding before the executing court as if the dispute between the insurer and the owner was the subject matter of determination before the tribunal and the issue is decided against the owner and in favour of the insurer. We have issued the aforementioned directions having regard to the scope and purport of Section 168 of the Motor Vehicles Act, 1988 in terms whereof it is not only entitled to determine the amount of claim as put forth by the claimant for recovery thereof from the insurer, owner or driver of the vehicle jointly or severally but also the dispute between the insurer on the one hand and the owner or driver of the vehicle involved in the accident inasmuch as can be resolved by the tribunal in such a proceeding.

1[ds]11. Admittedly, it is incumbent upon a Court of law to eschew that interpretation of a statute that would serve to negate its true import, or to render the words of any provision as superfluous. Nonetheless, we find no merit in the above submissions proffered by the learned counsel for the respondent. The effect of the 1994 amendment on Section 147 is unambiguous. Where earlier, the words any person could be held not to include the owner of the goods or his authorized representative travelling in the goods vehicle, Parliament has now made it clear that such a construction is no longer possible. The scope of this rationale does not, however, extend to cover the class of cases where gratuitous passengers for whom no insurance policy was envisaged, and for whom no insurance premium was paid, employ the goods vehicle as a medium of conveyance12. We find ourselves unable, furthermore, to countenance the contention of the respondents that the words any person as used in Section 147 of the Motor Vehicles Act, would be rendered otiose by an interpretation that removed gratuitous passengers from the ambit of the same. It was observed by this Court in the case concerning New India Assurance Co. Ltd. vs. Asha Rani (supra) that the true purport of the words any person is to be found in the liability of the insurer for third party risk, which was sought to be provided for by the enactment13. It is pertinent to note that a statutory liability enjoined upon an owner of the vehicle to compulsorily insure it so as to cover the liability in respect of a person who was travelling in a vehicle pursuant to a contract of employment in terms of proviso (ii) appended to Section 95 of the 1939 Act does no occur in Section 147 of the 1988 Act. The changes effected in the 1988 Act vis-a-vis the 1939 Act as regard definitions of goods vehicle, public service vehicle and stage carriage have also a bearing on the subject inasmuch as the concept of any goods carriage carrying any passenger or any other person was not contemplated14. In a situation of this nature, the doctrine of suppression of mischief rule as adumbrated in Heydons case (3 Co Rep 7a, 76 ER 637) shall apply. Such an amendment was made by the Parliament consciously. Having regard to the definition of goods carriage vis-a-vis public service vehicle, it is clear that whereas the goods carriage carrying any passenger is not contemplated under the 1988 Act as the same must be used solely for carrying the goods17. By reason of the 1994 Amendment what was added as including the owner of the goods or his authorised representative carried in the vehicle. The liability of the owner of the vehicle to insure it compulsorily, thus, by reason of the aforementioned amendment included only the owner of the goods or his authorised representative carried in the vehicle besides of the third parties. The intention of the Parliament, therefore, could not have been that the words any person occurring in Section 147 would cover all persons who were travelling in a goods carriage in any capacity whatsoever. If such was the intention there was no necessity of the Parliament to carry out an amendment inasmuch as expression any person contained in sub-clause (i) of clause (b) of sub-section (1) of Section 147 would have included the owner of the goods or his authorised representative besides the passengers who are gratuitous or otherwise19. In Asha Rani (supra), it has been noticed that sub-clause (i) of clause (b) of sub-section (1) of Section 147 of the 1988 Act speaks of liability which may be incurred by the owner of a vehicle in respect of death of or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place. Furthermore, an owner of a passenger-carrying vehicle must pay premium for covering the risk of the passengers travelling in the vehicle. The premium in view of the 1994 Amendment would only cover a third party as also the owner of the goods or his authorised representative and not any passenger carried in a goods vehicle whether for hire or reward or otherwise20. It is therefore, manifest that in spite of the amendment of 1994, the effect of the provision contained in Section 147 with respect to persons other than the owner of the goods or his authorized representative remains the same. Although the owner of the goods or his authorized representative would now be covered by the policy of insurance in respect of a goods vehicle, it was not the intention of the legislature to provide for the liability of the insurer with respect to passengers, especially gratuitous passengers, who were neither contemplated at the time the contract of insurance was entered into, nor any premium was paid to the extent of the benefit of insurance to such category of people21. The upshot of the aforementioned discussions is that instead and in place of the insurer the owner of the vehicle shall be liable to satisfy the decree. The question, however, would be as to whether keeping in view the fact that the law was not clear so long such a direction would be fair and equitable. We do not think so. We, therefore, clarify the legal position which shall have prospective effect. The Tribunal as also the High Court had proceeded in terms of the decisions of this Court in Satpal Sing (supra). The said decision has been overruled only in Asha Rani (supra). We, therefore, are of the opinion that the interest of justice will be sub-served if the appellant herein is directed to satisfy the awarded amount in favour of the claimant if not already satisfied and recover the same from the owner of the vehicle. For the purpose of such recovery, it would not be necessary for the insurer to file a separate suit but it may initiate a proceeding before the executing court as if the dispute between the insurer and the owner was the subject matter of determination before the tribunal and the issue is decided against the owner and in favour of the insurer. We have issued the aforementioned directions having regard to the scope and purport of Section 168 of the Motor Vehicles Act, 1988 in terms whereof it is not only entitled to determine the amount of claim as put forth by the claimant for recovery thereof from the insurer, owner or driver of the vehicle jointly or severally but also the dispute between the insurer on the one hand and the owner or driver of the vehicle involved in the accident inasmuch as can be resolved by the tribunal in such a proceeding.

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: remedy; and then the office of all the judges is always to make such construction as shall: (a) suppress the mischief and advance the remedy; and (b) suppress subtle inventions and evasions for the continuance of the mischief pro privato commodo (for private benefit); and (c) add force and life to the cure and remedy according to the true intent of the makes of the Act pro publico (for the public good). 16. Heydons Rule has been applied by this Court in a large number of cases in order to suppress the mischief which was intended to be remedied as against the literal rule which could have otherwise covered the field. (See for example, Smt. PEK Kalliani Amma and others vs. K. Devi and others, (AIR 1996 SC 1963 : Bengal Immunity Co. Ltd. vs. State of Bihar and Others, AIR 1955 SC 661 ; and Goodyear India Ltd. vs. State of Haryana and Another, AIR 1990 SC 781 ). 17. By reason of the 1994 Amendment what was added as including the owner of the goods or his authorised representative carried in the vehicle. The liability of the owner of the vehicle to insure it compulsorily, thus, by reason of the aforementioned amendment included only the owner of the goods or his authorised representative carried in the vehicle besides of the third parties. The intention of the Parliament, therefore, could not have been that the words any person occurring in Section 147 would cover all persons who were travelling in a goods carriage in any capacity whatsoever. If such was the intention there was no necessity of the Parliament to carry out an amendment inasmuch as expression any person contained in sub-clause (i) of clause (b) of sub-section (1) of Section 147 would have included the owner of the goods or his authorised representative besides the passengers who are gratuitous or otherwise. 18. The observations made in this connection by the Court in Asha Rani case (supra) to which one of us, Sinha, J, was a party, however, bear repetition: 26. In view of the changes in the relevant provisions in the 1988 Act vis-a-vis the 1939 Act, we are of the opinion that the meaning of the words any person must also be attributed having regard to the context in which they have been used i.e. a third party. Keeping in view the provisions of the 1988 Act, we are of the opinion that as the provisions thereof do not enjoin any statutory liability on the owner of a vehicle to get his vehicle insured for any passenger travelling in a goods vehicle, the insurers would not be liable therefor. 19. In Asha Rani (supra), it has been noticed that sub-clause (i) of clause (b) of sub-section (1) of Section 147 of the 1988 Act speaks of liability which may be incurred by the owner of a vehicle in respect of death of or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place. Furthermore, an owner of a passenger-carrying vehicle must pay premium for covering the risk of the passengers travelling in the vehicle. The premium in view of the 1994 Amendment would only cover a third party as also the owner of the goods or his authorised representative and not any passenger carried in a goods vehicle whether for hire or reward or otherwise. 20. It is therefore, manifest that in spite of the amendment of 1994, the effect of the provision contained in Section 147 with respect to persons other than the owner of the goods or his authorized representative remains the same. Although the owner of the goods or his authorized representative would now be covered by the policy of insurance in respect of a goods vehicle, it was not the intention of the legislature to provide for the liability of the insurer with respect to passengers, especially gratuitous passengers, who were neither contemplated at the time the contract of insurance was entered into, nor any premium was paid to the extent of the benefit of insurance to such category of people. 21. The upshot of the aforementioned discussions is that instead and in place of the insurer the owner of the vehicle shall be liable to satisfy the decree. The question, however, would be as to whether keeping in view the fact that the law was not clear so long such a direction would be fair and equitable. We do not think so. We, therefore, clarify the legal position which shall have prospective effect. The Tribunal as also the High Court had proceeded in terms of the decisions of this Court in Satpal Sing (supra). The said decision has been overruled only in Asha Rani (supra). We, therefore, are of the opinion that the interest of justice will be sub-served if the appellant herein is directed to satisfy the awarded amount in favour of the claimant if not already satisfied and recover the same from the owner of the vehicle. For the purpose of such recovery, it would not be necessary for the insurer to file a separate suit but it may initiate a proceeding before the executing court as if the dispute between the insurer and the owner was the subject matter of determination before the tribunal and the issue is decided against the owner and in favour of the insurer. We have issued the aforementioned directions having regard to the scope and purport of Section 168 of the Motor Vehicles Act, 1988 in terms whereof it is not only entitled to determine the amount of claim as put forth by the claimant for recovery thereof from the insurer, owner or driver of the vehicle jointly or severally but also the dispute between the insurer on the one hand and the owner or driver of the vehicle involved in the accident inasmuch as can be resolved by the tribunal in such a proceeding. ### Response: 1

K.KISHAN Vs. M/S VIJAY NIRMAN COMPANY PVT. LTD. REP. BY ITS MANAGING DIRECTOR

that the alternative contended for by the petitioner.? 15. A recent judgment of the Singapore High Court, contained in Lim PohYeoh (alias Lim Aster) and TS Ong Construction Pte Ltd. [2016] SGHC 179, was also referred to by Mr. Banerji. Again, in a situation which demands a far higher threshold that has to be crossed before the Insolvency Law can be said not to apply, the Singapore High Court referred to Rule 98(2)(a) of the Rules made under the Bankruptcy Act. The said Rule states that where a debtor appears to have a valid counter claim or cross-demand which is equivalent to or exceeds the amount of debt, the insolvency process will not be put against such debtor. It also referred to the Supreme Court Practice Directions to the same effect. (see paras 43 & 45 of the said judgment) 16. We now come to some of the judgments referred to by learned counsel for the respondent. It is important to note that both the Practice Directions referred to in the U.K. judgment and the Singapore High Court judgment, referred to in LKM Investment Holdings Pte Ltd. vs. Cathay Theatres Pte Ltd. [2000] SGHC 13, are in situations where the debt needs to be bona fide disputed, which is not the situation under our Code. For this reason, it is not possible to agree with learned counsel for the Respondent that a pending proceeding challenging an award or decree of a tribunal or Court would not make the debt contained therein a debt that is disputed. 17.The Australian High Court judgment also relied upon by the respondent in Ramsay Health Care Australia Pty Ltd vs. Adrian John Compton [2017] HCA 28 was relied upon to show, in para 111 thereof, that where a judgment debt has been obtained after testing of the merits in adversarial litigation, then in the absence of some evidence of fraud, collusion, or miscarriage of justice, a court exercising bankruptcy jurisdiction will rarely have substantial reasons to investigate whether the debt which emerged in the judgment was truly owed. With respect to the High Court of Australia, we may only state that following Mobilox Innovations (supra), it would be very difficult to incorporate the Australian law into our law. This is for the reason that our judgment in Mobilox Innovations (supra) has made it clear that the insolvency process, particularly in relation to operational creditors, cannot be used to bypass the adjudicatory and enforcement process of a debt contained in other statutes. We are, therefore, of the view that the higher threshold of fraud, collusion, or miscarriage of justice laid down by the Australian High Court will have no application to the situation under our Code. 18. We repeat with emphasis that under our Code, insofar as an operational debt is concerned, all that has to be seen is whether the said debt can be said to be disputed, and we have no doubt in stating that the filing of a Section 34 petition against an Arbitral Award shows that a pre-existing dispute which culminates at the first stage of the proceedings in an Award, continues even after the Award, at least till the final adjudicatory process under Sections 34 & 37 has taken place. 19. We may hasten to add that there may be cases where a Section 34 petition challenging an Arbitral Award may clearly and unequivocally be barred by limitation, in that it can be demonstrated to the Court that the period of 90 days plus the discretionary period of 30 days has clearly expired, after which either no petition under Section 34 has been filed or a belated petition under Section 34 has been filed. It is only in such clear cases that the insolvency process may then be put into operation. 20. We may hasten to add that there may also be other cases where a Section 34 petition may have been instituted in the wrong court, as a result of which the petitioner may claim the application of Section 14 of the Limitation Act to get over the bar of limitation laid down in Section 34(3) of the Arbitration Act. In such cases also, it is obvious that the insolvency process cannot be put into operation without an adjudication on the applicability of Section 14 of the Limitation Act. 21. With regard to the submission of learned counsel for the respondent, that the amount of Rs.1.71 Crores stood admitted by Mr. Banerji?s client, as was recorded in the Arbitral Award, suffice it to say that cross-claims of sums much above this amount has been turned down by the Arbitral Tribunal, which are pending in a Section 34 petition challenging the said Award. The very fact that there is a possibility that Mr. Banerji?s client may succeed on these cross-claims is sufficient to state that the operational debt, in the present case, cannot be said to be an undisputed debt. 22. We also accept Mr. Banerji?s submission that the Appellate Tribunal was in error in referring to Section 238 of the Code. Section 238 of the Code would apply in case there is an inconsistency between the Code and the Arbitration Act in the present case. We see no such inconsistency. On the contrary, the Award passed under the Arbitration Act together with the steps taken for its challenge would only make it clear that the operational debt, in the present case, happens to be a disputed one. 23. We are also of the view that the Appellate Tribunal, when it relied upon Form V Part 5 of the 2016 Rules to state that the operational debt would, therefore, be said to have been proved, missed the vital sub-clause (iii) in para 34 of Mobilox Innovations (supra). Even if it be clear that there be a record of an operational debt, it is important that the said debt be not disputed. If disputed within the parameters laid down in Mobilox Innovations (supra), an insolvency petition cannot be proceeded with further. 24.

1[ds]However, learned counsel appearing on behalf of the Respondent strongly relied on the fact that this is not an ordinary case inasmuch as the amount of Rs.1.71 Crores which was awarded was admitted by Mr. Banerji?s client in the arbitral proceedings to be a debt due, and that this being so, there can be no dispute regarding the same. We are afraid that we are unable to agree. As was correctly pointed out by Mr. Banerji, counter claims for amounts far exceeding this were rejected by the learned Arbitral Tribunal, which rejection is also the subjectmatter of challenge in a petition under Section 34 of the Act. It is important to note that unlike counter claim Nos. 1 and 2, which were rejected by the Arbitral Tribunal for lack of evidence, counter claim No.3 which amounts to Rs.19,88,20,475/was rejected on the basis of a price adjustment clause on merits. Therefore, it is difficult to say at this stage of the proceedings, that no dispute would exist between theIn para 38, this Court cautioned: We have also seen that one of the objects of the Code qua operational debts is to ensure that the amount of such debts, which is usually smaller than that of financial debts, does not enable operational creditors to put the corporate debtor into the insolvency resolution process prematurely or initiate the process for extraneous considerations. It is for this reason that it is enough that a dispute exists between the parties. Finally, the law was summed up as follows:51. It is clear, therefore, that once the operational creditor has filed an application, which is otherwise complete, the adjudicating authority must reject the application under Section 9 (5)(2)(d) if notice of dispute has been received by the operational creditor or there is a record of dispute in the information utility. It is clear that such notice must bring to the notice of the operational creditor the ?existence? of a dispute or the fact that a suit or arbitration proceeding relating to a dispute is pending between the parties. Therefore, all that the adjudicating authority is to see at this stage is whether there is a plausible contention which requires further investigation and that the ?dispute? is not a patently feeble legal argument or an assertion of fact unsupported by evidence. It is important to separate the grain from the chaff and to reject a spurious defence which is mere bluster. However, in doing so, the Court does not need to be satisfied that the defence is likely to succeed. The Court does not at this stage examine the merits of the dispute except to the extent indicated above. So long as a dispute truly exists in fact and is not spurious, hypothetical or illusory, the adjudicating authority has to reject theFollowing this judgment, it becomes clear that operational creditors cannot use the Insolvency Code either prematurely or for extraneous considerations or as a substitute for debt enforcement procedures. The alarming result of an operational debt contained in an arbitral award for a small amount of say, two lakhs of rupees, cannot possibly jeopardize an otherwise solvent company worth several crores of rupees. Such a company would be well within its rights to state that it is challenging the Arbitral Award passed against it, and the mere factum of challenge would be sufficient to state that it disputes the Award. Such a case would clearly come within para 38 of Mobilox Innovations (supra), being a case of aongoing dispute between the parties. The Code cannot be used in terrorem to extract this sum of money of Rs. two lakhs even though it may not be finally payable as adjudication proceedings in respect thereto are still pending. We repeat that the object of the Code, at least insofar as operational creditors are concerned, is to put the insolvency process against a corporate debtor only in clear cases where a real dispute between the parties as to the debt owed does note Australian High Court judgment also relied upon by the respondent in Ramsay Health Care Australia Pty Ltd vs. Adrian John Compton [2017] HCA 28 was relied upon to show, in para 111 thereof, that where a judgment debt has been obtained after testing of the merits in adversarial litigation, then in the absence of some evidence of fraud, collusion, or miscarriage of justice, a court exercising bankruptcy jurisdiction will rarely have substantial reasons to investigate whether the debt which emerged in the judgment was truly owed. With respect to the High Court of Australia, we may only state that following Mobilox Innovations (supra), it would be very difficult to incorporate the Australian law into our law. This is for the reason that our judgment in Mobilox Innovations (supra) has made it clear that the insolvency process, particularly in relation to operational creditors, cannot be used to bypass the adjudicatory and enforcement process of a debt contained in other statutes. We are, therefore, of the view that the higher threshold of fraud, collusion, or miscarriage of justice laid down by the Australian High Court will have no application to the situation under ourWe repeat with emphasis that under our Code, insofar as an operational debt is concerned, all that has to be seen is whether the said debt can be said to be disputed, and we have no doubt in stating that the filing of a Section 34 petition against an Arbitral Award shows that adispute which culminates at the first stage of the proceedings in an Award, continues even after the Award, at least till the final adjudicatory process under Sections 34 & 37 has takenWe may hasten to add that there may be cases where a Section 34 petition challenging an Arbitral Award may clearly and unequivocally be barred by limitation, in that it can be demonstrated to the Court that the period of 90 days plus the discretionary period of 30 days has clearly expired, after which either no petition under Section 34 has been filed or a belated petition under Section 34 has been filed. It is only in such clear cases that the insolvency process may then be put intoWe may hasten to add that there may also be other cases where a Section 34 petition may have been instituted in the wrong court, as a result of which the petitioner may claim the application of Section 14 of the Limitation Act to get over the bar of limitation laid down in Section 34(3) of the Arbitration Act. In such cases also, it is obvious that the insolvency process cannot be put into operation without an adjudication on the applicability of Section 14 of the LimitationWith regard to the submission of learned counsel for the respondent, that the amount of Rs.1.71 Crores stood admitted by Mr. Banerji?s client, as was recorded in the Arbitral Award, suffice it to say thatof sums much above this amount has been turned down by the Arbitral Tribunal, which are pending in a Section 34 petition challenging the said Award. The very fact that there is a possibility that Mr. Banerji?s client may succeed on theseis sufficient to state that the operational debt, in the present case, cannot be said to be an undisputedWe also accept Mr. Banerji?s submission that the Appellate Tribunal was in error in referring to Section 238 of the Code. Section 238 of the Code would apply in case there is an inconsistency between the Code and the Arbitration Act in the present case. We see no such inconsistency. On the contrary, the Award passed under the Arbitration Act together with the steps taken for its challenge would only make it clear that the operational debt, in the present case, happens to be a disputedWe are also of the view that the Appellate Tribunal, when it relied upon Form V Part 5 of the 2016 Rules to state that the operational debt would, therefore, be said to have been proved, missed the vital(iii) in para 34 of Mobilox Innovations (supra). Even if it be clear that there be a record of an operational debt, it is important that the said debt be not disputed. If disputed within the parameters laid down in Mobilox Innovations (supra), an insolvency petition cannot be proceeded with further.

### Instruction: Analyze the case proceeding and predict whether the appeal/petition will be accepted (1) or rejected (0). ### Input: that the alternative contended for by the petitioner.? 15. A recent judgment of the Singapore High Court, contained in Lim PohYeoh (alias Lim Aster) and TS Ong Construction Pte Ltd. [2016] SGHC 179, was also referred to by Mr. Banerji. Again, in a situation which demands a far higher threshold that has to be crossed before the Insolvency Law can be said not to apply, the Singapore High Court referred to Rule 98(2)(a) of the Rules made under the Bankruptcy Act. The said Rule states that where a debtor appears to have a valid counter claim or cross-demand which is equivalent to or exceeds the amount of debt, the insolvency process will not be put against such debtor. It also referred to the Supreme Court Practice Directions to the same effect. (see paras 43 & 45 of the said judgment) 16. We now come to some of the judgments referred to by learned counsel for the respondent. It is important to note that both the Practice Directions referred to in the U.K. judgment and the Singapore High Court judgment, referred to in LKM Investment Holdings Pte Ltd. vs. Cathay Theatres Pte Ltd. [2000] SGHC 13, are in situations where the debt needs to be bona fide disputed, which is not the situation under our Code. For this reason, it is not possible to agree with learned counsel for the Respondent that a pending proceeding challenging an award or decree of a tribunal or Court would not make the debt contained therein a debt that is disputed. 17.The Australian High Court judgment also relied upon by the respondent in Ramsay Health Care Australia Pty Ltd vs. Adrian John Compton [2017] HCA 28 was relied upon to show, in para 111 thereof, that where a judgment debt has been obtained after testing of the merits in adversarial litigation, then in the absence of some evidence of fraud, collusion, or miscarriage of justice, a court exercising bankruptcy jurisdiction will rarely have substantial reasons to investigate whether the debt which emerged in the judgment was truly owed. With respect to the High Court of Australia, we may only state that following Mobilox Innovations (supra), it would be very difficult to incorporate the Australian law into our law. This is for the reason that our judgment in Mobilox Innovations (supra) has made it clear that the insolvency process, particularly in relation to operational creditors, cannot be used to bypass the adjudicatory and enforcement process of a debt contained in other statutes. We are, therefore, of the view that the higher threshold of fraud, collusion, or miscarriage of justice laid down by the Australian High Court will have no application to the situation under our Code. 18. We repeat with emphasis that under our Code, insofar as an operational debt is concerned, all that has to be seen is whether the said debt can be said to be disputed, and we have no doubt in stating that the filing of a Section 34 petition against an Arbitral Award shows that a pre-existing dispute which culminates at the first stage of the proceedings in an Award, continues even after the Award, at least till the final adjudicatory process under Sections 34 & 37 has taken place. 19. We may hasten to add that there may be cases where a Section 34 petition challenging an Arbitral Award may clearly and unequivocally be barred by limitation, in that it can be demonstrated to the Court that the period of 90 days plus the discretionary period of 30 days has clearly expired, after which either no petition under Section 34 has been filed or a belated petition under Section 34 has been filed. It is only in such clear cases that the insolvency process may then be put into operation. 20. We may hasten to add that there may also be other cases where a Section 34 petition may have been instituted in the wrong court, as a result of which the petitioner may claim the application of Section 14 of the Limitation Act to get over the bar of limitation laid down in Section 34(3) of the Arbitration Act. In such cases also, it is obvious that the insolvency process cannot be put into operation without an adjudication on the applicability of Section 14 of the Limitation Act. 21. With regard to the submission of learned counsel for the respondent, that the amount of Rs.1.71 Crores stood admitted by Mr. Banerji?s client, as was recorded in the Arbitral Award, suffice it to say that cross-claims of sums much above this amount has been turned down by the Arbitral Tribunal, which are pending in a Section 34 petition challenging the said Award. The very fact that there is a possibility that Mr. Banerji?s client may succeed on these cross-claims is sufficient to state that the operational debt, in the present case, cannot be said to be an undisputed debt. 22. We also accept Mr. Banerji?s submission that the Appellate Tribunal was in error in referring to Section 238 of the Code. Section 238 of the Code would apply in case there is an inconsistency between the Code and the Arbitration Act in the present case. We see no such inconsistency. On the contrary, the Award passed under the Arbitration Act together with the steps taken for its challenge would only make it clear that the operational debt, in the present case, happens to be a disputed one. 23. We are also of the view that the Appellate Tribunal, when it relied upon Form V Part 5 of the 2016 Rules to state that the operational debt would, therefore, be said to have been proved, missed the vital sub-clause (iii) in para 34 of Mobilox Innovations (supra). Even if it be clear that there be a record of an operational debt, it is important that the said debt be not disputed. If disputed within the parameters laid down in Mobilox Innovations (supra), an insolvency petition cannot be proceeded with further. 24. ### Response: 1

Daya Singh (Dead) Through L.Rs. & Anr Vs. Dhan Kaur

only the law in force at the time of the death of the limited owner that should govern the case. To hold that the old Hindu Law applies to such a case is to allow your imagination to boggle. In the case decided by the Privy Council in AIR 1946 PC 173 (supra) if this principle had been applied the new heirs introduced by the Hindu Law of Inheritance (Amendment) Act, 1929 could not have been come in. We are not impressed with the reasoning of the Patna High Court that because the change brought about by that Act is different from the change brought about by the Hindu Succession Act a different conclusion follows. We should consider that if even the limited change in the area of succession effected by the Hindu Law of Inheritance (Amendment) Act, 1929 is to be given effect to as the law applicable on the date of the death of the limited owner, it is all the more reason why the Hindu Succession Act which makes a much more radical change in the Hindu Law should have similar application. The Mysore High Court thought that the Hindu Succession Act not being a mere declaratory Act, retrospective effect should not be given to it so as to impair existing rights and obligations. But the reversioners right being a mere spes successions there is no question of impairing existing rights by adopting the interpretation we place on Section 8 apart from the fact that, as earlier pointed out, the interpretation does not amount to giving retrospective effect to Section 8. Of course, if the property had already vested in a person under the old Hindu Law it cannot be divested.8. We must also point out that the classes of cases where such a question is likely to arise is very limited. Where a widow, mother or daughter was in possession of the estate on the coming into force of the Hindu Succession Act she would become full owner under the provisions of Section 14 of the Act. Even if a widow was in possession of the share belonging to her in the joint family estate under the provisions of the Hindu Womens Right to Property Act, 1937, she would become a full owner under Section 14. In both these cases Section 8 would have no operation. It is only in the rare cases, like the present, that the question is likely to arise at all and we can see no reason either in principle or on authority why the principle consistently followed under the earlier Hindu Law that on the death of the limited owner succession opens and would be decided on the basis that the last male owner died on that day, should not apply even after coming into force of the Hindu Succession Act.9. Mr. Naunit Lal appearing for the appellant argued that the result of the decision of the Court in (1966) 2 SCR 625 =(AIR 1966 SC 1879 ) (supra) is that on the death of Wadhawa Singhs widow it is the old Hindu Law that applied and therefore under the custom in force in Punjab under which a daughter was not entitled to succeed to the ancestral property of the father in preference to the reversioners should apply and the appellants are entitled to succeed. There is no doubt about the position under the Customary Law of Punjab before coming into force of the Hindu Succession Act. In Rattigans Digest of the Customary Law published by the University Book Agency (14th Ed.) paragraph 23 at page 132 it is stated:"23. (1) A daughter only succeeds to the ancestral landed property of her father, if an agriculturist, in default:-(1) Of the heirs mentioned in the preceding paragraph; and(2) Of near male collaterals of her father, provided that a married daughter sometimes excludes near male collaterals, especially amongst Muhammadan tribes:-(a) where she has married a near collateral descendant from the same common ancestor as her father, or(b) where she has, with her husband, continuously lived with her father since her marriage, looking after his domestic wants, and assisting him in the management of his estate; or(c) where, being married to a collateral of the fathers family, she has been appointed by her father as his heir......... ........ ....... ....... .......(2) But in regard to the acquired property of her father, the daughter is preferred to collateral."It is on the basis of this Customary Law that the revisioners succeeded in the suit filed by them questioning the gift made by the respondents mother to her. There is no doubt that Rattigans work is an authoritative one on the subject of Customary Law in Punjab. This Court in Mahant Salig Ram v. Musammat Maya Devi, (1955) 1 SCR 1191 at p. 1196 = (AIR 1955 SC 266 ) said:"The customary rights of succession of daughters as against the collaterals of the father with reference to ancestral and nonancestral lands are stated in paragraph 23 of Rattigans Digest of Customary Law. It is categorically stated in sub-paragraph (2) of that paragraph that the daughter succeeds to the self-acquired property of the father in preference to the collatorals even though they are within the fourth degree. Rattigans work has been accepted by the Privy Council as a "book of unquestioned authority in the Punjab. Indeed the correctness of this paragraph was not disputed before this Court in Gopal Singh v. Ujagar Singh, (1955) 1 SCR 86 = (AIR 1954 SC 1579)."It is not now open to the respondent to show whether any of the circumstances mentioned in sub-paragraph (2) of paragraph 23 of Rattigans Digest of Customary Law is present here as the previous decision is res judicata between the parties and in any case it has not been attempted to be shown in this case. But in the view we have taken that it is Section 8 of the Hindu Succession Act that applies and not the Customary Law the appellants cannot succeed in this appeal.

0[ds]4. In the case before this Court the two women were in possession of property whose last male holder, who had died before coming into force of the Hindu Succession Act, was their step son. They were not, therefore in legal possession of the properties of the last male holder. The question that had to be decided was whether because of the coming into force of the Hindu Succession Act they were entitled to succeed under Section 8 and the further question whether Section 14 would be attracted as they were actually in possession. It was held that as they were not legally in possession Section 14 would not apply. It was in that context that it was said that where a male Hindu died before the Act came into force i.e., where succession opened before the Act, Section 8 of the Act will have no application. The point that succession might open not only when the male Hindu died but also subsequently again when a limited owner who succeeds him dies was not taken into account. There was no need and no occasion to consider such a contingency in that case. There was the further fact that the last male holder was succeeded on his death by persons who were then his nearest heirs and the property vested in them could not be divested by the Hindu Succession Act coming into force subsequently though this fact was not adverted to in the judgment. This court had therefore also no occasion to consider the effect of the earlier decisions on the question as to what happens when a female limited owner, whether she is a widow, mother or daughter who succeeds the last male holderwould be noticed that the Privy Council interpreted the words "dying intestate" as merely meaning "in the case of intestacy of a Hindu male" and said that to place this interpretation on the Act is not to give retrospective effect to its provisions. Those are the very words found in Section 8. These may be contrasted with the words of Section 6 "where a male Hindu dies after the commencement of this Act." Here the reference is clearly to the time of the death. In Section 8, it is only to the fact of intestacy. The material point of time, as pointed out by the Privy Council, is the date when the succession opens, namely, the death of the widow. It is interesting to note that the Privy Council was interpreting the provisions of the Hindu Law of Inheritance (Amendment) Act, 1929 where the two contrasting expressions found inthe Hindu Succession Act, 1956 are not found. The case for the interpretation of the words "dying intestate" under the Hindu Succession Act is stronger. The words "where a male Hindu dies after the commencement of this Act" in Section 6 and their absence in Section 8, are extremely significant. Thus two propositions follow: (1) Succession opens on the death of the limited owner, and (2) the law then in force would govern the succession.6. Now if this proposition is correct as we hold it is, that, where a female heir succeeds to an estate, the person entitled to succeed on the basis as if the last male holder had lived up to and died at the death of the limited owner, succession to Wadhawa Singhs estate in the present case opened when his widow died and it would have to be decided on the basis that Wadhawa Singh had died in 1963 when his widow died. In that case the succession to his estate would have to be decided on the basis of Sec. 8 of the Hindu Succession Act. The various High Courts which have held otherwise seem to have been oppressed by the feeling that this amounted to giving retrospective effect to Section 8 of the Hindu Succession Act whereas it is only prospective. As the Privy Council pointed out it means no such thing. The accepted position under the Hindu Law is that where a limited owner succeeds to an estate the succession to the estate on her death will have to be decided on the basis that the last full owner died on that day. It would be reasonable to hold that in such a circumstance the law as it existed at the time when the last male holder actually died should be given effect to. If the person who is likely to succeed at the time of the limited owners death is not, as happens very often, likely to be the person who would have succeeded if the limited owner had not intervened, there is nothing unreasonable in holding that the law as to the person who is entitled to succeed on the limited owners death should be the law then in force and not the law in force at the time of the last full owners death.We must also point out that the classes of cases where such a question is likely to arise is very limited. Where a widow, mother or daughter was in possession of the estate on the coming into force of the Hindu Succession Act she would become full owner under the provisions of Section 14 of the Act. Even if a widow was in possession of the share belonging to her in the joint family estate under the provisions of the Hindu Womens Right to Property Act, 1937, she would become a full owner under Section 14. In both these cases Section 8 would have no operation. It is only in the rare cases, like the present, that the question is likely to arise at all and we can see no reason either in principle or on authority why the principle consistently followed under the earlier Hindu Law that on the death of the limited owner succession opens and would be decided on the basis that the last male owner died on that day, should not apply even after coming into force of the Hindu Successionis not now open to the respondent to show whether any of the circumstances mentioned in sub-paragraph (2) of paragraph 23 of Rattigans Digest of Customary Law is present here as the previous decision is res judicata between the parties and in any case it has not been attempted to be shown in this case. But in the view we have taken that it is Section 8 of the Hindu Succession Act that applies and not the Customary Law the appellants cannot succeed in this appeal.There is no doubt that Wadhawa Singhs widow had no right to make a gift of the property which she inherited from her husband in 1933 and the decree obtained by the appellants, who were reversioners to her husbands estate would bind the respondent who was also a party to thatnot the widow made the gift to the respondent in 1933, she would have become an absolute owner of the property as a result of Section 14 of the Hindu Succession Act and the gift made by her subsequently in favour of the respondent could not have been questioned. But having made the gift in 1933 she was not in possession of the property inherited by her from her husband and, therefore, did not become a full owner with the result that the subsequent gift made by her in favour of the respondent was of no effect. This point that unless the limited owner is in possession of the property Section 14 does not apply has now been settled by decisions of this Court beyondPunjab High Court in its decisions in Banso v. Charan Singh, AIR 1961 Punj 45, and Kuldip Singh v. Karnail Singh, AIR 1961 Punj 573, where the facts were similar to the present case, has taken the view that when a widow dies after the coming into force of the Hindu Succession Act the next heir to her husband is to be determined in accordance with the law prevailing on the date of the death of the widow and not in accordance with the law prevailing at the time of the death of her husband and held that the daughter succeeded in preference to the reversioners. The Mysore High Court on the other hand in Kempiah v. Girigamma, AIR 1966 Mys 189 has held that on the death of the widow succession would be governed by the Hindu Law which was in force when the last male holder actually died. The Patna High Court in Renuka Bala v. Aswini Kumar, AIR 1961 Pat 498 was disposed to take a similar view though the case before it was concerned with succession to the property of a female under Section 15. The Madras High Court in Sampathkumari v. Lakshmi Ammal, AIR 1963 Mad 50 also took the view that in such circumstances Section 8 of the Hindu Succession Act would not apply. But the case before that Court was on where two widows who had succeeded to the estate of their husband were in possession, and therefore, Section 14 was applicable. Lastly, we have the decision of this Court in Eramma v. Verrupanna, (1966) 2 SCR 626 = (AIR 1966 SC 1879 ). In that case this Court after setting out the provisions of Sec. 6 of the Hindu Succession Act,is clear from the express language of the section that it applied only to coparcenary property of the male Hindu holder who dies after the commencement of the Act. It is manifest that the language of Section 8 must be construed in the context of Section 6 of the Act. We accordingly hold that the provisions of Section 8 of the Hindu Succession Act are not retrospective in operation and where a male Hindu died before the Act came into force i.e., where succession opened before the Act, Sec. 8 of the Act will have noliterally this decision would seem to accord with the decisions of all the other High Courts except the Punjab High Court. But it should be noticed that the problem that we are faced with in the present appeal and in the cases before the Punjab and Mysore High Courts did not arise before this Court on the earlier occasion. The decisions of the Madras High Court and the Patna High Court are not directly inis no doubt about the position under the Customary Law of Punjab before coming into force of the Hindu Succession Act.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: only the law in force at the time of the death of the limited owner that should govern the case. To hold that the old Hindu Law applies to such a case is to allow your imagination to boggle. In the case decided by the Privy Council in AIR 1946 PC 173 (supra) if this principle had been applied the new heirs introduced by the Hindu Law of Inheritance (Amendment) Act, 1929 could not have been come in. We are not impressed with the reasoning of the Patna High Court that because the change brought about by that Act is different from the change brought about by the Hindu Succession Act a different conclusion follows. We should consider that if even the limited change in the area of succession effected by the Hindu Law of Inheritance (Amendment) Act, 1929 is to be given effect to as the law applicable on the date of the death of the limited owner, it is all the more reason why the Hindu Succession Act which makes a much more radical change in the Hindu Law should have similar application. The Mysore High Court thought that the Hindu Succession Act not being a mere declaratory Act, retrospective effect should not be given to it so as to impair existing rights and obligations. But the reversioners right being a mere spes successions there is no question of impairing existing rights by adopting the interpretation we place on Section 8 apart from the fact that, as earlier pointed out, the interpretation does not amount to giving retrospective effect to Section 8. Of course, if the property had already vested in a person under the old Hindu Law it cannot be divested.8. We must also point out that the classes of cases where such a question is likely to arise is very limited. Where a widow, mother or daughter was in possession of the estate on the coming into force of the Hindu Succession Act she would become full owner under the provisions of Section 14 of the Act. Even if a widow was in possession of the share belonging to her in the joint family estate under the provisions of the Hindu Womens Right to Property Act, 1937, she would become a full owner under Section 14. In both these cases Section 8 would have no operation. It is only in the rare cases, like the present, that the question is likely to arise at all and we can see no reason either in principle or on authority why the principle consistently followed under the earlier Hindu Law that on the death of the limited owner succession opens and would be decided on the basis that the last male owner died on that day, should not apply even after coming into force of the Hindu Succession Act.9. Mr. Naunit Lal appearing for the appellant argued that the result of the decision of the Court in (1966) 2 SCR 625 =(AIR 1966 SC 1879 ) (supra) is that on the death of Wadhawa Singhs widow it is the old Hindu Law that applied and therefore under the custom in force in Punjab under which a daughter was not entitled to succeed to the ancestral property of the father in preference to the reversioners should apply and the appellants are entitled to succeed. There is no doubt about the position under the Customary Law of Punjab before coming into force of the Hindu Succession Act. In Rattigans Digest of the Customary Law published by the University Book Agency (14th Ed.) paragraph 23 at page 132 it is stated:"23. (1) A daughter only succeeds to the ancestral landed property of her father, if an agriculturist, in default:-(1) Of the heirs mentioned in the preceding paragraph; and(2) Of near male collaterals of her father, provided that a married daughter sometimes excludes near male collaterals, especially amongst Muhammadan tribes:-(a) where she has married a near collateral descendant from the same common ancestor as her father, or(b) where she has, with her husband, continuously lived with her father since her marriage, looking after his domestic wants, and assisting him in the management of his estate; or(c) where, being married to a collateral of the fathers family, she has been appointed by her father as his heir......... ........ ....... ....... .......(2) But in regard to the acquired property of her father, the daughter is preferred to collateral."It is on the basis of this Customary Law that the revisioners succeeded in the suit filed by them questioning the gift made by the respondents mother to her. There is no doubt that Rattigans work is an authoritative one on the subject of Customary Law in Punjab. This Court in Mahant Salig Ram v. Musammat Maya Devi, (1955) 1 SCR 1191 at p. 1196 = (AIR 1955 SC 266 ) said:"The customary rights of succession of daughters as against the collaterals of the father with reference to ancestral and nonancestral lands are stated in paragraph 23 of Rattigans Digest of Customary Law. It is categorically stated in sub-paragraph (2) of that paragraph that the daughter succeeds to the self-acquired property of the father in preference to the collatorals even though they are within the fourth degree. Rattigans work has been accepted by the Privy Council as a "book of unquestioned authority in the Punjab. Indeed the correctness of this paragraph was not disputed before this Court in Gopal Singh v. Ujagar Singh, (1955) 1 SCR 86 = (AIR 1954 SC 1579)."It is not now open to the respondent to show whether any of the circumstances mentioned in sub-paragraph (2) of paragraph 23 of Rattigans Digest of Customary Law is present here as the previous decision is res judicata between the parties and in any case it has not been attempted to be shown in this case. But in the view we have taken that it is Section 8 of the Hindu Succession Act that applies and not the Customary Law the appellants cannot succeed in this appeal. ### Response: 0

Member-Secretary, Andhra Pradesh Stateboard For Prevention Vs. Andhra Pradesh Rayons Ltd. & Ors

realise money from those whose activities lead to pollution and who must bear the expenses of the maintenance and running of the State Board. It is a fiscal provision and must, therefore, not only be literally construed but also be strictly construed. Having regard to the literal expression used and bearing in mind the purpose for the legislation, we arrive at a result that certain industries have to pay the expenses of the maintenance and functioning of the State boards Considering the principle broadly and in common sense point of view, we find nothing to warrant the conclusion that rayon grade pulp is included in either of the industries as canvassed on behalf of the petitioner here and as held by the High Court in the judgment under appeal. 13. In this case, we must also note that neither the Water Pollution Board nor any authorities under the Act nor the High Court proceeded on any evidence how these expressions are used in the particular industry or understood in the trade generally. In other words, no principle of understanding in "common parlance" is involved in the instant case. 14. In that view of the matter, we are of the opinion that the contention sought for by the petitioner is of no substance. 15. Our attention, however, was drawn to the decision of a learned Single Judge of the High Court of Kerala in M/s. Gwalior Rayon Silk Mfg. (Wvg.) Co. Ltd., Mavoor v. Appellate Committee for Water Cess, Trivandrum (AIR 1983 Ker 110 : ILR (1983) 2 Ker 224). There, the learned Single Judge of the Kerala High Court held that industry manufacturing rayon grade pulp is chemical industry. The High Court has observed that the product of the Pulp Division of a rayon silk manufacturing company is rayon grade pulp, extracted from bamboo or wood. The High Court noted that the Pulp produced in the Pulp Division of the company is the raw material for the Staple Fibre Division. The High court further observed that the pulp in question is a chemical used as chemical raw material, in the form known as chemical cellulose, for preparation of fibres. The High Court noted that for the scientist cellulose is a carbohydrate an organic compound, a saccharide and for the layman also it is a chemical like salt and sugar. Manufacture of pulp from wood or bamboo involves consumption of large quantities of water which get polluted in the process; and "chemical industry" in the context in which it is used in Schedule I of the Act, can therefore, include an industry manufacturing rayon grade pulp. We are unable, with respect, to accept the circuitous process of reasoning of the Kerala High Court. As mentioned hereinbefore, looked at from this circuitous method every industry would be chemical industry. It could not have been the intention to include all industries because every industry has to go to certain chemical process more or less and, therefore, it could not be so construed. Such expression should, therefore, be construed reasonably, strictly and from a commonsense point of view. The High Court of Kerala has set out in the said judgment the companys case in that case which also produced rayon grade pulp and there manufacturing process consisted only of isolating cellulose present in bamboo and wood by removal of "lignin" and other contents, and that the resultant product is not chemical cellulose. It explained the process as underThe actual process of manufacture of rayon grade pulp is by feeding the raw materials on the conveyors leading to the chippers, where they are chipped into small pieces in uniform sizes. The raw materials are washed by a continuous stream of water before they are fed into chippers for removal of their adhering mud and dirt. The chips are then conveyed into digesters, where they are subjected to acid pre-hydrolysis, using dilute sulphuric acid solution. The spent liquor is then drained out, and the chips washed to remove the acid. The chips are again cooked using a solution containing cooking chemicals at high temperature of above 160 degree C. After the chips are thus cooked the pressure is released and the material is collected in a blow tank, from where the chipped pulp is sent to "Knotter Screen" for removal of uncooked particles. The pulp is washed in a series of washers in a counter-current manner. The washed pulp is bleached in a multi-staged bleaching plant, and converted into sheets in a continuous machine. The pulp sheets so obtained are sent to other factories for their conversion into staple Fibre. 16. The said High Court also relied on a passage from the "Book of Popular Science" Grolier, 1969, Vol. 7, p. 55 which reads as follows: "Just what is a chemical, after all ? Presumably it is a pure chemical substance (an element or compound) and not a mixture. Thus sulphuric acid is a chemical ..... But common salt and sugar, with which all of us are familiar, are also pure chemical substances ..... The truly chemical industries, which manufacture chemicals, are seldom well known to the public. This is because we, as consumers, do not ordinarily make use of Chemicals in their pure form. Instead they are converted into products that reach the consumer only after a number of operations." 17. As mentioned hereinbefore, the expression should be understood not in technical sense but from broad commonsense point of view to find out what it truly means by those who deal with them. Bearing the aforesaid perspective in mind, we are unable to agree with the view of the Kerala High Court Expressed in the aforesaid judgment. In that conspectus of the Kerala High Court everything would be included in the process of chemical. 18. In the aforesaid view of the matter we are of the opinion that the High Court of Andhra Pradesh in the impugned judgment was right and the High Court of Kerala in the judgment referred to hereinbefore was not right.

0[ds]It is the propriety; or the correctness of that decision which is sought to be canvassed before us by this petition. It must therefore, be made clear that we are not concerned with the correctness or otherwise of the decision of the High Court about the constitutional validity of the Act in question. That is not at issue before us since the petitioner, Andhra Pradesh State Board for Prevention and Control of Water Pollution has not challenged that finding. The only question is whether the respondent is an industry as mentioned in the aforesaid Schedule. The High Court in take impugned judgment has held that rayon grade pulp is not covered by any of the items specified in the said Schedule. We are of the opinion that the High Court was right.We fail to see that rayon grade pulp could be considered even remotely connected as such with chemical industry or textile industry or paper industry. In all preparations, there is certain chemical process but that does not make all industries chemical industries.Bearing the aforesaid principle in mind, we find that there is no absurdity in the literal meaning. The purpose of the Act is to realise money from those whose activities lead to pollution and who must bear the expenses of the maintenance and running of the State Board. It is a fiscal provision and must, therefore, not only be literally construed but also be strictly construed. Having regard to the literal expression used and bearing in mind the purpose for the legislation, we arrive at a result that certain industries have to pay the expenses of the maintenance and functioning of the State boards Considering the principle broadly and in common sense point of view, we find nothing to warrant the conclusion that rayon grade pulp is included in either of the industries as canvassed on behalf of the petitioner here and as held by the High Court in the judgment underIn this case, we must also note that neither the Water Pollution Board nor any authorities under the Act nor the High Court proceeded on any evidence how these expressions are used in the particular industry or understood in the trade generally. In other words, no principle of understanding in "common parlance" is involved in the instantIn that view of the matter, we are of the opinion that the contention sought for by the petitioner is of noOur attention, however, was drawn to the decision of a learned Single Judge of the High Court of Kerala in M/s. Gwalior Rayon Silk Mfg. (Wvg.) Co. Ltd., Mavoor v. Appellate Committee for Water Cess, Trivandrum (AIR 1983 Ker 110 : ILR (1983) 2 Ker 224).The said High Court also relied on a passage from the "Book of Popular Science" Grolier, 1969, Vol. 7, p. 55 which reads aswhat is a chemical, after all ? Presumably it is a pure chemical substance (an element or compound) and not a mixture. Thus sulphuric acid is a chemical ..... But common salt and sugar, with which all of us are familiar, are also pure chemical substances ..... The truly chemical industries, which manufacture chemicals, are seldom well known to the public. This is because we, as consumers, do not ordinarily make use of Chemicals in their pure form. Instead they are converted into products that reach the consumer only after a number ofAs mentioned hereinbefore, the expression should be understood not in technical sense but from broad commonsense point of view to find out what it truly means by those who deal with them. Bearing the aforesaid perspective in mind, we are unable to agree with the view of the Kerala High Court Expressed in the aforesaid judgment. In that conspectus of the Kerala High Court everything would be included in the process ofIn the aforesaid view of the matter we are of the opinion that the High Court of Andhra Pradesh in the impugned judgment was right and the High Court of Kerala in the judgment referred to hereinbefore was not right

### Instruction: Assess the case proceedings and provide a prediction: is the court likely to rule in favor of (1) or against (0) the appellant/petitioner? ### Input: realise money from those whose activities lead to pollution and who must bear the expenses of the maintenance and running of the State Board. It is a fiscal provision and must, therefore, not only be literally construed but also be strictly construed. Having regard to the literal expression used and bearing in mind the purpose for the legislation, we arrive at a result that certain industries have to pay the expenses of the maintenance and functioning of the State boards Considering the principle broadly and in common sense point of view, we find nothing to warrant the conclusion that rayon grade pulp is included in either of the industries as canvassed on behalf of the petitioner here and as held by the High Court in the judgment under appeal. 13. In this case, we must also note that neither the Water Pollution Board nor any authorities under the Act nor the High Court proceeded on any evidence how these expressions are used in the particular industry or understood in the trade generally. In other words, no principle of understanding in "common parlance" is involved in the instant case. 14. In that view of the matter, we are of the opinion that the contention sought for by the petitioner is of no substance. 15. Our attention, however, was drawn to the decision of a learned Single Judge of the High Court of Kerala in M/s. Gwalior Rayon Silk Mfg. (Wvg.) Co. Ltd., Mavoor v. Appellate Committee for Water Cess, Trivandrum (AIR 1983 Ker 110 : ILR (1983) 2 Ker 224). There, the learned Single Judge of the Kerala High Court held that industry manufacturing rayon grade pulp is chemical industry. The High Court has observed that the product of the Pulp Division of a rayon silk manufacturing company is rayon grade pulp, extracted from bamboo or wood. The High Court noted that the Pulp produced in the Pulp Division of the company is the raw material for the Staple Fibre Division. The High court further observed that the pulp in question is a chemical used as chemical raw material, in the form known as chemical cellulose, for preparation of fibres. The High Court noted that for the scientist cellulose is a carbohydrate an organic compound, a saccharide and for the layman also it is a chemical like salt and sugar. Manufacture of pulp from wood or bamboo involves consumption of large quantities of water which get polluted in the process; and "chemical industry" in the context in which it is used in Schedule I of the Act, can therefore, include an industry manufacturing rayon grade pulp. We are unable, with respect, to accept the circuitous process of reasoning of the Kerala High Court. As mentioned hereinbefore, looked at from this circuitous method every industry would be chemical industry. It could not have been the intention to include all industries because every industry has to go to certain chemical process more or less and, therefore, it could not be so construed. Such expression should, therefore, be construed reasonably, strictly and from a commonsense point of view. The High Court of Kerala has set out in the said judgment the companys case in that case which also produced rayon grade pulp and there manufacturing process consisted only of isolating cellulose present in bamboo and wood by removal of "lignin" and other contents, and that the resultant product is not chemical cellulose. It explained the process as underThe actual process of manufacture of rayon grade pulp is by feeding the raw materials on the conveyors leading to the chippers, where they are chipped into small pieces in uniform sizes. The raw materials are washed by a continuous stream of water before they are fed into chippers for removal of their adhering mud and dirt. The chips are then conveyed into digesters, where they are subjected to acid pre-hydrolysis, using dilute sulphuric acid solution. The spent liquor is then drained out, and the chips washed to remove the acid. The chips are again cooked using a solution containing cooking chemicals at high temperature of above 160 degree C. After the chips are thus cooked the pressure is released and the material is collected in a blow tank, from where the chipped pulp is sent to "Knotter Screen" for removal of uncooked particles. The pulp is washed in a series of washers in a counter-current manner. The washed pulp is bleached in a multi-staged bleaching plant, and converted into sheets in a continuous machine. The pulp sheets so obtained are sent to other factories for their conversion into staple Fibre. 16. The said High Court also relied on a passage from the "Book of Popular Science" Grolier, 1969, Vol. 7, p. 55 which reads as follows: "Just what is a chemical, after all ? Presumably it is a pure chemical substance (an element or compound) and not a mixture. Thus sulphuric acid is a chemical ..... But common salt and sugar, with which all of us are familiar, are also pure chemical substances ..... The truly chemical industries, which manufacture chemicals, are seldom well known to the public. This is because we, as consumers, do not ordinarily make use of Chemicals in their pure form. Instead they are converted into products that reach the consumer only after a number of operations." 17. As mentioned hereinbefore, the expression should be understood not in technical sense but from broad commonsense point of view to find out what it truly means by those who deal with them. Bearing the aforesaid perspective in mind, we are unable to agree with the view of the Kerala High Court Expressed in the aforesaid judgment. In that conspectus of the Kerala High Court everything would be included in the process of chemical. 18. In the aforesaid view of the matter we are of the opinion that the High Court of Andhra Pradesh in the impugned judgment was right and the High Court of Kerala in the judgment referred to hereinbefore was not right. ### Response: 0

Securities & Exch.Board Of India Vs. M/S Informetics Valuation & Rating P.Ltd

scope under the regulations for the time to be extended any further. The information sought must be in relation to the five years preceding the date of the application. In this view of the matter, we are of the opinion that the directions issued by the SAT that the Board could not have directed the respondent to produce the Audited Accounts for the two years beyond the date of the application, are in consonance with the provisions of the regulations. Under Regulation 7, the Board would have the power to seek further information or clarification for the purpose of processing of the application. This further information would relate only to the basic information with regard to the Audited Accounts for the five years preceding the date of the application. Therefore, the observations made by SAT as noticed above are perfectly justified. 25. This now brings us to the final submission made by Mr. C.U. Singh that the Board was within its power to ask for the Audited Accounts of the applicant for the 5 years preceding the date of the application. It is true that under Regulation 4(e), an applicant has to show that it has continuous net worth of minimum Rs.100 crores as per its Audited Annual Accounts for the previous five years prior to the filing of the application with the Board. Clause 2 of Form A provides the “Eligibility Criteria”. Under Clause 2(1), the applicant has to indicate the category to which the promoters of the applicant company belong under Regulation 4, which in this case was 4(e). Clause 2(3) provides that the applicant shall “enclose a Chartered Accountant’s certificate certifying the continuous net worth of Rs.100 crores for five years, in case the promoter referred to in Regulation 4(e)”. As noticed above, Regulation 4(e) postulates that the proof of net worth on the basis of the audited accounts for five years prior to the filing of the application has to be given. It is not disputed before us that the applicant has submitted the Chartered Accountant’s certificate certifying the continuous net worth of Rs.100 crores for five years on the basis of M/s. Coment (Mauritius) Limited bankers certificate. It is noticed by the SAT in the impugned order that the certificate was accepted by the Board and no clarification was sought from the respondent in regard to the certificate furnished by the Chartered Accountant. Mr. C.U. Singh submitted that the certificate submitted by the Chartered Accountant was issued on the basis of the certificate of ING Private bank dated 29th May, 2009 confirming that M/s. Coment (Mauritius) Limited had a continued net worth of over Rs.100 crores as per its Annual Accounts for the previous five years. It is not certified on the basis of the Audited Accounts, therefore, the certificate did not satisfy the requirements under the regulations. 26. We are of the opinion that the submission made by Mr. C.U. Singh has substance and cannot be brushed aside. The certificate actually provided by the Chartered Accountants is as under:- “NET WORTH CERTIFICATEWe certify that for previous five years continuous Net worth of M/s. Coment (Mauritius) Limited, Les Cascade Building, Edith Cavell Street, Port Louis, Mauritius is over Rs.100 crores (Rupees One Hundred Crores).The above information is given in strictest confidence at the request of our client for the purpose of filing application before Securities and Exchange Board of India.FOR M/S RAJNISH & ASSOCIATESCHARTERED ACCOUNTANTSCertified True CopySd/-(PARTNER)Place : New Delhi Membership No. 081180Date: 29.05.2009” 27. We are satisfied that the aforesaid certificate did not conform to the provisions contained in the regulations which requires that the certificate of the Chartered Accountant should be in confirmation of the Audited Accounts of the promoters/applicant for the five years preceding the date of the application. We are unable to approve the observations made by SAT that “neither the regulations nor the eligibility criteria in Form A requires the applicant to produce the annual accounts of the promoter.” We are also unable to approve the observations of SAT that “it is doubtful whether the Board could have asked for this information without doubting the veracity or the correctness of the certificate of the Chartered Accountant that accompanied the application.” The certificate of the Chartered Accountant is evidence of the required net worth of the promoter. Therefore, it has to be in strict conformity with Regulation 4(e). Since the certificate issued by the Chartered Accountants did not categorically state that it is based on the audited accounts for the 5 years preceding the date of application, the Board certainly had the power to direct the respondent to produce the audited accounts. That being so, under Regulation 6, it was the duty of the Board to have rejected the application of the respondent.28. Surprisingly, however, the Board continued to grant further time to the respondent to remove the objections even beyond the maximum sixty days permissible under the proviso to Regulation 6. It appears that the enquiries continued from 20th August, 2009 till March 1, 2011 when the show cause notice was issued to the respondent. The application of the respondent is not rejected till 21st July, 2011. The delay in the rejection of the application of the respondent was wholly unwarranted. It allowed the respondent a latitude not permissible under the regulations. Taking advantage of this latitude, the respondent has provided the Audited Accounts for the five years preceding the date of application. Not only this, we are informed that by now the respondent has even produced before this Court in a sealed cover the Audited Accounts of M/s. Coment (Mauritius) Limited for the subsequent two years upto 31st December, 2010 also.29. Since the Board had extended the time to the respondent, even though not permissible in law, we are not inclined to modify the directions issued by the SAT. Especially in view of the submission of Mr. Suri that respondent is willing at this stage to produce the Audited Accounts of the promoter even for the subsequent two years.

0[ds]27. We are satisfied that the aforesaid certificate did not conform to the provisions contained in the regulations which requires that the certificate of the Chartered Accountant should be in confirmation of the Audited Accounts of the promoters/applicant for the five years preceding the date of the application. We are unable to approve the observations made by SAT thatthe regulations nor the eligibility criteria in Form A requires the applicant to produce the annual accounts of theWe are also unable to approve the observations of SAT thatis doubtful whether the Board could have asked for this information without doubting the veracity or the correctness of the certificate of the Chartered Accountant that accompanied theThe certificate of the Chartered Accountant is evidence of the required net worth of the promoter. Therefore, it has to be in strict conformity with Regulation 4(e). Since the certificate issued by the Chartered Accountants did not categorically state that it is based on the audited accounts for the 5 years preceding the date of application, the Board certainly had the power to direct the respondent to produce the audited accounts. That being so, under Regulation 6, it was the duty of the Board to have rejected the application of the respondent.28. Surprisingly, however, the Board continued to grant further time to the respondent to remove the objections even beyond the maximum sixty days permissible under the proviso to Regulation 6. It appears that the enquiries continued from 20th August, 2009 till March 1, 2011 when the show cause notice was issued to the respondent. The application of the respondent is not rejected till 21st July, 2011. The delay in the rejection of the application of the respondent was wholly unwarranted. It allowed the respondent a latitude not permissible under the regulations. Taking advantage of this latitude, the respondent has provided the Audited Accounts for the five years preceding the date of application. Not only this, we are informed that by now the respondent has even produced before this Court in a sealed cover the Audited Accounts of M/s. Coment (Mauritius) Limited for the subsequent two years upto 31st December, 2010 also.29. Since the Board had extended the time to the respondent, even though not permissible in law, we are not inclined to modify the directions issued by the SAT. Especially in view of the submission of Mr. Suri that respondent is willing at this stage to produce the Audited Accounts of the promoter even for the subsequent two years.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: scope under the regulations for the time to be extended any further. The information sought must be in relation to the five years preceding the date of the application. In this view of the matter, we are of the opinion that the directions issued by the SAT that the Board could not have directed the respondent to produce the Audited Accounts for the two years beyond the date of the application, are in consonance with the provisions of the regulations. Under Regulation 7, the Board would have the power to seek further information or clarification for the purpose of processing of the application. This further information would relate only to the basic information with regard to the Audited Accounts for the five years preceding the date of the application. Therefore, the observations made by SAT as noticed above are perfectly justified. 25. This now brings us to the final submission made by Mr. C.U. Singh that the Board was within its power to ask for the Audited Accounts of the applicant for the 5 years preceding the date of the application. It is true that under Regulation 4(e), an applicant has to show that it has continuous net worth of minimum Rs.100 crores as per its Audited Annual Accounts for the previous five years prior to the filing of the application with the Board. Clause 2 of Form A provides the “Eligibility Criteria”. Under Clause 2(1), the applicant has to indicate the category to which the promoters of the applicant company belong under Regulation 4, which in this case was 4(e). Clause 2(3) provides that the applicant shall “enclose a Chartered Accountant’s certificate certifying the continuous net worth of Rs.100 crores for five years, in case the promoter referred to in Regulation 4(e)”. As noticed above, Regulation 4(e) postulates that the proof of net worth on the basis of the audited accounts for five years prior to the filing of the application has to be given. It is not disputed before us that the applicant has submitted the Chartered Accountant’s certificate certifying the continuous net worth of Rs.100 crores for five years on the basis of M/s. Coment (Mauritius) Limited bankers certificate. It is noticed by the SAT in the impugned order that the certificate was accepted by the Board and no clarification was sought from the respondent in regard to the certificate furnished by the Chartered Accountant. Mr. C.U. Singh submitted that the certificate submitted by the Chartered Accountant was issued on the basis of the certificate of ING Private bank dated 29th May, 2009 confirming that M/s. Coment (Mauritius) Limited had a continued net worth of over Rs.100 crores as per its Annual Accounts for the previous five years. It is not certified on the basis of the Audited Accounts, therefore, the certificate did not satisfy the requirements under the regulations. 26. We are of the opinion that the submission made by Mr. C.U. Singh has substance and cannot be brushed aside. The certificate actually provided by the Chartered Accountants is as under:- “NET WORTH CERTIFICATEWe certify that for previous five years continuous Net worth of M/s. Coment (Mauritius) Limited, Les Cascade Building, Edith Cavell Street, Port Louis, Mauritius is over Rs.100 crores (Rupees One Hundred Crores).The above information is given in strictest confidence at the request of our client for the purpose of filing application before Securities and Exchange Board of India.FOR M/S RAJNISH & ASSOCIATESCHARTERED ACCOUNTANTSCertified True CopySd/-(PARTNER)Place : New Delhi Membership No. 081180Date: 29.05.2009” 27. We are satisfied that the aforesaid certificate did not conform to the provisions contained in the regulations which requires that the certificate of the Chartered Accountant should be in confirmation of the Audited Accounts of the promoters/applicant for the five years preceding the date of the application. We are unable to approve the observations made by SAT that “neither the regulations nor the eligibility criteria in Form A requires the applicant to produce the annual accounts of the promoter.” We are also unable to approve the observations of SAT that “it is doubtful whether the Board could have asked for this information without doubting the veracity or the correctness of the certificate of the Chartered Accountant that accompanied the application.” The certificate of the Chartered Accountant is evidence of the required net worth of the promoter. Therefore, it has to be in strict conformity with Regulation 4(e). Since the certificate issued by the Chartered Accountants did not categorically state that it is based on the audited accounts for the 5 years preceding the date of application, the Board certainly had the power to direct the respondent to produce the audited accounts. That being so, under Regulation 6, it was the duty of the Board to have rejected the application of the respondent.28. Surprisingly, however, the Board continued to grant further time to the respondent to remove the objections even beyond the maximum sixty days permissible under the proviso to Regulation 6. It appears that the enquiries continued from 20th August, 2009 till March 1, 2011 when the show cause notice was issued to the respondent. The application of the respondent is not rejected till 21st July, 2011. The delay in the rejection of the application of the respondent was wholly unwarranted. It allowed the respondent a latitude not permissible under the regulations. Taking advantage of this latitude, the respondent has provided the Audited Accounts for the five years preceding the date of application. Not only this, we are informed that by now the respondent has even produced before this Court in a sealed cover the Audited Accounts of M/s. Coment (Mauritius) Limited for the subsequent two years upto 31st December, 2010 also.29. Since the Board had extended the time to the respondent, even though not permissible in law, we are not inclined to modify the directions issued by the SAT. Especially in view of the submission of Mr. Suri that respondent is willing at this stage to produce the Audited Accounts of the promoter even for the subsequent two years. ### Response: 0

HEMRAJ RATNAKAR SALIAN Vs. HDFC BANK LTD. & ORS

Hence, if any of the appellants claim that they are entitled to possession of a secured asset for any term exceeding one year from the date of the lease made in his favour, he has to produce proof of execution of a registered instrument in his favour by the lessor. Where he does not produce proof of execution of a registered instrument in his favour and instead relies on an unregistered instrument or oral agreement accompanied by delivery of possession, the Chief Metropolitan Magistrate or the District Magistrate, as the case may be, will have to come to the conclusion that he is not entitled to the possession of the secured asset for more than a year from the date of the instrument or from the date of delivery of possession in his favour by the landlord. 12. A Three-Judge Bench of this Court in Bajarang Shyamsunder Agarwal v. Central Bank of India & Anr. (2019) 9 SCC 94 , after considering almost all decisions of this Court, in relation to the right of a tenant in possession of the secured asset, has held that if a valid tenancy under law is in existence even prior to the creation of the mortgage, such tenants possession cannot be disturbed by the secured creditor by taking possession of the property. If a tenancy under law comes into existence after the creation of a mortgage but prior to issuance of a notice under Section 13(2) of the SARFAESI Act, it has to satisfy the conditions of Section 65-A of the Transfer of Property Act, 1882. If a tenant claims that he is entitled to possession of a Secured Asset for a term of more than a year, it has to be supported by the execution of a registered instrument. In the said decision of this Court, it was clarified that in the absence of a registered instrument, if the tenant only relies upon an unregistered instrument or an oral agreement accompanied by delivery of possession, the tenant is not entitled to possession of the secured asset for more than the period prescribed under the provisions of the Transfer of Property Act. It was held thus: 24.1. If a valid tenancy under law is in existence even prior to the creation of the mortgage, the tenants possession cannot be disturbed by the secured creditor by taking possession of the property. The lease has to be determined in accordance with Section 111 of the TP Act for determination of leases. As the existence of a prior existing lease inevitably affects the risk undertaken by the bank while providing the loan, it is expected of banks/creditors to have conducted a standard due diligence in this regard. Where the bank has proceeded to accept such a property as mortgage, it will be presumed that it has consented to the risk that comes as a consequence of the existing tenancy. In such a situation, the rights of a rightful tenant cannot be compromised under the SARFAESI Act proceedings. 24.2. If a tenancy under law comes into existence after the creation of a mortgage, but prior to the issuance of notice under Section 13(2) of the SARFAESI Act, it has to satisfy the conditions of Section 65-A of the TP Act. 24.3. In any case, if any of the tenants claim that he is entitled to possession of a secured asset for a term of more than a year, it has to be supported by the execution of a registered instrument. In the absence of a registered instrument, if the tenant relies on an unregistered instrument or an oral agreement accompanied by delivery of possession, the tenant is not entitled to possession of the secured asset for more than the period prescribed under Section 107 of the TP Act. 13. It was further held that the Rent Act would not come to the aid of a tenant-in-sufferance vis-à-vis SARFAESI Act due to the operation of Section 13(2) read with Section 13(13) of the SARFAESI Act. It was held as follows: 35. The operation of the Rent Act cannot be extended to a tenant-in-sufferance vis-à-vis the SARFAESI Act, due to the operation of Section 13(2) read with Section 13(13) of the SARFAESI Act. A contrary interpretation would violate the intention of the legislature to provide for Section 13(13), which has a valuable role in making the SARFAESI Act a self-executory instrument for debts recovery. Moreover, such an interpretation would also violate the mandate of Section 35, SARFAESI Act which is couched in broad terms. 14. In the present case, first of all there is a serious doubt as to the bona fide of the tenant, as there is no good or sufficient evidence to establish the tenancy of the appellant. According to the appellant, he is a tenant of the Secured Asset from 12.06.2012. However, the documents produced in support of his claim are xerox copies of the rent receipts and the first xerox copy of the rent receipt is of 12.05.2013 which is after the date of creation of the mortgage. It is pertinent to note here that the Borrowers have not claimed that any tenant is staying at the Secured Asset. At the time of grant of facility, third-party valuers had also confirmed that the Borrowers were staying at the Secured Asset. Be that as it may. The appellant has pleaded tenancy from 12.06.2012 to 17.12.2018. This is not supported by any registered instrument. Further, even according to the appellant, he is a tenant-in-sufferance, therefore, he is not entitled to any protection of the Rent Act. Secondly, even if the tenancy has been claimed to be renewed in terms of Section 13(13) of the SARFAESI Act, the Borrower would be required to seek consent of the secured creditor for transfer of the Secured Asset by way of sale, lease or otherwise, after issuance of the notice under Section 13(2) of the SARFAESI Act and, admittedly, no such consent has been sought by the Borrower in the present case.

0[ds]9. As noticed above, it is the case of the appellant that he is a tenant of the Secured Asset since 12.06.2012 and has paid advance rent upto 17.12.2018. The documents produced by the appellant are xerox copies of the rent receipts. However, in response to the notice issued under Section 13(2) of the SARFAESI Act, the Borrowers have sent a very detailed representation wherein they have not claimed that any tenant is staying at the Secured Asset. The appellant has pleaded tenancy from 12.06.2012 to 17.12.2018. The rent receipt claiming tenancy from 12.06.2012 is a xerox copy of 12.05.2013, which is after the date of creation of mortgage.This Court in Harshad Govardhan Sondagar v. International Asset Reconstruction Co. Ltd. & Ors. (2014) 6 SCC 1 has held that right of appeal is available to the tenant claiming under the borrower. In Kanaiyalal Lalchand Sachdev v. State of Maharashtra (2011) 2 SCC 782 this Court has held that DRT can not only set aside the action of the secured creditor but even restore the status quo ante. Therefore, an alternative remedy was available to the appellant to challenge the impugned order under Section 17 of the SARFAESI Act even before the amendment to Section 17 of the SARFAESI Act. However, given that the instant appeal has been pending consideration before this Court from the year 2016, we propose to examine the case on merits without directing the appellant to avail the alternative remedy.11. In Harshad Govardhan Sondagar (supra) this Court has categorically held that if the tenancy claim is for any term exceeding one year, the tenancy can be made only by a registered instrument. It was held thus :36. We may now consider the contention of the respondents that some of the appellants have not produced any document to prove that they are bona fide lessees of the secured assets. We find that in the cases before us, the appellants have relied on the written instruments or rent receipts issued by the landlord to the tenant. Section 107 of the Transfer of Property Act provides that a lease of immovable property from year to year, or for any term exceeding one year or reserving a yearly rent, can be made only by a registered instrument and all other leases of immovable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession. Hence, if any of the appellants claim that they are entitled to possession of a secured asset for any term exceeding one year from the date of the lease made in his favour, he has to produce proof of execution of a registered instrument in his favour by the lessor. Where he does not produce proof of execution of a registered instrument in his favour and instead relies on an unregistered instrument or oral agreement accompanied by delivery of possession, the Chief Metropolitan Magistrate or the District Magistrate, as the case may be, will have to come to the conclusion that he is not entitled to the possession of the secured asset for more than a year from the date of the instrument or from the date of delivery of possession in his favour by the landlord.12. A Three-Judge Bench of this Court in Bajarang Shyamsunder Agarwal v. Central Bank of India & Anr. (2019) 9 SCC 94 , after considering almost all decisions of this Court, in relation to the right of a tenant in possession of the secured asset, has held that if a valid tenancy under law is in existence even prior to the creation of the mortgage, such tenants possession cannot be disturbed by the secured creditor by taking possession of the property. If a tenancy under law comes into existence after the creation of a mortgage but prior to issuance of a notice under Section 13(2) of the SARFAESI Act, it has to satisfy the conditions of Section 65-A of the Transfer of Property Act, 1882. If a tenant claims that he is entitled to possession of a Secured Asset for a term of more than a year, it has to be supported by the execution of a registered instrument. In the said decision of this Court, it was clarified that in the absence of a registered instrument, if the tenant only relies upon an unregistered instrument or an oral agreement accompanied by delivery of possession, the tenant is not entitled to possession of the secured asset for more than the period prescribed under the provisions of the Transfer of Property Act. It was held thus:24.1. If a valid tenancy under law is in existence even prior to the creation of the mortgage, the tenants possession cannot be disturbed by the secured creditor by taking possession of the property. The lease has to be determined in accordance with Section 111 of the TP Act for determination of leases. As the existence of a prior existing lease inevitably affects the risk undertaken by the bank while providing the loan, it is expected of banks/creditors to have conducted a standard due diligence in this regard. Where the bank has proceeded to accept such a property as mortgage, it will be presumed that it has consented to the risk that comes as a consequence of the existing tenancy. In such a situation, the rights of a rightful tenant cannot be compromised under the SARFAESI Act proceedings.24.2. If a tenancy under law comes into existence after the creation of a mortgage, but prior to the issuance of notice under Section 13(2) of the SARFAESI Act, it has to satisfy the conditions of Section 65-A of the TP Act.24.3. In any case, if any of the tenants claim that he is entitled to possession of a secured asset for a term of more than a year, it has to be supported by the execution of a registered instrument. In the absence of a registered instrument, if the tenant relies on an unregistered instrument or an oral agreement accompanied by delivery of possession, the tenant is not entitled to possession of the secured asset for more than the period prescribed under Section 107 of the TP Act.13. It was further held that the Rent Act would not come to the aid of a tenant-in-sufferance vis-à-vis SARFAESI Act due to the operation of Section 13(2) read with Section 13(13) of the SARFAESI Act. It was held as follows:35. The operation of the Rent Act cannot be extended to a tenant-in-sufferance vis-à-vis the SARFAESI Act, due to the operation of Section 13(2) read with Section 13(13) of the SARFAESI Act. A contrary interpretation would violate the intention of the legislature to provide for Section 13(13), which has a valuable role in making the SARFAESI Act a self-executory instrument for debts recovery. Moreover, such an interpretation would also violate the mandate of Section 35, SARFAESI Act which is couched in broad terms.14. In the present case, first of all there is a serious doubt as to the bona fide of the tenant, as there is no good or sufficient evidence to establish the tenancy of the appellant. According to the appellant, he is a tenant of the Secured Asset from 12.06.2012. However, the documents produced in support of his claim are xerox copies of the rent receipts and the first xerox copy of the rent receipt is of 12.05.2013 which is after the date of creation of the mortgage. It is pertinent to note here that the Borrowers have not claimed that any tenant is staying at the Secured Asset. At the time of grant of facility, third-party valuers had also confirmed that the Borrowers were staying at the Secured Asset. Be that as it may. The appellant has pleaded tenancy from 12.06.2012 to 17.12.2018. This is not supported by any registered instrument. Further, even according to the appellant, he is a tenant-in-sufferance, therefore, he is not entitled to any protection of the Rent Act. Secondly, even if the tenancy has been claimed to be renewed in terms of Section 13(13) of the SARFAESI Act, the Borrower would be required to seek consent of the secured creditor for transfer of the Secured Asset by way of sale, lease or otherwise, after issuance of the notice under Section 13(2) of the SARFAESI Act and, admittedly, no such consent has been sought by the Borrower in the present case.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: Hence, if any of the appellants claim that they are entitled to possession of a secured asset for any term exceeding one year from the date of the lease made in his favour, he has to produce proof of execution of a registered instrument in his favour by the lessor. Where he does not produce proof of execution of a registered instrument in his favour and instead relies on an unregistered instrument or oral agreement accompanied by delivery of possession, the Chief Metropolitan Magistrate or the District Magistrate, as the case may be, will have to come to the conclusion that he is not entitled to the possession of the secured asset for more than a year from the date of the instrument or from the date of delivery of possession in his favour by the landlord. 12. A Three-Judge Bench of this Court in Bajarang Shyamsunder Agarwal v. Central Bank of India & Anr. (2019) 9 SCC 94 , after considering almost all decisions of this Court, in relation to the right of a tenant in possession of the secured asset, has held that if a valid tenancy under law is in existence even prior to the creation of the mortgage, such tenants possession cannot be disturbed by the secured creditor by taking possession of the property. If a tenancy under law comes into existence after the creation of a mortgage but prior to issuance of a notice under Section 13(2) of the SARFAESI Act, it has to satisfy the conditions of Section 65-A of the Transfer of Property Act, 1882. If a tenant claims that he is entitled to possession of a Secured Asset for a term of more than a year, it has to be supported by the execution of a registered instrument. In the said decision of this Court, it was clarified that in the absence of a registered instrument, if the tenant only relies upon an unregistered instrument or an oral agreement accompanied by delivery of possession, the tenant is not entitled to possession of the secured asset for more than the period prescribed under the provisions of the Transfer of Property Act. It was held thus: 24.1. If a valid tenancy under law is in existence even prior to the creation of the mortgage, the tenants possession cannot be disturbed by the secured creditor by taking possession of the property. The lease has to be determined in accordance with Section 111 of the TP Act for determination of leases. As the existence of a prior existing lease inevitably affects the risk undertaken by the bank while providing the loan, it is expected of banks/creditors to have conducted a standard due diligence in this regard. Where the bank has proceeded to accept such a property as mortgage, it will be presumed that it has consented to the risk that comes as a consequence of the existing tenancy. In such a situation, the rights of a rightful tenant cannot be compromised under the SARFAESI Act proceedings. 24.2. If a tenancy under law comes into existence after the creation of a mortgage, but prior to the issuance of notice under Section 13(2) of the SARFAESI Act, it has to satisfy the conditions of Section 65-A of the TP Act. 24.3. In any case, if any of the tenants claim that he is entitled to possession of a secured asset for a term of more than a year, it has to be supported by the execution of a registered instrument. In the absence of a registered instrument, if the tenant relies on an unregistered instrument or an oral agreement accompanied by delivery of possession, the tenant is not entitled to possession of the secured asset for more than the period prescribed under Section 107 of the TP Act. 13. It was further held that the Rent Act would not come to the aid of a tenant-in-sufferance vis-à-vis SARFAESI Act due to the operation of Section 13(2) read with Section 13(13) of the SARFAESI Act. It was held as follows: 35. The operation of the Rent Act cannot be extended to a tenant-in-sufferance vis-à-vis the SARFAESI Act, due to the operation of Section 13(2) read with Section 13(13) of the SARFAESI Act. A contrary interpretation would violate the intention of the legislature to provide for Section 13(13), which has a valuable role in making the SARFAESI Act a self-executory instrument for debts recovery. Moreover, such an interpretation would also violate the mandate of Section 35, SARFAESI Act which is couched in broad terms. 14. In the present case, first of all there is a serious doubt as to the bona fide of the tenant, as there is no good or sufficient evidence to establish the tenancy of the appellant. According to the appellant, he is a tenant of the Secured Asset from 12.06.2012. However, the documents produced in support of his claim are xerox copies of the rent receipts and the first xerox copy of the rent receipt is of 12.05.2013 which is after the date of creation of the mortgage. It is pertinent to note here that the Borrowers have not claimed that any tenant is staying at the Secured Asset. At the time of grant of facility, third-party valuers had also confirmed that the Borrowers were staying at the Secured Asset. Be that as it may. The appellant has pleaded tenancy from 12.06.2012 to 17.12.2018. This is not supported by any registered instrument. Further, even according to the appellant, he is a tenant-in-sufferance, therefore, he is not entitled to any protection of the Rent Act. Secondly, even if the tenancy has been claimed to be renewed in terms of Section 13(13) of the SARFAESI Act, the Borrower would be required to seek consent of the secured creditor for transfer of the Secured Asset by way of sale, lease or otherwise, after issuance of the notice under Section 13(2) of the SARFAESI Act and, admittedly, no such consent has been sought by the Borrower in the present case. ### Response: 0

Maharashtra State Electricity Board Vs. Thana Electric Supply Co. & Others

that term. The Amending Act of 1976 sought to limit the economic burden of this reform. 35. The expression "nationalisation" means the acquisition and control of privately owned business by government [See Blacks Law Dictionary, 5th edn., p. 924]. In A New English Dictionary on Historical Principles by Murray, Vol. VI page 32 the word nationalisation is stated to connote the acquisition and operation by a national government of business enterprises formerly owned an operated by private individuals or corporations. Most States have nationalised their postal and telegraphic systems, and many have nationalised railways and other means of transportation. It is the policy of socialism to nationalize all productive industry. 36. The idea of nationalisation of a material resource of the community cannot be divorced from the idea of distribution of that resource in the community in a manner which advances common good. The cognate and sequential question would be whether the provisions of the Amending Act, 1976, had a reasonable and direct nexus with the objects of Article 39(b). It is true, the protection of Article 31-C is accorded only to those provisions which are basically and essentially necessary for giving effect to the objects of Article 39(b). The High Court from the trend of its reasoning in the judgment, appears to take the view that while the provision for the takeover in the Principal Act might amount to a power to acquire, however, the objects of the Amending Act of 1976, which merely sought to beat down the price could not be said to be part of that power and was, therefore, incapable of establishing any nexus with Article 39(b). There is, we say so with respect, a fallacy in this reasoning. 37. The Amending Act of 1976, renders the cost of this economic reform brought about with the objects of Article 39(b) in view an affordable one in terms of money. Can this be held to have no direct or reasonable nexus with the objects of Article 39(b) ? When a legislative enactment is challenged as not conforming to the constitutional mandate "the judicial branch of the government" it is said has only one duty - to lay the article of the Constitution which is invoked beside the statute which is challenged and to decide whether the latter squares with the former." (United State v. Butler, 297 US1). 38. In the financial memorandum appended to the Amending Act of 1976 it is, inter alia, stated: "So far as Maharashtra State is concerned, it is a matter of policy that Maharashtra State Electricity Board is purchasing private electricity undertakings as and when their licences expire. This policy will be continued and the Board will take over private undertakings hereafter also as and when their licence periods expire.Under Section 7-A of the Indian Electricity Act, on revocation of the licence as well as on the purchase of the undertaking, the board or the State Government as the case may be has to pay compensation or purchase price at the market value of the undertaking. In the normal course this market value will be very high. Under the amended Act, the Board or the State Government will be required to pay as compensation or purchase price the depreciated book value of the undertaking. This will be less than the compensation or purchase price to be paid under the present Act.Since purchase of an electrical undertaking by the State Government would be a rare possibility the extent of expenditure to government involved cannot be foretold with any amount of accuracy." 39. The communitys economic burden for social and economic reform is an integral part of the exercise involved in social and economic change in the ushering in of an egalitarian and eclectic social and economic order in tune with the ethos of the Constitution. The cost - in terms of monetary expenditure - of economic change is a factor integrated with the objects of Article 39(b). The court must, on matters of economic policy, defer to legislative judgment as conditioned by time and circumstances. The wisdom of social change is, dependent, in some degree, upon trial and error, on the felt needs of the time. 40. A similar contention was urged in Writ Petition Nos. 457 and 458 of 1972 ((1988) 1 SCC 311 : 1988 SCC (L&S) 256 : (1987) 5 ATC 325). We have discussed at para 50 of that judgment the inevitability of integrating the costs of social and economic reform - in terms of monetary burden on the State - with the effectuation of the directive principles. 41. We accordingly hold that the provisions of Amending Act of 1976 have a direct and substantial relationship with the objects of Article 39(b) and, therefore, are entitled to the protection of Article 39-C. If the impugned law has such protection, as we indeed hold that it has, all challenges to it on the ground of violation of Articles 14, 19 and 31 must necessarily fail. That apart, even on the merits, many of the contentions are insubstantial. For instance, the grievance that "service lines" had been omitted from computation of the amount is without merit. That again has been dealt with in paras 88 to 92 of the judgment in Writ Petition Nos. 457 and 458 of 1972 ((1988) 1 SCC 311 : 1988 SCC (L&S) 256 : (1987) 5 ATC 325). Insubstantial, likewise, is the contention that the value of the "goodwill" has been omitted from computation of the amount. 42. So far as the companys cross-appeal in CA No. 243 of 1985 in which the company assails the correctness of the judgment of the High Court to the extent it has gone against the company is concerned, we approve the reasons of the High Court in coming to such conclusions as it did on those aspects. Some of those aspects have, again, been dealt with in our judgments in WP Nos. 457 and 458 of 1972 and Writ Petition Nos. 5, 14 and 15 of 1974. 43.

1[ds]If the contention of the State and the Electricity Board prevails and is accepted, all other contentions which, in turn, rest on an alleged infraction of Articles 14, 19(1)(f) and (g) and 31 do not survive. It is, however, the contention of Shri Andhyarujina that the question whether the power given to the government to postpone payment of the price by fixing instalments and the statutory limitations on the rate of interest are violative of Article 19(1)(f) and (g) became purely academic in the present case as, indeed, under the orders of the High Court Rupees four crores and five lakhs had been paid even before possession was taken and that a further sum of Rupees one crore and sixteen lakhs was paid pursuant to the orders of this Court. Learned counsel also submitted further that apart altogether from the protection of Article 31-C, the Amending Act of 1976 is justifiable as a reasonable restriction on the freedom under Article 19(1) (f) andAt the outset the misconception that an express legislative declaration in the legislation in condition precedent to the attraction of Article 31-C would, perhaps, require to be removed. The High Court, we say so with respect, was under a clear misconception on the point that an express incantation was necessary in the law itself. The nexus between the law and the objects of Article 39 (b) could be shown independently of any such declaration by the legislature. The absence of evidence of nexus, in the form of an express declaration, was not by itself evidence of absence of such nexus. Indeed in State of Maharashtra v. Basantibai Mohanlal Khetan ((1986) 2 SCC 516 : AIR 1986 SC 1466 , 1475), this Court, while examining the correctness of the view of High Court that Article 31-C was inapplicable in the absence of such a declaration in the very law itself, observed : (SCC pp. 530-31, paraArticle 31-C does not say that in an Act there should be a declaration by the appropriate legislature to the effect that it is being enacted to achieve the object contained in Article 39(b). In order to ascertain whether it is protected by Article 31-C, the court has to satisfy itself about the character of the legislation by studying all parts of it. The question whether an Act is intended to secure the objects contained in Article 39(b) or not does not depend upon the declaration by the legislature but depends on itsThis proposition was not accepted. This Court said : (SCR p.the whole scheme of the Electricity Act and the rules made thereunder is kept in mind, it becomes obvious that notwithstanding the use of the expression "compulsory purchase" in the second proviso to sub-section (1) of Section 7, there is no compulsory purchase or compulsory acquisition in the sense in which that expression is ordinarilystrong reliance on these observations Shri Sen contended that any proposition of a "compulsory acquisition" with the cognate implication of the acquisition seeking to subserve the objects of Article 39(b) is alien to the present case which was one of a contractual sale. Shri Sen also referred to Article 31 (2-A), as it then stood, whichWhere a law does not provide for the transfer of the ownership or right to possession of any property to the State or to any corporation owned or controlled by the State, it shall not be deemed to provide for the compulsory acquisition or requisitioning of property, notwithstanding that it deprives any person of hiscontend that where the transfer of ownership is not brought about by the operation of law itself - but, as here, only by a consensual transaction - there is no idea of a "compulsory acquisition" in the situation which might, in turn, serve the objects of ArticleThe Division Bench of the High Court held that as the option to purchase had been exercised prior to the issue of Ordinance-50 of 1974, the licensee was entitled to the market value under the unamended Section 7-A. The High Court in effect took the view that once the option was exercised and communicated, the option with all the incidents that go with it including the stipulation as to the particular price implicit in the option binds both the parties and that the right to receive the preaches price was crystallised into a chose-in-action. The reasoning of the High Court is on thesethe time the option was exercised by the appellant under Section 7-A of the Act, the respondent company was entitled to the market value of the undertaking to be determined in accordance with the provisions of sub-section (2) of Section 7-A. There was, therefore, an implied contract between the respondent company and the appellant that the appellant would pay to the respondent company the market price of the undertaking in the event it purchased the undertaking. The option of purchase was exercised by the appellant before the amendment of Section 6 and Section 7-A of the Act by the Bihar Ordinance 50 of 1974. The appellant is, therefore, liable to pay to the respondent company the market value of the undertaking in terms of the unamended provision Sectionother words, when the option is exercised the licensee is bound to sell and the concerned authority is bound to purchase the undertaking. It is difficult to accept the contention that this binding effect on either party will be without the fixation of the purchase price or the consideration for the transaction. As soon as this stage is reached after the exercise of option to purchase by the service of a notice as mentioned in Section 6 of the Act, the concerned authority has to purchase the undertaking on payment of the market value of the undertaking to be determined in accordance with the provision of Section 7-A of the ActThe right to receive the market value of the undertaking is a debt or a chose-in-action and is property within the meaning of Article 19(1)(f) and Article 31(2) of theIt was held in that case the amending processes were violative of the licensees fundamental rights under Article 31(2) of theWhat, in the ultimate analysis, underlies, and is indeed, the emphasis in, Shri Sens submissions is the postulate that in the takeover by government of an "undertaking", there is no element of "nationalisation" of the undertaking and consequently, no question of effectuation of the objects of Article 39 (b) arises. The arguments addressed in the case are not without their interesting aspects as to what, in the last analysis, is and should bel, the form and content of a law which seeks to serve the objects of Article 39(b). In the decision of the Calcutta High Court (AIR 1982 Cal 74 : (1981) 1 Cal LJ 372) relied upon by Shri Sen, no appeal was made by the Electricity Board to the protection of Article 31-C. That apart, the concept of the licensees rights crystallising themselves into a chose-in-action upon the exercise of the option that commended itself to the Calcutta High Court did not appeal to the Bombay High Court in the judgment underThe business of an electricity supply undertaking, a public utility service, in pursuance of a licence granted underthe Electricity Act, 1910, is comprehensively controlled by the terms of that statute. The terms on which a franchise is created and conferred are amenable to unilateral modification by statute. The terms which are so amenable to unilateral alteration to the disadvantage of the licensee include the term pertaining to the quantification of the price payable for the takeover. It is difficult to accept the proposition that the right to the payment of the price gets crystallised into a chose-in-action independently of or even before the actual transfer of ownership of the undertaking. In Fazilka Electric Supply Company case (1962 Supp 3 SCR 496 : AIR 1963 SC 464 : (1962) 46 ITR 127 ) it was, no doubt, held that the transfer of the ownership of the undertaking was the result of consensual, bilateral activity. However, in Gujarat Electricity Board v. Girdharlal Motilal ((1969) 1 SCR 589 : AIR 1969 SC 267 ) referring to the relevant provisions of the 1910 Act it was held that they conferred power on the State Electricity Board "to take away the property of theIt appears to us that even if the provisions ofthe Electricity Act, 1910, are held and understood to provide for takeover by the State of a privately owned undertaking only by the adoption of the expedient of a consensual sale, that circumstance, by itself, would not be decisive of whether the Amending Act of 1976 has no direct and reasonable nexus with the objects of Article 39(b). The High Court, itself referring to the object of the relevant provisions of the 1910 Act enabling a takeoverElectricity act, 1910, as enacted contemplated State control over the material resources of electricity by providing for compulsory purchase of electricityt so far as the Amending Act was concerned the High Courtwas already the objective of the parent Act. It cannot, therefore, be held to be the object of the Amending Act ofThe reasoning of the High Court that the Amending Act, 1976, which was incorporated into the became part of the Principal Act, would have no such purpose, does not square with its own view of the purpose of the Principal Act. After having said that the relevant provisions of the Amending Act did not share with the Principal Act the objective of takeover of an undertaking the High Court on a logical corollary of that premise, held that the Amending Act had no nexus with the object of ArticleThe effect of the relevant provisions of the 1910 Act, as amended by the Amending Act of 1976, is the transfer of the ownership and control of material resources of the community for purposes of ensuring that they are so distributed as best to subserve the common good. In effect, the provisions bring about nationalisation in the larger sense of that term. The Amending Act of 1976 sought to limit the economic burden of thisThe expression "nationalisation" means the acquisition and control of privately owned business by government [See Blacks Law Dictionary, 5th edn., p. 924]. In A New English Dictionary on Historical Principles by Murray, Vol. VI page 32 the word nationalisation is stated toacquisition and operation by a national government of business enterprises formerly owned an operated by private individuals or corporations. Most States have nationalised their postal and telegraphic systems, and many have nationalised railways and other means of transportation. It is the policy of socialism to nationalize all productiveThe idea of nationalisation of a material resource of the community cannot be divorced from the idea of distribution of that resource in the community in a manner which advances common good. The cognate and sequential question would be whether the provisions of the Amending Act, 1976, had a reasonable and direct nexus with the objects of Article 39(b). It is true, the protection of Article 31-C is accorded only to those provisions which are basically and essentially necessary for giving effect to the objects of Article 39(b). The High Court from the trend of its reasoning in the judgment, appears to take the view that while the provision for the takeover in the Principal Act might amount to a power to acquire, however, the objects of the Amending Act of 1976, which merely sought to beat down the price could not be said to be part of that power and was, therefore, incapable of establishing any nexus with Article 39(b). There is, we say so with respect, a fallacy in thisThe Amending Act of 1976, renders the cost of this economic reform brought about with the objects of Article 39(b) in view an affordable one in terms of money. Can this be held to have no direct or reasonable nexus with the objects of Article 39(b) ? When a legislative enactment is challenged as not conforming to the constitutional mandate "the judicial branch of the government" it is said has only one duty - to lay the article of the Constitution which is invoked beside the statute which is challenged and to decide whether the latter squares with the former."State v. Butler, 297In the financial memorandum appended to the Amending Act of 1976 it is, inter alia,far as Maharashtra State is concerned, it is a matter of policy that Maharashtra State Electricity Board is purchasing private electricity undertakings as and when their licences expire. This policy will be continued and the Board will take over private undertakings hereafter also as and when their licence periodsSection 7-A of theIndian Electricity Act,on revocation of the licence as well as on the purchase of the undertaking, the board or the State Government as the case may be has to pay compensation or purchase price at the market value of the undertaking. In the normal course this market value will be very high. Under the amended Act, the Board or the State Government will be required to pay as compensation or purchase price the depreciated book value of the undertaking. This will be less than the compensation or purchase price to be paid under the presentpurchase of an electrical undertaking by the State Government would be a rare possibility the extent of expenditure to government involved cannot be foretold with any amount ofThe communitys economic burden for social and economic reform is an integral part of the exercise involved in social and economic change in the ushering in of an egalitarian and eclectic social and economic order in tune with the ethos of the Constitution. The cost - in terms of monetary expenditure - of economic change is a factor integrated with the objects of Article 39(b). The court must, on matters of economic policy, defer to legislative judgment as conditioned by time and circumstances. The wisdom of social change is, dependent, in some degree, upon trial and error, on the felt needs of theA similar contention was urged in Writ Petition Nos. 457 and 458 of 1972 ((1988) 1 SCC 311 : 1988 SCC (L&S) 256 : (1987) 5 ATC 325). We have discussed at para 50 of that judgment the inevitability of integrating the costs of social and economic reform - in terms of monetary burden on the State - with the effectuation of the directiveWe accordingly hold that the provisions of Amending Act of 1976 have a direct and substantial relationship with the objects of Article 39(b) and, therefore, are entitled to the protection of Article 39-C. If the impugned law has such protection, as we indeed hold that it has, all challenges to it on the ground of violation of Articles 14, 19 and 31 must necessarily fail. That apart, even on the merits, many of the contentions are insubstantial. For instance, the grievance that "service lines" had been omitted from computation of the amount is without merit. That again has been dealt with in paras 88 to 92 of the judgment in Writ Petition Nos. 457 and 458 of 1972 ((1988) 1 SCC 311 : 1988 SCC (L&S) 256 : (1987) 5 ATC 325). Insubstantial, likewise, is the contention that the value of the "goodwill" has been omitted from computation of theSo far as the companys cross-appeal in CA No. 243 of 1985 in which the company assails the correctness of the judgment of the High Court to the extent it has gone against the company is concerned, we approve the reasons of the High Court in coming to such conclusions as it did on those aspects. Some of those aspects have, again, been dealt with in our judgments in WP Nos. 457 and 458 of 1972 and Writ Petition Nos. 5, 14 and 15 of 1974

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: that term. The Amending Act of 1976 sought to limit the economic burden of this reform. 35. The expression "nationalisation" means the acquisition and control of privately owned business by government [See Blacks Law Dictionary, 5th edn., p. 924]. In A New English Dictionary on Historical Principles by Murray, Vol. VI page 32 the word nationalisation is stated to connote the acquisition and operation by a national government of business enterprises formerly owned an operated by private individuals or corporations. Most States have nationalised their postal and telegraphic systems, and many have nationalised railways and other means of transportation. It is the policy of socialism to nationalize all productive industry. 36. The idea of nationalisation of a material resource of the community cannot be divorced from the idea of distribution of that resource in the community in a manner which advances common good. The cognate and sequential question would be whether the provisions of the Amending Act, 1976, had a reasonable and direct nexus with the objects of Article 39(b). It is true, the protection of Article 31-C is accorded only to those provisions which are basically and essentially necessary for giving effect to the objects of Article 39(b). The High Court from the trend of its reasoning in the judgment, appears to take the view that while the provision for the takeover in the Principal Act might amount to a power to acquire, however, the objects of the Amending Act of 1976, which merely sought to beat down the price could not be said to be part of that power and was, therefore, incapable of establishing any nexus with Article 39(b). There is, we say so with respect, a fallacy in this reasoning. 37. The Amending Act of 1976, renders the cost of this economic reform brought about with the objects of Article 39(b) in view an affordable one in terms of money. Can this be held to have no direct or reasonable nexus with the objects of Article 39(b) ? When a legislative enactment is challenged as not conforming to the constitutional mandate "the judicial branch of the government" it is said has only one duty - to lay the article of the Constitution which is invoked beside the statute which is challenged and to decide whether the latter squares with the former." (United State v. Butler, 297 US1). 38. In the financial memorandum appended to the Amending Act of 1976 it is, inter alia, stated: "So far as Maharashtra State is concerned, it is a matter of policy that Maharashtra State Electricity Board is purchasing private electricity undertakings as and when their licences expire. This policy will be continued and the Board will take over private undertakings hereafter also as and when their licence periods expire.Under Section 7-A of the Indian Electricity Act, on revocation of the licence as well as on the purchase of the undertaking, the board or the State Government as the case may be has to pay compensation or purchase price at the market value of the undertaking. In the normal course this market value will be very high. Under the amended Act, the Board or the State Government will be required to pay as compensation or purchase price the depreciated book value of the undertaking. This will be less than the compensation or purchase price to be paid under the present Act.Since purchase of an electrical undertaking by the State Government would be a rare possibility the extent of expenditure to government involved cannot be foretold with any amount of accuracy." 39. The communitys economic burden for social and economic reform is an integral part of the exercise involved in social and economic change in the ushering in of an egalitarian and eclectic social and economic order in tune with the ethos of the Constitution. The cost - in terms of monetary expenditure - of economic change is a factor integrated with the objects of Article 39(b). The court must, on matters of economic policy, defer to legislative judgment as conditioned by time and circumstances. The wisdom of social change is, dependent, in some degree, upon trial and error, on the felt needs of the time. 40. A similar contention was urged in Writ Petition Nos. 457 and 458 of 1972 ((1988) 1 SCC 311 : 1988 SCC (L&S) 256 : (1987) 5 ATC 325). We have discussed at para 50 of that judgment the inevitability of integrating the costs of social and economic reform - in terms of monetary burden on the State - with the effectuation of the directive principles. 41. We accordingly hold that the provisions of Amending Act of 1976 have a direct and substantial relationship with the objects of Article 39(b) and, therefore, are entitled to the protection of Article 39-C. If the impugned law has such protection, as we indeed hold that it has, all challenges to it on the ground of violation of Articles 14, 19 and 31 must necessarily fail. That apart, even on the merits, many of the contentions are insubstantial. For instance, the grievance that "service lines" had been omitted from computation of the amount is without merit. That again has been dealt with in paras 88 to 92 of the judgment in Writ Petition Nos. 457 and 458 of 1972 ((1988) 1 SCC 311 : 1988 SCC (L&S) 256 : (1987) 5 ATC 325). Insubstantial, likewise, is the contention that the value of the "goodwill" has been omitted from computation of the amount. 42. So far as the companys cross-appeal in CA No. 243 of 1985 in which the company assails the correctness of the judgment of the High Court to the extent it has gone against the company is concerned, we approve the reasons of the High Court in coming to such conclusions as it did on those aspects. Some of those aspects have, again, been dealt with in our judgments in WP Nos. 457 and 458 of 1972 and Writ Petition Nos. 5, 14 and 15 of 1974. 43. ### Response: 1

Collector of Central Excise, Patna Vs. Tata Iron & Steel Company Limited

S.P.BHARUCHA(1) The assessee held a stock of exigible goods in fully manufactured condition on 1st March, 1989. On this date the special excise duty leviable on such goods was enhanced. The goods were cleared after 1st March, 1989. The question in this appeal is : Are the goods exigible to special excise duty at the rate that was in force prior to 1st March, 1989, when they were manufactured, or at the rate in force after 1st March, 1989, when they were cleared? The authorities held that they were liable to special excise duty at the enhanced rate, basing themselves upon the judgment of this Court in Wallace Flour Mills Company Ltd. v. Collector of Central Excise. The tribunal took the contrary view, relying upon the judgment of this Court in Ponds India Ltd. v. Collector of Central Excise, Madras.(2) In our view, the tribunal was right in the view that it took. Special excise duty is an annual levy, as has been explained in the judgment in Ponds. It ceases to have effect on the 28th February of a given year and a new levy, distinct and different, comes into operation with effect from the 1st of March of that year. Therefore, goods manufactured during the earlier period must be deemed to have been cleared on the last day of that period and exigible to special excise duty at the rate, if any, prevalent during that period.(3) We are unable to accept the submission on behalf of the revenue that the enhanced rate of special excise duty applies to goods manufactured during the earlier period but cleared during the later period because special excise duty was leviable during the earlier period. This is for the reason that the levy during the previous period and the levy during the later period are different, as explained in Ponds.(4) The decision of the tribunal must, therefore, be affirmed. The assessee will be entitled to refund in accordance with the provisions of the statute, as amended, and the judgment of this Court in Mafatlal Industries Ltd. v. Union of India and Ors.

0[ds](2) In our view, the tribunal was right in the view that it took. Special excise duty is an annual levy, as has been explained in the judgment in Ponds. It ceases to have effect on the 28th February of a given year and a new levy, distinct and different, comes into operation with effect from the 1st of March of that year. Therefore, goods manufactured during the earlier period must be deemed to have been cleared on the last day of that period and exigible to special excise duty at the rate, if any, prevalent during that period.(3) We are unable to accept the submission on behalf of the revenue that the enhanced rate of special excise duty applies to goods manufactured during the earlier period but cleared during the later period because special excise duty was leviable during the earlier period. This is for the reason that the levy during the previous period and the levy during the later period are different, as explained in Ponds.(4) The decision of the tribunal must, therefore, be affirmed. The assessee will be entitled to refund in accordance with the provisions of the statute, as amended, and the judgment of this Court in Mafatlal Industries Ltd. v. Union of India and Ors.

### Instruction: Examine the details of the case proceeding and forecast if the appeal/petition stands a chance of being upheld (1) or dismissed (0). ### Input: S.P.BHARUCHA(1) The assessee held a stock of exigible goods in fully manufactured condition on 1st March, 1989. On this date the special excise duty leviable on such goods was enhanced. The goods were cleared after 1st March, 1989. The question in this appeal is : Are the goods exigible to special excise duty at the rate that was in force prior to 1st March, 1989, when they were manufactured, or at the rate in force after 1st March, 1989, when they were cleared? The authorities held that they were liable to special excise duty at the enhanced rate, basing themselves upon the judgment of this Court in Wallace Flour Mills Company Ltd. v. Collector of Central Excise. The tribunal took the contrary view, relying upon the judgment of this Court in Ponds India Ltd. v. Collector of Central Excise, Madras.(2) In our view, the tribunal was right in the view that it took. Special excise duty is an annual levy, as has been explained in the judgment in Ponds. It ceases to have effect on the 28th February of a given year and a new levy, distinct and different, comes into operation with effect from the 1st of March of that year. Therefore, goods manufactured during the earlier period must be deemed to have been cleared on the last day of that period and exigible to special excise duty at the rate, if any, prevalent during that period.(3) We are unable to accept the submission on behalf of the revenue that the enhanced rate of special excise duty applies to goods manufactured during the earlier period but cleared during the later period because special excise duty was leviable during the earlier period. This is for the reason that the levy during the previous period and the levy during the later period are different, as explained in Ponds.(4) The decision of the tribunal must, therefore, be affirmed. The assessee will be entitled to refund in accordance with the provisions of the statute, as amended, and the judgment of this Court in Mafatlal Industries Ltd. v. Union of India and Ors. ### Response: 0

M/S. Indcon Structurals (P) Ltd Vs. Commnr. Of Central Excise, Chennai

it has acquired a definite trade and business understanding. The record shows that the adjudicating authority in its order has recorded categorical finding that in support of the claim, the assessee-Company has produced on record certificates of the well-known Architects or Engineers and Town Planners, Interior Design Engineers and Consultants and users to the effect that the cement tiles manufactured by the assessee-Company are totally different from floor coverings. Some samples pertaining to floor coverings and other products, including cement tiles, were produced by the assessee-Company as material evidence for comparative analysis before the adjudicating authority at the time of inspection of the factory premises. The adjudicating authority on such inspection had studied the process of manufacture of cement tiles and found that cement, sand, blue metal, gravel were mixed in pre-determined proposition along with pigments and then the mixture was poured into moulds, compacted and allowed to set automatically through vibration table. The adjudicating authority further noticed that the cement tiles were demoulded, cured, surface treated and are marketed in the brand name of Eurocon tiles. These tiles are capable of using for wall application of both external/ internal wall tiling, which form an integral part of the wall on which they are cemented. The adjudicating authority also studied the product in question with reference to its characteristics, temperature resistance, structural properties and durability. The authority has also perused Section Notes/ Chapter Notes of Chapters 39, 57, 59 and 68 dealing with the goods floor coverings and flooring materials. On going through the expressions given for the products, floor coverings / wall coverings under Chapter Headings 39, 57 and 59, which are made out of plastics, coir / textiles, the adjudicating authority has observed that floor coverings have got a distinct identity from the floor materials as the floor covering materials are totally different products which are commonly used as an additional coverage to an existing floor / wall, only for the purpose of beautification and decoration. The authority also observed that floor coverings are quite replaceable in nature since they are mechanically placed on the floor and could be reusable also, whereas the tiles such as mosaic / granite /cement tiles which are basically embedded to the floor is normally on lifetime basis and further that such tiles once laid on the floor are almost impossible to remove without breaking or causing damage to the floor itself. The major differences that exist between the floor materials and floor covering materials along with specifications maintained by ISI No. 1237/1980 for cement tiles and ISI No. 11206/1984 and ISI No. 809/92 for other floor covering materials would go to show that basically the specifications so maintained by ISI for cement tiles and for other floor covering materials are not akin in nature. On close examination of the entire material on record, the adjudicating authority has come to the definite conclusion that the cement tiles manufactured by the assessee-company are in no way akin to floor covering materials and these are covered within the nomenclature of floor tiles and, therefore, the assessee-Company is entitled to the benefit of Exemption Notification No. 59/90. 11. The appellate authority as noticed earlier has confirmed the order of the adjudicating authority and held that the cement tiles in question are not floor coverings and the benefit of the notification has been rightly extended to the assessee-Company. The Member (Technical) of the CEGAT has also come to the conclusion that the cement tiles in question are flooring materials and become constituent part of the floor or wall or stairways. These tiles cannot be termed as floor coverings. In support of his findings, the Member (Technical) has taken into consideration notes of the IS specifications and various certificates issued by the qualified Architects, Engineers, Valuers and Interor-Designers dealing in the said goods. The other two Members of the CEGAT, in our view, have failed to consider the nomenclature of the words and expressions "floor coverings in rolls or in the form of tiles" as used under sub-headings 6807.00 in the description of goods specified in Table annexed with the Exemption Notification. The majority Members in recording different view than the one taken by the adjudicating authority, the first appellate authority and the Member (Technical), CEGAT, have only observed that no restricted meaning could be given to the expression "floor-coverings" as to include only those items which could be just separate or placed on the floor and to put the items that are affixed to the floor to cover the same out of its purview. The second Member (Technical) in his separate order, supporting the order of the Member (Judicial), has mainly relied upon an earlier decision in Niraj Cement Structurals vs. Collector of Central Excise Mumbai (1998 (101) E.L.T. 284 (Tribunal). We have gone through the said decision of the Tribunal but, in our considered view, the same is of no assistance or help to the Revenue in peculiar facts and circumstances of the present case. In that case, the assessee was manufacturer of tiles covered by the same Notification No. 59/90-CE and description of the goods were also under the same sub-heading. In that case the product manufactured by the Company was used as floor coverings inasmuch as the titles were placed on the floor covering the cable running underneath the floor. Thus, the findings of the Tribunal in the Niraj Cement case (supra) cannot be uniformity applied to the products in question manufactured by the assessee-Company. 12. In the facts and circumstances narrated hereinabove, the noted contentions of the learned Additional Solicitor General do not merit acceptance. The objection of the Revenue that the cement tiles manufactured by the assessee-Company are covered under the expression "floor coverings in rolls or in the form of tiles" is misconceived. 13. We, therefore, hold that as per the trade understanding and usages, cement tiles, the subject-matter of the present case, is a form of floor itself and, therefore, entitled to the benefit of Exemption Notification No. 59/1990. 14.

1[ds]The appellate authority as noticed earlier has confirmed the order of the adjudicating authority and held that the cement tiles in question are not floor coverings and the benefit of the notification has been rightly extended to the assessee-Company. The Member (Technical) of the CEGAT has also come to the conclusion that the cement tiles in question are flooring materials and become constituent part of the floor or wall or stairways. These tiles cannot be termed as floor coverings. In support of his findings, the Member (Technical) has taken into consideration notes of the IS specifications and various certificates issued by the qualified Architects, Engineers, Valuers and Interor-Designers dealing in the said goods. The other two Members of the CEGAT, in our view, have failed to consider the nomenclature of the words and expressions "floor coverings in rolls or in the form of tiles" as used under sub-headings 6807.00 in the description of goods specified in Table annexed with the Exemption Notification. The majority Members in recording different view than the one taken by the adjudicating authority, the first appellate authority and the Member (Technical), CEGAT, have only observed that no restricted meaning could be given to the expression "floor-coverings" as to include only those items which could be just separate or placed on the floor and to put the items that are affixed to the floor to cover the same out of its purview. The second Member (Technical) in his separate order, supporting the order of the Member (Judicial), has mainly relied upon an earlier decision in Niraj Cement Structurals vs. Collector of Central Excise Mumbai (1998 (101) E.L.T. 284 (Tribunal). We have gone through the said decision of the Tribunal but, in our considered view, the same is of no assistance or help to the Revenue in peculiar facts and circumstances of the present case. In that case, the assessee was manufacturer of tiles covered by the same Notification No. 59/90-CE and description of the goods were also under the same sub-heading. In that case the product manufactured by the Company was used as floor coverings inasmuch as the titles were placed on the floor covering the cable running underneath the floor. Thus, the findings of the Tribunal in the Niraj Cement case (supra) cannot be uniformity applied to the products in question manufactured by thethe facts and circumstances narrated hereinabove, the noted contentions of the learned Additional Solicitor General do not merit acceptance. The objection of the Revenue that the cement tiles manufactured by the assessee-Company are covered under the expression "floor coverings in rolls or in the form of tiles" istherefore, hold that as per the trade understanding and usages, cement tiles, the subject-matter of the present case, is a form of floor itself and, therefore, entitled to the benefit of Exemption Notification No. 59/1990.

### Instruction: Review the case details and predict the decision: will the court accept (1) or deny (0) the appeal/petition? ### Input: it has acquired a definite trade and business understanding. The record shows that the adjudicating authority in its order has recorded categorical finding that in support of the claim, the assessee-Company has produced on record certificates of the well-known Architects or Engineers and Town Planners, Interior Design Engineers and Consultants and users to the effect that the cement tiles manufactured by the assessee-Company are totally different from floor coverings. Some samples pertaining to floor coverings and other products, including cement tiles, were produced by the assessee-Company as material evidence for comparative analysis before the adjudicating authority at the time of inspection of the factory premises. The adjudicating authority on such inspection had studied the process of manufacture of cement tiles and found that cement, sand, blue metal, gravel were mixed in pre-determined proposition along with pigments and then the mixture was poured into moulds, compacted and allowed to set automatically through vibration table. The adjudicating authority further noticed that the cement tiles were demoulded, cured, surface treated and are marketed in the brand name of Eurocon tiles. These tiles are capable of using for wall application of both external/ internal wall tiling, which form an integral part of the wall on which they are cemented. The adjudicating authority also studied the product in question with reference to its characteristics, temperature resistance, structural properties and durability. The authority has also perused Section Notes/ Chapter Notes of Chapters 39, 57, 59 and 68 dealing with the goods floor coverings and flooring materials. On going through the expressions given for the products, floor coverings / wall coverings under Chapter Headings 39, 57 and 59, which are made out of plastics, coir / textiles, the adjudicating authority has observed that floor coverings have got a distinct identity from the floor materials as the floor covering materials are totally different products which are commonly used as an additional coverage to an existing floor / wall, only for the purpose of beautification and decoration. The authority also observed that floor coverings are quite replaceable in nature since they are mechanically placed on the floor and could be reusable also, whereas the tiles such as mosaic / granite /cement tiles which are basically embedded to the floor is normally on lifetime basis and further that such tiles once laid on the floor are almost impossible to remove without breaking or causing damage to the floor itself. The major differences that exist between the floor materials and floor covering materials along with specifications maintained by ISI No. 1237/1980 for cement tiles and ISI No. 11206/1984 and ISI No. 809/92 for other floor covering materials would go to show that basically the specifications so maintained by ISI for cement tiles and for other floor covering materials are not akin in nature. On close examination of the entire material on record, the adjudicating authority has come to the definite conclusion that the cement tiles manufactured by the assessee-company are in no way akin to floor covering materials and these are covered within the nomenclature of floor tiles and, therefore, the assessee-Company is entitled to the benefit of Exemption Notification No. 59/90. 11. The appellate authority as noticed earlier has confirmed the order of the adjudicating authority and held that the cement tiles in question are not floor coverings and the benefit of the notification has been rightly extended to the assessee-Company. The Member (Technical) of the CEGAT has also come to the conclusion that the cement tiles in question are flooring materials and become constituent part of the floor or wall or stairways. These tiles cannot be termed as floor coverings. In support of his findings, the Member (Technical) has taken into consideration notes of the IS specifications and various certificates issued by the qualified Architects, Engineers, Valuers and Interor-Designers dealing in the said goods. The other two Members of the CEGAT, in our view, have failed to consider the nomenclature of the words and expressions "floor coverings in rolls or in the form of tiles" as used under sub-headings 6807.00 in the description of goods specified in Table annexed with the Exemption Notification. The majority Members in recording different view than the one taken by the adjudicating authority, the first appellate authority and the Member (Technical), CEGAT, have only observed that no restricted meaning could be given to the expression "floor-coverings" as to include only those items which could be just separate or placed on the floor and to put the items that are affixed to the floor to cover the same out of its purview. The second Member (Technical) in his separate order, supporting the order of the Member (Judicial), has mainly relied upon an earlier decision in Niraj Cement Structurals vs. Collector of Central Excise Mumbai (1998 (101) E.L.T. 284 (Tribunal). We have gone through the said decision of the Tribunal but, in our considered view, the same is of no assistance or help to the Revenue in peculiar facts and circumstances of the present case. In that case, the assessee was manufacturer of tiles covered by the same Notification No. 59/90-CE and description of the goods were also under the same sub-heading. In that case the product manufactured by the Company was used as floor coverings inasmuch as the titles were placed on the floor covering the cable running underneath the floor. Thus, the findings of the Tribunal in the Niraj Cement case (supra) cannot be uniformity applied to the products in question manufactured by the assessee-Company. 12. In the facts and circumstances narrated hereinabove, the noted contentions of the learned Additional Solicitor General do not merit acceptance. The objection of the Revenue that the cement tiles manufactured by the assessee-Company are covered under the expression "floor coverings in rolls or in the form of tiles" is misconceived. 13. We, therefore, hold that as per the trade understanding and usages, cement tiles, the subject-matter of the present case, is a form of floor itself and, therefore, entitled to the benefit of Exemption Notification No. 59/1990. 14. ### Response: 1

The State Of Kerala Vs. The Pullangode Rubber And Produce Co.Ltd

or cinnamon or that they were being used on that day for any purpose ancillary to the cultivation of such crops or that they were being used on that day for the preparation of such crops for the market.11. We now turn to the question whether land used for providing firewood to a rubber estates smoke-houses and its workers is land that is not a private forest within the meaning of the said Act. The question is now answered by the judgment of this Court in Pioneer Rubber Plantation, Nalambur, Kerala State v. State of Kerala and another, 1992(4) SCC 175. The majority of the Bench of three learned Judges held that it appeared reasonable that the area "required for the purpose of growing firewood trees for fuel in the factories and smoke-houses (of rubber plantations) as well as for supply to the employees of the estate for their domestic use should be excluded from the definition of the term `private forest." 12. The High Court was, therefore, right in holding that land used for supplying firewood for the smoke-houses of the company was excludable from the definition of `private forest under the said Act. The consequential question is whether the High Court was right in making an assessment thereof as indicated above and fixing an extent of 75 acres in this behalf. The answer must be in the negative.13. As demonstrated above by an analysis of the definition, it was for the company to plead and establish by evidence that on 10th May, 1971 the land admeasuring 594.78 acres or some specific part thereof was being used for supplying firewood to its smoke-houses and its workmen.14. As the companys claim statement before the Tribunal, which we have quoted above, shows, it had not even made an averment that the area of 594.78 acres or some specific part thereof was being used on 10th May, 1971 for supplying firewood to its smoke-houses or its workmen. Even so, and concentrating very properly on the date 10th May, 1971, the Tribunal discussed the companys evidence, oral and documentary, in some detail. It found, and rightly, that the evidence did not establish that this acreage of land or any specific part thereof was being used by the company for these purposes on 10th May, 1971. In the absence of evidence the companys claim must fail in regard to the entire area of 594.78 acres.15. In the same proceeding, the company contended before the Tribunal that two areas of land (R.S. 1032 admeasuring 28.40 acres and R.S. 1964 admeasuring 37.75 acres) were wooded areas in enclaves surrounded by its rubber plantation and that these should not be considered private forests. The Tribunal noted the evidence of the companys witness that if such land was treated as a forest vested in the State, the companys surrounding plantation would be jeopardised. The Tribunal found that it could not be held that these were lands utilised for any purpose covered by the definition quoted above and held them to be private forests. The High Court, in appeal, noted that the wooded area of 28.40 acres in R.S. 1032 was an enclave surrounded by rubber trees but that the area of 37.75 acres in R.S. 739 lay on the boundary of the companys estate. The High Court, being unsatisfied with the evidence in this behalf, rejected the companys claim in regard to these two areas of the said land, and the company is in appeal. Â?37Â?3
Å16. Our attention was drawn by learned counsel for the company to the judgment of this Court in Bhavani Tea and Produce Co. Ltd. v. State of Kerala and others, 1991(2) SCC 483. Among other claims in this matter was a claim by the appellant tea company that certain areas of land within its plantation were excluded from the purview of the said Act. A Bench of two learned Judges of this Court said that the said Act, the Kerala Forest Act, the Kerala Land Reforms Act and the Madras Preservation of Private Forest Act considered plantations as well. Therefore, while applying the said Act, the same principle was applicable. Accordingly, it was reasonable to take division of the plantation as a unit and apply the principle aforementioned. Based thereon, this Court held that plots admeasuing 25.08 acres, 1.65 acres, 3.82 acres, 10.70 acres, 10.58 acres, 8.10 acres and 24.84 acres formed small portions of the respective divisions of the plantation and could be taken to have been principally cultivated. Accordingly, these plots were found to be exempt from vesting under the said Act.17. We respectfully agree, having regard particularly to the words in the definition, "lands which are used principally for the cultivation of.....", where the large part of a parcel of land is used for plantation of the specified crops leaving only a small part within not so cultivated, it is reasonable to say that the parcel of land as a whole is used principally for the cultivation of the specified crops. The principle would apply in the instant case to the land admeasuring 28.40 acres in R.S. 1032 because it is an enclave within the companys plantation of 2148.28 acres. The area of 37.75 acres in R.S. 1964 is on the periphery of the companys plantation and there is nothing to suggest that it is bounded elsewhere also by a rubber plantation. The exemption, therefore, cannot be made applicable to R.S. 1964.18. Before parting with these appeals we must mention that they were ordered to be heard by a three Judge Bench because it had been contended, based upon the decision in the case of Bhavani Tea and Produce Co. Ltd. (supra), that a cultivated plantation was excluded from the operation of the Madras Preservation of Private Forest Act. No such argument has been advanced before us, even after we pointed out the referral order. It is, therefore not necessary for us to consider the correctness of the decision in Bhavani Tea and Produce Co. Ltd. in its entirety.

1[ds]12. The High Court was, therefore, right in holding that land used for supplying firewood for theof the company was excludable from the definition of `private forest under the said Act. The consequential question is whether the High Court was right in making an assessment thereof as indicated above and fixing an extent of 75 acres in this behalf. The answer must be in the negative.13. As demonstrated above by an analysis of the definition, it was for the company to plead and establish by evidence that on 10th May, 1971 the land admeasuring 594.78 acres or some specific part thereof was being used for supplying firewood to itsand its workmen.14. As the companys claim statement before the Tribunal, which we have quoted above, shows, it had not even made an averment that the area of 594.78 acres or some specific part thereof was being used on 10th May, 1971 for supplying firewood to itsor its workmen. Even so, and concentrating very properly on the date 10th May, 1971, the Tribunal discussed the companys evidence, oral and documentary, in some detail. It found, and rightly, that the evidence did not establish that this acreage of land or any specific part thereof was being used by the company for these purposes on 10th May, 1971. In the absence of evidence the companys claim must fail in regard to the entire area of 594.78 acres.15. In the same proceeding, the company contended before the Tribunal that two areas of land (R.S. 1032 admeasuring 28.40 acres and R.S. 1964 admeasuring 37.75 acres) were wooded areas in enclaves surrounded by its rubber plantation and that these should not be considered private forests. The Tribunal noted the evidence of the companys witness that if such land was treated as a forest vested in the State, the companys surrounding plantation would be jeopardised. The Tribunal found that it could not be held that these were lands utilised for any purpose covered by the definition quoted above and held them to be private forests. The High Court, in appeal, noted that the wooded area of 28.40 acres in R.S. 1032 was an enclave surrounded by rubber trees but that the area of 37.75 acres in R.S. 739 lay on the boundary of the companys estate. The High Court, being unsatisfied with the evidence in this behalf, rejected the companys claim in regard to these two areas of the said land, and the company is in appeal. Â?37Â?3
 Å16. Our attention was drawn by learned counsel for the company to the judgment of this Court in Bhavani Tea and Produce Co. Ltd. v. State of Kerala and others, 1991(2) SCC 483. Among other claims in this matter was a claim by the appellant tea company that certain areas of land within its plantation were excluded from the purview of the said Act. A Bench of two learned Judges of this Court said that the said Act, the Kerala Forest Act, the Kerala Land Reforms Act and the Madras Preservation of Private Forest Act considered plantations as well. Therefore, while applying the said Act, the same principle was applicable. Accordingly, it was reasonable to take division of the plantation as a unit and apply the principle aforementioned. Based thereon, this Court held that plots admeasuing 25.08 acres, 1.65 acres, 3.82 acres, 10.70 acres, 10.58 acres, 8.10 acres and 24.84 acres formed small portions of the respective divisions of the plantation and could be taken to have been principally cultivated. Accordingly, these plots were found to be exempt from vesting under the said Act.17. We respectfully agree, having regard particularly to the words in the definition, "lands which are used principally for the cultivation of.....", where the large part of a parcel of land is used for plantation of the specified crops leaving only a small part within not so cultivated, it is reasonable to say that the parcel of land as a whole is used principally for the cultivation of the specified crops. The principle would apply in the instant case to the land admeasuring 28.40 acres in R.S. 1032 because it is an enclave within the companys plantation of 2148.28 acres. The area of 37.75 acres in R.S. 1964 is on the periphery of the companys plantation and there is nothing to suggest that it is bounded elsewhere also by a rubber plantation. The exemption, therefore, cannot be made applicable to R.S. 1964.18. Before parting with these appeals we must mention that they were ordered to be heard by a three Judge Bench because it had been contended, based upon the decision in the case of Bhavani Tea and Produce Co. Ltd. (supra), that a cultivated plantation was excluded from the operation of the Madras Preservation of Private Forest Act. No such argument has been advanced before us, even after we pointed out the referral order. It is, therefore not necessary for us to consider the correctness of the decision in Bhavani Tea and Produce Co. Ltd. in its entirety.

### Instruction: Review the case details and predict the decision: will the court accept (1) or deny (0) the appeal/petition? ### Input: or cinnamon or that they were being used on that day for any purpose ancillary to the cultivation of such crops or that they were being used on that day for the preparation of such crops for the market.11. We now turn to the question whether land used for providing firewood to a rubber estates smoke-houses and its workers is land that is not a private forest within the meaning of the said Act. The question is now answered by the judgment of this Court in Pioneer Rubber Plantation, Nalambur, Kerala State v. State of Kerala and another, 1992(4) SCC 175. The majority of the Bench of three learned Judges held that it appeared reasonable that the area "required for the purpose of growing firewood trees for fuel in the factories and smoke-houses (of rubber plantations) as well as for supply to the employees of the estate for their domestic use should be excluded from the definition of the term `private forest." 12. The High Court was, therefore, right in holding that land used for supplying firewood for the smoke-houses of the company was excludable from the definition of `private forest under the said Act. The consequential question is whether the High Court was right in making an assessment thereof as indicated above and fixing an extent of 75 acres in this behalf. The answer must be in the negative.13. As demonstrated above by an analysis of the definition, it was for the company to plead and establish by evidence that on 10th May, 1971 the land admeasuring 594.78 acres or some specific part thereof was being used for supplying firewood to its smoke-houses and its workmen.14. As the companys claim statement before the Tribunal, which we have quoted above, shows, it had not even made an averment that the area of 594.78 acres or some specific part thereof was being used on 10th May, 1971 for supplying firewood to its smoke-houses or its workmen. Even so, and concentrating very properly on the date 10th May, 1971, the Tribunal discussed the companys evidence, oral and documentary, in some detail. It found, and rightly, that the evidence did not establish that this acreage of land or any specific part thereof was being used by the company for these purposes on 10th May, 1971. In the absence of evidence the companys claim must fail in regard to the entire area of 594.78 acres.15. In the same proceeding, the company contended before the Tribunal that two areas of land (R.S. 1032 admeasuring 28.40 acres and R.S. 1964 admeasuring 37.75 acres) were wooded areas in enclaves surrounded by its rubber plantation and that these should not be considered private forests. The Tribunal noted the evidence of the companys witness that if such land was treated as a forest vested in the State, the companys surrounding plantation would be jeopardised. The Tribunal found that it could not be held that these were lands utilised for any purpose covered by the definition quoted above and held them to be private forests. The High Court, in appeal, noted that the wooded area of 28.40 acres in R.S. 1032 was an enclave surrounded by rubber trees but that the area of 37.75 acres in R.S. 739 lay on the boundary of the companys estate. The High Court, being unsatisfied with the evidence in this behalf, rejected the companys claim in regard to these two areas of the said land, and the company is in appeal. Â?37Â?3
Å16. Our attention was drawn by learned counsel for the company to the judgment of this Court in Bhavani Tea and Produce Co. Ltd. v. State of Kerala and others, 1991(2) SCC 483. Among other claims in this matter was a claim by the appellant tea company that certain areas of land within its plantation were excluded from the purview of the said Act. A Bench of two learned Judges of this Court said that the said Act, the Kerala Forest Act, the Kerala Land Reforms Act and the Madras Preservation of Private Forest Act considered plantations as well. Therefore, while applying the said Act, the same principle was applicable. Accordingly, it was reasonable to take division of the plantation as a unit and apply the principle aforementioned. Based thereon, this Court held that plots admeasuing 25.08 acres, 1.65 acres, 3.82 acres, 10.70 acres, 10.58 acres, 8.10 acres and 24.84 acres formed small portions of the respective divisions of the plantation and could be taken to have been principally cultivated. Accordingly, these plots were found to be exempt from vesting under the said Act.17. We respectfully agree, having regard particularly to the words in the definition, "lands which are used principally for the cultivation of.....", where the large part of a parcel of land is used for plantation of the specified crops leaving only a small part within not so cultivated, it is reasonable to say that the parcel of land as a whole is used principally for the cultivation of the specified crops. The principle would apply in the instant case to the land admeasuring 28.40 acres in R.S. 1032 because it is an enclave within the companys plantation of 2148.28 acres. The area of 37.75 acres in R.S. 1964 is on the periphery of the companys plantation and there is nothing to suggest that it is bounded elsewhere also by a rubber plantation. The exemption, therefore, cannot be made applicable to R.S. 1964.18. Before parting with these appeals we must mention that they were ordered to be heard by a three Judge Bench because it had been contended, based upon the decision in the case of Bhavani Tea and Produce Co. Ltd. (supra), that a cultivated plantation was excluded from the operation of the Madras Preservation of Private Forest Act. No such argument has been advanced before us, even after we pointed out the referral order. It is, therefore not necessary for us to consider the correctness of the decision in Bhavani Tea and Produce Co. Ltd. in its entirety. ### Response: 1

Bajrang Factory Ltd. & Another Vs. University of Calcutta & Others

every word used in a document, such a construction should be accepted instead of a construction which would have the effect of cutting down the clear meaning of the words used by the testator. Further, where one of the two reasonable constructions would lead to intestacy, that should be discarded in favour of a construction which does not create any such hiatus. ( Pearey Lal v. Rameshwar Das) (5) It is one of the cardinal principles of construction of wills that to the extent that it is legally possible effect should be given to every disposition contained in the will unless the law prevents effect being given to it. Of course, if there are two repugnant provisions conferring successive interests, if the first interest created is valid the subsequent interest cannot take effect but a Court of construction will proceed to the farthest extent to avoid repugnancy, so that effect could be given as far as possible to every testamentary intention contained in the will. ( Ramachandra Shenoy v. Hilda Brite Mrs ) 41. To the same effect are the judgments of this Court in Arunkumar and Another v. Shriniwas and Others [(2003) 6 SCC 98] , Uma Devi Nambiar and Others v. T.C. Sidhan (Dead) [(2004) 2 SCC 321] , Sadhu Singh v. Gurdwara Sahib Narike and Others [(2006) 8 SCC 75] and Gurdev Kaur and Others v. Kaki and Others [(2007) 1 SCC 546] . 42. In Halsburys Law of England, 4th Edition,, Vol. 50, at pg 332, it was stated:: The only principle of construction which is applicable without qualification to all wills and overrides every other rule of construction is that the testators intention is collected from a consideration of the whole will taken in connection with any evidence properly admissible, and the meaning of the will and of every part of it is determined according to that intention. For this purpose, the will and all the codicils to it are construed together as one testamentary disposition, but not as one document, and the testators intention is gathered from the whole disposition. 43. With a view to ascertain the intention of the maker of the Will, not only the terms thereof are required to be taken into consideration but all also circumstances attending thereto. The Will as a whole must, thus, be considered for the said purpose and not merely the particular part thereof. As the Will if read in its entirety, can be given effect to, it is imperative that nothing should be read therein to invalidate the same. 44. In construing a will, no doubt, all possible contingencies are required to be taken into consideration; but it is also a well-settled principle of law that only because a part of a document is invalid, the entire document need not be invalidated, if the former forms a severable part. The legatee admittedly did not have any issue, nor did he adopt or appoint any person. In a situation of this nature, effect can be given to clause 12 of the will, if it is read as occurring immediately after Clause 5 of the original will. As the said clause stands on its own footing, its effect must be considered vis-à-vis clause 6, but the court may not start with construction of clauses 6 and 7, which may lead to a conclusion that clause 5 is also invalid. The contingencies contemplated by clause 6 may not have any effect on clause 7, if it does not take place at all. The property which should have been purchased with the sale proceeds could have been the subject-matter of the bequest and in terms thereof the University of Calcutta became the beneficiary on the death of the original legatee. We do not find any reason as to why the same cannot be given effect to. We have indicated hereinbefore that it is possible to construe clause 7 of the will and in fact a plain reading thereof would, thus, lead to the conclusion that it merely provides for an option given to the legatee to take recourse thereto. We have also indicated hereinbefore that the term device in the context of clause 7 does not carry any meaning and, therefore, the same for all intent and purport should be substituted by the word desire. As a matter of fact, the appellant in the copy of the will supplied to us had also used the word desire in place of the word device, which would also go to show that even the appellant understood clause 7 in that fashion. Clause 7, if so read, will have no application to the properties which were to be substituted in place of the immovable properties belonging to the testator. The benefit of the sale proceeds, thus, in absence of any action on the part of the legatee in terms of clause 7 shall also vest in the University. Moreover, the question as to whether the deed of sale purported to have been executed by the legatee in favour of Chamong Tea Co. Ltd.. or other instruments executed by him in favour of the appellants herein are pending consideration before the High Court which may have to be determined on its own merit. In the event, the said transactions are held to be void, the question of giving any other or further effect to clause 6 of the Will may not arise. 45. In view of the findings aforementioned, we are of the opinion that the decision relied upon by Mr. Sundaram on Margaret Goonewardens (supra) cannot be said to have any application in the instant case, as in view of our findings aforementioned, clause 5 of the will is not hit by Section 113 of the Indian Succession Act. 46. The submission (iv) of the appellant fails in view of the matter that Clause 12 does not attract Section 129 of the Act since both the clauses, i.e., 5 and 7 are valid as observed hereinbefore. 47. For the reasons aforementioned, there

0[ds]are of the opinion that the decision relied upon by Mr. Sundaram on Margaret Goonewardens (supra) cannot be said to have any application in the instant case, as in view of our findings aforementioned, clause 5 of the will is not hit by Section 113 of the Indian Succession Act.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: every word used in a document, such a construction should be accepted instead of a construction which would have the effect of cutting down the clear meaning of the words used by the testator. Further, where one of the two reasonable constructions would lead to intestacy, that should be discarded in favour of a construction which does not create any such hiatus. ( Pearey Lal v. Rameshwar Das) (5) It is one of the cardinal principles of construction of wills that to the extent that it is legally possible effect should be given to every disposition contained in the will unless the law prevents effect being given to it. Of course, if there are two repugnant provisions conferring successive interests, if the first interest created is valid the subsequent interest cannot take effect but a Court of construction will proceed to the farthest extent to avoid repugnancy, so that effect could be given as far as possible to every testamentary intention contained in the will. ( Ramachandra Shenoy v. Hilda Brite Mrs ) 41. To the same effect are the judgments of this Court in Arunkumar and Another v. Shriniwas and Others [(2003) 6 SCC 98] , Uma Devi Nambiar and Others v. T.C. Sidhan (Dead) [(2004) 2 SCC 321] , Sadhu Singh v. Gurdwara Sahib Narike and Others [(2006) 8 SCC 75] and Gurdev Kaur and Others v. Kaki and Others [(2007) 1 SCC 546] . 42. In Halsburys Law of England, 4th Edition,, Vol. 50, at pg 332, it was stated:: The only principle of construction which is applicable without qualification to all wills and overrides every other rule of construction is that the testators intention is collected from a consideration of the whole will taken in connection with any evidence properly admissible, and the meaning of the will and of every part of it is determined according to that intention. For this purpose, the will and all the codicils to it are construed together as one testamentary disposition, but not as one document, and the testators intention is gathered from the whole disposition. 43. With a view to ascertain the intention of the maker of the Will, not only the terms thereof are required to be taken into consideration but all also circumstances attending thereto. The Will as a whole must, thus, be considered for the said purpose and not merely the particular part thereof. As the Will if read in its entirety, can be given effect to, it is imperative that nothing should be read therein to invalidate the same. 44. In construing a will, no doubt, all possible contingencies are required to be taken into consideration; but it is also a well-settled principle of law that only because a part of a document is invalid, the entire document need not be invalidated, if the former forms a severable part. The legatee admittedly did not have any issue, nor did he adopt or appoint any person. In a situation of this nature, effect can be given to clause 12 of the will, if it is read as occurring immediately after Clause 5 of the original will. As the said clause stands on its own footing, its effect must be considered vis-à-vis clause 6, but the court may not start with construction of clauses 6 and 7, which may lead to a conclusion that clause 5 is also invalid. The contingencies contemplated by clause 6 may not have any effect on clause 7, if it does not take place at all. The property which should have been purchased with the sale proceeds could have been the subject-matter of the bequest and in terms thereof the University of Calcutta became the beneficiary on the death of the original legatee. We do not find any reason as to why the same cannot be given effect to. We have indicated hereinbefore that it is possible to construe clause 7 of the will and in fact a plain reading thereof would, thus, lead to the conclusion that it merely provides for an option given to the legatee to take recourse thereto. We have also indicated hereinbefore that the term device in the context of clause 7 does not carry any meaning and, therefore, the same for all intent and purport should be substituted by the word desire. As a matter of fact, the appellant in the copy of the will supplied to us had also used the word desire in place of the word device, which would also go to show that even the appellant understood clause 7 in that fashion. Clause 7, if so read, will have no application to the properties which were to be substituted in place of the immovable properties belonging to the testator. The benefit of the sale proceeds, thus, in absence of any action on the part of the legatee in terms of clause 7 shall also vest in the University. Moreover, the question as to whether the deed of sale purported to have been executed by the legatee in favour of Chamong Tea Co. Ltd.. or other instruments executed by him in favour of the appellants herein are pending consideration before the High Court which may have to be determined on its own merit. In the event, the said transactions are held to be void, the question of giving any other or further effect to clause 6 of the Will may not arise. 45. In view of the findings aforementioned, we are of the opinion that the decision relied upon by Mr. Sundaram on Margaret Goonewardens (supra) cannot be said to have any application in the instant case, as in view of our findings aforementioned, clause 5 of the will is not hit by Section 113 of the Indian Succession Act. 46. The submission (iv) of the appellant fails in view of the matter that Clause 12 does not attract Section 129 of the Act since both the clauses, i.e., 5 and 7 are valid as observed hereinbefore. 47. For the reasons aforementioned, there ### Response: 0

M/S ICOMM TELE LTD Vs. PUNJAB STATE WATER SUPPLY AND SEWERAGE BOARD

to be kept in mind in deciding that such a clause would be arbitrary in the sense of being something which would be unfair and unjust and which no reasonable man would agree to. Indeed, a claim may be dismissed but need not be frivolous, as is obvious from the fact that where three arbitrators are appointed, there have been known to be majority and minority awards, making it clear that there may be two possible or even plausible views which would indicate that the claim is dismissed or allowed on merits and not because it is frivolous. Further, even where a claim is found to be justified and correct, the amount that is deposited need not be refunded to the successful claimant. Take for example a claim based on a termination of a contract being illegal and consequent damages thereto. If the claim succeeds and the termination is set aside as being illegal and a damages claim of one crore is finally granted by the learned arbitrator at only ten lakhs, only one tenth of the deposit made will be liable to be returned to the successful party. The party who has lost in the arbitration proceedings will be entitled to forfeit nine tenths of the deposit made despite the fact that the aforesaid party has an award against it. This would render the entire clause wholly arbitrary, being not only excessive or disproportionate but leading to the wholly unjust result of a party who has lost an arbitration being entitled to forfeit such part of the deposit as falls proportionately short of the amount awarded as compared to what is claimed.24. Further, it is also settled law that arbitration is an important alternative dispute resolution process which is to be encouraged because of high pendency of cases in courts and cost of litigation. Any requirement as to deposit would certainly amount to a clog on this process. Also, it is easy to visualize that often a deposit of 10% of a huge claim would be even greater than court fees that may be charged for filing a suit in a civil court. This Court in State of J&K v. Dev Dutt Pandit, (1999) 7 SCC 339 , has held:- “23. Arbitration is considered to be an important alternative disputes redressal process which is to be encouraged because of high pendency of cases in the courts and cost of litigation. Arbitration has to be looked up to with all earnestness so that the litigant public has faith in the speedy process of resolving their disputes by this process. What happened in the present case is certainly a paradoxical situation which should be avoided. Total contract is for Rs. 12,23,500. When the contractor has done less than 50% of the work the contract is terminated. He has been paid Rs 5,71,900. In a Section 20 petition he makes a claim of Rs. 39,47,000 and before the arbitrator the claim is inflated to Rs. 63,61,000. He gets away with Rs. 20,08,000 with interest at the rate of 10% per annum and penal interest at the rate of 18% per annum. Such type of arbitration becomes subject of witticism and do not help the institution of arbitration. Rather it brings a bad name to the arbitration process as a whole. When claims are inflated out of all proportions not only that heavy cost should be awarded to the other party but the party making such inflated claims should be deprived of the cost. We, therefore, set aside the award of cost of Rs. 7500 given in favour of the contractor and against the State of Jammu and Kashmir.” (Emphasis supplied) 25. Several judgments of this Court have also reiterated that the primary object of arbitration is to reach a final disposal of disputes in a speedy, effective, inexpensive and expeditious manner. Thus, in Centrotrade Minerals & Metal Inc. v. Hindustan Copper Ltd., (2017) 2 SCC 228 , this court held: "39. In Union of India v. U.P. State Bridge Corpn. Ltd. [(2015) 2 SCC 52] this Court accepted the view [O.P. Malhotra on the Law and Practice of Arbitration and Conciliation (3rd Edn. revised by Ms Indu Malhotra, Senior Advocate)] that the A&C Act has four foundational pillars and then observed in para 16 of the Report [sic] that:“16. First and paramount principle of the first pillar is ‘fair, speedy and inexpensive trial by an Arbitral Tribunal’. Unnecessary delay or expense would frustrate the very purpose of arbitration. Interestingly, the second principle which is recognised in the Act is the party autonomy in the choice of procedure. This means that if a particular procedure is prescribed in the arbitration agreement which the parties have agreed to, that has to be generally resorted to.” (Emphasis in original) 26. Similarly, in Union of India v. Varindera Constructions Ltd., (2018) 7 SCC 794 , this Court held:- “12. The primary object of the arbitration is to reach a final disposition in a speedy, effective, inexpensive and expeditious manner. In order to regulate the law regarding arbitration, legislature came up with legislation which is known as Arbitration and Conciliation Act, 1996. In order to make arbitration process more effective, the legislature restricted the role of courts in case where matter is subject to the arbitration. Section 5 of the Act specifically restricted the interference of the courts to some extent. In other words, it is only in exceptional circumstances, as provided by this Act, the court is entitled to intervene in the dispute which is the subject- matter of arbitration. Such intervention may be before, at or after the arbitration proceeding, as the case may be. In short, court shall not intervene with the subject-matter of arbitration unless injustice is caused to either of the parties.” 27. Deterring a party to an arbitration from invoking this alternative dispute resolution process by a pre-deposit of 10% would discourage arbitration, contrary to the object of de-clogging the Court system, and would render the arbitral process ineffective and expensive.

1[ds]7. Having heard learned counsel for both parties, it will be seen that the 10%before a party can successfully invoke the arbitration clause is on the basis that this is in order to avoid frivolous claims.From this clause, it also becomes clear that arbitration is considered to be an alternative dispute resolution process and entry to the civil court is sought to be taken away if the disputes between the parties are covered by the arbitration clause.9. It is well settled that the terms of an invitation to tender are not open to judicial scrutiny, as they are in the realm of contract, unless they are arbitrary, discriminatory, or actuated by malice.As has correctly been argued by learned counsel appearing on behalf of the respondents, thisjudgment in Central Inland Water Transport Corpn. (supra), which lays down that contracts of adhesion, i.e., contracts in which there is unequal bargaining power, between private persons and the State are liable to be set aside on the ground that they are unconscionable, does not apply where both parties are businessmen and the contract is a commercial transaction (see paragraph 89 of the said judgment). In this view of the matter, the argument of the appellant based on this judgment must fail.In upholding such a clause, this Court referred to the judgment in Central Inland Water Transport Corpn. (supra) and distinguished this judgment, stating that the concept of unequal bargaining power has no application in the case of commercial contracts. It then went on toIt has been submitted by learned counsel for the appellant that there should be a cap in the quantum payable in terms of sub-clause (7) of Clause 25-A. This plea is clearly without substance. It is to be noted that it is structured on the basis of the quantum involved. Higher the claim, the higher is the amount of fee chargeable. There is a logic in it. It is the balancing factor to prevent frivolous and inflated claims. If the appellants plea is accepted that there should be a cap in the figure, a claimant who is making higher claim stands on a better pedestal than one who makes a claim of a lesser amount.It will be noticed that in this judgment there was no plea that the aforesaid condition contained in an arbitration clause was violative of Article 14 of the Constitution of India as such clause is arbitrary. The only pleas taken were that the ratio of Central Inland Water Transport Corpn. (supra) would apply and that there should be a cap in the quantum payable by way of security deposit, both of which pleas were turned down by this court. Also, the security deposit made would, on the termination of the arbitration proceedings, first be adjusted against costs if any awarded by the arbitrator against the claimant party, and the balance remaining after such adjustment then be refunded to the party making the deposit. This clause is materially different from clause 25(viii), which, as we have seen, makes it clear that in all cases the deposit is to be 10% of the amount claimed and that refund can only be in proportion to the amount awarded with respect to the amount claimed, the balance being forfeited and paid to the other party, even though that other party may have lost the case. This being so, this judgment is wholly distinguishable and does not apply at all to the facts of the present case.We agree with the learned counsel for the respondents that the aforesaid clause cannot be said to be discriminatory in that it applies equally to both respondent No. 2 and the appellant. However, arbitrariness is a separate and distinct facet of Article 14.The first important thing to notice is that the 10%of the amount claimed is in order to avoid frivolous claims by the party invoking arbitration. It is well settled that a frivolous claim can be dismissed with exemplary costs.It is therefore always open to the party who has succeeded before the arbitrator to invoke this principle and it is open to the arbitrator to dismiss a claim as frivolous on imposition of exemplary costs.The important principle established by this case is that unless it is first found that the litigation that has been embarked upon is frivolous, exemplary costs or punitive damages do not follow. Clearly, therefore, aof 10% of the amount claimed, which can amount to large sums of money, is obviously without any direct nexus to the filing of frivolous claims, as it applies to all claims (frivolous or otherwise) made at the very threshold. A 10% deposit has to be made before any determination that a claim made by the party invoking arbitration is frivolous. This is also one important aspect of the matter to be kept in mind in deciding that such a clause would be arbitrary in the sense of being something which would be unfair and unjust and which no reasonable man would agree to. Indeed, a claim may be dismissed but need not be frivolous, as is obvious from the fact that where three arbitrators are appointed, there have been known to be majority and minority awards, making it clear that there may be two possible or even plausible views which would indicate that the claim is dismissed or allowed on merits and not because it is frivolous. Further, even where a claim is found to be justified and correct, the amount that is deposited need not be refunded to the successful claimant. Take for example a claim based on a termination of a contract being illegal and consequent damages thereto. If the claim succeeds and the termination is set aside as being illegal and a damages claim of one crore is finally granted by the learned arbitrator at only ten lakhs, only one tenth of the deposit made will be liable to be returned to the successful party. The party who has lost in the arbitration proceedings will be entitled to forfeit nine tenths of the deposit made despite the fact that the aforesaid party has an award against it. This would render the entire clause wholly arbitrary, being not only excessive or disproportionate but leading to the wholly unjust result of a party who has lost an arbitration being entitled to forfeit such part of the deposit as falls proportionately short of the amount awarded as compared to what is claimed.24. Further, it is also settled law that arbitration is an important alternative dispute resolution process which is to be encouraged because of high pendency of cases in courts and cost of litigation. Any requirement as to deposit would certainly amount to a clog on this process. Also, it is easy to visualize that often a deposit of 10% of a huge claim would be even greater than court fees that may be charged for filing a suit in a civil court.Several judgments of this Court have also reiterated that the primary object of arbitration is to reach a final disposal of disputes in a speedy, effective, inexpensive and expeditious manner.Deterring a party to an arbitration from invoking this alternative dispute resolution process by a pre-deposit of 10% would discourage arbitration, contrary to the object of de-clogging the Court system, and would render the arbitral process ineffective and expensive.

### Instruction: Delve into the case proceeding and predict the outcome: is the judgment expected to be in support (1) or in denial (0) of the appeal? ### Input: to be kept in mind in deciding that such a clause would be arbitrary in the sense of being something which would be unfair and unjust and which no reasonable man would agree to. Indeed, a claim may be dismissed but need not be frivolous, as is obvious from the fact that where three arbitrators are appointed, there have been known to be majority and minority awards, making it clear that there may be two possible or even plausible views which would indicate that the claim is dismissed or allowed on merits and not because it is frivolous. Further, even where a claim is found to be justified and correct, the amount that is deposited need not be refunded to the successful claimant. Take for example a claim based on a termination of a contract being illegal and consequent damages thereto. If the claim succeeds and the termination is set aside as being illegal and a damages claim of one crore is finally granted by the learned arbitrator at only ten lakhs, only one tenth of the deposit made will be liable to be returned to the successful party. The party who has lost in the arbitration proceedings will be entitled to forfeit nine tenths of the deposit made despite the fact that the aforesaid party has an award against it. This would render the entire clause wholly arbitrary, being not only excessive or disproportionate but leading to the wholly unjust result of a party who has lost an arbitration being entitled to forfeit such part of the deposit as falls proportionately short of the amount awarded as compared to what is claimed.24. Further, it is also settled law that arbitration is an important alternative dispute resolution process which is to be encouraged because of high pendency of cases in courts and cost of litigation. Any requirement as to deposit would certainly amount to a clog on this process. Also, it is easy to visualize that often a deposit of 10% of a huge claim would be even greater than court fees that may be charged for filing a suit in a civil court. This Court in State of J&K v. Dev Dutt Pandit, (1999) 7 SCC 339 , has held:- “23. Arbitration is considered to be an important alternative disputes redressal process which is to be encouraged because of high pendency of cases in the courts and cost of litigation. Arbitration has to be looked up to with all earnestness so that the litigant public has faith in the speedy process of resolving their disputes by this process. What happened in the present case is certainly a paradoxical situation which should be avoided. Total contract is for Rs. 12,23,500. When the contractor has done less than 50% of the work the contract is terminated. He has been paid Rs 5,71,900. In a Section 20 petition he makes a claim of Rs. 39,47,000 and before the arbitrator the claim is inflated to Rs. 63,61,000. He gets away with Rs. 20,08,000 with interest at the rate of 10% per annum and penal interest at the rate of 18% per annum. Such type of arbitration becomes subject of witticism and do not help the institution of arbitration. Rather it brings a bad name to the arbitration process as a whole. When claims are inflated out of all proportions not only that heavy cost should be awarded to the other party but the party making such inflated claims should be deprived of the cost. We, therefore, set aside the award of cost of Rs. 7500 given in favour of the contractor and against the State of Jammu and Kashmir.” (Emphasis supplied) 25. Several judgments of this Court have also reiterated that the primary object of arbitration is to reach a final disposal of disputes in a speedy, effective, inexpensive and expeditious manner. Thus, in Centrotrade Minerals & Metal Inc. v. Hindustan Copper Ltd., (2017) 2 SCC 228 , this court held: "39. In Union of India v. U.P. State Bridge Corpn. Ltd. [(2015) 2 SCC 52] this Court accepted the view [O.P. Malhotra on the Law and Practice of Arbitration and Conciliation (3rd Edn. revised by Ms Indu Malhotra, Senior Advocate)] that the A&C Act has four foundational pillars and then observed in para 16 of the Report [sic] that:“16. First and paramount principle of the first pillar is ‘fair, speedy and inexpensive trial by an Arbitral Tribunal’. Unnecessary delay or expense would frustrate the very purpose of arbitration. Interestingly, the second principle which is recognised in the Act is the party autonomy in the choice of procedure. This means that if a particular procedure is prescribed in the arbitration agreement which the parties have agreed to, that has to be generally resorted to.” (Emphasis in original) 26. Similarly, in Union of India v. Varindera Constructions Ltd., (2018) 7 SCC 794 , this Court held:- “12. The primary object of the arbitration is to reach a final disposition in a speedy, effective, inexpensive and expeditious manner. In order to regulate the law regarding arbitration, legislature came up with legislation which is known as Arbitration and Conciliation Act, 1996. In order to make arbitration process more effective, the legislature restricted the role of courts in case where matter is subject to the arbitration. Section 5 of the Act specifically restricted the interference of the courts to some extent. In other words, it is only in exceptional circumstances, as provided by this Act, the court is entitled to intervene in the dispute which is the subject- matter of arbitration. Such intervention may be before, at or after the arbitration proceeding, as the case may be. In short, court shall not intervene with the subject-matter of arbitration unless injustice is caused to either of the parties.” 27. Deterring a party to an arbitration from invoking this alternative dispute resolution process by a pre-deposit of 10% would discourage arbitration, contrary to the object of de-clogging the Court system, and would render the arbitral process ineffective and expensive. ### Response: 1

UCO Bank & Another Vs. Dipak Debbarma & Others

view in the concurring judgment of Ruma Pal, J. in ITC Ltd. vs. Agricultural Produce Market Committee and Ors. (supra), seems to have been echoed in a recent pronouncement of this Court in Vishal N. Kalsaria vs. Bank of India & Ors. (2016) 3 SCC 762 ), wherein this Court had held that the provisions of the Act of 2002 will not have an overriding effect on the provisions of the State Rent Control Acts.15. In the present case the conflict between the Central and the State Act is on account of an apparent overstepping by the provisions of the State Act dealing with land reform into an area of banking covered by the Central Act. The test, therefore, would be to find out as to which is the dominant legislation having regard the area of encroachment.16. The provisions of the Act of 2002 enable the bank to take possession of any property where a security interest has been created in its favour. Specifically, Section 13 of the 2002 Act enables the bank to take possession of and sell such property to any person to realise its dues. The purchaser of such property acquires a clear title to the property sold, subject to compliance with the requirements prescribed.17. Section 187 of the Tripura Act of 1960, on the other hand, prohibits the bank from transferring the property which has been mortgaged by a member of a scheduled tribe to any person other than a member of a scheduled tribe. This is a clear restriction on what is permitted by the Act of 2002 for the realisation of amounts due to the bank.18. The Act of 2002 is relatable to the Entry of banking which is included in List I of the Seventh Schedule. Sale of mortgaged property by a bank is an inseparable and integral part of the business of banking. The object of the State Act, as already noted, is an attempt to consolidate the land revenue law in the State and also to provide measures of agrarian reforms. The field of encroachment made by the State legislature is in the area of banking. So long there did not exist any parallel Central Act dealing with sale of secured assets and referable to Entry 45 of List I, the State Act, including Section 187, operated validly. However, the moment Parliament stepped in by enacting such a law traceable to Entry 45 and dealing exclusively with activities relating to sale of secured assets, the State law, to the extent that it is inconsistent with the Act of 2002, must give way. The dominant legislation being the Parliamentary legislation, the provisions of the Tripura Act of 1960, pro tanto, (Section 187) would be invalid. It is the provisions of the Act of 2002, which do not contain any embargo on the category of persons to whom mortgaged property can be sold by the bank for realisation of its dues that will prevail over the provisions contained in Section 187 of the Tripura Act of 1960.19. The decision of this Court in Central Bank of India vs. State of Kerala and Ors. (2009) 4 SCC 94 ), holding that the provisions of the Bombay Sales Tax Act, 1959 and the Kerala General Sales Tax Act, 1963 providing for a first charge on the property of the person liable to pay sales tax, in favour of the State, is not inconsistent with the provisions contained in the Recovery of Debts Due to Banks and Financial Institutions, Act 1993 (for short the “DRT Act”) and also the Act of 2002 must be understood by noticing the absence of any specific provision in either of the Central enactments containing a similar/parallel provision of a first charge in favour of the bank. The judgment of this Court holding the State enactments to be valid and the Central enactments not to have any overriding effect, proceeds on the said basis i.e. absence of any provision creating a first charge in favour of the bank in either of the Central enactments.20. The High Court in the judgment under challenge has also taken the view that the impugned sale Notification dated 26.06.2012 is invalid for infraction of Rule 5 and Rule 8(5) of the Security Interest (Enforcement) Rules, 2002, in as much as the bank did not obtain any valuation report of the property before resorting to the impugned auction sale. The Rules in question read as follows.“5. Valuation of movable secured assets.-After taking possession under sub-rule (1) of rule 4 and in any case before sale, the authorised officer shall obtain the estimated value of the movable secured assets and thereafter, if considered necessary, fix in consultation with the secured creditor, the reserve price of the assets to be sold in realisation of the dues of the secured creditor.”“8. Sale of immovable secured assets.-(5) Before effecting sale of the immovable property referred to in sub-rule (1) of rule 9, the authorized officer shall obtain valuation of the property from an approved valuer and in consultation with the secured creditor, fix the reserve price of the property and may sell the whole or any part of such immovable secured asset by any of the following methods.21. Our attention had been specifically drawn to the stand of the appellant-Bank before the High Court in the counter filed (paragraph 20). Taking into account the averments made in the said affidavit, we find that the sale proclamation had mentioned a reserve price of Rs. 275 lacs and the property had been actually sold by auction at Rs. 416 lacs. That apart, the valuation report dated 14.06.2012 of the approved valuer valuing the property at Rs. 341.15 lacs has also been placed before us by way of an additional document which we are inclined to take on record. The requirements under Rule 5 and Rule 8(5) have, therefore, been complied with and the sale proclamation and the sale effected pursuant thereto cannot be invalidated on the above ground.22. For the aforesaid reasons, the

1[ds]15. In the present case the conflict between the Central and the State Act is on account of an apparent overstepping by the provisions of the State Act dealing with land reform into an area of banking covered by the Central Act. The test, therefore, would be to find out as to which is the dominant legislation having regard the area of encroachment.16. The provisions of the Act of 2002 enable the bank to take possession of any property where a security interest has been created in its favour. Specifically, Section 13 of the 2002 Act enables the bank to take possession of and sell such property to any person to realise its dues. The purchaser of such property acquires a clear title to the property sold, subject to compliance with the requirements prescribed.Our attention had been specifically drawn to the stand of the appellant-Bank before the High Court in the counter filed (paragraph 20). Taking into account the averments made in the said affidavit, we find that the sale proclamation had mentioned a reserve price of Rs. 275 lacs and the property had been actually sold by auction at Rs. 416 lacs. That apart, the valuation report dated 14.06.2012 of the approved valuer valuing the property at Rs. 341.15 lacs has also been placed before us by way of an additional document which we are inclined to take on record. The requirements under Rule 5 and Rule 8(5) have, therefore, been complied with and the sale proclamation and the sale effected pursuant thereto cannot be invalidated on the above ground.Section 187 of the Tripura Act of 1960, on the other hand, prohibits the bank from transferring the property which has been mortgaged by a member of a scheduled tribe to any person other than a member of a scheduled tribe. This is a clear restriction on what is permitted by the Act of 2002 for the realisation of amounts due to the bank.18. The Act of 2002 is relatable to the Entry of banking which is included in List I of the Seventh Schedule. Sale of mortgaged property by a bank is an inseparable and integral part of the business of banking. The object of the State Act, as already noted, is an attempt to consolidate the land revenue law in the State and also to provide measures of agrarian reforms. The field of encroachment made by the State legislature is in the area of banking. So long there did not exist any parallel Central Act dealing with sale of secured assets and referable to Entry 45 of List I, the State Act, including Section 187, operated validly. However, the moment Parliament stepped in by enacting such a law traceable to Entry 45 and dealing exclusively with activities relating to sale of secured assets, the State law, to the extent that it is inconsistent with the Act of 2002, must give way. The dominant legislation being the Parliamentary legislation, the provisions of the Tripura Act of 1960, pro tanto, (Section 187) would be invalid. It is the provisions of the Act of 2002, which do not contain any embargo on the category of persons to whom mortgaged property can be sold by the bank for realisation of its dues that will prevail over the provisions contained in Section 187 of the Tripura Act of 1960.19. The decision of this Court in Central Bank of India vs. State of Kerala and Ors. (2009) 4 SCC 94 ), holding that the provisions of the Bombay Sales Tax Act, 1959 and the Kerala General Sales Tax Act, 1963 providing for a first charge on the property of the person liable to pay sales tax, in favour of the State, is not inconsistent with the provisions contained in the Recovery of Debts Due to Banks and Financial Institutions, Act 1993 (for short the) and also the Act of 2002 must be understood by noticing the absence of any specific provision in either of the Central enactments containing a similar/parallel provision of a first charge in favour of the bank. The judgment of this Court holding the State enactments to be valid and the Central enactments not to have any overriding effect, proceeds on the said basis i.e. absence of any provision creating a first charge in favour of the bank in either of the Central enactments.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: view in the concurring judgment of Ruma Pal, J. in ITC Ltd. vs. Agricultural Produce Market Committee and Ors. (supra), seems to have been echoed in a recent pronouncement of this Court in Vishal N. Kalsaria vs. Bank of India & Ors. (2016) 3 SCC 762 ), wherein this Court had held that the provisions of the Act of 2002 will not have an overriding effect on the provisions of the State Rent Control Acts.15. In the present case the conflict between the Central and the State Act is on account of an apparent overstepping by the provisions of the State Act dealing with land reform into an area of banking covered by the Central Act. The test, therefore, would be to find out as to which is the dominant legislation having regard the area of encroachment.16. The provisions of the Act of 2002 enable the bank to take possession of any property where a security interest has been created in its favour. Specifically, Section 13 of the 2002 Act enables the bank to take possession of and sell such property to any person to realise its dues. The purchaser of such property acquires a clear title to the property sold, subject to compliance with the requirements prescribed.17. Section 187 of the Tripura Act of 1960, on the other hand, prohibits the bank from transferring the property which has been mortgaged by a member of a scheduled tribe to any person other than a member of a scheduled tribe. This is a clear restriction on what is permitted by the Act of 2002 for the realisation of amounts due to the bank.18. The Act of 2002 is relatable to the Entry of banking which is included in List I of the Seventh Schedule. Sale of mortgaged property by a bank is an inseparable and integral part of the business of banking. The object of the State Act, as already noted, is an attempt to consolidate the land revenue law in the State and also to provide measures of agrarian reforms. The field of encroachment made by the State legislature is in the area of banking. So long there did not exist any parallel Central Act dealing with sale of secured assets and referable to Entry 45 of List I, the State Act, including Section 187, operated validly. However, the moment Parliament stepped in by enacting such a law traceable to Entry 45 and dealing exclusively with activities relating to sale of secured assets, the State law, to the extent that it is inconsistent with the Act of 2002, must give way. The dominant legislation being the Parliamentary legislation, the provisions of the Tripura Act of 1960, pro tanto, (Section 187) would be invalid. It is the provisions of the Act of 2002, which do not contain any embargo on the category of persons to whom mortgaged property can be sold by the bank for realisation of its dues that will prevail over the provisions contained in Section 187 of the Tripura Act of 1960.19. The decision of this Court in Central Bank of India vs. State of Kerala and Ors. (2009) 4 SCC 94 ), holding that the provisions of the Bombay Sales Tax Act, 1959 and the Kerala General Sales Tax Act, 1963 providing for a first charge on the property of the person liable to pay sales tax, in favour of the State, is not inconsistent with the provisions contained in the Recovery of Debts Due to Banks and Financial Institutions, Act 1993 (for short the “DRT Act”) and also the Act of 2002 must be understood by noticing the absence of any specific provision in either of the Central enactments containing a similar/parallel provision of a first charge in favour of the bank. The judgment of this Court holding the State enactments to be valid and the Central enactments not to have any overriding effect, proceeds on the said basis i.e. absence of any provision creating a first charge in favour of the bank in either of the Central enactments.20. The High Court in the judgment under challenge has also taken the view that the impugned sale Notification dated 26.06.2012 is invalid for infraction of Rule 5 and Rule 8(5) of the Security Interest (Enforcement) Rules, 2002, in as much as the bank did not obtain any valuation report of the property before resorting to the impugned auction sale. The Rules in question read as follows.“5. Valuation of movable secured assets.-After taking possession under sub-rule (1) of rule 4 and in any case before sale, the authorised officer shall obtain the estimated value of the movable secured assets and thereafter, if considered necessary, fix in consultation with the secured creditor, the reserve price of the assets to be sold in realisation of the dues of the secured creditor.”“8. Sale of immovable secured assets.-(5) Before effecting sale of the immovable property referred to in sub-rule (1) of rule 9, the authorized officer shall obtain valuation of the property from an approved valuer and in consultation with the secured creditor, fix the reserve price of the property and may sell the whole or any part of such immovable secured asset by any of the following methods.21. Our attention had been specifically drawn to the stand of the appellant-Bank before the High Court in the counter filed (paragraph 20). Taking into account the averments made in the said affidavit, we find that the sale proclamation had mentioned a reserve price of Rs. 275 lacs and the property had been actually sold by auction at Rs. 416 lacs. That apart, the valuation report dated 14.06.2012 of the approved valuer valuing the property at Rs. 341.15 lacs has also been placed before us by way of an additional document which we are inclined to take on record. The requirements under Rule 5 and Rule 8(5) have, therefore, been complied with and the sale proclamation and the sale effected pursuant thereto cannot be invalidated on the above ground.22. For the aforesaid reasons, the ### Response: 1

State Of West Bengal Vs. Atul Krishna Shaw And Anr

the appellate authority without discussing the evidence of Mr. Dutta who had stated in his evidence that there are shrubs outside and inside the lands in dispute. It is the specific case of the respondents that they made embankment, but Mr. Dutta finds that there was no embankment to any of the plots. That was also a finding recorded by the Assistant Settlement Officer. There is no discussion by the appellate authority of the evidence given on that count. Though written objections were filed and evidence was adduced by the respondents, neither in the objections nor in the oral evidence tendered by the two respondents or their witnesses it was shown that the lands were used earlier for salt cultivation by erstwhile landholder. Therefore, this is an extraneous factor which the District Judge picked from his hat without any foundation. The solitary revenue receipt produced by the respondents was rejected by the Assistant Settlement Officer for cogent reasons. The appellant authority being final authority on facts, is enjoined and incumbent upon it to appreciate the evidence; consider the reasoning of the primary authority and assign its own reasons as to why it disagrees with the reasons and findings of the primary authority. Unless adequate reasons are given, merely because it is an appellate authority, it cannot brush aside the reasoning or findings recorded by the primary authority. By mere recording that dakhilas (rent receipts) show that lands are used as pisciculture is a finding without consideration of the relevant material on record. The other finding that respondents applied to the Chief Minister for loan and that it would establish that the loan amount was utilised for developing fishery is also a surmise drawn by the appellate authority. It is already seen that admittedly the respondents have Plot Nos. 2201 and 2235 in which they have been carrying on fishery operations. The application said to have been filed before the Chief Minister has not been produced. The account books of the respondents have not been produced. When the documentary evidence, which being the best evidence, is available but not produced an adverse inference has to be drawn by the Tribunal concerned against the respondents for non-production and had it been produced, it would have gone against the respondents. A police complaint was said to have been made concerning disturbance in the enjoyment of the lands in question. No documentary evidence was produced or summoned. Even if it is done it might be self-serving one unless there is a record of finding of possession and enjoyment by the respondents for fishery. Even then also it is not binding on the State nor relevant in civil proceedings. 11. The contention of Shri Chatterjee that it is the duty of the appellant to produce the record to repudiate the findings recorded by the appellate authority is without substance. In a quasi-judicial enquiry it is for the parties who rely upon certain state of facts in their favour to adduce evidence in proof thereof. The proceedings under the Act is not like a trial in a civil court and the question of burden of proof does not arise. In the absence of adduction of the available documentary evidence, the necessary conclusion drawn by the Assistant Settlement Officer that the loan application made might pertain to Plot Nos. 2201 and 2235 is well justified. The appellate authority is not justified in law to brush aside that finding. The other finding that the witnesses examined on behalf of the respondents support the existence of the fishery for a pretty long time is also without discussing the evidence and assigning reasons in that regard. The Assistant Settlement Officer extensively considered the evidence and has given cogent reasons which were neither discussed nor found to be untenable by the appellate authority. Thus, we have no hesitation in coming to the conclusion that the appellate tribunal dis-regarded the material evidence on record, kept it aside, indulged in fishing expedition and crashed under the weight of conjectures and surmises. The appellate order is, therefore, vitiated by manifest and patent error of law apparent on the face of the record. When so much is to be said and judicial review done, the High Court in our considered view, committed error of law in dismissing the writ petition in limine. In the facts and circumstances of this case, in particular, when the litigation has taken well over 28 years till now, we find it not a fir case to remit to the High Court or Tribunal for fresh consideration. 12. It is contended that the respondents are entitled to the computation of holding under the Act, since they are possessed of some other lands. We direct that if any determination of total holding of the lands including Plot Nos. 2201 and 2235 any other lands are to be made under the Act or any other Land Reform law singly or conjointly it is open to the appropriate authorities to determine the holding of the respondents in accordance with law after giving reasonable opportunity to the respondents and the State after excluding the plots of lands in dispute. 13. Shri Roy, learned counsel for the State repeatedly asserted that the lands no longer remain to be fishery land and became part of urban area around the Calcutta city and building operations are going on. On the other hand the counsel for the respondents asserted to the contrary. We have no definite evidence on record. Therefore, if the lands are still found to be capable of using for fishery purpose and in case the State intends to lease if out for fishing operations, to any third party, as per rules in vogue, first preference may be given to the respondents, subject to the usual terms, as per the procedure prevalent in the State of West Bengal in this regard. 14. Accordingly, we quash the order of appellate tribunal dated March 4, 1971 and restore the order of the Assistant Settlement Officer dated July 12, 1968.

1[ds]7. Admittedly the High Court did not go into any of the questions raised by the appellant in the writ petition. It summarily dismissed the writ petition. Therefore, what we have to read is only the orders of the appellate tribunal and the Assistant Settlement Officer - the primary authority together with the record of evidence. Counsel took us through the evidence to show that the findings recorded by the appellate Judge are based on either no evidence or surmises and conjectures. We have given our anxious consideration to the respective contentions and considered the evidence on record once again. It is indisputably true that it is a quasi-judicial proceeding. If the appellate authority had appreciated the evidence on record and recorded the findings of fact, those findings are binding on this Court or the High Court. By process of judicial review we cannot appreciate the evidence and record our own findings of fact. If the findings are based on no evidence or based on conjectures or surmises and no reasonable man would, on given facts and circumstances, come to the conclusion reached by the appellate authority on the basis of the evidence on record, certainly this Court would oversee whether the findings recorded by the appellate authority is based on no evidence or beset with surmises or conjectures. Giving of reasons is an essential element of administration of justice. A right to reason is, therefore, an indispensable part of sound system of judicial review. Reasoned decision is not only for the purpose of showing that the citizen is receiving justice, but also a valid discipline for the Tribunal itself. Therefore, statement of reasons is one of the essentials ofShri Roy, learned counsel for the State repeatedly asserted that the lands no longer remain to be fishery land and became part of urban area around the Calcutta city and building operations are going on. On the other hand the counsel for the respondents asserted to the contrary. We have no definite evidence on record. Therefore, if the lands are still found to be capable of using for fishery purpose and in case the State intends to lease if out for fishing operations, to any third party, as per rules in vogue, first preference may be given to the respondents, subject to the usual terms, as per the procedure prevalent in the State of West Bengal in thisAccordingly, we quash the order of appellate tribunal dated March 4, 1971 and restore the order of the Assistant Settlement Officer dated July 12, 1968

### Instruction: Examine the case narrative and anticipate the court's decision: will it result in an approval (1) or disapproval (0) of the appeal? ### Input: the appellate authority without discussing the evidence of Mr. Dutta who had stated in his evidence that there are shrubs outside and inside the lands in dispute. It is the specific case of the respondents that they made embankment, but Mr. Dutta finds that there was no embankment to any of the plots. That was also a finding recorded by the Assistant Settlement Officer. There is no discussion by the appellate authority of the evidence given on that count. Though written objections were filed and evidence was adduced by the respondents, neither in the objections nor in the oral evidence tendered by the two respondents or their witnesses it was shown that the lands were used earlier for salt cultivation by erstwhile landholder. Therefore, this is an extraneous factor which the District Judge picked from his hat without any foundation. The solitary revenue receipt produced by the respondents was rejected by the Assistant Settlement Officer for cogent reasons. The appellant authority being final authority on facts, is enjoined and incumbent upon it to appreciate the evidence; consider the reasoning of the primary authority and assign its own reasons as to why it disagrees with the reasons and findings of the primary authority. Unless adequate reasons are given, merely because it is an appellate authority, it cannot brush aside the reasoning or findings recorded by the primary authority. By mere recording that dakhilas (rent receipts) show that lands are used as pisciculture is a finding without consideration of the relevant material on record. The other finding that respondents applied to the Chief Minister for loan and that it would establish that the loan amount was utilised for developing fishery is also a surmise drawn by the appellate authority. It is already seen that admittedly the respondents have Plot Nos. 2201 and 2235 in which they have been carrying on fishery operations. The application said to have been filed before the Chief Minister has not been produced. The account books of the respondents have not been produced. When the documentary evidence, which being the best evidence, is available but not produced an adverse inference has to be drawn by the Tribunal concerned against the respondents for non-production and had it been produced, it would have gone against the respondents. A police complaint was said to have been made concerning disturbance in the enjoyment of the lands in question. No documentary evidence was produced or summoned. Even if it is done it might be self-serving one unless there is a record of finding of possession and enjoyment by the respondents for fishery. Even then also it is not binding on the State nor relevant in civil proceedings. 11. The contention of Shri Chatterjee that it is the duty of the appellant to produce the record to repudiate the findings recorded by the appellate authority is without substance. In a quasi-judicial enquiry it is for the parties who rely upon certain state of facts in their favour to adduce evidence in proof thereof. The proceedings under the Act is not like a trial in a civil court and the question of burden of proof does not arise. In the absence of adduction of the available documentary evidence, the necessary conclusion drawn by the Assistant Settlement Officer that the loan application made might pertain to Plot Nos. 2201 and 2235 is well justified. The appellate authority is not justified in law to brush aside that finding. The other finding that the witnesses examined on behalf of the respondents support the existence of the fishery for a pretty long time is also without discussing the evidence and assigning reasons in that regard. The Assistant Settlement Officer extensively considered the evidence and has given cogent reasons which were neither discussed nor found to be untenable by the appellate authority. Thus, we have no hesitation in coming to the conclusion that the appellate tribunal dis-regarded the material evidence on record, kept it aside, indulged in fishing expedition and crashed under the weight of conjectures and surmises. The appellate order is, therefore, vitiated by manifest and patent error of law apparent on the face of the record. When so much is to be said and judicial review done, the High Court in our considered view, committed error of law in dismissing the writ petition in limine. In the facts and circumstances of this case, in particular, when the litigation has taken well over 28 years till now, we find it not a fir case to remit to the High Court or Tribunal for fresh consideration. 12. It is contended that the respondents are entitled to the computation of holding under the Act, since they are possessed of some other lands. We direct that if any determination of total holding of the lands including Plot Nos. 2201 and 2235 any other lands are to be made under the Act or any other Land Reform law singly or conjointly it is open to the appropriate authorities to determine the holding of the respondents in accordance with law after giving reasonable opportunity to the respondents and the State after excluding the plots of lands in dispute. 13. Shri Roy, learned counsel for the State repeatedly asserted that the lands no longer remain to be fishery land and became part of urban area around the Calcutta city and building operations are going on. On the other hand the counsel for the respondents asserted to the contrary. We have no definite evidence on record. Therefore, if the lands are still found to be capable of using for fishery purpose and in case the State intends to lease if out for fishing operations, to any third party, as per rules in vogue, first preference may be given to the respondents, subject to the usual terms, as per the procedure prevalent in the State of West Bengal in this regard. 14. Accordingly, we quash the order of appellate tribunal dated March 4, 1971 and restore the order of the Assistant Settlement Officer dated July 12, 1968. ### Response: 1

THE DEPOT MANAGER APSRTC (NOW KNOWN AS TSRTC) Vs. N.DANAIAH

L. Nageswara Rao, J. 1. Leave granted. 2. The Respondent was working as a driver in the APSRTC. An enquiry was initiated against him for ticket irregularities. The charges that were framed against the Respondent are as follows: 1. For having collected the fare of Rs. 240/- from a batch of three passengers (2 + 1) at their boarding stage itself, who boarded the bus at Humnabad and bound for Tuljapur ex-stages 9 to 13, but issued tickets to them on sighting the TTIs at stage No. 11 i.e. Omergaon, which constitutes misconduct Under Regulation 28(vi) a & 28(x) of APSRTC Employees (Conduct) Regulations, 1963. 2. For having failed to collect fare and issue tickets to a passenger who boarded the bus at Humnabad and bound for Tuljapur ex-stages 9 to 13, which constitutes misconduct under Regulations 28(vi)(a) of APSRTC Employees (Conduct) Regulations 1963. 3. For having misbehaved with the TTIs by uttering words Nen Dongana Ticketlu isthanukunnanu inthalo Nidrapoyanu, Ekkadaku ragane gurthu vachhi mimmulanu chuchi echhanu. Edi N thappa Nannu emichestharo chesukondi angrily, which constitutes misconduct under Regulations 28(xxii) of APSRTC Employees (Conduct) Regulations 1963. 3. The Enquiry Officer held the charges framed against the Respondent were proved. The Respondent was removed from service on the basis of the findings recorded by the Enquiry Officer. 4. A petition was filed Under Section 2-A(2) of the Industrial Disputes Act by the Respondent for setting aside the order of removal before the labour Court. The order of removal dated 22.09.2005 was found to be justified by the labour Court. Aggrieved by the Award of the labour Court, the Respondent filed a writ petition in the High Court of judicature at Hyderabad. The said writ petition was dismissed by a learned Single Judge. The Division Bench of the High Court reversed the judgment of the learned Single Judge and allowed the appeal filed by the Respondent. Reliance was placed by the Division Bench on a Circular dated 26.12.2004, which relates to TIMS services operating with double drivers on long distance routes. That apart, the Division Bench held that the Respondent who was the second driver cannot be said to be responsible for any lapses or irregularities. 5. After hearing learned Counsel for the parties and considering the material on record we are of the opinion that the judgment of the Division Bench is not sustainable and is liable to be set aside for the following reasons: 1. The date on which the ticket irregularities were committed by the Respondent was 19.01.2003 whereas the circular that was relied upon by the Division Bench was issued on 26.12.2004. Hence, the Circular is not applicable to the facts of this case. 2. The reasons recorded by the Enquiry Officer which were accepted by the Disciplinary Officer, were considered by the Labour Court which refused to pass an order in favour of the Respondent. The learned Single Judge also upheld the award of the Labour Court. Findings of fact as recorded in the departmental enquiry and upheld by the Labour Court could not have been upset by the Division Bench without any justifiable reasons. The conclusion of the Division Bench are contrary to the findings recorded, by the Enquiry Officer.

1[ds]5. After hearing learned Counsel for the parties and considering the material on record we are of the opinion that the judgment of the Division Bench is not sustainable and is liable to be set aside for the following reasons:1. The date on which the ticket irregularities were committed by the Respondent was 19.01.2003 whereas the circular that was relied upon by the Division Bench was issued on 26.12.2004. Hence, the Circular is not applicable to the facts of this case.2. The reasons recorded by the Enquiry Officer which were accepted by the Disciplinary Officer, were considered by the Labour Court which refused to pass an order in favour of the Respondent. The learned Single Judge also upheld the award of the Labour Court. Findings of fact as recorded in the departmental enquiry and upheld by the Labour Court could not have been upset by the Division Bench without any justifiable reasons. The conclusion of the Division Bench are contrary to the findings recorded, by the Enquiry Officer.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: L. Nageswara Rao, J. 1. Leave granted. 2. The Respondent was working as a driver in the APSRTC. An enquiry was initiated against him for ticket irregularities. The charges that were framed against the Respondent are as follows: 1. For having collected the fare of Rs. 240/- from a batch of three passengers (2 + 1) at their boarding stage itself, who boarded the bus at Humnabad and bound for Tuljapur ex-stages 9 to 13, but issued tickets to them on sighting the TTIs at stage No. 11 i.e. Omergaon, which constitutes misconduct Under Regulation 28(vi) a & 28(x) of APSRTC Employees (Conduct) Regulations, 1963. 2. For having failed to collect fare and issue tickets to a passenger who boarded the bus at Humnabad and bound for Tuljapur ex-stages 9 to 13, which constitutes misconduct under Regulations 28(vi)(a) of APSRTC Employees (Conduct) Regulations 1963. 3. For having misbehaved with the TTIs by uttering words Nen Dongana Ticketlu isthanukunnanu inthalo Nidrapoyanu, Ekkadaku ragane gurthu vachhi mimmulanu chuchi echhanu. Edi N thappa Nannu emichestharo chesukondi angrily, which constitutes misconduct under Regulations 28(xxii) of APSRTC Employees (Conduct) Regulations 1963. 3. The Enquiry Officer held the charges framed against the Respondent were proved. The Respondent was removed from service on the basis of the findings recorded by the Enquiry Officer. 4. A petition was filed Under Section 2-A(2) of the Industrial Disputes Act by the Respondent for setting aside the order of removal before the labour Court. The order of removal dated 22.09.2005 was found to be justified by the labour Court. Aggrieved by the Award of the labour Court, the Respondent filed a writ petition in the High Court of judicature at Hyderabad. The said writ petition was dismissed by a learned Single Judge. The Division Bench of the High Court reversed the judgment of the learned Single Judge and allowed the appeal filed by the Respondent. Reliance was placed by the Division Bench on a Circular dated 26.12.2004, which relates to TIMS services operating with double drivers on long distance routes. That apart, the Division Bench held that the Respondent who was the second driver cannot be said to be responsible for any lapses or irregularities. 5. After hearing learned Counsel for the parties and considering the material on record we are of the opinion that the judgment of the Division Bench is not sustainable and is liable to be set aside for the following reasons: 1. The date on which the ticket irregularities were committed by the Respondent was 19.01.2003 whereas the circular that was relied upon by the Division Bench was issued on 26.12.2004. Hence, the Circular is not applicable to the facts of this case. 2. The reasons recorded by the Enquiry Officer which were accepted by the Disciplinary Officer, were considered by the Labour Court which refused to pass an order in favour of the Respondent. The learned Single Judge also upheld the award of the Labour Court. Findings of fact as recorded in the departmental enquiry and upheld by the Labour Court could not have been upset by the Division Bench without any justifiable reasons. The conclusion of the Division Bench are contrary to the findings recorded, by the Enquiry Officer. ### Response: 1

United India Insurance Co. Ltd Vs. Laxmamma & Others

order directing a certain person to pay a certain sum of money to a certain person. It involves a promise that such money would be paid.18. Thus, when the insured fails to pay the premium promised, or when the cheque issued by him towards the premium is returned dishonoured by the bank concerned the insurer need not perform his part of the promise. The corollary is that the insured cannot claim performance from the insurer in such a situation.19. Under Section 25 of the Contract Act an agreement made without consideration is void. Section 65 of the Contract Act says that when a contract becomes void any person who has received any advantage under such contract is bound to restore it to the person from whom he received it. So, even if the insurer has disbursed the amount covered by the policy to the insured before the cheque was returned dishonoured, the insurer is entitled to get the money back.20. However, if the insured makes up the premium even after the cheque was dishonoured but before the date of accident it would be a different case as payment of consideration can be treated as paid in the order in which the nature of transaction required it. As such an event did not happen in this case, the Insurance Company is legally justified in refusing to pay the amount claimed by the respondents.” 16. In Deddappa (2008) 2 SCC 595 , the Court was concerned with the plea of the insurance company that although the vehicle was insured by the owner for the period October 17, 1997 to October 16, 1998 but the cheque issued therefor having been dishonoured, the policy was cancelled and, thus, it was not liable. That was a case where for the above period of policy, the cheque was issued by the owner on October 15, 1997; the bank issued a return memo on October 21, 1997 disclosing dishonour of the cheque with remarks ‘fund insufficient’ and the insurance company, thereafter, cancelled the policy of insurance by communicating to the owner of the vehicle and an intimation to the concerned RTO. The accident occurred on February 6, 1998 after the cancellation of the policy. 17. The Court in Deddappa (2008) 2 SCC 595 again considered the relevant statutory provisions and decisions of this Court including the above three decisions in Inderjit Kaur (1998) 1 SCC 371 , Rula and Seema Malhotra (2001) 3 SCC 151. In para 24 (at page 601) of the Report, the Court observed as under: “24. We are not oblivious of the distinction between the statutory liability of the insurance company vis-C -vis a third party in the context of Sections 147 and 149 of the Act and its liabilities in other cases. But the same liabilities arising under a contract of insurance would have to be met if the contract is valid. If the contract of insurance has been cancelled and all concerned have been intimated thereabout, we are of the opinion, the insurance company would not be liable to satisfy the claim.” Then in para 26 (at page 602), the Court invoked extraordinary jurisdiction under Article 142 of the Constitution of India and directed the insurance company to pay the amount of claim to the claimants and recover the same from the owner of the vehicle. 18. We find it hard to accept the submission of the learned counsel for the insurer that the three-Judge Bench decision in Inderjit Kaur (1998) 1 SCC 371 has been diluted by the subsequent decisions in Seema Malhotra (2001) 3 SCC 151 and Deddappa (2008) 2 SCC 595.turned on the facts obtaining therein. In the case of Seema Malhotra2, the claim was by the legal heirs of the insured for the damage to the insured vehicle. In this peculiar fact situation, the Court held that when the cheque for premium returned dishonoured, the insurer was not obligated to perform its part of the promise. Insofar as Deddappa (2008) 2 SCC 595 is concerned, that was a case where the accident of the vehicle occurred after the insurance policy had already been cancelled by the insurance company. 19. In our view, the legal position is this : where the policy of insurance is issued by an authorized insurer on receipt of cheque towards payment of premium and such cheque is returned dishonoured, the liability of authorized insurer to indemnify third parties in respect of the liability which that policy covered subsists and it has to satisfy award of compensation by reason of the provisions of Sections 147(5) and 149(1) of the M.V. Act unless the policy of insurance is cancelled by the authorized insurer and intimation of such cancellation has reached the insured before the accident. In other words, where the policy of insurance is issued by an authorized insurer to cover a vehicle on receipt of the cheque paid towards premium and the cheque gets dishonored and before the accident of the vehicle occurs, such insurance company cancels the policy of insurance and sends intimation thereof to the owner, the insurance company’s liability to indemnify the third parties which that policy covered ceases and the insurance company is not liable to satisfy awards of compensation in respect thereof.20. Having regard to the above legal position, insofar as facts of the present case are concerned, the owner of the bus obtained policy of insurance from the insurer for the period April 16, 2004 to April 15, 2005 for which premium was paid through cheque on April 14, 2004. The accident occurred on May 11, 2004. It was only thereafter that the insurer cancelled the insurance policy by communication dated May 13, 2004 on the ground of dishonour of cheque which was received by the owner of the vehicle on May 21, 2004. The cancellation of policy having been done by the insurer after the accident, the insurer became liable to satisfy award of compensation passed in favour of the claimants.21. In view of the above, the

0[ds]19. In our view, the legal position is this : where the policy of insurance is issued by an authorized insurer on receipt of cheque towards payment of premium and such cheque is returned dishonoured, the liability of authorized insurer to indemnify third parties in respect of the liability which that policy covered subsists and it has to satisfy award of compensation by reason of the provisions of Sections 147(5) and 149(1) of the M.V. Act unless the policy of insurance is cancelled by the authorized insurer and intimation of such cancellation has reached the insured before the accident. In other words, where the policy of insurance is issued by an authorized insurer to cover a vehicle on receipt of the cheque paid towards premium and the cheque gets dishonored and before the accident of the vehicle occurs, such insurance company cancels the policy of insurance and sends intimation thereof to the owner, the insuranceliability to indemnify the third parties which that policy covered ceases and the insurance company is not liable to satisfy awards of compensation in respect thereof.20. Having regard to the above legal position, insofar as facts of the present case are concerned, the owner of the bus obtained policy of insurance from the insurer for the period April 16, 2004 to April 15, 2005 for which premium was paid through cheque on April 14, 2004. The accident occurred on May 11, 2004. It was only thereafter that the insurer cancelled the insurance policy by communication dated May 13, 2004 on the ground of dishonour of cheque which was received by the owner of the vehicle on May 21, 2004. The cancellation of policy having been done by the insurer after the accident, the insurer became liable to satisfy award of compensation passed in favour of the claimants.

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: order directing a certain person to pay a certain sum of money to a certain person. It involves a promise that such money would be paid.18. Thus, when the insured fails to pay the premium promised, or when the cheque issued by him towards the premium is returned dishonoured by the bank concerned the insurer need not perform his part of the promise. The corollary is that the insured cannot claim performance from the insurer in such a situation.19. Under Section 25 of the Contract Act an agreement made without consideration is void. Section 65 of the Contract Act says that when a contract becomes void any person who has received any advantage under such contract is bound to restore it to the person from whom he received it. So, even if the insurer has disbursed the amount covered by the policy to the insured before the cheque was returned dishonoured, the insurer is entitled to get the money back.20. However, if the insured makes up the premium even after the cheque was dishonoured but before the date of accident it would be a different case as payment of consideration can be treated as paid in the order in which the nature of transaction required it. As such an event did not happen in this case, the Insurance Company is legally justified in refusing to pay the amount claimed by the respondents.” 16. In Deddappa (2008) 2 SCC 595 , the Court was concerned with the plea of the insurance company that although the vehicle was insured by the owner for the period October 17, 1997 to October 16, 1998 but the cheque issued therefor having been dishonoured, the policy was cancelled and, thus, it was not liable. That was a case where for the above period of policy, the cheque was issued by the owner on October 15, 1997; the bank issued a return memo on October 21, 1997 disclosing dishonour of the cheque with remarks ‘fund insufficient’ and the insurance company, thereafter, cancelled the policy of insurance by communicating to the owner of the vehicle and an intimation to the concerned RTO. The accident occurred on February 6, 1998 after the cancellation of the policy. 17. The Court in Deddappa (2008) 2 SCC 595 again considered the relevant statutory provisions and decisions of this Court including the above three decisions in Inderjit Kaur (1998) 1 SCC 371 , Rula and Seema Malhotra (2001) 3 SCC 151. In para 24 (at page 601) of the Report, the Court observed as under: “24. We are not oblivious of the distinction between the statutory liability of the insurance company vis-C -vis a third party in the context of Sections 147 and 149 of the Act and its liabilities in other cases. But the same liabilities arising under a contract of insurance would have to be met if the contract is valid. If the contract of insurance has been cancelled and all concerned have been intimated thereabout, we are of the opinion, the insurance company would not be liable to satisfy the claim.” Then in para 26 (at page 602), the Court invoked extraordinary jurisdiction under Article 142 of the Constitution of India and directed the insurance company to pay the amount of claim to the claimants and recover the same from the owner of the vehicle. 18. We find it hard to accept the submission of the learned counsel for the insurer that the three-Judge Bench decision in Inderjit Kaur (1998) 1 SCC 371 has been diluted by the subsequent decisions in Seema Malhotra (2001) 3 SCC 151 and Deddappa (2008) 2 SCC 595.turned on the facts obtaining therein. In the case of Seema Malhotra2, the claim was by the legal heirs of the insured for the damage to the insured vehicle. In this peculiar fact situation, the Court held that when the cheque for premium returned dishonoured, the insurer was not obligated to perform its part of the promise. Insofar as Deddappa (2008) 2 SCC 595 is concerned, that was a case where the accident of the vehicle occurred after the insurance policy had already been cancelled by the insurance company. 19. In our view, the legal position is this : where the policy of insurance is issued by an authorized insurer on receipt of cheque towards payment of premium and such cheque is returned dishonoured, the liability of authorized insurer to indemnify third parties in respect of the liability which that policy covered subsists and it has to satisfy award of compensation by reason of the provisions of Sections 147(5) and 149(1) of the M.V. Act unless the policy of insurance is cancelled by the authorized insurer and intimation of such cancellation has reached the insured before the accident. In other words, where the policy of insurance is issued by an authorized insurer to cover a vehicle on receipt of the cheque paid towards premium and the cheque gets dishonored and before the accident of the vehicle occurs, such insurance company cancels the policy of insurance and sends intimation thereof to the owner, the insurance company’s liability to indemnify the third parties which that policy covered ceases and the insurance company is not liable to satisfy awards of compensation in respect thereof.20. Having regard to the above legal position, insofar as facts of the present case are concerned, the owner of the bus obtained policy of insurance from the insurer for the period April 16, 2004 to April 15, 2005 for which premium was paid through cheque on April 14, 2004. The accident occurred on May 11, 2004. It was only thereafter that the insurer cancelled the insurance policy by communication dated May 13, 2004 on the ground of dishonour of cheque which was received by the owner of the vehicle on May 21, 2004. The cancellation of policy having been done by the insurer after the accident, the insurer became liable to satisfy award of compensation passed in favour of the claimants.21. In view of the above, the ### Response: 0

KALYANI (DEAD) THROUGH LRS. & ORS Vs. THE SULTHAN BATHERY MUNICIPALITY & ORS

the averments in the petition are concerned, they refer to a couple of representations given right from 2011 onwards and when nothing proceeded, the appellants approached the High Court in 2014. Therefore, to say that there was substantial delay on the part of the appellants in agitating for their rights would not be correct. We find from the writ petition that one of the first representation was made on 30.03.2011 addressed to the Chief Engineer, PWD claiming compensation to which the appellants also received a response dated 25.04.2011 stating that PWD had not acquired the land but had received it from the Panchayat. The appellants also obtained relevant material under the Right to Information Act with respect to their claim which is also a part of the writ petition. The appellants further gave a legal notice dated 11.01.2013 addressed to the State as also the PWD. Thereafter another representation was given to the Secretary of the Panchayat on 05.11.2013 claiming compensation. In the counter affidavit filed by the Panchayat and also the PWD, the representation of the petitioners referred to above are not denied. 16. The Division Bench has also noted that there was no scheme for road development by giving price of the land acquired. This observation by the Division Bench would also be contrary to mandate of Article 300A. If there was no scheme, then it was the fault of the State or the Panchayat. To say that there was no scheme is one thing and owner of the land surrendering his land voluntarily without payment of compensation would be different. If there was no such scheme then all the more it was necessary to get the surrender, if any, documented, by the Panchayat/Municipality or the State or the PWD, as the case may be. 17. Sole question for consideration would be as to whether the appellants had voluntarily surrendered their land to the Panchayat free of cost without raising any claim for compensation or not. The Panchayat as also the PWD have failed to produce a single piece of document or evidence in any other form in support of their defense that the appellants have surrendered their land voluntarily. The consistent stand of the appellants, on the other hand, has been that they have not given their land to the Panchayat voluntarily and that they were assured that they would be suitably compensated. The PWD proceeded to construct the road upon the land made available by the Panchayat. No doubt, the road is in the ownership and possession of the Panchayat but the land over which the road was to be constructed or widened was neither in ownership nor possession of the Panchayat. The PWD did not care to take any further clarification from the Panchayat as to whether such land has been acquired, purchased or voluntarily given by the land owners. The PWD has only stated that it received the land from Panchayat and that it was informed that such land has been made available voluntarily without any claim for compensation and free of cost. 18. The stand of the PWD cannot be the basis for determining as to whether the appellants had surrendered their land free of cost without any claim for compensation or that they had expectations to receive compensation as assured by the Panchayat. The Division Bench fell in error in taking into consideration the stand of the PWD. 19. The Division Bench also proceeded to note that the appellants were keen on changing their stand by initially claiming from the State and then from the Panchayat. This reasoning is also not tenable. The appellants are farmers. They cannot be treated as the persons conversant with intricacies of law. The appellants had, from the very beginning, stated that assurance was given by the Panchayat. They had not changed their stand but were consistent. It is for this reason that the learned Single Judge had although directed the collector to determine the value of compensation but the liability to pay the compensation was saddled on the Panchayat/Municipality and not on the State. The Division Bench committed an error in commenting against the appellants and drawing an adverse inference. It took a view too technical, to deprive the appellants of their right to compensation. 20. Article 300A clearly mandates that no person shall be deprived of his property save by authority of law. In the present case, we do not find, under which authority of law, the land of the appellants was taken and they were deprived of the same. If the Panchayat and the PWD failed to produce any evidence that appellants have surrendered their lands voluntarily, depriving the appellants of the property would be in violation of Article 300-A of the Constitution. 21. A Constitution Bench of this Court in the case of K.T. Plantation Private Limited and another vs. State of Karnataka (2011)9 SCC 1 apart from others, dealt with an issue relating to payment of compensation where a person is deprived of his property after deletion of Article 31(2). It laid down that there are two requirements to be fulfilled while depriving a person of his property. Requirement of public purpose is a pre-condition and right to claim compensation is also inbuilt in Article 300-A. While answering the reference in paragraph 221(e) it provided as follows: 221. We, therefore, answer the reference as follows: Xxx xxx xxx (e) Public purpose is a precondition for deprivation of a person from his property under Article 300-A and the right to claim compensation is also inbuilt in that article and when a person is deprived of his property the State has to be justify both the grounds which may depend on scheme of the statute, legislative policy, object and purpose of the legislature and other related factors. Construction/widening of road no doubt would be a public purpose but there being no justification for not paying compensation the action of the respondents would be arbitrary, unreasonable and clearly violative of Article 300-A of the Constitution.

1[ds]9. It is not disputed that the appellants did lose their land in the construction/widening of the road belonging to the Panchayat/Municipality. It is also admitted that the road as it existed and after further construction and widening would be owned by the Panchayat/Municipality, that is to say that the appellants would be deprived of their right, title or interest over the land utilized for the said purpose. As such the appellants have been deprived of their land in the said process.10. The appellants are farmers and the land utilized is agricultural land. It was part of their livelihood. Depriving them of their part of their livelihood and also of their property without authority of law would be violative of Article 21 and Article 300A of the Constitution.In the present case, it being utilized for the road to be owned by the Panchayat/Municipality, it could either have been voluntarily surrendered, transferred by way of title deeds or by way of acquisition as may be provided under the statute.12. In the present case, admittedly, there is neither any acquisition proceedings nor any transfer of rights by the appellants by way of sale, gift or otherwise. What is being alleged is that it was a voluntarily surrender of rights for no consideration. This is the stand taken by Panchayat/Municipality. If the Panchayat/Municipality is taking this stand, the burden would be on the Panchayat/Municipality to establish such voluntary surrender. A memorandum or an agreement or a written document ought to have been executed by the appellants stating their free will to surrender for no consideration in favour of the Panchayat/Municipality.13. The learned single Judge has clearly recorded that Panchayat/Municipality as also the PWD failed to produce any such evidence. Even the Division Bench did not find any material on record produced by the Panchayat/Municipality or the PWD to the aforesaid effect. However, the Division Bench proceeded on the premise that the burden would lie on the appellants to establish that they were given an assurance. It is the Panchayat/Municipality which is the beneficiary. Burden should be on the Panchayat/Municipality to prove that there was a voluntary surrender.14. In our considered view, the Division Bench proceeded on a wrong premise on shifting the burden on the appellants. The assertion that it was surrendered voluntarily without any claim for consideration is by the Panchayat/Municipality. The PWD has only stated that it received the land from Panchayat and that it was given to understand that the land was surrendered voluntarily. Thus, it is the stand of Panchayat/Municipality which is to be taken note of.15. Another reasoning given by the Division Bench is that the appellants made a stale claim and it was as an afterthought that they started claiming compensation after construction/widening of the road had completed. This reasoning of the Division Bench, in our view, was also not sustainable in as much as the appellants had represented at the earliest, after the land was utilized, to the authorities to pay the compensation. As far as the averments in the petition are concerned, they refer to a couple of representations given right from 2011 onwards and when nothing proceeded, the appellants approached the High Court in 2014. Therefore, to say that there was substantial delay on the part of the appellants in agitating for their rights would not be correct. We find from the writ petition that one of the first representation was made on 30.03.2011 addressed to the Chief Engineer, PWD claiming compensation to which the appellants also received a response dated 25.04.2011 stating that PWD had not acquired the land but had received it from the Panchayat. The appellants also obtained relevant material under the Right to Information Act with respect to their claim which is also a part of the writ petition. The appellants further gave a legal notice dated 11.01.2013 addressed to the State as also the PWD. Thereafter another representation was given to the Secretary of the Panchayat on 05.11.2013 claiming compensation. In the counter affidavit filed by the Panchayat and also the PWD, the representation of the petitioners referred to above are not denied.16. The Division Bench has also noted that there was no scheme for road development by giving price of the land acquired. This observation by the Division Bench would also be contrary to mandate of Article 300A. If there was no scheme, then it was the fault of the State or the Panchayat. To say that there was no scheme is one thing and owner of the land surrendering his land voluntarily without payment of compensation would be different. If there was no such scheme then all the more it was necessary to get the surrender, if any, documented, by the Panchayat/Municipality or the State or the PWD, as the case may be.The Panchayat as also the PWD have failed to produce a single piece of document or evidence in any other form in support of their defense that the appellants have surrendered their land voluntarily. The consistent stand of the appellants, on the other hand, has been that they have not given their land to the Panchayat voluntarily and that they were assured that they would be suitably compensated. The PWD proceeded to construct the road upon the land made available by the Panchayat. No doubt, the road is in the ownership and possession of the Panchayat but the land over which the road was to be constructed or widened was neither in ownership nor possession of the Panchayat. The PWD did not care to take any further clarification from the Panchayat as to whether such land has been acquired, purchased or voluntarily given by the land owners. The PWD has only stated that it received the land from Panchayat and that it was informed that such land has been made available voluntarily without any claim for compensation and free of cost.18. The stand of the PWD cannot be the basis for determining as to whether the appellants had surrendered their land free of cost without any claim for compensation or that they had expectations to receive compensation as assured by the Panchayat. The Division Bench fell in error in taking into consideration the stand of the PWD.19. The Division Bench also proceeded to note that the appellants were keen on changing their stand by initially claiming from the State and then from the Panchayat. This reasoning is also not tenable. The appellants are farmers. They cannot be treated as the persons conversant with intricacies of law. The appellants had, from the very beginning, stated that assurance was given by the Panchayat. They had not changed their stand but were consistent. It is for this reason that the learned Single Judge had although directed the collector to determine the value of compensation but the liability to pay the compensation was saddled on the Panchayat/Municipality and not on the State. The Division Bench committed an error in commenting against the appellants and drawing an adverse inference. It took a view too technical, to deprive the appellants of their right to compensation.20. Article 300A clearly mandates that no person shall be deprived of his property save by authority of law. In the present case, we do not find, under which authority of law, the land of the appellants was taken and they were deprived of the same. If the Panchayat and the PWD failed to produce any evidence that appellants have surrendered their lands voluntarily, depriving the appellants of the property would be in violation of Article 300-A of the Constitution.21. A Constitution Bench of this Court in the case of K.T. Plantation Private Limited and another vs. State of Karnataka (2011)9 SCC 1 apart from others, dealt with an issue relating to payment of compensation where a person is deprived of his property after deletion of Article 31(2). It laid down that there are two requirements to be fulfilled while depriving a person of his property. Requirement of public purpose is a pre-condition and right to claim compensation is also inbuilt in Article 300-A. While answering the reference in paragraph 221(e) it provided as follows:221. We, therefore, answer the reference as follows:Xxx xxx xxx(e) Public purpose is a precondition for deprivation of a person from his property under Article 300-A and the right to claim compensation is also inbuilt in that article and when a person is deprived of his property the State has to be justify both the grounds which may depend on scheme of the statute, legislative policy, object and purpose of the legislature and other related factors.Construction/widening of road no doubt would be a public purpose but there being no justification for not paying compensation the action of the respondents would be arbitrary, unreasonable and clearly violative of Article 300-A of the Constitution.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: the averments in the petition are concerned, they refer to a couple of representations given right from 2011 onwards and when nothing proceeded, the appellants approached the High Court in 2014. Therefore, to say that there was substantial delay on the part of the appellants in agitating for their rights would not be correct. We find from the writ petition that one of the first representation was made on 30.03.2011 addressed to the Chief Engineer, PWD claiming compensation to which the appellants also received a response dated 25.04.2011 stating that PWD had not acquired the land but had received it from the Panchayat. The appellants also obtained relevant material under the Right to Information Act with respect to their claim which is also a part of the writ petition. The appellants further gave a legal notice dated 11.01.2013 addressed to the State as also the PWD. Thereafter another representation was given to the Secretary of the Panchayat on 05.11.2013 claiming compensation. In the counter affidavit filed by the Panchayat and also the PWD, the representation of the petitioners referred to above are not denied. 16. The Division Bench has also noted that there was no scheme for road development by giving price of the land acquired. This observation by the Division Bench would also be contrary to mandate of Article 300A. If there was no scheme, then it was the fault of the State or the Panchayat. To say that there was no scheme is one thing and owner of the land surrendering his land voluntarily without payment of compensation would be different. If there was no such scheme then all the more it was necessary to get the surrender, if any, documented, by the Panchayat/Municipality or the State or the PWD, as the case may be. 17. Sole question for consideration would be as to whether the appellants had voluntarily surrendered their land to the Panchayat free of cost without raising any claim for compensation or not. The Panchayat as also the PWD have failed to produce a single piece of document or evidence in any other form in support of their defense that the appellants have surrendered their land voluntarily. The consistent stand of the appellants, on the other hand, has been that they have not given their land to the Panchayat voluntarily and that they were assured that they would be suitably compensated. The PWD proceeded to construct the road upon the land made available by the Panchayat. No doubt, the road is in the ownership and possession of the Panchayat but the land over which the road was to be constructed or widened was neither in ownership nor possession of the Panchayat. The PWD did not care to take any further clarification from the Panchayat as to whether such land has been acquired, purchased or voluntarily given by the land owners. The PWD has only stated that it received the land from Panchayat and that it was informed that such land has been made available voluntarily without any claim for compensation and free of cost. 18. The stand of the PWD cannot be the basis for determining as to whether the appellants had surrendered their land free of cost without any claim for compensation or that they had expectations to receive compensation as assured by the Panchayat. The Division Bench fell in error in taking into consideration the stand of the PWD. 19. The Division Bench also proceeded to note that the appellants were keen on changing their stand by initially claiming from the State and then from the Panchayat. This reasoning is also not tenable. The appellants are farmers. They cannot be treated as the persons conversant with intricacies of law. The appellants had, from the very beginning, stated that assurance was given by the Panchayat. They had not changed their stand but were consistent. It is for this reason that the learned Single Judge had although directed the collector to determine the value of compensation but the liability to pay the compensation was saddled on the Panchayat/Municipality and not on the State. The Division Bench committed an error in commenting against the appellants and drawing an adverse inference. It took a view too technical, to deprive the appellants of their right to compensation. 20. Article 300A clearly mandates that no person shall be deprived of his property save by authority of law. In the present case, we do not find, under which authority of law, the land of the appellants was taken and they were deprived of the same. If the Panchayat and the PWD failed to produce any evidence that appellants have surrendered their lands voluntarily, depriving the appellants of the property would be in violation of Article 300-A of the Constitution. 21. A Constitution Bench of this Court in the case of K.T. Plantation Private Limited and another vs. State of Karnataka (2011)9 SCC 1 apart from others, dealt with an issue relating to payment of compensation where a person is deprived of his property after deletion of Article 31(2). It laid down that there are two requirements to be fulfilled while depriving a person of his property. Requirement of public purpose is a pre-condition and right to claim compensation is also inbuilt in Article 300-A. While answering the reference in paragraph 221(e) it provided as follows: 221. We, therefore, answer the reference as follows: Xxx xxx xxx (e) Public purpose is a precondition for deprivation of a person from his property under Article 300-A and the right to claim compensation is also inbuilt in that article and when a person is deprived of his property the State has to be justify both the grounds which may depend on scheme of the statute, legislative policy, object and purpose of the legislature and other related factors. Construction/widening of road no doubt would be a public purpose but there being no justification for not paying compensation the action of the respondents would be arbitrary, unreasonable and clearly violative of Article 300-A of the Constitution. ### Response: 1

Shahzada Nand & Sons Vs. The Commissioner Of Income Tax, Patiala

has to be judged not on any subjective standard of the assessing authority but from the point of view of commercial expediency. Let us see whether the amount of commission paid to Saheb Dayal and Gurditta Mal in the present case can be said to be reasonable from this standpoint. It is clear from the order of the Tribunal that reliance was placed by the Tribunal mainly and substantially on the fact that the nature of the work done by Saheb Dayal and Gurditta Mal remained unchanged in the relevant accounting year and there was nothing to show that the increase in the turnover during the relevant accounting year was as a result of any extra efforts made by these two employees and hence it could not be said that there were any special circumstances which warranted the payment of commission to them. But, as already pointed out above, the commission paid to an employee cannot be branded as unreasonable merely because the employee has done in the relevant accounting year the same work which he was doing in the earlier years. Even where the nature of the work has remained the same, commercial expediency may require payment of commission to an employee. Here, Saheb Dayal and Gurditta Mal were each receiving a salary of Rs. 1, 000 per month and besides this salary, there were admittedly no other perquisites given to them. They were the persons attending to the business of the assessee and in fact Gurditta Mal was an experienced and seasoned businessman and it was he who was advising OCM in regard to designs, etc., and he and Saheb Dayal were primarily responsible for the flourishing state of the business. The turnover of the sales of the assessee steadily rose from 1960-61 and in the relevant accounting year, it reached the exciting figure of Rs. 54.28 lakhs. So also the overriding commission which started with the modest figure of Rs. 35, 964 in the accounting year relevant to the assessment year 1960-61 went on steadily increasing from year to year until it reached the figure of Rs. 1, 13, 449 in the relevant accounting year. The assessee, therefore, felt that in view of the tremendous progress in the business which was largely the result of the services rendered by Saheb Dayal and Gurditta Mal, a part of the overriding commission should be paid to them, so that they may carry a sense of satisfaction that their efforts have been suitably rewarded and they may have an added incentive to work and may be spurred to greater efficiency in the future. It may be noted that the overriding Commission of the assessee during the relevant accounting year was Rs. 1, 13, 449 and the total profit was Rs. 3, 08, 034 and if out of this total profit of Rs. 3, 08, 034, an aggregate sum of Rs. 45, 380 was paid to Saheb Dayal and Gurditta Mal as commission, it is difficult to see how such payment could be regarded as unreasonable. It is true that there was no obligation on the assessee to make payment of this commission to Saheb Dayal and Gurditta Mal, but it is now well-settled that the mere fact that commission is paid ex gratia would not necessarily mean that it is unreasonable. Commercial expediency does not mean that an employer should not make any payment to an employee unless the employee is entitled to it under a contract. Even where there is no contract, an employer may pay commission to an employee if he thinks that it would be in the interest of his business to do so. It is obvious that no business can prosper unless the employees engaged in it are satisfied and contented and they feel a sense of involvement and identification and this can be best secured by giving them a stake in the business and allowing them to share in the profits. It would indeed be a wise step on the part of an employer to offer incentives to his employees by sharing a part of his profits with them. This would not only be good business but also good ethics. It would be in consonance with Gandhian concept as also modern socialistic thought which, with its deeply rooted faith in social and economic democracy, regards the employees as much as the employer as co-sharers in the business. If an employer earns profits to which the employees have necessarily contributed by putting in their labour, there is no reason why the employer should not share a part of these profits with the employees. That is the demand of social justice today and it is high time that the administration of our tax law recognised it and encouraged sharing of profits by employers with employees by adopting a progressive and liberal approach in the applicability of section 36, sub-section (1), clause (ii). What is the requirement of commercial expediency must be judged not in the light of the 19th century laissez faire doctrine which regarded man as an economic being concerned only to protect and advance his self-interest but in the context of current socio-economic thinking which places the general interest of the community above the personal interest of the individual and believes that a business or undertaking is the product of the combined efforts of the employer and the employees and where there is sufficiently large profit, after providing for the salary or remuneration of the employer and the employees and other prior charges such as interest on capital, depreciation, reserves, etc., a part of it should in all fairness go to the employees. We are, therefore, of the view that the sum of Rs. 45, 380 paid by the assessee to Saheb Dayal and Gurditta Mal by way of commission during the relevant accounting year was reasonable having regard to all the circumtances of the case and it ought to have been allowed as a deductible expenditure under section 36, sub-section (1), clause (ii). 6.

1[ds]Now, before we proceed to consider the question which arises for determination before us, we must make it clear at the outset that in the present case the genuineness of the payment of commission made to Saheb Dayal and Gurditta Mal was at no time doubted by the revenue authorities. It was not the case of the revenue that this payment was not made or that it was sham or bogus. If that had been the finding, there would have been an end of the case of the assessee. No question would then have arisen for considering the applicability of section 36, sub-section (1), clause (ii). No payment having been made, no deduction would have been permissibleThe only ground on which the High Court negatived the applicability of section 36, sub-section (1), clause (ii), was that during the relevant accounting year Saheb Dayal and Gurditta Mal rendered the same services which they were rendering in earlier years and no extra services were rendered by them which could justify payment of commission in addition to salary and bonus. The High Court appeared to take the view that there must be correlation between the payment of commission and the services rendered and since commission was paid by the assessee for the first time during the relevant accounting year, there must be some extra services rendered by Saheb Dayal and Gurditta Mal in that year over and above the usual services rendered by them in the earlier years. Since, according to the High Court, there was no proof that any extra services were rendered by Saheb Dayal and Gurditta Mal, the High Court held that the payment of commission could not be said to be for services rendered within the meaning of section 36, sub-section (1), clause (ii). This view taken by the High Court is, in our opinion, plainly erroneous. Section 36, sub-section (1), clause (ii), does not postulate that there should be any extra services rendered by an employee before payment of commission to him can be justified as an allowable expenditureIt is true that the services rendered by these two employees during the relevant accounting year were in no way greater or more onerous than the services rendered by them in the earlier years, but that is immaterial. There is no such requirement and the argument based on it cannot be sustained. It is not justified by the language of section 36, sub-section (1), clause (ii), and, indeed, if it were pushed to its logical extreme, it would be difficult to support even payment of bonus as a permissible deduction under that provision. Of course, the circumstance that no additional services are rendered by an employee would undoubtedly be of some relevance in determining the reasonableness of the amount of commission but it would have to be considered along with other circumstances and the question whether commercial expediency justified the payment of commission would have to be judged in the light of all the circumstances existing at the material time. This was the view taken by the Gujarat High Court in Laxmandas Sejram v. Commissioner of Income-tax [1964] 54 ITR 763 (Guj) and we wholly accept that view. It is, therefore, no answer to the applicability of section 36, sub-section (1), clause (ii), to say that no extra services were rendered by Saheb Dayal and Gurditta Mal during the relevant accounting year. But it is well settled that these factors are to be considered from the point of view of a normal, prudent businessman. The reasonableness of the payment with reference to these factors has to be judged not on any subjective standard of the assessing authority but from the point of view of commercial expediency. It is clear from the order of the Tribunal that reliance was placed by the Tribunal mainly and substantially on the fact that the nature of the work done by Saheb Dayal and Gurditta Mal remained unchanged in the relevant accounting year and there was nothing to show that the increase in the turnover during the relevant accounting year was as a result of any extra efforts made by these two employees and hence it could not be said that there were any special circumstances which warranted the payment of commission to them. But, as already pointed out above, the commission paid to an employee cannot be branded as unreasonable merely because the employee has done in the relevant accounting year the same work which he was doing in the earlier years. Even where the nature of the work has remained the same, commercial expediency may require payment of commission to an employee. Here, Saheb Dayal and Gurditta Mal were each receiving a salary of Rs. 1, 000 per month and besides this salary, there were admittedly no other perquisites given to them. They were the persons attending to the business of the assessee and in fact Gurditta Mal was an experienced and seasoned businessman and it was he who was advising OCM in regard to designs, etc., and he and Saheb Dayal were primarily responsible for the flourishing state of the business. The turnover of the sales of the assessee steadily rose from 1960-61 and in the relevant accounting year, it reached the exciting figure of Rs. 54.28 lakhs. So also the overriding commission which started with the modest figure of Rs. 35, 964 in the accounting year relevant to the assessment year 1960-61 went on steadily increasing from year to year until it reached the figure of Rs. 1, 13, 449 in the relevant accounting year. The assessee, therefore, felt that in view of the tremendous progress in the business which was largely the result of the services rendered by Saheb Dayal and Gurditta Mal, a part of the overriding commission should be paid to them, so that they may carry a sense of satisfaction that their efforts have been suitably rewarded and they may have an added incentive to work and may be spurred to greater efficiency in the future. It may be noted that the overriding Commission of the assessee during the relevant accounting year was Rs. 1, 13, 449 and the total profit was Rs. 3, 08, 034 and if out of this total profit of Rs. 3, 08, 034, an aggregate sum of Rs. 45, 380 was paid to Saheb Dayal and Gurditta Mal as commission, it is difficult to see how such payment could be regarded as unreasonable. It is true that there was no obligation on the assessee to make payment of this commission to Saheb Dayal and Gurditta Mal, but it is now well-settled that the mere fact that commission is paid ex gratia would not necessarily mean that it is unreasonable. Commercial expediency does not mean that an employer should not make any payment to an employee unless the employee is entitled to it under a contract. Even where there is no contract, an employer may pay commission to an employee if he thinks that it would be in the interest of his business to do so. It is obvious that no business can prosper unless the employees engaged in it are satisfied and contented and they feel a sense of involvement and identification and this can be best secured by giving them a stake in the business and allowing them to share in the profits. It would indeed be a wise step on the part of an employer to offer incentives to his employees by sharing a part of his profits with them. This would not only be good business but also good ethics. It would be in consonance with Gandhian concept as also modern socialistic thought which, with its deeply rooted faith in social and economic democracy, regards the employees as much as the employer as co-sharers in the business. If an employer earns profits to which the employees have necessarily contributed by putting in their labour, there is no reason why the employer should not share a part of these profits with the employees. That is the demand of social justice today and it is high time that the administration of our tax law recognised it and encouraged sharing of profits by employers with employees by adopting a progressive and liberal approach in the applicability of section 36, sub-section (1), clause (ii). What is the requirement of commercial expediency must be judged not in the light of the 19th century laissez faire doctrine which regarded man as an economic being concerned only to protect and advance his self-interest but in the context of current socio-economic thinking which places the general interest of the community above the personal interest of the individual and believes that a business or undertaking is the product of the combined efforts of the employer and the employees and where there is sufficiently large profit, after providing for the salary or remuneration of the employer and the employees and other prior charges such as interest on capital, depreciation, reserves, etc., a part of it should in all fairness go to the employees. We are, therefore, of the view that the sum of Rs. 45, 380 paid by the assessee to Saheb Dayal and Gurditta Mal by way of commission during the relevant accounting year was reasonable having regard to all the circumtances of the case and it ought to have been allowed as a deductible expenditure under section 36, sub-section (1), clause (ii)

### Instruction: Delve into the case proceeding and predict the outcome: is the judgment expected to be in support (1) or in denial (0) of the appeal? ### Input: has to be judged not on any subjective standard of the assessing authority but from the point of view of commercial expediency. Let us see whether the amount of commission paid to Saheb Dayal and Gurditta Mal in the present case can be said to be reasonable from this standpoint. It is clear from the order of the Tribunal that reliance was placed by the Tribunal mainly and substantially on the fact that the nature of the work done by Saheb Dayal and Gurditta Mal remained unchanged in the relevant accounting year and there was nothing to show that the increase in the turnover during the relevant accounting year was as a result of any extra efforts made by these two employees and hence it could not be said that there were any special circumstances which warranted the payment of commission to them. But, as already pointed out above, the commission paid to an employee cannot be branded as unreasonable merely because the employee has done in the relevant accounting year the same work which he was doing in the earlier years. Even where the nature of the work has remained the same, commercial expediency may require payment of commission to an employee. Here, Saheb Dayal and Gurditta Mal were each receiving a salary of Rs. 1, 000 per month and besides this salary, there were admittedly no other perquisites given to them. They were the persons attending to the business of the assessee and in fact Gurditta Mal was an experienced and seasoned businessman and it was he who was advising OCM in regard to designs, etc., and he and Saheb Dayal were primarily responsible for the flourishing state of the business. The turnover of the sales of the assessee steadily rose from 1960-61 and in the relevant accounting year, it reached the exciting figure of Rs. 54.28 lakhs. So also the overriding commission which started with the modest figure of Rs. 35, 964 in the accounting year relevant to the assessment year 1960-61 went on steadily increasing from year to year until it reached the figure of Rs. 1, 13, 449 in the relevant accounting year. The assessee, therefore, felt that in view of the tremendous progress in the business which was largely the result of the services rendered by Saheb Dayal and Gurditta Mal, a part of the overriding commission should be paid to them, so that they may carry a sense of satisfaction that their efforts have been suitably rewarded and they may have an added incentive to work and may be spurred to greater efficiency in the future. It may be noted that the overriding Commission of the assessee during the relevant accounting year was Rs. 1, 13, 449 and the total profit was Rs. 3, 08, 034 and if out of this total profit of Rs. 3, 08, 034, an aggregate sum of Rs. 45, 380 was paid to Saheb Dayal and Gurditta Mal as commission, it is difficult to see how such payment could be regarded as unreasonable. It is true that there was no obligation on the assessee to make payment of this commission to Saheb Dayal and Gurditta Mal, but it is now well-settled that the mere fact that commission is paid ex gratia would not necessarily mean that it is unreasonable. Commercial expediency does not mean that an employer should not make any payment to an employee unless the employee is entitled to it under a contract. Even where there is no contract, an employer may pay commission to an employee if he thinks that it would be in the interest of his business to do so. It is obvious that no business can prosper unless the employees engaged in it are satisfied and contented and they feel a sense of involvement and identification and this can be best secured by giving them a stake in the business and allowing them to share in the profits. It would indeed be a wise step on the part of an employer to offer incentives to his employees by sharing a part of his profits with them. This would not only be good business but also good ethics. It would be in consonance with Gandhian concept as also modern socialistic thought which, with its deeply rooted faith in social and economic democracy, regards the employees as much as the employer as co-sharers in the business. If an employer earns profits to which the employees have necessarily contributed by putting in their labour, there is no reason why the employer should not share a part of these profits with the employees. That is the demand of social justice today and it is high time that the administration of our tax law recognised it and encouraged sharing of profits by employers with employees by adopting a progressive and liberal approach in the applicability of section 36, sub-section (1), clause (ii). What is the requirement of commercial expediency must be judged not in the light of the 19th century laissez faire doctrine which regarded man as an economic being concerned only to protect and advance his self-interest but in the context of current socio-economic thinking which places the general interest of the community above the personal interest of the individual and believes that a business or undertaking is the product of the combined efforts of the employer and the employees and where there is sufficiently large profit, after providing for the salary or remuneration of the employer and the employees and other prior charges such as interest on capital, depreciation, reserves, etc., a part of it should in all fairness go to the employees. We are, therefore, of the view that the sum of Rs. 45, 380 paid by the assessee to Saheb Dayal and Gurditta Mal by way of commission during the relevant accounting year was reasonable having regard to all the circumtances of the case and it ought to have been allowed as a deductible expenditure under section 36, sub-section (1), clause (ii). 6. ### Response: 1

CENTRAL BUREAU OF INVESTIGATION Vs. RAMENDU CHATTOPADHYAY

in the name of the accused company; and by inducing the public to invest under these schemes with the allure of high returns, collected funds amounting to Rs. 255,91,00,541/¬, but did not repay the amount to the tune of Rs. 15,69,35,003/¬, thereby cheating the investors of such amount. During the course of investigation, it was prima facie established that the Respondent, the accused company, and one Ashis Chatterjee, a director in several companies under the Tower Group, were liable to be chargesheeted. Though material was also found against another director of the accused company, Ranjit Mullick, no further action was taken since he had expired by then. In pursuance of the above findings, a chargesheet was filed against the Respondent, and against Ashis Chatterjee and the accused company, under Section 120B read with Sections 420 and 409 of the Indian Penal Code ( the IPC), and Sections 4 and 6 of the Prizes and Chit Money Circulation Scheme (Banning) Act, 1978. Further investigation under Section 173(8) of the Code of Criminal Procedure was kept open. The Respondent was arrested on 10.03.2016, before being released on bail by the impugned order. During the interregnum also, he was released on bail several times. 4. It is submitted by the CBI that the High Court granted bail to the Respondent without assigning any reason, and such grant of bail by the High Court is in question in this petition. Per contra, Shri Basanth, learned Senior Counsel for the Respondent argues in support of the impugned order by contending that the Respondent has not misused his liberty and has not come in the way of selling of company assets by the One-Man Committee constituted for the purpose. On the contrary, it is submitted that the Respondent is cooperating with the investigation agencies and the One-Man Committee. 5. The records prima facie reveal that the Respondent was the founding director of the accused company. He was a key decision¬ making authority of the company, and used to sign certificates issued to the investors and other important documents. He was also an authorised signatory of all bank accounts of the company and used to conduct agents meetings. As per the allegations, he used to mislead the agents by stating that the company had necessary permissions from the regulatory authorities to collect funds, and also used to project in the meetings that the returns paid by the accused company to its investors were higher than any other agency. As per the chargesheet, the accused company used to receive cash from the investors so that the Respondent, who used to receive cash directly from the company account frequently, without proper accounting, could easily siphon off the money. 6. The Respondent was granted interim bail by the High Court on 09.05.2017 in Misc. Case No. 738 of 2017 for three months, inter alia for the purpose of his co-operation with the authorities in liquidating the assets of the company for repaying the investors. The aforementioned period of interim bail was extended from time to time by the High Court, i.e. on 13.09.2017 upto 25.10.2017, on 25.10.2017 upto 09.11.2017, and on 27.11.2017 upto 04.12.2017. Subsequently, he was released on bail by the impugned order, as mentioned supra. It has been brought to the notice of this Court by the CBI that during the said periods of availing bail, not a single property of the accused company could be sold, and the very purpose of his availing interim bail was frustrated, though a One-Man Committee headed by a retired Judge of the High Court, namely, Justice S.P. Talukdar, was appointed for this purpose. A letter dated 08.08.2019 written by Justice Talukdar, a copy of which was produced before this Court, reveals that no property of the Tower Group of companies has been sold by the One¬Man Committee so far, and as a consequence, no amount has been deposited in the account of the One¬ Man Committee or returned to the investors. 7. It has also been brought to the notice of this Court that the Respondent, with the dishonest intention of deceiving and alluring investors, as well as agents and business developers, had got brochures of the Tower Group of companies published. In the aforesaid brochures, a letter was published in the name of Smt. Sheela Bhide, IAS, Chairman and Managing Director, India Trade Promotion Organisation. On the basis of this purported letter, it prima facie appears that the accused tried to falsely impress upon the public that the accused company was doing lawful business and also gaining huge profits. Though Smt. Sheela Bhide was also named as an accused in the FIR, during investigation, she denied having issued this letter. 8. This Court is conscious of the need to view such economic offences having a deep-rooted conspiracy and involving a huge loss of investors money seriously. Though further investigation is going on, as of now, the investigation discloses that the Respondent played a key role in the promotion of the chit fund scam described supra, thereby cheating a large number of innocent depositors and misappropriating their hard¬ earned money. 9. We are of the prima facie view that if the Respondent continues on bail, there is little chance of realising any amount by selling the properties of the Tower Group of companies, since he may use unlawful tactics to keep prospective buyers away. Moreover, it is relevant to note that the investigating agency has not yet assessed the exact total amount invested by the people of Orissa in the accused company, so as to find out the specific liability of the company in that regard. However, it is argued by both the Counsel that the amount may be about Rs. 350 Crores. Be that as it may, having regard to the material on record, and since a huge amount of money belonging to investors has been siphoned off, as well as for the aforesaid reasons, the High Court, in our considered opinion, should not have released the Respondent on bail.

1[ds]@ SPECIAL LEAVE PETITION (CRIMINAL) NO. 120 OF 2019)8. This Court is conscious of the need to view such economic offences having a deep-rooted conspiracy and involving a huge loss of investors money seriously. Though further investigation is going on, as of now, the investigation discloses that the Respondent played a key role in the promotion of the chit fund scam described supra, thereby cheating a large number of innocent depositors and misappropriating their hard¬ earned money9. We are of the prima facie view that if the Respondent continues on bail, there is little chance of realising any amount by selling the properties of the Tower Group of companies, since he may use unlawful tactics to keep prospective buyers away. Moreover, it is relevant to note that the investigating agency has not yet assessed the exact total amount invested by the people of Orissa in the accused company, so as to find out the specific liability of the company in that regard. However, it is argued by both the Counsel that the amount may be about Rs. 350 Crores. Be that as it may, having regard to the material on record, and since a huge amount of money belonging to investors has been siphoned off, as well as for the aforesaid reasons, the High Court, in our considered opinion, should not have released the Respondent on bail@ SPECIAL LEAVE PETITION (CRIMINAL) NO. 462 OF 2019)Even in this case, we are of the view that if the Respondent is released on bail, he may obstruct efforts to liquidate the properties of the Tower Group5. Having regard to the material on record and since large amounts of money belonging to innocent investors have been siphoned off, as well as for the aforesaid reasons, the High Court, in our considered opinion, should not have released the Respondent on bail.

### Instruction: From the information provided in the case proceeding, infer whether the court's decision will be positive (1) or negative (0) for the appellant. ### Input: in the name of the accused company; and by inducing the public to invest under these schemes with the allure of high returns, collected funds amounting to Rs. 255,91,00,541/¬, but did not repay the amount to the tune of Rs. 15,69,35,003/¬, thereby cheating the investors of such amount. During the course of investigation, it was prima facie established that the Respondent, the accused company, and one Ashis Chatterjee, a director in several companies under the Tower Group, were liable to be chargesheeted. Though material was also found against another director of the accused company, Ranjit Mullick, no further action was taken since he had expired by then. In pursuance of the above findings, a chargesheet was filed against the Respondent, and against Ashis Chatterjee and the accused company, under Section 120B read with Sections 420 and 409 of the Indian Penal Code ( the IPC), and Sections 4 and 6 of the Prizes and Chit Money Circulation Scheme (Banning) Act, 1978. Further investigation under Section 173(8) of the Code of Criminal Procedure was kept open. The Respondent was arrested on 10.03.2016, before being released on bail by the impugned order. During the interregnum also, he was released on bail several times. 4. It is submitted by the CBI that the High Court granted bail to the Respondent without assigning any reason, and such grant of bail by the High Court is in question in this petition. Per contra, Shri Basanth, learned Senior Counsel for the Respondent argues in support of the impugned order by contending that the Respondent has not misused his liberty and has not come in the way of selling of company assets by the One-Man Committee constituted for the purpose. On the contrary, it is submitted that the Respondent is cooperating with the investigation agencies and the One-Man Committee. 5. The records prima facie reveal that the Respondent was the founding director of the accused company. He was a key decision¬ making authority of the company, and used to sign certificates issued to the investors and other important documents. He was also an authorised signatory of all bank accounts of the company and used to conduct agents meetings. As per the allegations, he used to mislead the agents by stating that the company had necessary permissions from the regulatory authorities to collect funds, and also used to project in the meetings that the returns paid by the accused company to its investors were higher than any other agency. As per the chargesheet, the accused company used to receive cash from the investors so that the Respondent, who used to receive cash directly from the company account frequently, without proper accounting, could easily siphon off the money. 6. The Respondent was granted interim bail by the High Court on 09.05.2017 in Misc. Case No. 738 of 2017 for three months, inter alia for the purpose of his co-operation with the authorities in liquidating the assets of the company for repaying the investors. The aforementioned period of interim bail was extended from time to time by the High Court, i.e. on 13.09.2017 upto 25.10.2017, on 25.10.2017 upto 09.11.2017, and on 27.11.2017 upto 04.12.2017. Subsequently, he was released on bail by the impugned order, as mentioned supra. It has been brought to the notice of this Court by the CBI that during the said periods of availing bail, not a single property of the accused company could be sold, and the very purpose of his availing interim bail was frustrated, though a One-Man Committee headed by a retired Judge of the High Court, namely, Justice S.P. Talukdar, was appointed for this purpose. A letter dated 08.08.2019 written by Justice Talukdar, a copy of which was produced before this Court, reveals that no property of the Tower Group of companies has been sold by the One¬Man Committee so far, and as a consequence, no amount has been deposited in the account of the One¬ Man Committee or returned to the investors. 7. It has also been brought to the notice of this Court that the Respondent, with the dishonest intention of deceiving and alluring investors, as well as agents and business developers, had got brochures of the Tower Group of companies published. In the aforesaid brochures, a letter was published in the name of Smt. Sheela Bhide, IAS, Chairman and Managing Director, India Trade Promotion Organisation. On the basis of this purported letter, it prima facie appears that the accused tried to falsely impress upon the public that the accused company was doing lawful business and also gaining huge profits. Though Smt. Sheela Bhide was also named as an accused in the FIR, during investigation, she denied having issued this letter. 8. This Court is conscious of the need to view such economic offences having a deep-rooted conspiracy and involving a huge loss of investors money seriously. Though further investigation is going on, as of now, the investigation discloses that the Respondent played a key role in the promotion of the chit fund scam described supra, thereby cheating a large number of innocent depositors and misappropriating their hard¬ earned money. 9. We are of the prima facie view that if the Respondent continues on bail, there is little chance of realising any amount by selling the properties of the Tower Group of companies, since he may use unlawful tactics to keep prospective buyers away. Moreover, it is relevant to note that the investigating agency has not yet assessed the exact total amount invested by the people of Orissa in the accused company, so as to find out the specific liability of the company in that regard. However, it is argued by both the Counsel that the amount may be about Rs. 350 Crores. Be that as it may, having regard to the material on record, and since a huge amount of money belonging to investors has been siphoned off, as well as for the aforesaid reasons, the High Court, in our considered opinion, should not have released the Respondent on bail. ### Response: 1

M.P. POWER MANAGEMENT COMPANY LTD Vs. RENEW CLEAN ENERGY PVT. LTD

of Rs.11,95,54,200/- on respondent No.1. Being aggrieved, respondent No.1 filed Writ Petition No.12432 of 2017 before the High Court praying that the appellant be directed not to give effect to termination and encashment of performance bank guarantee. The High Court vide impugned judgment dated 18.08.2017 partly allowed the writ petition setting aside the order of termination of the contract while maintaining the invocation of the bank guarantee. 8. We have heard the learned counsel appearing for the parties and perused the impugned judgment and materials on record. 9. Clause 2.1 of the PPA required respondent No.1 to fulfil all Conditions Subsequent within a period of 210 days from the effective date i.e. 06.06.2017, failing which Article 2.5 of the PPA allowed further extension up to nine months for fulfillment of the Conditions Subsequent subject to payment of liquidated damages in terms of the PPA. Clause 2.5 of the PPA reads as follows:-2.5 DELAY IN ACHIEVING CONDITIONS SUBSEQUENT: 2.5.1. In case of delay in achieving any of the Conditions Subsequent under clause 2.1 (a to h), as may be applicable, MPPMCL shall encash CPG (submitted by Seller @ Rs.30 Lakhs/MW) as under, subject to Force Majeure: a) Delay from 0-3 months - 1% per week. b) Delay from 3-6 months - 2% per week for the period exceeding 3 months, apart from (a) above. c) Delay from 6-9 months - 3% per week for the period exceeding 6 months, apart from (a) and (b) above. d) In case of delay of more than 9 months, MPPMCL shall terminate PPA and release balance amount of CPG.10. Since respondent No.1 was unable to obtain the requisite land, on request by respondent No.1, the State Government allotted 96.73 acres of land at district Rajgarh to the appellant for being allotted to respondent No.1 on lease. According to respondent No.1, upon initiation of measurement and demarcation exercise by the revenue officials, the land was found to be heavily encroached and there was stiff resistance which continued every time respondent No.1 tried to approach the said land and therefore, respondent No.1 could not access the project site and commence any construction activities. On request by respondent No.1 by its letter dated 29.09.2016, respondent No.1 sought for change of location of the project. The Board of Directors considered the request of respondent No.1 and by Resolution dated 29.12.2016 allowed change of location of the project. Thereafter, respondent No.1 purchased the land to an extent of 253 acres in village Bansara and Pipriya Rai in Ashok Nagar district within a period of about eighty three days from the date of the appellants approval. After acquiring the land, respondent No.1 undertook the construction activities and the project in an advanced stage of synchronization as early as on 10.07.2017. The same was notified to the appellant by communication dated 10.07.2017 stating that the commissioning of the project is in final stage and that the expected date of commissioning of the project is 31.08.2017 which according to respondent No.1 is ahead of the scheduled commissioning date i.e. 07.09.2017 in terms of the PPA. 11. Even when respondent No.1 has undertaken the construction activities in the changed location and informed the appellant that the expected date of commissioning of the project is 31.08.2017, the appellant terminated the contract by its order dated 11.08.2017. As pointed out by respondent No.1 in its counter affidavit, on 06.06.2016, respondent No.1 has got sanction of the term debt facility of Rs.267.37 crores from PTC India Financial Services Limited and has spent huge amount in purchasing the land to an extent of 253 acres in Ashok Nagar district. Respondent No.1 has also spent substantial amount in development of the project in the changed location and reached an advanced stage of commissioning the project by 31.08.2017. The delay in commissioning the project appears to be due to unavoidable circumstances like resistance faced at the allotted site in Rajgarh district and subsequent change of location of the project. These circumstances, though not a Force Majeure event, time taken by respondent No.1 in change of location and construction of the plant have to be kept in view for counting the delay. Having invested huge amount in purchasing the land and development of the project at Ashok Nagar district and when the project is in the final stage of commissioning, the termination of the contract is not fair. 12. The High Court observed that the delay in completing the project was only for sixteen days. But according to the appellant, respondent No.1 was granted time period of 210 days to complete the Conditions Subsequent after which the penalty was leviable for the delay and if the delay exceeded more than nine months, the appellant could terminate the contract. According to appellant, the delay was not of sixteen days; but the said delay of sixteen days is beyond the period of nine months permissible under the PPA. In the light of our observations above, we are not inclined to go into the merits of this contention. Suffice to note that in cases of delay, Articles 2.5 and 2.6 provide for levy of penalty. As observed by the High Court, since the contract permits imposition of penalty, respondent No.1 is liable to pay penalty in terms of clause 2.5.1 of the PPA for the delay. But the action of the appellant in terminating the contract is arbitrary and was rightly set aside by the High Court. 13. While setting aside the termination of the contract, the High Court maintained the action of invocation of bank guarantee in terms of clause 2.5.1 of the PPA. By order dated 22.09.2017, this Court has stayed the order of the High Court subject to restitution by the appellant of the amount covered by the bank guarantee which has been invoked which is said to have been complied with by the appellant. In our view, interest of justice would be met by directing respondent No.1 to pay penalty amount of Rs.11,95,54,200/- imposed upon respondent No.1 by the appellant.

0[ds]11. Even when respondent No.1 has undertaken the construction activities in the changed location and informed the appellant that the expected date of commissioning of the project is 31.08.2017, the appellant terminated the contract by its order dated 11.08.2017. As pointed out by respondent No.1 in its counter affidavit, on 06.06.2016, respondent No.1 has got sanction of the term debt facility of Rs.267.37 crores from PTC India Financial Services Limited and has spent huge amount in purchasing the land to an extent of 253 acres in Ashok Nagar district. Respondent No.1 has also spent substantial amount in development of the project in the changed location and reached an advanced stage of commissioning the project by 31.08.2017. The delay in commissioning the project appears to be due to unavoidable circumstances like resistance faced at the allotted site in Rajgarh district and subsequent change of location of the project. These circumstances, though not a Force Majeure event, time taken by respondent No.1 in change of location and construction of the plant have to be kept in view for counting the delay. Having invested huge amount in purchasing the land and development of the project at Ashok Nagar district and when the project is in the final stage of commissioning, the termination of the contract is not fair.The High Court observed that the delay in completing the project was only for sixteen days.But according to the appellant, respondent No.1 was granted time period of 210 days to complete the Conditions Subsequent after which the penalty was leviable for the delay and if the delay exceeded more than nine months, the appellant could terminate the contract. According to appellant, the delay was not of sixteen days; but the said delay of sixteen days is beyond the period of nine months permissible under the PPA.In the light of our observations above, we are not inclined to go into the merits of this contention. Suffice to note that in cases of delay, Articles 2.5 and 2.6 provide for levy of penalty. As observed by the High Court, since the contract permits imposition of penalty, respondent No.1 is liable to pay penalty in terms of clause 2.5.1 of the PPA for the delay. But the action of the appellant in terminating the contract is arbitrary and was rightly set aside by the High Court.While setting aside the termination of the contract, the High Court maintained the action of invocation of bank guarantee in terms of clause 2.5.1 of the PPA. By order dated 22.09.2017, this Court has stayed the order of the High Court subject to restitution by the appellant of the amount covered by the bank guarantee which has been invoked which is said to have been complied with by the appellant. In our view, interest of justice would be met by directing respondent No.1 to pay penalty amount of Rs.11,95,54,200/imposed upon respondent No.1 by the appellant.

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: of Rs.11,95,54,200/- on respondent No.1. Being aggrieved, respondent No.1 filed Writ Petition No.12432 of 2017 before the High Court praying that the appellant be directed not to give effect to termination and encashment of performance bank guarantee. The High Court vide impugned judgment dated 18.08.2017 partly allowed the writ petition setting aside the order of termination of the contract while maintaining the invocation of the bank guarantee. 8. We have heard the learned counsel appearing for the parties and perused the impugned judgment and materials on record. 9. Clause 2.1 of the PPA required respondent No.1 to fulfil all Conditions Subsequent within a period of 210 days from the effective date i.e. 06.06.2017, failing which Article 2.5 of the PPA allowed further extension up to nine months for fulfillment of the Conditions Subsequent subject to payment of liquidated damages in terms of the PPA. Clause 2.5 of the PPA reads as follows:-2.5 DELAY IN ACHIEVING CONDITIONS SUBSEQUENT: 2.5.1. In case of delay in achieving any of the Conditions Subsequent under clause 2.1 (a to h), as may be applicable, MPPMCL shall encash CPG (submitted by Seller @ Rs.30 Lakhs/MW) as under, subject to Force Majeure: a) Delay from 0-3 months - 1% per week. b) Delay from 3-6 months - 2% per week for the period exceeding 3 months, apart from (a) above. c) Delay from 6-9 months - 3% per week for the period exceeding 6 months, apart from (a) and (b) above. d) In case of delay of more than 9 months, MPPMCL shall terminate PPA and release balance amount of CPG.10. Since respondent No.1 was unable to obtain the requisite land, on request by respondent No.1, the State Government allotted 96.73 acres of land at district Rajgarh to the appellant for being allotted to respondent No.1 on lease. According to respondent No.1, upon initiation of measurement and demarcation exercise by the revenue officials, the land was found to be heavily encroached and there was stiff resistance which continued every time respondent No.1 tried to approach the said land and therefore, respondent No.1 could not access the project site and commence any construction activities. On request by respondent No.1 by its letter dated 29.09.2016, respondent No.1 sought for change of location of the project. The Board of Directors considered the request of respondent No.1 and by Resolution dated 29.12.2016 allowed change of location of the project. Thereafter, respondent No.1 purchased the land to an extent of 253 acres in village Bansara and Pipriya Rai in Ashok Nagar district within a period of about eighty three days from the date of the appellants approval. After acquiring the land, respondent No.1 undertook the construction activities and the project in an advanced stage of synchronization as early as on 10.07.2017. The same was notified to the appellant by communication dated 10.07.2017 stating that the commissioning of the project is in final stage and that the expected date of commissioning of the project is 31.08.2017 which according to respondent No.1 is ahead of the scheduled commissioning date i.e. 07.09.2017 in terms of the PPA. 11. Even when respondent No.1 has undertaken the construction activities in the changed location and informed the appellant that the expected date of commissioning of the project is 31.08.2017, the appellant terminated the contract by its order dated 11.08.2017. As pointed out by respondent No.1 in its counter affidavit, on 06.06.2016, respondent No.1 has got sanction of the term debt facility of Rs.267.37 crores from PTC India Financial Services Limited and has spent huge amount in purchasing the land to an extent of 253 acres in Ashok Nagar district. Respondent No.1 has also spent substantial amount in development of the project in the changed location and reached an advanced stage of commissioning the project by 31.08.2017. The delay in commissioning the project appears to be due to unavoidable circumstances like resistance faced at the allotted site in Rajgarh district and subsequent change of location of the project. These circumstances, though not a Force Majeure event, time taken by respondent No.1 in change of location and construction of the plant have to be kept in view for counting the delay. Having invested huge amount in purchasing the land and development of the project at Ashok Nagar district and when the project is in the final stage of commissioning, the termination of the contract is not fair. 12. The High Court observed that the delay in completing the project was only for sixteen days. But according to the appellant, respondent No.1 was granted time period of 210 days to complete the Conditions Subsequent after which the penalty was leviable for the delay and if the delay exceeded more than nine months, the appellant could terminate the contract. According to appellant, the delay was not of sixteen days; but the said delay of sixteen days is beyond the period of nine months permissible under the PPA. In the light of our observations above, we are not inclined to go into the merits of this contention. Suffice to note that in cases of delay, Articles 2.5 and 2.6 provide for levy of penalty. As observed by the High Court, since the contract permits imposition of penalty, respondent No.1 is liable to pay penalty in terms of clause 2.5.1 of the PPA for the delay. But the action of the appellant in terminating the contract is arbitrary and was rightly set aside by the High Court. 13. While setting aside the termination of the contract, the High Court maintained the action of invocation of bank guarantee in terms of clause 2.5.1 of the PPA. By order dated 22.09.2017, this Court has stayed the order of the High Court subject to restitution by the appellant of the amount covered by the bank guarantee which has been invoked which is said to have been complied with by the appellant. In our view, interest of justice would be met by directing respondent No.1 to pay penalty amount of Rs.11,95,54,200/- imposed upon respondent No.1 by the appellant. ### Response: 0

Sime Darby Engineering SDN. BHD Vs. Engineers India Ltd

the agreement it should be clear if the disputes and differences are not resolved mutually, the same shall be referred to arbitration in accordance with the provisions of the said Act. Clause 12.3 stipulates the requirement on the part of the arbitrator(s) to give reasons. 23. The Arbitration Tribunal as defined under Section 2(d) of the Act means "a sole arbitrator or a panel of arbitrators". 24. Section 10(2) of the Act is very relevant in order to resolve the controversy in this case in as much as Section 10(2) makes it very clear where the number of arbitrator is not determined, the arbitral tribunal shall consist of a sole arbitrator. In this connection if UNCITRAL rules are referred the position will remain the same. UNCITRAL model law on International Commercial Arbitration also accepts the same definition of Arbitration Tribunal in Article 2(b). Article 10 of those rules is almost identical with Section 10 of the said Act. Article 2(b) and Article 10 of those rules are extracted hereinbelow:- "Article 2. Definition and rules of interpretation - For the purposes of this Law:(a) xxx xxx(b) "arbitral tribunal" means a sole arbitrator or a panel of arbitrators.""Article 10. Number of arbitrators - (1) The parties are free to determine the number of arbitrators.(2) Failing such determination, the number of arbitrators shall be three." 25. Therefore, the definition of Arbitral Tribunal in Section 2(1)(d) of the said Act is verbatim the same as in Article 2(b). Article 10 of the UNCITRAL model law has close similarity with Section 10 of the said Act. 26. Section 10 deviates from Article 10 of the UNCITRAL law only in the sense that Section 10(1) of the Act provides that despite the freedom given to the parties to determine the number of arbitrators such numbers shall not be even number. But in default of determination of the number, Section 10(2) provides the tribunal is to consist of a sole arbitrator. Therefore, scheme of Section 10(2) of the Act is virtually similar to Article 10.2 of the UNCITRAL model law. 27. In the instant case Clause 12.2 of the Arbitration clause is silent about the number of arbitrator. Therefore, Section 10(2) of the said Act squarely applies.28. The learned counsel for the respondent has referred to a passage at page 185 para 4-18 of Redfern and Hunter, Law and Practice of International Commercial Arbitration, Fourth Edn. But looking at the said book this Court finds that the said passage was not been properly quoted. In paragraph 4-15 of the said book it has been provided as follows:- "A sole arbitrator shall be appointed unless the parties have agreed in writing otherwise, or unless the LCIA Court determines that in view of all the circumstances of the case a three-member tribunal is appropriate." 29. In the said paragraph it has also been stated that there are distinct advantages of referring a dispute to a sole arbitrator on grounds of speed and economy. "A sole arbitrator does not need to `deliberate with others, without having to spend time in consultation with colleagues in an endeavour to arrive at an agreed or majority determination of the matters in dispute." (Page 184)30. Similar opinion has been expressed in Russell on Arbitration 23rd Edition. At page 129, paragraph 4-035 with reference to arbitration it has been said "Where no choice is made, the law implied a reference to a tribunal consisting of a sole arbitrator." In fact Section 15(3) of the (English) Arbitration Act, 1996 provides for the same.31. Mustil and Boyd on Commercial Arbitration, 2nd Edition also contains the same statement of law. At page 174 of the said book it has been provided that "an arbitration agreement calls for a reference to a single arbitrator, either if it contains an express stipulation to that effect, or if it is silent as to the mode of arbitration."32. In the instant case, the arbitration clause 12.2 is silent as to the number of arbitrator. The said clause read with Section 10(2) of the Act makes it very clear that arbitral tribunal in the instant case would be consisting of a sole arbitrator.33. The learned counsel for the respondent has referred to its policy decision which has been quoted hereinabove. Such policy decision cannot change the contractual clause. In any event the contract between the parties was entered into in 2004. The said policy decision came into effect in 2005. Therefore, the said policy decision cannot in any way override contract between the parties.34. The parties autonomy in the arbitration agreement must be given due importance in construing the intention of the parties. In so far as reference to the expression `arbitrator(s) in clause 12.3 is concerned, the same does not in any way affect the intention of the parties in clause 12.2.35. It is noted in this connection that parties have freedom to change the number of arbitrator even after the contract has been entered and by mutual consent the parties may amend the contract. If that takes place, in such an eventuality clause 12.3 provides that the arbitrator or arbitrators have to give reasoned award in respect of each dispute and difference referred. Here also the expression which has been used is `him which also points to a sole arbitrator.36. It is clearly provided in the said Act that an arbitral tribunal can, if necessary, take the help of experts in terms of Section 27 of the said Act. If the sole arbitrator requires the assistance of an expert it can always take such assistance.37. Mr. Mukul Rohtagi, learned counsel for the respondent has fairly submitted that if his argument is not accepted by the Court then his client has no objection to the appointment of Honble Mr. Justice D.P. Wadhwa, a former Judge of this Court, to be the sole arbitrator in this case. The name of Justice Wadhwa also finds place in the list of names suggested by the petitioner. Therefore, appointment of Justice Wadhwa is fairly by consensus.

1[ds]27. In the instant case Clause 12.2 of the Arbitration clause is silent about the number of arbitrator. Therefore, Section 10(2) of the said Act squarely applies.28. The learned counsel for the respondent has referred to a passage at page 185 paraof Redfern and Hunter, Law and Practice of International Commercial Arbitration, Fourth Edn. But looking at the said book this Court finds that the said passage was not been properly quoted. In paragraphof the said book it has been provided assole arbitrator shall be appointed unless the parties have agreed in writing otherwise, or unless the LCIA Court determines that in view of all the circumstances of the case a29. In the said paragraph it has also been stated that there are distinct advantages of referring a dispute to a sole arbitrator on grounds of speed and economy. "A sole arbitrator does not need to `deliberate with others, without having to spend time in consultation with colleagues in an endeavour to arrive at an agreed or majority determination of the matters in dispute." (Page 184)30. Similar opinion has been expressed in Russell on Arbitration 23rd Edition. At page 129, paragraphwith reference to arbitration it has been said "Where no choice is made, the law implied a reference to a tribunal consisting of a sole arbitrator." In fact Section 15(3) of the (English) Arbitration Act, 1996 provides for the same.31. Mustil and Boyd on Commercial Arbitration, 2nd Edition also contains the same statement of law. At page 174 of the said book it has been provided that "an arbitration agreement calls for a reference to a single arbitrator, either if it contains an express stipulation to that effect, or if it is silent as to the mode of arbitration."32. In the instant case, the arbitration clause 12.2 is silent as to the number of arbitrator. The said clause read with Section 10(2) of the Act makes it very clear that arbitral tribunal in the instant case would be consisting of a sole arbitrator.33.parties.34. The parties autonomy in the arbitration agreement must be given due importance in construing the intention of the parties. In so far as reference to the expression `arbitrator(s) in clause 12.3 is concerned, the same does not in any way affect the intention of the parties in clause 12.2.35. It is noted in this connection that parties have freedom to change the number of arbitrator even after the contract has been entered and by mutual consent the parties may amend the contract. If that takes place, in such an eventuality clause 12.3 provides that the arbitrator or arbitrators have to give reasoned award in respect of each dispute and difference referred. Here also the expression which has been used is `him which also points to a sole arbitrator.36. It is clearly provided in the said Act that an arbitral tribunal can, if necessary, take the help of experts in terms of Section 27 of the said Act. If the sole arbitrator requires the assistance of an expert it can always take such assistance.37. Mr. Mukul Rohtagi, learned counsel for the respondent has fairly submitted that if his argument is not accepted by the Court then his client has no objection to the appointment of Honble Mr. Justice D.P. Wadhwa, a former Judge of this Court, to be the sole arbitrator in this case. The name of Justice Wadhwa also finds place in the list of names suggested by the petitioner. Therefore, appointment of Justice Wadhwa is fairly by consensus.

### Instruction: Assess the case proceedings and provide a prediction: is the court likely to rule in favor of (1) or against (0) the appellant/petitioner? ### Input: the agreement it should be clear if the disputes and differences are not resolved mutually, the same shall be referred to arbitration in accordance with the provisions of the said Act. Clause 12.3 stipulates the requirement on the part of the arbitrator(s) to give reasons. 23. The Arbitration Tribunal as defined under Section 2(d) of the Act means "a sole arbitrator or a panel of arbitrators". 24. Section 10(2) of the Act is very relevant in order to resolve the controversy in this case in as much as Section 10(2) makes it very clear where the number of arbitrator is not determined, the arbitral tribunal shall consist of a sole arbitrator. In this connection if UNCITRAL rules are referred the position will remain the same. UNCITRAL model law on International Commercial Arbitration also accepts the same definition of Arbitration Tribunal in Article 2(b). Article 10 of those rules is almost identical with Section 10 of the said Act. Article 2(b) and Article 10 of those rules are extracted hereinbelow:- "Article 2. Definition and rules of interpretation - For the purposes of this Law:(a) xxx xxx(b) "arbitral tribunal" means a sole arbitrator or a panel of arbitrators.""Article 10. Number of arbitrators - (1) The parties are free to determine the number of arbitrators.(2) Failing such determination, the number of arbitrators shall be three." 25. Therefore, the definition of Arbitral Tribunal in Section 2(1)(d) of the said Act is verbatim the same as in Article 2(b). Article 10 of the UNCITRAL model law has close similarity with Section 10 of the said Act. 26. Section 10 deviates from Article 10 of the UNCITRAL law only in the sense that Section 10(1) of the Act provides that despite the freedom given to the parties to determine the number of arbitrators such numbers shall not be even number. But in default of determination of the number, Section 10(2) provides the tribunal is to consist of a sole arbitrator. Therefore, scheme of Section 10(2) of the Act is virtually similar to Article 10.2 of the UNCITRAL model law. 27. In the instant case Clause 12.2 of the Arbitration clause is silent about the number of arbitrator. Therefore, Section 10(2) of the said Act squarely applies.28. The learned counsel for the respondent has referred to a passage at page 185 para 4-18 of Redfern and Hunter, Law and Practice of International Commercial Arbitration, Fourth Edn. But looking at the said book this Court finds that the said passage was not been properly quoted. In paragraph 4-15 of the said book it has been provided as follows:- "A sole arbitrator shall be appointed unless the parties have agreed in writing otherwise, or unless the LCIA Court determines that in view of all the circumstances of the case a three-member tribunal is appropriate." 29. In the said paragraph it has also been stated that there are distinct advantages of referring a dispute to a sole arbitrator on grounds of speed and economy. "A sole arbitrator does not need to `deliberate with others, without having to spend time in consultation with colleagues in an endeavour to arrive at an agreed or majority determination of the matters in dispute." (Page 184)30. Similar opinion has been expressed in Russell on Arbitration 23rd Edition. At page 129, paragraph 4-035 with reference to arbitration it has been said "Where no choice is made, the law implied a reference to a tribunal consisting of a sole arbitrator." In fact Section 15(3) of the (English) Arbitration Act, 1996 provides for the same.31. Mustil and Boyd on Commercial Arbitration, 2nd Edition also contains the same statement of law. At page 174 of the said book it has been provided that "an arbitration agreement calls for a reference to a single arbitrator, either if it contains an express stipulation to that effect, or if it is silent as to the mode of arbitration."32. In the instant case, the arbitration clause 12.2 is silent as to the number of arbitrator. The said clause read with Section 10(2) of the Act makes it very clear that arbitral tribunal in the instant case would be consisting of a sole arbitrator.33. The learned counsel for the respondent has referred to its policy decision which has been quoted hereinabove. Such policy decision cannot change the contractual clause. In any event the contract between the parties was entered into in 2004. The said policy decision came into effect in 2005. Therefore, the said policy decision cannot in any way override contract between the parties.34. The parties autonomy in the arbitration agreement must be given due importance in construing the intention of the parties. In so far as reference to the expression `arbitrator(s) in clause 12.3 is concerned, the same does not in any way affect the intention of the parties in clause 12.2.35. It is noted in this connection that parties have freedom to change the number of arbitrator even after the contract has been entered and by mutual consent the parties may amend the contract. If that takes place, in such an eventuality clause 12.3 provides that the arbitrator or arbitrators have to give reasoned award in respect of each dispute and difference referred. Here also the expression which has been used is `him which also points to a sole arbitrator.36. It is clearly provided in the said Act that an arbitral tribunal can, if necessary, take the help of experts in terms of Section 27 of the said Act. If the sole arbitrator requires the assistance of an expert it can always take such assistance.37. Mr. Mukul Rohtagi, learned counsel for the respondent has fairly submitted that if his argument is not accepted by the Court then his client has no objection to the appointment of Honble Mr. Justice D.P. Wadhwa, a former Judge of this Court, to be the sole arbitrator in this case. The name of Justice Wadhwa also finds place in the list of names suggested by the petitioner. Therefore, appointment of Justice Wadhwa is fairly by consensus. ### Response: 1

S. S. Gadgil, Income-Tax Officer, Bombay Vs. Lal And Company

in terms imposes a fetter upon the power of the Income-tax Officer to bring to tax escaped income. If prescribed different periods in different classes of cases for enforcement of the right of the State to recover tax. It was observed by this Court in Ahmedabad Manufasturing and Calico Printing Co. Ltd. v. S. G. Mehta, 1963-48 ITR (SC) 154 at p. 171 : (AIR 1963 SC 1436 at pp. 1445-46)."It must be remembered that if the Incometax Act prescribed a period during which tax due in any particular assessment year may be assessed, then on the expiry of that period the department cannot make an assessment. Where no period is prescribed the assessment can be completed at any time but once completed it is final. Once a final assessment has been made, it can only be reopened to rectify a mistake apparent from the record (S. 35) or to reassess where there has been an escapement of assessment income for one reason or another (S. 34). Both these sections which enable reopening of back assessments provide their own periods of time for action but all these periods of time, whether for the first assessment or for rectification, or for reassessment, merely create a bar when that time passed against the machinery set up by the Income-tax Act for the assessment and levy of the tax. They do not create an exemption in favour of the assessee or grant an absolution on the expiry of the period. The liability is not enforceable but the tax may again become eligible if the bar is removed and the "taxpayers is brought within the jurisdiction of the said machinery by reason of a new power. This is, of course, subject to the condition, either expressly or by clear implication. If the language of the law has that clear meaning, it must be given that effect and where the language expressly so declares or clearly implies it, the retrospective operation is not controlled by the commencement clause. "11. Counsel for the Commissioner sough to derive some support from Income-tax Officer, Companies District I, Calcutta v. Calcutta Discount Co. Ltd., 1953-23 ITR 471 : (AIR 1953 Cal 721 ) in which Chakravarti C. J. dealing with effect of the Income-tax and Business Profits Tax (Amendment) Act, 1948, observed :"The plain effect of the substitution of the new S. 34 with effect from 30-3-1948 is that from that date the Income-tax Act is not to be read as including the new section as a part thereof and if it is to be so read, the further effect of the express language of the section is that so far as cases coming within Cl. (a) of sub-sec. (I ) are concerned all assessment years ending, within eight years from 30-3-1948 and from subsequent dates, are within its preview and it will apply to them, provided the notice contemplated is given within such eight years. What is not within the purview of the section is assessment year which ended before eight years from 30-3-1948."But it may be recalled that the amending Act of 1948 with which the Court was concerned in Calcutta Discount Companys case, 1953-23 ITR 471 : (Al R 1953 Cal 721 ) came into force on September 8, 1948, but S.1 (2) prescribed that the amendment in S. 34 of the Income-tax Act, 1922, shall be deemed to have come into force on March 30, 1948, and the period under the unamended section within which notice could be issued under S.34(3) against the assessee company ended on March 31, 1951. Before that date the amending Act came into operation, and at no time had the right to re-assess become barred.12. In considering whether the amended statute applies, the question is one of interpretation i.e. to ascertain whether it was the intention of the Legislature to deprive a tax payer of the plea that action for assessment or re-assessment could not be commenced, on the ground that before the amending Act became effective, it was barred. Therefore the view that even when the right to assess or reassess has lapsed on account of the expiry of the period of limitation prescribed under the earlier statute, the Income-tax Officer can exercise his powers to assess or re-assess under the amending statute which gives an extended period of limitation was not accepted in Calcutta Discount Companys case, 1953-23 ITR 471 : (AIR 1953 Cal 721 ).13. As we have already pointed out the right to commence a proceeding for assessment against the assessee as an agent of a non-resident party under the Income-tax Act before it was amended, ended on March 31, 1956. It is true that under the amending Act by S.18 of the Finance Act, 1956, authority was conferred upon the Income-tax Officer to assess a person as an agent of a foreign party under S. 43 within two years from the end of the year of assessment. But authority of the Income-tax Officer under the Act before it was amended by the Finance Act of 1956 having already come to an end, the amending provision will not assist him to commence a proceeding even though at the date when he issued the notice it is within the period provided by that amending Act. This will be so, notwithstanding the fact that there has been no determinable point of time between the expiry of the time provided under the old Act and the commencement of the amending Act. The legislature has given to S. 18 of the Finance Act 1956, only a limited retrospective operation i.e. up to April 1,1956, only. That provision must be read subject to the rule that in the absence of an express provision or clear implication, the Legislature does not intend to attribute to the amending provision a greater retrospectively than is expressly mentioned, nor to authorise the come-tax Officer to commence proceedings which before the new Act came into force had by the expiry of the period provided become barred.14

0[ds]12. In considering whether the amended statute applies, the question is one of interpretation i.e. to ascertain whether it was the intention of the Legislature to deprive a tax payer of the plea that action for assessment or re-assessment could not be commenced, on the ground that before the amending Act became effective, it was barred. Therefore the view that even when the right to assess or reassess has lapsed on account of the expiry of the period of limitation prescribed under the earlier statute, the Income-tax Officer can exercise his powers to assess or re-assess under the amending statute which gives an extended period of limitation was not accepted in Calcutta Discount Companys case, 1953-23 ITR 471 : (AIR 1953 Cal 721 ).13. As we have already pointed out the right to commence a proceeding for assessment against the assessee as an agent of a non-resident party under the Income-tax Act before it was amended, ended on March 31, 1956. It is true that under the amending Act by S.18 of the Finance Act, 1956, authority was conferred upon the Income-tax Officer to assess a person as an agent of a foreign party under S. 43 within two years from the end of the year of assessment. But authority of the Income-tax Officer under the Act before it was amended by the Finance Act of 1956 having already come to an end, the amending provision will not assist him to commence a proceeding even though at the date when he issued the notice it is within the period provided by that amending Act. This will be so, notwithstanding the fact that there has been no determinable point of time between the expiry of the time provided under the old Act and the commencement of the amending Act. The legislature has given to S. 18 of the Finance Act 1956, only a limited retrospective operation i.e. up to April 1,1956, only. That provision must be read subject to the rule that in the absence of an express provision or clear implication, the Legislature does not intend to attribute to the amending provision a greater retrospectively than is expressly mentioned, nor to authorise the come-tax Officer to commence proceedings which before the new Act came into force had by the expiry of the period provided become barred.A proceeding for assessment is not a suit for adjudication of a civil dispute. That anproceeding is in the nature of a judicial proceeding between contesting parties, is a matter which is not capable of even a plausible argument. Theauthorities who have power to assess and recover tax are not acting as judges deciding a litigation between the citizen and the State: they are administrative authorities whose proceedings are regulated by statute, but whose function is to estimate the income of the taxpayer and to assess him to tax on the basis of that estimate. Tax legislation necessitates the setting up of machinery to ascertain the taxable income, and to assess tax on the income, but that does not impress the proceeding with the character of an action between the citizen and the State: Commissionerof Inland Revenue v. Sneath, (1932) 17 Tax Cas 149 at p.64 and ShellCo. of Australia Ltd. v. Federal Commissioner of Taxation, 1931 ACit may be recalled that the amending Act of 1948 with which the Court was concerned in Calcutta Discount Companys case,ITR 471 : (Al R 1953 Cal 721 ) came into force on September 8, 1948, but S.1 (2) prescribed that the amendment in S. 34 of theAct, 1922, shall be deemed to have come into force on March 30, 1948, and the period under the unamended section within which notice could be issued under S.34(3) against the assessee company ended on March 31, 1951. Before that date the amending Act came into operation, and at no time had the right to

### Instruction: Given the specifics of the case proceeding, anticipate the court's ruling: will it favor (1) or oppose (0) the appellant’s request? ### Input: in terms imposes a fetter upon the power of the Income-tax Officer to bring to tax escaped income. If prescribed different periods in different classes of cases for enforcement of the right of the State to recover tax. It was observed by this Court in Ahmedabad Manufasturing and Calico Printing Co. Ltd. v. S. G. Mehta, 1963-48 ITR (SC) 154 at p. 171 : (AIR 1963 SC 1436 at pp. 1445-46)."It must be remembered that if the Incometax Act prescribed a period during which tax due in any particular assessment year may be assessed, then on the expiry of that period the department cannot make an assessment. Where no period is prescribed the assessment can be completed at any time but once completed it is final. Once a final assessment has been made, it can only be reopened to rectify a mistake apparent from the record (S. 35) or to reassess where there has been an escapement of assessment income for one reason or another (S. 34). Both these sections which enable reopening of back assessments provide their own periods of time for action but all these periods of time, whether for the first assessment or for rectification, or for reassessment, merely create a bar when that time passed against the machinery set up by the Income-tax Act for the assessment and levy of the tax. They do not create an exemption in favour of the assessee or grant an absolution on the expiry of the period. The liability is not enforceable but the tax may again become eligible if the bar is removed and the "taxpayers is brought within the jurisdiction of the said machinery by reason of a new power. This is, of course, subject to the condition, either expressly or by clear implication. If the language of the law has that clear meaning, it must be given that effect and where the language expressly so declares or clearly implies it, the retrospective operation is not controlled by the commencement clause. "11. Counsel for the Commissioner sough to derive some support from Income-tax Officer, Companies District I, Calcutta v. Calcutta Discount Co. Ltd., 1953-23 ITR 471 : (AIR 1953 Cal 721 ) in which Chakravarti C. J. dealing with effect of the Income-tax and Business Profits Tax (Amendment) Act, 1948, observed :"The plain effect of the substitution of the new S. 34 with effect from 30-3-1948 is that from that date the Income-tax Act is not to be read as including the new section as a part thereof and if it is to be so read, the further effect of the express language of the section is that so far as cases coming within Cl. (a) of sub-sec. (I ) are concerned all assessment years ending, within eight years from 30-3-1948 and from subsequent dates, are within its preview and it will apply to them, provided the notice contemplated is given within such eight years. What is not within the purview of the section is assessment year which ended before eight years from 30-3-1948."But it may be recalled that the amending Act of 1948 with which the Court was concerned in Calcutta Discount Companys case, 1953-23 ITR 471 : (Al R 1953 Cal 721 ) came into force on September 8, 1948, but S.1 (2) prescribed that the amendment in S. 34 of the Income-tax Act, 1922, shall be deemed to have come into force on March 30, 1948, and the period under the unamended section within which notice could be issued under S.34(3) against the assessee company ended on March 31, 1951. Before that date the amending Act came into operation, and at no time had the right to re-assess become barred.12. In considering whether the amended statute applies, the question is one of interpretation i.e. to ascertain whether it was the intention of the Legislature to deprive a tax payer of the plea that action for assessment or re-assessment could not be commenced, on the ground that before the amending Act became effective, it was barred. Therefore the view that even when the right to assess or reassess has lapsed on account of the expiry of the period of limitation prescribed under the earlier statute, the Income-tax Officer can exercise his powers to assess or re-assess under the amending statute which gives an extended period of limitation was not accepted in Calcutta Discount Companys case, 1953-23 ITR 471 : (AIR 1953 Cal 721 ).13. As we have already pointed out the right to commence a proceeding for assessment against the assessee as an agent of a non-resident party under the Income-tax Act before it was amended, ended on March 31, 1956. It is true that under the amending Act by S.18 of the Finance Act, 1956, authority was conferred upon the Income-tax Officer to assess a person as an agent of a foreign party under S. 43 within two years from the end of the year of assessment. But authority of the Income-tax Officer under the Act before it was amended by the Finance Act of 1956 having already come to an end, the amending provision will not assist him to commence a proceeding even though at the date when he issued the notice it is within the period provided by that amending Act. This will be so, notwithstanding the fact that there has been no determinable point of time between the expiry of the time provided under the old Act and the commencement of the amending Act. The legislature has given to S. 18 of the Finance Act 1956, only a limited retrospective operation i.e. up to April 1,1956, only. That provision must be read subject to the rule that in the absence of an express provision or clear implication, the Legislature does not intend to attribute to the amending provision a greater retrospectively than is expressly mentioned, nor to authorise the come-tax Officer to commence proceedings which before the new Act came into force had by the expiry of the period provided become barred.14 ### Response: 0

Lakshman Singh Kothari Vs. Smt. Rup Kanwar

acts; the object of the corporeal giving and receiving in adoption is obviously to secure due publicity (Colebrooks Digest. Book V. T. 273, commentary), and Yeshwadas employing her uncle to perform this physical act, which derived its efficacy from her own volition accompanying it, cannot, we think, deprive it of its legal effect. We hold, therefore, with the learned Judge, that the adoption is proved and effectual. This view was approved by the Bombay High Court in Shamsing v. Santabai, ILR 25 Bom 551. A Division Bench of the Madras High Court in Viyyamma v. Suryaprakasa Rao, ILR (1942) Mad 608 : (AIR 1942 Mad 379 ) applied the principle to a converse case of an adoptive father delegating his power to accept the adoptive boy to another. Sir Lionel Leach, C. J., in extending the rule of delegation to a case of receiving says at p. 613 (of ILR Mad): (at p. 380) (of AIR) thus: If this were not so, what would be the position when through accident or illness the natural father or the adoptive parent could not be present in person to do what is necessary? There could be no adoption. Further citation would be redundant. It is, therefore, settled law that, after the natural and adoptive parents exercised their volition to give and take the boy in adoption, either of them could, under certain unavoidable compelling circumstances, delegate his right to give or the right to receive the adoptive son, as the case may be, to a third party. 9. Strong reliance is placed by learned counsel for the appellant on the decision of the Judicial Committee in Biradhmal v. Prabhabhati, AIR 1939 PC 152 . There a widow executed a deed of adoption whereby she purported to have adopted as son to her deceased husband a boy. The Sub-Registrar before whom the document was registered put to the boys natural father and to the widow questions whether they had executed the deed. The boy was also present at that time. The Judicial Committee held that, under the said circumstances, there was proof of giving and taking. The question posed by the Privy Council was stated thus: The sole issue discussed before their Lordships was the question of fact whether on 30th June, 1924, at about 6 p.m. when the adoption deed was being registered the boy was present and was given by Bhanwarmal and taken by the widow. The question so posed was answered thus at p. 155: ......their Lordships think that the evidence that the boy was present at the time when the sub-registrar put to his father and to the widow the questions whether they had executed the deed is sufficient to prove a giving and taking. This sentence is rather laconic and may lend support to the argument that mere putting questions by the Sub-Registrar would amount to giving and taking of the adoptive boy; but the subsequent discussion makes it clear that Privy Council had not laid down any such wide proposition. Their Lordships proceeded to observe: Even if the suggestion be accepted that the auspicious day ended at noon on the 30th and that the deed was executed before noon and before the boy arrived at Ajmer, it seems quite probable that the registration proceedings which were arranged for 6 p.m. would be regarded as a suitable occasion for carrying out the very simple ceremony that was necessary. These observations indicate that on the material placed before the Privy Council- it is not necessary to say that we would come to the same conclusion on the same material-it held that there was giving and taking of the boy at about 6 p.m. when the document was given for registration. The Judicial Committee, in our view, did not intend to depart from the well recognized doctrine of Hindu Law that there should be a ceremony of giving and taking to validate an adoption. 10. The law may be briefly stated thus: Under the Hindu Law, whether among the regenerate caste or among Sudras, there cannot be a valid adoption unless the adoptive boy is transferred from one family to another and that can be done only by the ceremony of giving and taking. The object of the corporeal giving and receiving in adoption is obviously to secure due publicity. To achieve this object it is essential to have a formal ceremony. No particular form is prescribed for the ceremony, but the law requires that the natural parent shall hand over the adoptive boy and the adoptive parent shall receive him. The nature of the ceremony may vary depending upon the circumstances of each case. But a ceremony there shall be, and giving and taking shall be part of it. The exigencies of the situation arising out of diverse circumstances necessitated the introduction of the doctrine of delegation; and, therefore, the parents, after exercising their volition to give and take the boy in adoption, may both or either of them delegate the physical act of handing over the boy or receiving him, as the case may be, to a third party. 11. In the present case, none of the aforesaid conditions has been satisfied. The High Court found that Zalim Singh and Moti Singh did not decide to take the boy in adoption on February 14, 1923. The High Court further found that their common intention was to take the boy in adoption only after he was admitted in Gurukul or thereafter. The documents filed and the oral evidence adduced in the case establish that the adoptive father did not delegate his power to give the boy in adoption to Moti Singh to Hira Lal and that Moti Singh did not receive the boy as a part of the ceremony of adoption, but only received him with a view to send him to Gurukul. We, therefore, hold that the ceremony of giving and taking which is very essential for the validity of an adoption, had not taken place in this case.

0[ds]Further citation would be redundant. It is, therefore, settled law that, after the natural and adoptive parents exercised their volition to give and take the boy in adoption, either of them could, under certain unavoidable compelling circumstances, delegate his right to give or the right to receive the adoptive son, as the case may be, to a third partyWe, therefore, hold, on the evidence, oral and documentary, that Sujan Singh and Moti Singh wanted to take the plaintiff in adoption either after the boy was admitted in Gurukul or after he finished his education therein that Hira Lal, on the requrest of the plaintiffs father, accompanied the boy to Sujan Singhs house at Ajmer and left him there, that Moti Singh welcomed the boy as was expected of him and thereafter sent him to Gurukul and that no formal ceremony of giving and taking had taken placeThese observations indicate that on the material placed before the Privy Council- it is not necessary to say that we would come to the same conclusion on the same material-it held that there was giving and taking of the boy at about 6 p.m. when the document was given for registration. The Judicial Committee, in our view, did not intend to depart from the well recognized doctrine of Hindu Law that there should be a ceremony of giving and taking to validate an adoption10. The law may be briefly stated thus: Under the Hindu Law, whether among the regenerate caste or among Sudras, there cannot be a valid adoption unless the adoptive boy is transferred from one family to another and that can be done only by the ceremony of giving and taking. The object of the corporeal giving and receiving in adoption is obviously to secure due publicity. To achieve this object it is essential to have a formal ceremony. No particular form is prescribed for the ceremony, but the law requires that the natural parent shall hand over the adoptive boy and the adoptive parent shall receive him. The nature of the ceremony may vary depending upon the circumstances of each case. But a ceremony there shall be, and giving and taking shall be part of it. The exigencies of the situation arising out of diverse circumstances necessitated the introduction of the doctrine of delegation; and, therefore, the parents, after exercising their volition to give and take the boy in adoption, may both or either of them delegate the physical act of handing over the boy or receiving him, as the case may be, to a third party11. In the present case, none of the aforesaid conditions has been satisfied. The High Court found that Zalim Singh and Moti Singh did not decide to take the boy in adoption on February 14, 1923. The High Court further found that their common intention was to take the boy in adoption only after he was admitted in Gurukul or thereafter. The documents filed and the oral evidence adduced in the case establish that the adoptive father did not delegate his power to give the boy in adoption to Moti Singh to Hira Lal and that Moti Singh did not receive the boy as a part of the ceremony of adoption, but only received him with a view to send him to Gurukul. We, therefore, hold that the ceremony of giving and taking which is very essential for the validity of an adoption, had not taken place in this case

### Instruction: Given the specifics of the case proceeding, anticipate the court's ruling: will it favor (1) or oppose (0) the appellant’s request? ### Input: acts; the object of the corporeal giving and receiving in adoption is obviously to secure due publicity (Colebrooks Digest. Book V. T. 273, commentary), and Yeshwadas employing her uncle to perform this physical act, which derived its efficacy from her own volition accompanying it, cannot, we think, deprive it of its legal effect. We hold, therefore, with the learned Judge, that the adoption is proved and effectual. This view was approved by the Bombay High Court in Shamsing v. Santabai, ILR 25 Bom 551. A Division Bench of the Madras High Court in Viyyamma v. Suryaprakasa Rao, ILR (1942) Mad 608 : (AIR 1942 Mad 379 ) applied the principle to a converse case of an adoptive father delegating his power to accept the adoptive boy to another. Sir Lionel Leach, C. J., in extending the rule of delegation to a case of receiving says at p. 613 (of ILR Mad): (at p. 380) (of AIR) thus: If this were not so, what would be the position when through accident or illness the natural father or the adoptive parent could not be present in person to do what is necessary? There could be no adoption. Further citation would be redundant. It is, therefore, settled law that, after the natural and adoptive parents exercised their volition to give and take the boy in adoption, either of them could, under certain unavoidable compelling circumstances, delegate his right to give or the right to receive the adoptive son, as the case may be, to a third party. 9. Strong reliance is placed by learned counsel for the appellant on the decision of the Judicial Committee in Biradhmal v. Prabhabhati, AIR 1939 PC 152 . There a widow executed a deed of adoption whereby she purported to have adopted as son to her deceased husband a boy. The Sub-Registrar before whom the document was registered put to the boys natural father and to the widow questions whether they had executed the deed. The boy was also present at that time. The Judicial Committee held that, under the said circumstances, there was proof of giving and taking. The question posed by the Privy Council was stated thus: The sole issue discussed before their Lordships was the question of fact whether on 30th June, 1924, at about 6 p.m. when the adoption deed was being registered the boy was present and was given by Bhanwarmal and taken by the widow. The question so posed was answered thus at p. 155: ......their Lordships think that the evidence that the boy was present at the time when the sub-registrar put to his father and to the widow the questions whether they had executed the deed is sufficient to prove a giving and taking. This sentence is rather laconic and may lend support to the argument that mere putting questions by the Sub-Registrar would amount to giving and taking of the adoptive boy; but the subsequent discussion makes it clear that Privy Council had not laid down any such wide proposition. Their Lordships proceeded to observe: Even if the suggestion be accepted that the auspicious day ended at noon on the 30th and that the deed was executed before noon and before the boy arrived at Ajmer, it seems quite probable that the registration proceedings which were arranged for 6 p.m. would be regarded as a suitable occasion for carrying out the very simple ceremony that was necessary. These observations indicate that on the material placed before the Privy Council- it is not necessary to say that we would come to the same conclusion on the same material-it held that there was giving and taking of the boy at about 6 p.m. when the document was given for registration. The Judicial Committee, in our view, did not intend to depart from the well recognized doctrine of Hindu Law that there should be a ceremony of giving and taking to validate an adoption. 10. The law may be briefly stated thus: Under the Hindu Law, whether among the regenerate caste or among Sudras, there cannot be a valid adoption unless the adoptive boy is transferred from one family to another and that can be done only by the ceremony of giving and taking. The object of the corporeal giving and receiving in adoption is obviously to secure due publicity. To achieve this object it is essential to have a formal ceremony. No particular form is prescribed for the ceremony, but the law requires that the natural parent shall hand over the adoptive boy and the adoptive parent shall receive him. The nature of the ceremony may vary depending upon the circumstances of each case. But a ceremony there shall be, and giving and taking shall be part of it. The exigencies of the situation arising out of diverse circumstances necessitated the introduction of the doctrine of delegation; and, therefore, the parents, after exercising their volition to give and take the boy in adoption, may both or either of them delegate the physical act of handing over the boy or receiving him, as the case may be, to a third party. 11. In the present case, none of the aforesaid conditions has been satisfied. The High Court found that Zalim Singh and Moti Singh did not decide to take the boy in adoption on February 14, 1923. The High Court further found that their common intention was to take the boy in adoption only after he was admitted in Gurukul or thereafter. The documents filed and the oral evidence adduced in the case establish that the adoptive father did not delegate his power to give the boy in adoption to Moti Singh to Hira Lal and that Moti Singh did not receive the boy as a part of the ceremony of adoption, but only received him with a view to send him to Gurukul. We, therefore, hold that the ceremony of giving and taking which is very essential for the validity of an adoption, had not taken place in this case. ### Response: 0

Dr. Ashok Vs. Union Of India

be specified in the notification pending investigation into the matter. In Other words, In respect o an insecticide within the meaning of section 3(e) ((iii) i.e. a preparation or formulation containing anyone or more of such substances specified in the schedule. the appropriate Government can immediately by issue of notification prohibit the sale. distribution or use of the same pending investigation. Under the proviso to subsection (1) of section 27. if the investigation is not completed within the period of 60 days the n the prohibition in question could be extended for such further period not exceeding 30 days in the aggregate. Under sub-section (2) if the Central Government on the basis of its own investigation or on receipt of the report from the state Government and after consultation with the Registration Committee is satisfied that the use of the said insecticide or batch is or is not likely to cause any such risk the n it may pass such order as it deems fit depending upon the circumstances of the case. either refusing to register the insecticide or cancel the Certificate of Registration. If already granted. The use of the word said insecticide in sub-section (2) obviously refers t o the insecticide in question which was the subject matter of consideration under sub-section (1) and in respect of which pending further investigation into the matter the Central Government has already issued a prohibition for sale, distribution or use of the insecticide in question. Therefore , the power of cancellation of Certificate of Registration conferred upon the Central Government under sub-section (2) of Section 27 can be exercised only in respect of any insecticide specified in sub-clause (iii) of clause (e) of section 3 i.e. a preparation or formulation of one or more of the substances specified in the schedule but the said power cannot be exercised in respect of an insecticide which is specified in the schedule itself by the Parliament. We are unable to accept the agreements advanced by the learned Additional Solicitor General that sub-section (2) of section 27 is not restricted to an insecticide in respect of which the Central Government has already issued a notification prohibiting the sale. distribution or use pending investigation into the matter. The Scheme of sub-section (1) and sub-section (2) of section 27 is that in respect of a formulation which is also an insecticide within the meaning of section 3 (e) (iii) the Central Government for reasons to be recorded in writing and pending investigation into the matter can immediately prohibit sale. distribution or use and after further investigation can cancel the Certificate of Registration in respect the reof under sub-section (2) of Section 27. That being the position in exercise of such power under sub- section (2) of section 27 a certificate of Registration in respect of an insecticide under sub-section 3(e) (i) cannot be cancelled under sub-section (2) of section 27. This is also in consonance with the logic that an insecticide which is the formulation of any one or more of the substances specified in the schedule and is consumer oriented power of cancellation of registration certainly has been conferred upon the central Government but in respect of an insecticide which does not come to a consumer and is a substance specified in the schedule itself and therefore an insecticide under section 3(e) (i), the power has not been conferred upon the Central Government since the specified substance in the schedule has been specified by the Parliament itself. In view of the aforesaid conclusion of ours we would h old that those of the Certificates of Registration granted to the petitioner in respect of any formulations namely BHC 10% WP, the order of the Central Government cancelling Certificate of Registration is well within the jurisdiction and the re is no legal infirmity in the same. But in respect of Benzene Hexachloride which is one of the substances specified in the schedule and as such is an insecticide within the meaning of section 3 (e)(i) the re is no power with the Central Government under sub- section (2) of section 27 to cancel the Certificate of Registration.So far as the contention of Mr. Vaidyanathan, the learned senior counsel appearing for the petitioners in the transferred case that consultation with the Registration committee is a pre-condition for exercise of power under sub-section (2) and such consultation being not the re. the issuance of notification is bad we are of the considered opinion that undoubtedly before the power under sub-section (2) of section 27 can be exercised the central Government is duty bound to have consultation with the Registration Committee. But in the case in hand having examined the counter-affidavits filed on behalf of the different Ministries of the Central Government that the re has been due and substantial consultation with the Registration Committee which is apparent in the notification of December 1994 itself. and since the n the re has been further study into the matter and committees of experts have been constituted who have gone into the matter and on the basis of the reports submitted by such expert committee ultimately the Central Government has taken the final decision. It is not possible for us to hold that the re has been no consultation with the Registration Committee before exercising of power under sub- section (2) of section 27. Contention of Mr. Vaidyanathan. the learned senior counsel on this score. There for, must be rejected. Before we part with this case. and having examined the different provisions of the Insecticides Act. 1968 we find that once a substance is specified in the schedule as contemplated under Section 3(e)(i) the n the re is no power for cancelling the registration certificate issued in respect of the same substance even if on scientific study it appears that the substance in question is grossly detrimental to the human health. This is a lacuna in the legislation itself. and therefore , steps should be taken for appropriate amendment to the legislation. 17.

1[ds]An examination of the aforesaid provisions of the Act indicates that before registering a particular insecticide the Registration Committee is duty bound to hold such enquiry as it deems fit for satisfying itself that the insecticide to which the application relate s is safe to human beings and animals.Coming now to the core question namely whether under Section 27 of the Act the central Government can cancel the Certificate of Registration in respect of an insecticide.It appears to us that under subsection (1) of section 27 when the Central Government or the State Government is of the opinion that the use of any insecticide specified ine (iii) of clause (e) of section 3 or any specific batch there of is likely to involve risk to human beings or animals and it is necessary to take immediate action the n on recording reasons in writing the sale. distribution or use of the insecticide or batch can be prohibited in such area. to such extent not exceeding 60 days as may be specified in the notification pending investigation into the matter. In Other words, In respect o an insecticide within the meaning of section 3(e) ((iii) i.e. a preparation or formulation containing anyone or more of such substances specified in the schedule. the appropriate Government can immediately by issue of notification prohibit the sale. distribution or use of the same pending investigation. Under the proviso to subsection (1) of section 27. if the investigation is not completed within the period of 60 days the n the prohibition in question could be extended for such further period not exceeding 30 days in the aggregate. Undersubsection(2) if the Central Government on the basis of its own investigation or on receipt of the report from the state Government and after consultation with the Registration Committee is satisfied that the use of the said insecticide or batch is or is not likely to cause any such risk the n it may pass such order as it deems fit depending upon the circumstances of the case. either refusing to register the insecticide or cancel the Certificate of Registration. If already granted. The use of the word said insecticide insubsection(2) obviously refers t o the insecticide in question which was the subject matter of consideration undersubsection(1) and in respect of which pending further investigation into the matter the Central Government has already issued a prohibition for sale, distribution or use of the insecticide in question. Therefore , the power of cancellation of Certificate of Registration conferred upon the Central Government undersubsection(2) of Section 27 can be exercised only in respect of any insecticide specified ine (iii) of clause (e) of section 3 i.e. a preparation or formulation of one or more of the substances specified in the schedule but the said power cannot be exercised in respect of an insecticide which is specified in the schedule itself by the Parliament. We are unable to accept the agreements advanced by the learned Additional Solicitor General thatsubsection(2) of section 27 is not restricted to an insecticide in respect of which the Central Government has already issued a notification prohibiting the sale. distribution or use pending investigation into the matter. The Scheme ofsubsection(1) andsubsection(2) of section 27 is that in respect of a formulation which is also an insecticide within the meaning of section 3 (e) (iii) the Central Government for reasons to be recorded in writing and pending investigation into the matter can immediately prohibit sale. distribution or use and after further investigation can cancel the Certificate of Registration in respect the reof undersubsection(2) of Section 27. That being the position in exercise of such power under subsection (2) of section 27 a certificate of Registration in respect of an insecticide undersubsection3(e) (i) cannot be cancelled undersubsection(2) of section 27. This is also in consonance with the logic that an insecticide which is the formulation of any one or more of the substances specified in the schedule and is consumer oriented power of cancellation of registration certainly has been conferred upon the central Government but in respect of an insecticide which does not come to a consumer and is a substance specified in the schedule itself and therefore an insecticide under section 3(e) (i), the power has not been conferred upon the Central Government since the specified substance in the schedule has been specified by the Parliament itself. In view of the aforesaid conclusion of ours we would h old that those of the Certificates of Registration granted to the petitioner in respect of any formulations namely BHC 10% WP, the order of the Central Government cancelling Certificate of Registration is well within the jurisdiction and the re is no legal infirmity in the same. But in respect of Benzene Hexachloride which is one of the substances specified in the schedule and as such is an insecticide within the meaning of section 3 (e)(i) the re is no power with the Central Government under subsection (2) of section 27 to cancel the Certificate of Registration.So far as the contention of Mr. Vaidyanathan, the learned senior counsel appearing for the petitioners in the transferred case that consultation with the Registration committee is an for exercise of power undersubsection(2) and such consultation being not the re. the issuance of notification is bad we are of the considered opinion that undoubtedly before the power undersubsection(2) of section 27 can be exercised the central Government is duty bound to have consultation with the Registration Committee. But in the case in hand having examined thes filed on behalf of the different Ministries of the Central Government that the re has been due and substantial consultation with the Registration Committee which is apparent in the notification of December 1994 itself. and since the n the re has been further study into the matter and committees of experts have been constituted who have gone into the matter and on the basis of the reports submitted by such expert committee ultimately the Central Government has taken the final decision. It is not possible for us to hold that the re has been no consultation with the Registration Committee before exercising of power under subsection (2) of section 27. Contention of Mr. Vaidyanathan. the learned senior counsel on this score. There for, must be rejected. Before we part with this case. and having examined the different provisions of the Insecticides Act. 1968 we find that once a substance is specified in the schedule as contemplated under Section 3(e)(i) the n the re is no power for cancelling the registration certificate issued in respect of the same substance even if on scientific study it appears that the substance in question is grossly detrimental to the human health. This is a lacuna in the legislation itself. and therefore , steps should be taken for appropriate amendment to the legislation.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: be specified in the notification pending investigation into the matter. In Other words, In respect o an insecticide within the meaning of section 3(e) ((iii) i.e. a preparation or formulation containing anyone or more of such substances specified in the schedule. the appropriate Government can immediately by issue of notification prohibit the sale. distribution or use of the same pending investigation. Under the proviso to subsection (1) of section 27. if the investigation is not completed within the period of 60 days the n the prohibition in question could be extended for such further period not exceeding 30 days in the aggregate. Under sub-section (2) if the Central Government on the basis of its own investigation or on receipt of the report from the state Government and after consultation with the Registration Committee is satisfied that the use of the said insecticide or batch is or is not likely to cause any such risk the n it may pass such order as it deems fit depending upon the circumstances of the case. either refusing to register the insecticide or cancel the Certificate of Registration. If already granted. The use of the word said insecticide in sub-section (2) obviously refers t o the insecticide in question which was the subject matter of consideration under sub-section (1) and in respect of which pending further investigation into the matter the Central Government has already issued a prohibition for sale, distribution or use of the insecticide in question. Therefore , the power of cancellation of Certificate of Registration conferred upon the Central Government under sub-section (2) of Section 27 can be exercised only in respect of any insecticide specified in sub-clause (iii) of clause (e) of section 3 i.e. a preparation or formulation of one or more of the substances specified in the schedule but the said power cannot be exercised in respect of an insecticide which is specified in the schedule itself by the Parliament. We are unable to accept the agreements advanced by the learned Additional Solicitor General that sub-section (2) of section 27 is not restricted to an insecticide in respect of which the Central Government has already issued a notification prohibiting the sale. distribution or use pending investigation into the matter. The Scheme of sub-section (1) and sub-section (2) of section 27 is that in respect of a formulation which is also an insecticide within the meaning of section 3 (e) (iii) the Central Government for reasons to be recorded in writing and pending investigation into the matter can immediately prohibit sale. distribution or use and after further investigation can cancel the Certificate of Registration in respect the reof under sub-section (2) of Section 27. That being the position in exercise of such power under sub- section (2) of section 27 a certificate of Registration in respect of an insecticide under sub-section 3(e) (i) cannot be cancelled under sub-section (2) of section 27. This is also in consonance with the logic that an insecticide which is the formulation of any one or more of the substances specified in the schedule and is consumer oriented power of cancellation of registration certainly has been conferred upon the central Government but in respect of an insecticide which does not come to a consumer and is a substance specified in the schedule itself and therefore an insecticide under section 3(e) (i), the power has not been conferred upon the Central Government since the specified substance in the schedule has been specified by the Parliament itself. In view of the aforesaid conclusion of ours we would h old that those of the Certificates of Registration granted to the petitioner in respect of any formulations namely BHC 10% WP, the order of the Central Government cancelling Certificate of Registration is well within the jurisdiction and the re is no legal infirmity in the same. But in respect of Benzene Hexachloride which is one of the substances specified in the schedule and as such is an insecticide within the meaning of section 3 (e)(i) the re is no power with the Central Government under sub- section (2) of section 27 to cancel the Certificate of Registration.So far as the contention of Mr. Vaidyanathan, the learned senior counsel appearing for the petitioners in the transferred case that consultation with the Registration committee is a pre-condition for exercise of power under sub-section (2) and such consultation being not the re. the issuance of notification is bad we are of the considered opinion that undoubtedly before the power under sub-section (2) of section 27 can be exercised the central Government is duty bound to have consultation with the Registration Committee. But in the case in hand having examined the counter-affidavits filed on behalf of the different Ministries of the Central Government that the re has been due and substantial consultation with the Registration Committee which is apparent in the notification of December 1994 itself. and since the n the re has been further study into the matter and committees of experts have been constituted who have gone into the matter and on the basis of the reports submitted by such expert committee ultimately the Central Government has taken the final decision. It is not possible for us to hold that the re has been no consultation with the Registration Committee before exercising of power under sub- section (2) of section 27. Contention of Mr. Vaidyanathan. the learned senior counsel on this score. There for, must be rejected. Before we part with this case. and having examined the different provisions of the Insecticides Act. 1968 we find that once a substance is specified in the schedule as contemplated under Section 3(e)(i) the n the re is no power for cancelling the registration certificate issued in respect of the same substance even if on scientific study it appears that the substance in question is grossly detrimental to the human health. This is a lacuna in the legislation itself. and therefore , steps should be taken for appropriate amendment to the legislation. 17. ### Response: 1

Kultar Singh Vs. Mukhtiar Singh

Suba. In these proceedings, we are not concerned to consider the propriety, the reasonableness or the desirability of the claim for Punjabi Suba. That is a political issue and it is perfectly competent to political parties to hold bona fide divergent and conflicting views on such a political issue. The significance of the reference to the Punjabi Suba in the impugned poster arises from the fact that it gives a clue to the meaning which the poster intended to assign to the word "Panth". Therefore, we are satisfied that the word "Panth" in this poster does not mean Sikh religion; and so, it would not be possible to accept the view that by distributing this poster, the appellant ap- pealed to his voters to vote for him because of his religion.15. in this connection, it may be relevant to refer to the oral evidence led in this case. Kartar Singh has stated that since the last 30 years the other name of the Akali Party is Panthic Party. This witness had been actively helping the appellant in his election, and he added that at the said election, there was a common front of all the opposition parties against the Congress. These parties were Jan Sangh, Swatantra Party, Akali Party and others. Another witness Ajmer Singh admitted that Shiromani Akali Dal was a political party of the Sikhs. He also stated that excepting 1957 elections, for which there was settlement with the Congress, the Akali Dal had been fighting in all the elections. In 1957, the Akali candidates contested the election on the Congress ticket. In 1958, the Akali Dal started an agitation for getting Punjabi Suba because it thought that the Regional Formula had not been properly implemented by the Government. This evidence would show that the Akali Dal Party is also known as the Panthic Party and that one of the major issues on which it fought the Congress Party at the election in question was the creation of a separate province which it calls the Punjabi Suba, In construing the impugned poster, the High Court does not appear to have been taken into account this oral evidence. It is true, that oral evidence would not be of any material assistance in construing the words in the pamphlet; but as we have just indicated, the word "Panth" used in six places in the pamphlet can be properly interpreted only to mean the Akali Dal Party and it is in that context that the statements made by the witnesses as to the name by which the Akali Dal Party is known in popular minds, may have some relevance.16. It appears that a similar question has been considered by the Election Tribunals on two occasions in the past. In Sardul Singh Caveeshar v. Hukam Singh, 6 Ele LR 316 at p. 326 (Ele. Tri. Patiala) the Election Tribunal had to consider the denotation of the words "Panth" and "Panthic" candidate and it has observed that though the words "Panthic candidate" would literally signify a candidate of the Sikh community, after the Akali Dal Party came to be known as the Panthic Party in the popular minds, the word "Panthic" candidate came to signify a candidate of the Akali Dal Party. It appears from this judgment that the Akali Dal Party called itself the Panthic Party even at the time when there were separate Sikh electorate, and that has a Significance of its own. When there were separate Sikh electorates, the candidates who fought against each other would all be Sikhs and yet, the Akali Dal Party which set up its own candidates, described itself as a Panthic Party and its candidates as Panthic candidates, (vide Baba Gurdit Singh v. Sardar Partap Singh Kairon, 1 Doabia Ele Cases 92 (Punj.). These decisions tend to show that the Akali Dal Party is known as Panthic Party and its candidates as Panthic candidates, and that incidentally may be of some help to determine the true denotation of the word "Panthi" used in the impugned poster in the present case. Unfortunately, these decisions also do not appear to have been placed before the High Court.17. Before we part with this appeal, we may refer to a recent decision of this Court in Jagdev Singh Sidhanti v. Partap Singh Daulta, Civil Appeal No. 936 of 1963, D/-12-2-1964 (SC). In that case, the election of the successful candidate was challenged on the ground that he had committed a corrupt practice under Section 123(3) of the Act in that he had Appealed to the voters to vote for him on the ground of his language, and the High Court had upheld that contention in reversing the conclusion of the High Court, this Court pointed out that the reference to the language on which the challenge to the successful candidates election was based, had to be considered in the context of the main controversy between the parties and that controversy was that the Hariana Lok Samiti which had sponsored the candidature of the successful candidate wanted to resist the imposition of Punjabi in the Hariana region and that was clearly a political issue. If in propagating its views on such a political issue, a candidate introduces an argument based on language, the context of the speech in which the consideration of language has been introduced must not be ignored, and that is how this Court held that the corrupt practice alleged against the successful candidate had not been established. Political issues which form the subject-matter of controversies at election meetings may indirectly and incidentally introduce considerations of language or religion, but in deciding the question as to whether corrupt practice has been committed under S. 123(3), care must be taken to consider the impugned speech or appeal carefully and always in the light of the relevant political controversy. We are, therefore, satisfied that the High Court was in error in coming to the conclusion that the impugned poster Ext. P-10 attracted the provisions of S. 123(3) of the Act.

1[ds]8. In considering the question as to whetherthe distribution of the impugned poster by the appellant constitutes corrupt practice under S.there is one point which has to be borne in mind. The appellant has been adopted as its candidate by the Akali Dal Party. This Party is recognised as a political party by the Election Commission notwithstanding the fact that all of its members are only Sikhs. It is well known that there are several parties in this country which subscribe to different political and economic ideologies, but the membership of their is either confined to, or predominantly held by, members of particular communities or religions. So long as law does not prohibit the formation of such parties and in fact recognises their for the purpose of election and parliamentary life, it would be necessary to remember that an appeal made by candidates of such parties for votes may, if successful, lead to their election and in an indirect way, may conceivably be influenced by consideration of religion, race, caste, community or language. This infirmity cannot perhaps be avoided so long as parties are allowed to function and are recognised though their composition may be predominantly based on membership of particular communities or religions. That is why we think, in considering the question as to whether a particular appeal made by a candidate falls within the mischief of S. 123 (3), Courts should not be astute to read into the words used in the appeal anything more than can be attributed to them on its fair and reasonable construction.The word Panth is one of Sanskrit origin and etymologically it means the path or the way. It must be conceded that by itself it has come to indicate the Sikh religion, because it has been used by Sikhs to denote their religion and their denomination as the followers of that Panth. In that context, Panth may mean the Sikh religion and the followers of the Panth would be the persons who follow the path prescribed by the Sikh Gurus and as such, would signify the Sikh community. Panthic is an adjective which means, of the Panth or belonging to the Panth, and so, prima facie, the glory or prestige of the Panth may mean the glory or prestige of the Sikhthere is no doubt whatever that in this sentence, the Panth cannot possibly mean the Sikh religion. The expression "the opponents of the Panth" obviously means the opponents of the Akali Dal party and what the pamphlet purports to tell the electors is, just as at the last Gurdwara Elections the Akali Dal Party succeeded over its opponents, so should the Akali Dal Party triumph in the election in question. The next sentence makes it still clearer that the Panth and the Akali Dal party are treated as synonymous in this portion because it says "every Sikh vote should go to the representatives of the Akali Dal", and that can be reconciled with the previous sentence only on the basis that in the minds of those who drafted the impugned poster, the Akali Dal Party and the Panth are the same. Then the poster says that the prayer made in the poster if accepted, will once again preserve the honour of the Panth; the words "once again" take us back to the triumph which the Akali Dal Party achieved at the Last Gurdwara Elections, and so, the Panth in this context must mean the Akali Dal Party; and in the end when the pamphlet refers to the victory of the Panth and the honour of the Panth, it must be taken to refer to the victory and honour of the Akali Dal Party. The last sentence is very significant. It says that by maintaining such honour, meaning the honour of the Panth which is the Akali Dal, we will reach our final goal, that is, the Punjabi Suba. It is not disputed that at these elections, the Akali Dal Party propagated for the creation of the Punjabi Suba and the crux of the appeal made by the impugned poster is that if the voters returned the Akali Dal candidate, the honour and prestige of the Akali Dal would be maintained and the ideal of the Punjabi Suba attained. In the end, the poster also says that those who issued it were anxious to keep the honour and prestige of the Panth ever high.14. We have carefully considered the view taken by the Punjab High Court and the Tribunal, but we are satisfied that the said view is inconsistent with a fair and reasonable construction of the impugned poster. In fact the High Court does not appear to have considered the different places in the poster where the word "Panth" has been used and no attempt has been made to co-relate these sentences and to enquire whether the meaning attributed by the High Court to the word "Panth" is justified in regard to all the sentences in which that word occurs. It is an elementary rule of construction that the same word cannot have two different meanings in the same document, unless the context compels the adoption of such a course. After all, the impugned poster was issued in furtherance of the appellants candidature at an election, and the plain object which it has placed before the voters is that the Punjabi Suba can be achieved if the appellant is elected; and that necessarily means that the appellant belongs to the Akali Dal Party and the Akali Dal Party is the strong supporter of the Punjabi Suba. In these proceedings, we are not concerned to consider the propriety, the reasonableness or the desirability of the claim for Punjabi Suba. That is a political issue and it is perfectly competent to political parties to hold bona fide divergent and conflicting views on such a political issue. The significance of the reference to the Punjabi Suba in the impugned poster arises from the fact that it gives a clue to the meaning which the poster intended to assign to the word "Panth". Therefore, we are satisfied that the word "Panth" in this poster does not mean Sikh religion; and so, it would not be possible to accept the view that by distributing this poster, the appellant ap- pealed to his voters to vote for him because of hisin propagating its views on such a political issue, a candidate introduces an argument based on language, the context of the speech in which the consideration of language has been introduced must not be ignored, and that is how this Court held that the corrupt practice alleged against the successful candidate had not been established. Political issues which form the subject-matter of controversies at election meetings may indirectly and incidentally introduce considerations of language or religion, but in deciding the question as to whether corrupt practice has been committed under S. 123(3), care must be taken to consider the impugned speech or appeal carefully and always in the light of the relevant political controversy. We are, therefore, satisfied that the High Court was in error in coming to the conclusion that the impugned poster Ext. P-10 attracted the provisions of S. 123(3) of the Act.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: Suba. In these proceedings, we are not concerned to consider the propriety, the reasonableness or the desirability of the claim for Punjabi Suba. That is a political issue and it is perfectly competent to political parties to hold bona fide divergent and conflicting views on such a political issue. The significance of the reference to the Punjabi Suba in the impugned poster arises from the fact that it gives a clue to the meaning which the poster intended to assign to the word "Panth". Therefore, we are satisfied that the word "Panth" in this poster does not mean Sikh religion; and so, it would not be possible to accept the view that by distributing this poster, the appellant ap- pealed to his voters to vote for him because of his religion.15. in this connection, it may be relevant to refer to the oral evidence led in this case. Kartar Singh has stated that since the last 30 years the other name of the Akali Party is Panthic Party. This witness had been actively helping the appellant in his election, and he added that at the said election, there was a common front of all the opposition parties against the Congress. These parties were Jan Sangh, Swatantra Party, Akali Party and others. Another witness Ajmer Singh admitted that Shiromani Akali Dal was a political party of the Sikhs. He also stated that excepting 1957 elections, for which there was settlement with the Congress, the Akali Dal had been fighting in all the elections. In 1957, the Akali candidates contested the election on the Congress ticket. In 1958, the Akali Dal started an agitation for getting Punjabi Suba because it thought that the Regional Formula had not been properly implemented by the Government. This evidence would show that the Akali Dal Party is also known as the Panthic Party and that one of the major issues on which it fought the Congress Party at the election in question was the creation of a separate province which it calls the Punjabi Suba, In construing the impugned poster, the High Court does not appear to have been taken into account this oral evidence. It is true, that oral evidence would not be of any material assistance in construing the words in the pamphlet; but as we have just indicated, the word "Panth" used in six places in the pamphlet can be properly interpreted only to mean the Akali Dal Party and it is in that context that the statements made by the witnesses as to the name by which the Akali Dal Party is known in popular minds, may have some relevance.16. It appears that a similar question has been considered by the Election Tribunals on two occasions in the past. In Sardul Singh Caveeshar v. Hukam Singh, 6 Ele LR 316 at p. 326 (Ele. Tri. Patiala) the Election Tribunal had to consider the denotation of the words "Panth" and "Panthic" candidate and it has observed that though the words "Panthic candidate" would literally signify a candidate of the Sikh community, after the Akali Dal Party came to be known as the Panthic Party in the popular minds, the word "Panthic" candidate came to signify a candidate of the Akali Dal Party. It appears from this judgment that the Akali Dal Party called itself the Panthic Party even at the time when there were separate Sikh electorate, and that has a Significance of its own. When there were separate Sikh electorates, the candidates who fought against each other would all be Sikhs and yet, the Akali Dal Party which set up its own candidates, described itself as a Panthic Party and its candidates as Panthic candidates, (vide Baba Gurdit Singh v. Sardar Partap Singh Kairon, 1 Doabia Ele Cases 92 (Punj.). These decisions tend to show that the Akali Dal Party is known as Panthic Party and its candidates as Panthic candidates, and that incidentally may be of some help to determine the true denotation of the word "Panthi" used in the impugned poster in the present case. Unfortunately, these decisions also do not appear to have been placed before the High Court.17. Before we part with this appeal, we may refer to a recent decision of this Court in Jagdev Singh Sidhanti v. Partap Singh Daulta, Civil Appeal No. 936 of 1963, D/-12-2-1964 (SC). In that case, the election of the successful candidate was challenged on the ground that he had committed a corrupt practice under Section 123(3) of the Act in that he had Appealed to the voters to vote for him on the ground of his language, and the High Court had upheld that contention in reversing the conclusion of the High Court, this Court pointed out that the reference to the language on which the challenge to the successful candidates election was based, had to be considered in the context of the main controversy between the parties and that controversy was that the Hariana Lok Samiti which had sponsored the candidature of the successful candidate wanted to resist the imposition of Punjabi in the Hariana region and that was clearly a political issue. If in propagating its views on such a political issue, a candidate introduces an argument based on language, the context of the speech in which the consideration of language has been introduced must not be ignored, and that is how this Court held that the corrupt practice alleged against the successful candidate had not been established. Political issues which form the subject-matter of controversies at election meetings may indirectly and incidentally introduce considerations of language or religion, but in deciding the question as to whether corrupt practice has been committed under S. 123(3), care must be taken to consider the impugned speech or appeal carefully and always in the light of the relevant political controversy. We are, therefore, satisfied that the High Court was in error in coming to the conclusion that the impugned poster Ext. P-10 attracted the provisions of S. 123(3) of the Act. ### Response: 1

Kurapati Venkatasatyanarayana & Others Vs. The State Of Andhra Pradesh

to a separate assessable item, a Court can sever the items and cut out one or more along with the sum attributed to it, while affirming the residue. But where the assessment consists of a single undivided sum in respect of the totality of property treated as assessable, and when one component (not dismissible as de minimis) is on any view not assessable and wrongly included, it would seem clear that such a procedure is barred, and the assessment is bad wholly. That matter is covered by authority. In Montreal Light, Heat and Power Consolidated v. City of Westmount, (1926) SCR (Can) 515 the Court (see especially per Anglin, C. J.) in these conditions held that an assessment which was bad in part was infected throughout, and treated it as invalid. Here their Lordships are of opinion, by parity of reasoning, that the assessment was invalid in toto."Applying the principle to the special facts and circumstances of the case the Court set aside the orders of assessment and directed that the case should be remanded to the Assessment Officer for re-assessment of the appellants in accordance with law. The same principle was applied but with a different result in the later case the State of Jammu and Kashmir v. Caltex (India) Ltd., 17 STC 612 =(AIR 1966 SC 1350 ) in which the question arose as regards the validity of an assessment of sales-tax of all retail sales of motor spirit. The Petrol Taxation Officer assessed the respondent to pay sales-tax for the period January, 1955 to May, 1959 under Section 3 of the Jammu and Kashmir Motor Spirit (Taxation of Sales) Act, 2005. The respondent applied under Section 103 of the Constitution of Jammu and Kashmir and a single Judge of the High Court held that the respondent was liable to pay sales-tax only in respect of the sales which took place during the period January to September, 1955 and issued a writ restraining the appellants from levying tax for the period October, 1955 to May, 1959. On appeal a Division Bench of the High Court quashed the assessment for the entire period. On appeal to this Court it was held that though there was one order of assessment for the period January 1, 1955 to May 1959 the assessment could be split up and dissected and the items of sale could be separated and taxed for different periods. It was pointed out that the sales-tax was imposed in the ultimate analysis on receipts from individual sales or purchases of goods effected during the entire period, and, therefore, a writ of mandamus could be issued directing the appellant not to realise sales-tax with regard to transactions of sale during the period from September 7, 1955 to May 1959.11. A similar question arose for determination in an American case (Frank Batterman v. Western Union Telegraph Co., (1887) 127 US 411). The question in that case was"whether a single tax, assessed under the Revised Statutes of Ohio, Section 2778, upon the receipts of a telegraph company which receipts were derived partly from inter-State commerce and partly from commerce within the State but which were returned and assessed in gross and without separation or apportionment, is wholly invalid, or invalid only in the proportion and to the extent that the said receipts were delivered from inter-State commerce".It was held unanimously by the Supreme Court of the United States that the assessment was not wholly invalid but it was invalid only in proportion to the extent that such receipts were derived from inter-State commerce. It was observed that where the subjects of taxation can be separated so that which arises from inter-State commerce can be distinguished from that which arises from commerce wholly within the State, the Court will act upon this distinction, and will restrain the tax on inter-State commerce, while permitting the State to collect that upon commerce wholly within its own territory. The principle of this case has been consistently followed in American cases: (see Bowman v. Continental Company, ((1920) 256 US 642). This case has been cited with approval by this Court in 1953 SCR 1069 at p. 1097 = (AIR 1953 SC 252 at p. 263) wherein it was observed that the same principle should be applied in dealing with taxing statutes in this country also.12. In the present case we are of opinion that though there is a single order of assessment for the period from April 1, 1949 to March 31, 1950 the assessment could be split up and dissected and the items of sale separated and taxed for different periods. It is quite easy in this case to ascertain the turnover of the appellant for the pre-Constitution and post-Constitution periods for these figures are furnished in the plaint by the appellant himself. It is open to the Court in these circumstances to serve the illegal part of the assessment and give a declaration with regard to that part alone instead of declaring the entire assessment void. For these reasons we hold that the appellant should be granted a declaration that the order of assessment made by the Deputy Commercial Tax Officer for the year 1949-50 is invalid to the extent that the levy of sales-tax is made on sales relating to goods which were delivered for the purpose of consumption outside the State for the period from January 26, 1950 to March 31, 1950.The result is that the appellant is entitled for refund of the amount illegally collected from him for the period from January 26, 1950 to March 31, 1950. The trial Court has already found that the appellant is entitled to claim exemption with regard to turnover for this period to the extent of Rs. 3,34,107-15-6 and the tax payable on this sum is Rs. 5,220-7-0. The appellant is, therefore, entitled to a decree for the refund of Rs. 5,220-7-0. The appellant is also entitled to interest at 6 per cent per annum from the date of suit till realization of this amount

1[ds]herefore, by incorporating Section 22 of the Madras Act read with Article 286, notwithstanding the amplitude of the power otherwise granted by the charging section read with the definition of sale a cumulative fetter of triple dimension was imposed upon the taxing power of the State. The Legislature of the Madras State could not since January 26, 1950, levy a tax on sale of goods taking place outside the State or in the course of import of the goods into, or export of the goods out of, the territory of India, or on sale of any goods where such sale took place in the course of inter-State trade or commerce. By the Explanation to Article 286 (1) (a) which is incorporated by Section 22 of the Madras Act a sale is deemed to take place in the State in which the goods are actually delivered as a direct result of such sale for the purpose of consumption in that State even though under the law relating to sale of goods the property in the goods has by reason of such sale passed in anotherby incorporating Section 22 of the Madras Act read with Article 286, notwithstanding the amplitude of the power otherwise granted by the charging section read with the definition of sale a cumulative fetter of triple dimension was imposed upon the taxing power of the State. The Legislature of the Madras State could not since January 26, 1950, levy a tax on sale of goods taking place outside the State or in the course of import of the goods into, or export of the goods out of, the territory of India, or on sale of any goods where such sale took place in the course of inter-State trade or commerce. By the Explanation to Article 286 (1) (a) which is incorporated by Section 22 of the Madras Act a sale is deemed to take place in the State in which the goods are actually delivered as a direct result of such sale for the purpose of consumption in that State even though under the law relating to sale of goods the property in the goods has by reason of such sale passed in anotherour opinion the argument is well founded and must be accepted as correct. In India Copper Corporations case 12 STC 56 = (AIR 1961 SC 347 ) it was pointed out by this Court that if the goods were as a direct result of a sale delivered outside the State of Bihar for the purpose of consumption in the State of first delivery, the assessee would be entitled to the exemption from sales-tax by virtue of the Explanation to Art. 286 (1) (a) of the Constitution and it would not be necessary for the assessee to prove further that the goods so delivered were actually consumed in the State of first destination.9. In the present case of the Subordinate Judge has, upon a consideration of the evidence adduced by the parties stated in his report dated June 27, 1962 that the intention of the appellant was that the sale and delivery should be for the purpose of consumption in the delivery States. It is true that in his subsequent report date March 22, 1963 the Subordinate Judge gave a different finding. But it is obvious that the subsequent report of the Subordinate Judge is vitiated because the principle laid down by this Court in India Copper Corporations case, 12 STC 56 = (AIR 1961 SC 347 ) has not been taken into account. Having regard to the evidence adduced by the appellant in this case we are satisfied that the part of the turnover which related to sales from January 26, 1950 to March 31, 1950 was not liable to sales-tax and the levy of sales-tax from the appellant to this extent is illegal.In support of this argument reference was made to the decision of this Court in Ram Narain Sons Ltd. v. Assistant Commissioner of Sales Tax, 6 STC627 at p. 637 = (AIR 1955 SC 765 at p. 770)

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: to a separate assessable item, a Court can sever the items and cut out one or more along with the sum attributed to it, while affirming the residue. But where the assessment consists of a single undivided sum in respect of the totality of property treated as assessable, and when one component (not dismissible as de minimis) is on any view not assessable and wrongly included, it would seem clear that such a procedure is barred, and the assessment is bad wholly. That matter is covered by authority. In Montreal Light, Heat and Power Consolidated v. City of Westmount, (1926) SCR (Can) 515 the Court (see especially per Anglin, C. J.) in these conditions held that an assessment which was bad in part was infected throughout, and treated it as invalid. Here their Lordships are of opinion, by parity of reasoning, that the assessment was invalid in toto."Applying the principle to the special facts and circumstances of the case the Court set aside the orders of assessment and directed that the case should be remanded to the Assessment Officer for re-assessment of the appellants in accordance with law. The same principle was applied but with a different result in the later case the State of Jammu and Kashmir v. Caltex (India) Ltd., 17 STC 612 =(AIR 1966 SC 1350 ) in which the question arose as regards the validity of an assessment of sales-tax of all retail sales of motor spirit. The Petrol Taxation Officer assessed the respondent to pay sales-tax for the period January, 1955 to May, 1959 under Section 3 of the Jammu and Kashmir Motor Spirit (Taxation of Sales) Act, 2005. The respondent applied under Section 103 of the Constitution of Jammu and Kashmir and a single Judge of the High Court held that the respondent was liable to pay sales-tax only in respect of the sales which took place during the period January to September, 1955 and issued a writ restraining the appellants from levying tax for the period October, 1955 to May, 1959. On appeal a Division Bench of the High Court quashed the assessment for the entire period. On appeal to this Court it was held that though there was one order of assessment for the period January 1, 1955 to May 1959 the assessment could be split up and dissected and the items of sale could be separated and taxed for different periods. It was pointed out that the sales-tax was imposed in the ultimate analysis on receipts from individual sales or purchases of goods effected during the entire period, and, therefore, a writ of mandamus could be issued directing the appellant not to realise sales-tax with regard to transactions of sale during the period from September 7, 1955 to May 1959.11. A similar question arose for determination in an American case (Frank Batterman v. Western Union Telegraph Co., (1887) 127 US 411). The question in that case was"whether a single tax, assessed under the Revised Statutes of Ohio, Section 2778, upon the receipts of a telegraph company which receipts were derived partly from inter-State commerce and partly from commerce within the State but which were returned and assessed in gross and without separation or apportionment, is wholly invalid, or invalid only in the proportion and to the extent that the said receipts were delivered from inter-State commerce".It was held unanimously by the Supreme Court of the United States that the assessment was not wholly invalid but it was invalid only in proportion to the extent that such receipts were derived from inter-State commerce. It was observed that where the subjects of taxation can be separated so that which arises from inter-State commerce can be distinguished from that which arises from commerce wholly within the State, the Court will act upon this distinction, and will restrain the tax on inter-State commerce, while permitting the State to collect that upon commerce wholly within its own territory. The principle of this case has been consistently followed in American cases: (see Bowman v. Continental Company, ((1920) 256 US 642). This case has been cited with approval by this Court in 1953 SCR 1069 at p. 1097 = (AIR 1953 SC 252 at p. 263) wherein it was observed that the same principle should be applied in dealing with taxing statutes in this country also.12. In the present case we are of opinion that though there is a single order of assessment for the period from April 1, 1949 to March 31, 1950 the assessment could be split up and dissected and the items of sale separated and taxed for different periods. It is quite easy in this case to ascertain the turnover of the appellant for the pre-Constitution and post-Constitution periods for these figures are furnished in the plaint by the appellant himself. It is open to the Court in these circumstances to serve the illegal part of the assessment and give a declaration with regard to that part alone instead of declaring the entire assessment void. For these reasons we hold that the appellant should be granted a declaration that the order of assessment made by the Deputy Commercial Tax Officer for the year 1949-50 is invalid to the extent that the levy of sales-tax is made on sales relating to goods which were delivered for the purpose of consumption outside the State for the period from January 26, 1950 to March 31, 1950.The result is that the appellant is entitled for refund of the amount illegally collected from him for the period from January 26, 1950 to March 31, 1950. The trial Court has already found that the appellant is entitled to claim exemption with regard to turnover for this period to the extent of Rs. 3,34,107-15-6 and the tax payable on this sum is Rs. 5,220-7-0. The appellant is, therefore, entitled to a decree for the refund of Rs. 5,220-7-0. The appellant is also entitled to interest at 6 per cent per annum from the date of suit till realization of this amount ### Response: 1

Toyoto Jidosha Kabushiki Kaisha Vs. M/s. Prius Auto Industries Ltd. & Others

the first test, i.e., likelihood of confusion is required to be satisfied only in quia timet actions and actual confusion will have to be proved when the suit or claim is being adjudicated finally as by then a considerable period of time following the initiation of the action of passing off might have elapsed. Once the claimant who has brought the action of passing off establishes his goodwill in the jurisdiction in which he claims that the defendants are trying to pass off their goods under the brand name of the claimants goods, the burden of establishing actual confusion as distinguished from possibility thereof ought not to be fastened on the claimant. The possibility or likelihood of confusion is capable of being demonstrated with reference to the particulars of the mark or marks, as may be, and the circumstances surrounding the manner of sale/marketing of the goods by the defendants and such other relevant facts. Proof of actual confusion, on the other hand, would require the claimant to bring before the Court evidence which may not be easily forthcoming and directly available to the claimant. In a given situation, there may be no complaints made to the claimant that goods marketed by the defendants under the impugned mark had been inadvertently purchased as that of the plaintiff/claimant. The onus of bringing such proof, as an invariable requirement, would be to cast on the claimant an onerous burden which may not be justified. Commercial and business morality which is the foundation of the law of passing off should not be allowed to be defeated by imposing such a requirement. In such a situation, likelihood of confusion would be a surer and better test of proving an action of passing off by the defendants. Such a test would also be consistent with commercial and business morality which the law of passing off seeks to achieve. In the last resort, therefore, it is preponderance of probabilities that must be left to judge the claim.32. The next exercise would now be the application of the above principles to the facts of the present case for determination of the correctness of either of the views arrived at in the two-tier adjudication performed by the High Court of Delhi. Indeed, the trade mark `Prius had undoubtedly acquired a great deal of goodwill in several other jurisdictions in the world and that too much earlier to the use and registration of the same by the defendants in India. But if the territoriality principle is to govern the matter, and we have already held it should, there must be adequate evidence to show that the plaintiff had acquired a substantial goodwill for its car under the brand name `Prius in the Indian market also. The car itself was introduced in the Indian market in the year 2009-2010. The advertisements in automobile magazines, international business magazines; availability of data in information-disseminating portals like Wikipedia and online Britannica dictionary and the information on the internet, even if accepted, will not be a safe basis to hold the existence of the necessary goodwill and reputation of the product in the Indian market at the relevant point of time, particularly having regard to the limited online exposure at that point of time, i.e., in the year 2001. The news items relating to the launching of the product in Japan isolatedly and singularly in the Economic Times (Issues dated 27.03.1997 and 15.12.1997) also do not firmly establish the acquisition and existence of goodwill and reputation of the brand name in the Indian market. Coupled with the above, the evidence of the plaintiffs witnesses themselves would be suggestive of a very limited sale of the product in the Indian market and virtually the absence of any advertisement of the product in India prior to April, 2001. This, in turn, would show either lack of goodwill in the domestic market or lack of knowledge and information of the product amongst a significant section of the Indian population. While it may be correct that the population to whom such knowledge or information of the product should be available would be the section of the public dealing with the product as distinguished from the general population, even proof of such knowledge and information within the limited segment of the population is not prominent. All these should lead to us to eventually agree with the conclusion of the Division Bench of the High Court that the brand name of the car Prius had not acquired the degree of goodwill, reputation and the market or popularity in the Indian market so as to vest in the plaintiff the necessary attributes of the right of a prior user so as to successfully maintain an action of passing off even against the registered owner. In any event the core of the controversy between the parties is really one of appreciation of the evidence of the parties; an exercise that this Court would not undoubtedly repeat unless the view taken by the previous forum is wholly and palpably unacceptable which does not appear to be so in the present premises.33. If goodwill or reputation in the particular jurisdiction (in India) is not established by the plaintiff, no other issue really would need any further examination to determine the extent of the plaintiffs right in the action of passing off that it had brought against the defendants in the Delhi High Court. Consequently, even if we are to disagree with the view of the Division Bench of the High Court in accepting the defendants version of the origin of the mark `Prius, the eventual conclusion of the Division Bench will, nonetheless, have to be sustained. We cannot help but also to observe that in the present case the plaintiffs delayed approach to the Courts has remained unexplained. Such delay cannot be allowed to work to the prejudice of the defendants who had kept on using its registered mark to market its goods during the inordinately long period of silence maintained by the plaintiff.

0[ds]28. The overwhelming judicial and academic opinion all over the globe, therefore, seems to be in favour of the territoriality principle. We do not see why the same should not apply to this Country.29. To give effect to the territoriality principle, the courts must necessarily have to determine if there has been a spill over of the reputation and goodwill of the mark used by the claimant who has brought the passing off action. In the course of such determination it may be necessary to seek and ascertain the existence of not necessarily a real market but the presence of the claimant through its mark within a particular territorial jurisdiction in a more subtle form which can best be manifested by the following illustrations, though they arise from decisions of Courts which may not be final in that particular jurisdiction.Whether the second principle evolved under the trinity test, i.e., triple identity test laid down in Reckitt and Colman Ltd. (supra) would stand established on the test of likelihood of confusion or real/actual confusionanother question that seems to have arisen in the present case as the Division Bench of the High Court has taken the view that the first test, i.e., likelihood of confusion is required to be satisfied only in quia timet actions and actual confusion will have to be proved when the suit or claim is being adjudicated finally as by then a considerable period of time following the initiation of the action of passing off might have elapsed. Once the claimant who has brought the action of passing off establishes his goodwill in the jurisdiction in which he claims that the defendants are trying to pass off their goods under the brand name of the claimants goods, the burden of establishing actual confusion as distinguished from possibility thereof ought not to be fastened on the claimant. The possibility or likelihood of confusion is capable of being demonstrated with reference to the particulars of the mark or marks, as may be, and the circumstances surrounding the manner of sale/marketing of the goods by the defendants and such other relevant facts. Proof of actual confusion, on the other hand, would require the claimant to bring before the Court evidence which may not be easily forthcoming and directly available to the claimant. In a given situation, there may be no complaints made to the claimant that goods marketed by the defendants under the impugned mark had been inadvertently purchased as that of the plaintiff/claimant. The onus of bringing such proof, as an invariable requirement, would be to cast on the claimant an onerous burden which may not be justified. Commercial and business morality which is the foundation of the law of passing off should not be allowed to be defeated by imposing such a requirement. In such a situation, likelihood of confusion would be a surer and better test of proving an action of passing off by the defendants. Such a test would also be consistent with commercial and business morality which the law of passing off seeks to achieve. In the last resort, therefore, it is preponderance of probabilities that must be left to judge the claim.32. The next exercise would now be the application of the above principles to the facts of the present case for determination of the correctness of either of the views arrived at in theadjudication performed by the High Court of Delhi. Indeed, the trade mark `Prius had undoubtedly acquired a great deal of goodwill in several other jurisdictions in the world and that too much earlier to the use and registration of the same by the defendants in India. But if the territoriality principle is to govern the matter, and we have already held it should, there must be adequate evidence to show that the plaintiff had acquired a substantial goodwill for its car under the brand name `Prius in the Indian market also. The car itself was introduced in the Indian market in the yearThe advertisements in automobile magazines, international business magazines; availability of data inportals like Wikipedia and online Britannica dictionary and the information on the internet, even if accepted, will not be a safe basis to hold the existence of the necessary goodwill and reputation of the product in the Indian market at the relevant point of time, particularly having regard to the limited online exposure at that point of time, i.e., in the year 2001. The news items relating to the launching of the product in Japan isolatedly and singularly in the Economic Times (Issues dated 27.03.1997 and 15.12.1997) also do not firmly establish the acquisition and existence of goodwill and reputation of the brand name in the Indian market. Coupled with the above, the evidence of the plaintiffs witnesses themselves would be suggestive of a very limited sale of the product in the Indian market and virtually the absence of any advertisement of the product in India prior to April, 2001. This, in turn, would show either lack of goodwill in the domestic market or lack of knowledge and information of the product amongst a significant section of the Indian population. While it may be correct that the population to whom such knowledge or information of the product should be available would be the section of the public dealing with the product as distinguished from the general population, even proof of such knowledge and information within the limited segment of the population is not prominent. All these should lead to us to eventually agree with the conclusion of the Division Bench of the High Court that the brand name of the car Prius had not acquired the degree of goodwill, reputation and the market or popularity in the Indian market so as to vest in the plaintiff the necessary attributes of the right of a prior user so as to successfully maintain an action of passing off even against the registered owner. In any event the core of the controversy between the parties is really one of appreciation of the evidence of the parties; an exercise that this Court would not undoubtedly repeat unless the view taken by the previous forum is wholly and palpably unacceptable which does not appear to be so in the present premises.33. If goodwill or reputation in the particular jurisdiction (in India) is not established by the plaintiff, no other issue really would need any further examination to determine the extent of the plaintiffs right in the action of passing off that it had brought against the defendants in the Delhi High Court. Consequently, even if we are to disagree with the view of the Division Bench of the High Court in accepting the defendants version of the origin of the mark `Prius, the eventual conclusion of the Division Bench will, nonetheless, have to be sustained. We cannot help but also to observe that in the present case the plaintiffs delayed approach to the Courts has remained unexplained. Such delay cannot be allowed to work to the prejudice of the defendants who had kept on using its registered mark to market its goods during the inordinately long period of silence maintained by the plaintiff.

### Instruction: Delve into the case proceeding and predict the outcome: is the judgment expected to be in support (1) or in denial (0) of the appeal? ### Input: the first test, i.e., likelihood of confusion is required to be satisfied only in quia timet actions and actual confusion will have to be proved when the suit or claim is being adjudicated finally as by then a considerable period of time following the initiation of the action of passing off might have elapsed. Once the claimant who has brought the action of passing off establishes his goodwill in the jurisdiction in which he claims that the defendants are trying to pass off their goods under the brand name of the claimants goods, the burden of establishing actual confusion as distinguished from possibility thereof ought not to be fastened on the claimant. The possibility or likelihood of confusion is capable of being demonstrated with reference to the particulars of the mark or marks, as may be, and the circumstances surrounding the manner of sale/marketing of the goods by the defendants and such other relevant facts. Proof of actual confusion, on the other hand, would require the claimant to bring before the Court evidence which may not be easily forthcoming and directly available to the claimant. In a given situation, there may be no complaints made to the claimant that goods marketed by the defendants under the impugned mark had been inadvertently purchased as that of the plaintiff/claimant. The onus of bringing such proof, as an invariable requirement, would be to cast on the claimant an onerous burden which may not be justified. Commercial and business morality which is the foundation of the law of passing off should not be allowed to be defeated by imposing such a requirement. In such a situation, likelihood of confusion would be a surer and better test of proving an action of passing off by the defendants. Such a test would also be consistent with commercial and business morality which the law of passing off seeks to achieve. In the last resort, therefore, it is preponderance of probabilities that must be left to judge the claim.32. The next exercise would now be the application of the above principles to the facts of the present case for determination of the correctness of either of the views arrived at in the two-tier adjudication performed by the High Court of Delhi. Indeed, the trade mark `Prius had undoubtedly acquired a great deal of goodwill in several other jurisdictions in the world and that too much earlier to the use and registration of the same by the defendants in India. But if the territoriality principle is to govern the matter, and we have already held it should, there must be adequate evidence to show that the plaintiff had acquired a substantial goodwill for its car under the brand name `Prius in the Indian market also. The car itself was introduced in the Indian market in the year 2009-2010. The advertisements in automobile magazines, international business magazines; availability of data in information-disseminating portals like Wikipedia and online Britannica dictionary and the information on the internet, even if accepted, will not be a safe basis to hold the existence of the necessary goodwill and reputation of the product in the Indian market at the relevant point of time, particularly having regard to the limited online exposure at that point of time, i.e., in the year 2001. The news items relating to the launching of the product in Japan isolatedly and singularly in the Economic Times (Issues dated 27.03.1997 and 15.12.1997) also do not firmly establish the acquisition and existence of goodwill and reputation of the brand name in the Indian market. Coupled with the above, the evidence of the plaintiffs witnesses themselves would be suggestive of a very limited sale of the product in the Indian market and virtually the absence of any advertisement of the product in India prior to April, 2001. This, in turn, would show either lack of goodwill in the domestic market or lack of knowledge and information of the product amongst a significant section of the Indian population. While it may be correct that the population to whom such knowledge or information of the product should be available would be the section of the public dealing with the product as distinguished from the general population, even proof of such knowledge and information within the limited segment of the population is not prominent. All these should lead to us to eventually agree with the conclusion of the Division Bench of the High Court that the brand name of the car Prius had not acquired the degree of goodwill, reputation and the market or popularity in the Indian market so as to vest in the plaintiff the necessary attributes of the right of a prior user so as to successfully maintain an action of passing off even against the registered owner. In any event the core of the controversy between the parties is really one of appreciation of the evidence of the parties; an exercise that this Court would not undoubtedly repeat unless the view taken by the previous forum is wholly and palpably unacceptable which does not appear to be so in the present premises.33. If goodwill or reputation in the particular jurisdiction (in India) is not established by the plaintiff, no other issue really would need any further examination to determine the extent of the plaintiffs right in the action of passing off that it had brought against the defendants in the Delhi High Court. Consequently, even if we are to disagree with the view of the Division Bench of the High Court in accepting the defendants version of the origin of the mark `Prius, the eventual conclusion of the Division Bench will, nonetheless, have to be sustained. We cannot help but also to observe that in the present case the plaintiffs delayed approach to the Courts has remained unexplained. Such delay cannot be allowed to work to the prejudice of the defendants who had kept on using its registered mark to market its goods during the inordinately long period of silence maintained by the plaintiff. ### Response: 0

Mamtaj Bi Bapusab Nadaf Vs. United India Insurance Co.

Compensation, Bizapur, were allowed and the Commissioner vide its judgment dated 24th July, 2003, found the Insurance Company liable to pay compensation to the appellants.6. Aggrieved by the said judgment, the Insurance Company preferred in M.F.A. No.5843/2003 and M.F.A. No.5844/2003 before the High Court of Karnataka at Bangalore. The High Court allowed the appeals and modified the order passed by the Commissioner and the liability of the Insurance Company was set aside. However, the appellants were at liberty to recover the amount of compensation from the employer.7. According to the reasoning of the High Court, the vehicle was not involved in the accident and the death of the workmen by no stretch of imagination can be said to have any proximate or direct connection with the vehicle. The High Court also observed that the mere fact that Maize was brought to the spot where the workmen had died in the insured vehicle, would not render the Insurance Company liable in respect of the death, the cause of which was not proximate to the actual user of the vehicle.8. In the present case, the use of the vehicle was not even claimed as being a ground on which the liability is said to be fastened on the Insurance Company. 9. Learned counsel appearing on behalf of the appellants placed reliance on the decision of this Court in Shivaji Dayanu Patil and Anr. vs. Vatschala Uttam More, (1991) 3 SCC 530. Brief facts of that case are that a collision between a petrol tanker and a truck took place on a National Highway at about 3.00 a.m. as a result of which the tanker went off the road and fell on its left side at a distance of about 20 feet from the Highway. Due to overturning of the tanker, the petrol contained in it leaked out and collected nearby. At about 7.15 a.m. an explosion took place in the tanker causing burn injuries to those assembled near it including the respondents son who later succumbed to the injuries. The facts of this case are entirely different and are not applicable to the present case. In this case, the petrol tanker was directly involved in the accident and that all the workmen were directly connected with the accident. This case does not help the appellants in any manner.10. Learned counsel for the appellants has also placed reliance on a Division Bench judgment of the Karnataka High Court delivered on 24th February, 2006 in M.F.A. No.1870/2005 (WC). In that case, the workman who was working as a loader, went in the lorry and loaded the lorry with stones and thereafter he was required to unload the same close to the Crusher near the quarry along with other loaders. At about 2.30 p.m. in the afternoon, the deceased workman got down from the lorry in order to unload the stones along with other loaders and when they opened the lock at the hind portion of the lorry, the entire load of stones in the lorry fell on him, as a result of which he sustained injuries and succumbed to the injuries on the spot. In this case, the vehicle was directly involved in the unfortunate accident. 11. Both the above-mentioned cases relied on by the learned counsel for the appellants are of no avail to him. These cases do not help the appellants in any manner. 12. Learned counsel for the Insurance Company has placed reliance on the Explanation to Section 147(1) of the Motor Vehicles Act, 1988, which reads as under: "147. Requirements of policies and limits of liability.- (1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which-(a) is issued by a person who is an authorised insurer; and(b) insures the person or classes of persons specified in the policy to the extent specified in sub-section (2)-(i) against any liability which may be incurred by him in respect of of the death of or bodily injury to any person, including owner of the goods or his authorised representative carried in the vehicle or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place;(ii) against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place;Provided that a policy shall not be required-(i) to cover liability in respect of the death, arising out of and in the course of his employment, of the employee of a person insured by the policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmens Compensation Act, 1923 (8 of 1923) in respect of the death of, or bodily injury to, any such employee-(a) engaged in driving the vehicle, or(b) if it is a public service vehicle engaged as conductor of the vehicle or in examining tickets on the vehicle, or(c) if it is a goods carriage, being carried in the vehicle, or(ii) to cover any contractual liability.Explanation: For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have arisen out of, the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in a public place." 13. According to the learned counsel for the respondents, on a plain reading of the above quoted Explanation, the Insurance Company cannot be held liable for the death of the workmen and therefore, the Insurance Company cannot be held liable to pay compensation to the appellants.

1[ds]7. According to the reasoning of the High Court, the vehicle was not involved in the accident and the death of the workmen by no stretch of imagination can be said to have any proximate or direct connection with the vehicle. The High Court also observed that the mere fact that Maize was brought to the spot where the workmen had died in the insured vehicle, would not render the Insurance Company liable in respect of the death, the cause of which was not proximate to the actual user of the vehicle.8. In the present case, the use of the vehicle was not even claimed as being a ground on which the liability is said to be fastened on the Insurance Company.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: Compensation, Bizapur, were allowed and the Commissioner vide its judgment dated 24th July, 2003, found the Insurance Company liable to pay compensation to the appellants.6. Aggrieved by the said judgment, the Insurance Company preferred in M.F.A. No.5843/2003 and M.F.A. No.5844/2003 before the High Court of Karnataka at Bangalore. The High Court allowed the appeals and modified the order passed by the Commissioner and the liability of the Insurance Company was set aside. However, the appellants were at liberty to recover the amount of compensation from the employer.7. According to the reasoning of the High Court, the vehicle was not involved in the accident and the death of the workmen by no stretch of imagination can be said to have any proximate or direct connection with the vehicle. The High Court also observed that the mere fact that Maize was brought to the spot where the workmen had died in the insured vehicle, would not render the Insurance Company liable in respect of the death, the cause of which was not proximate to the actual user of the vehicle.8. In the present case, the use of the vehicle was not even claimed as being a ground on which the liability is said to be fastened on the Insurance Company. 9. Learned counsel appearing on behalf of the appellants placed reliance on the decision of this Court in Shivaji Dayanu Patil and Anr. vs. Vatschala Uttam More, (1991) 3 SCC 530. Brief facts of that case are that a collision between a petrol tanker and a truck took place on a National Highway at about 3.00 a.m. as a result of which the tanker went off the road and fell on its left side at a distance of about 20 feet from the Highway. Due to overturning of the tanker, the petrol contained in it leaked out and collected nearby. At about 7.15 a.m. an explosion took place in the tanker causing burn injuries to those assembled near it including the respondents son who later succumbed to the injuries. The facts of this case are entirely different and are not applicable to the present case. In this case, the petrol tanker was directly involved in the accident and that all the workmen were directly connected with the accident. This case does not help the appellants in any manner.10. Learned counsel for the appellants has also placed reliance on a Division Bench judgment of the Karnataka High Court delivered on 24th February, 2006 in M.F.A. No.1870/2005 (WC). In that case, the workman who was working as a loader, went in the lorry and loaded the lorry with stones and thereafter he was required to unload the same close to the Crusher near the quarry along with other loaders. At about 2.30 p.m. in the afternoon, the deceased workman got down from the lorry in order to unload the stones along with other loaders and when they opened the lock at the hind portion of the lorry, the entire load of stones in the lorry fell on him, as a result of which he sustained injuries and succumbed to the injuries on the spot. In this case, the vehicle was directly involved in the unfortunate accident. 11. Both the above-mentioned cases relied on by the learned counsel for the appellants are of no avail to him. These cases do not help the appellants in any manner. 12. Learned counsel for the Insurance Company has placed reliance on the Explanation to Section 147(1) of the Motor Vehicles Act, 1988, which reads as under: "147. Requirements of policies and limits of liability.- (1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which-(a) is issued by a person who is an authorised insurer; and(b) insures the person or classes of persons specified in the policy to the extent specified in sub-section (2)-(i) against any liability which may be incurred by him in respect of of the death of or bodily injury to any person, including owner of the goods or his authorised representative carried in the vehicle or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place;(ii) against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place;Provided that a policy shall not be required-(i) to cover liability in respect of the death, arising out of and in the course of his employment, of the employee of a person insured by the policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmens Compensation Act, 1923 (8 of 1923) in respect of the death of, or bodily injury to, any such employee-(a) engaged in driving the vehicle, or(b) if it is a public service vehicle engaged as conductor of the vehicle or in examining tickets on the vehicle, or(c) if it is a goods carriage, being carried in the vehicle, or(ii) to cover any contractual liability.Explanation: For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have arisen out of, the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in a public place." 13. According to the learned counsel for the respondents, on a plain reading of the above quoted Explanation, the Insurance Company cannot be held liable for the death of the workmen and therefore, the Insurance Company cannot be held liable to pay compensation to the appellants. ### Response: 1

Ramrao Shankar Tapase Vs. Maharashtra Industrial Development Corpn. & Others

non-agricultural potentiality and are situated nearer to the industrial area, the High Court has further added 15% and has determined and awarded the compensation at the rate of Rs. 2,00,000/- per hectare for cultivable land. In some of the cases, the same is reduced to Rs.1,80,000/- per hectare or reduced to Rs.1,50,000/- per hectare (Civil Appeal Nos. 2733- 2734/2022), by considering the location of the lands acquired. 10. Looking to the fact that the sale deed produced at Ex. 41 with respect to the land bearing Survey No. 20/2 was with respect to the very village Bhoyar which was the only sale exemplar of the same village and other sale exemplars/sale deeds were with respect to another village Lohara and also with respect to small pieces of land, we are of the considered view that the High Court has rightly relied upon and considered the sale exemplar at Ex. 41 while determining the compensation in the present cases with respect to the lands of very village Bhoyar. However, at the same time, bearing in mind the decision of this Court in the case of Pehlad Ram (supra), by which this Court has observed and held that a cumulative increase of 10 to 15% per year in the market value of the land may be accepted, in the facts and circumstances of the case, we are of the opinion that instead of 10% cumulative increase as adopted by the High Court, if 12% cumulative increase would have been adopted, it would have been just and proper and in the fitness of things. 11. Now, so far as the submission on behalf of the claimants that the lands in question were acquired for the industrial corporation and were to be used for the industries/commercial purpose and accordingly the compensation should have been paid is concerned, what is required to be considered is that the lands in question were agricultural lands. Even for the purpose of industrial use and/or industries, the corporation is required to incur the expenditure towards its development and therefore the development charges would have to be deducted while determining the compensation. However, in the present case, the development charges are not deducted. Even otherwise, the future use of the acquired land cannot be the main criteria to determine the compensation for the lands acquired. 12. In the case of Hookiyar Singh (supra), it is observed and held that while determining the compensation, the future use of the land is not the relevant consideration. 12.1 In the case of Subh Ram (supra), it is observed and held that the purpose of acquisition is also a relevant factor. However, the said observation may not apply in all cases and all circumstances as the general rule is that the landowner is being compensated for what he has lost and not with reference to the purpose of acquisition. It is further observed and held that the purpose of acquisition can never be a factor to increase the market value of the acquired land. 13. Now, so far as the compensation determined differently for different lands acquired with respect to the same village Bhoyar, ranging from Rs. 1,50,000/- per hectare to Rs. 2,00,000/- per hectare is concerned, different market value/compensation can be determined for different lands located differently in the same village or locality. In the case of Tarlochan Singh (supra), it is observed and held that it is common knowledge that all the lands in the same village may not possess the same quality and command a common market price. 13.1 In the case of Basant Kumar (supra), it is observed and held that even in the same village, no two lands command same market value. The lands abutting the main road or national highway would command a higher market value and as the location of the land is interior, the market value of such land would be lesser despite the quality of land being similar to the land on the main road or highway. 13.2 In the case of Kanwar Singh (supra), it is observed and held that generally there would be difference in the potentiality of lands situated in two different villages. 14. In the present case, as such, there is already a sale exemplar at Ex. 41 with respect to very village Bhoyar which as observed hereinabove can be said to be the best exemplar while determining the compensation with respect to the lands acquired of the same village Bhoyar. The High Court has rightly relied upon and considered the sale deed at Ex. 41 being land survey no. 20/2 and determined the market value at Rs.1,00,000/- per hectare in the year 1992 and has rightly determined the compensation relying upon the sale exemplar produced at Ex. 41. However, at the same time, as observed hereinabove, instead of 10% cumulative increase, the High Court ought to have added 12% increase cumulatively for about three years. To that extent, the impugned common judgment and order passed by the High Court is required to be modified and the appeals preferred by the original claimants are required to be partly allowed to the aforesaid extent. Thus, the market value of the acquired land would be Rs. 1,40,492/- per hectare and after rounding off, it will become Rs.1,50,000/- per hectare. Further adding 50% towards the non-agricultural potentiality, the fair market value for determining the compensation would be Rs. 2,25,000/- per hectare in the cases where the High Court has determined and awarded the compensation at Rs. 2,00,000/- per hectare. There shall be corresponding reduction in the compensation with respect to other lands as made by the High Court looking to the location of the lands. Thus, wherever the High Court has determined the compensation at Rs.1,80,000/- per hectare, it will come to Rs. 2,00,000/- per hectare and wherever the High Court has determined the compensation at Rs. 1,50,000/- per hectare, it will come to Rs. 1,75,000/- per hectare. The appeals preferred by the claimants are required to be partly allowed to the aforesaid extent.

1[ds]9. The High Court by the impugned judgment and order has mainly relied upon Ex. 41, the sale deed with respect to the land bearing Survey No. 20/2 of the very village Bhoyar dated 18.09.1992, by which one of the claimants – Satish Nimodiya purchased the said land at Rs. 91,736/p per hectare. The High Court has rounded off the same to Rs.1,00,000/- per hectare. Therefore, the High Court has considered the value of the land in 1992 at Rs. 1,00,000/- per hectare. Considering three years gap between the sale exemplar dated 18.09.1992 (Ex. 41) and the land acquired in the present case, the High Court has added 10% increase cumulatively for three years and has determined the fair market value of the acquired land at Rs. 1,30,000/- per hectare. That thereafter, considering the fact that the lands acquired have non-agricultural potentiality and are situated nearer to the industrial area, the High Court has further added 15% and has determined and awarded the compensation at the rate of Rs. 2,00,000/- per hectare for cultivable land. In some of the cases, the same is reduced to Rs.1,80,000/- per hectare or reduced to Rs.1,50,000/- per hectare (Civil Appeal Nos. 2733- 2734/2022), by considering the location of the lands acquired.10. Looking to the fact that the sale deed produced at Ex. 41 with respect to the land bearing Survey No. 20/2 was with respect to the very village Bhoyar which was the only sale exemplar of the same village and other sale exemplars/sale deeds were with respect to another village Lohara and also with respect to small pieces of land, we are of the considered view that theHigh Court has rightly relied uponand considered the sale exemplar at Ex. 41 while determining the compensation in the present cases with respect to the lands of very village Bhoyar.However, at the same time, bearing in mind the decision of this Court in the case of Pehlad Ram (supra), by which this Court has observed and held that a cumulative increase of 10 to 15% per year in the market value of the land may be accepted, in the facts and circumstances of the case, we are of the opinion that instead of 10% cumulative increase as adopted by the High Court, if 12% cumulative increase would have been adopted, it would have been just and proper and in the fitness of things.11. Now, so far as the submission on behalf of the claimants that the lands in question were acquired for the industrial corporation and were to be used for the industries/commercial purpose and accordingly the compensation should have been paid is concerned, what is required to be considered is that the lands in question were agricultural lands. Even for the purpose of industrial use and/or industries, the corporation is required to incur the expenditure towards its development and therefore the development charges would have to be deducted while determining the compensation. However, in the present case, the development charges are not deducted. Even otherwise, the future use of the acquired land cannot be the main criteria to determine the compensation for the lands acquired.12. In the case of Hookiyar Singh (supra), it is observed and held that while determining the compensation, the future use of the land is not the relevant consideration.12.1 In the case of Subh Ram (supra), it is observed and held that the purpose of acquisition is also a relevant factor. However, the said observation may not apply in all cases and all circumstances as the general rule is that the landowner is being compensated for what he has lost and not with reference to the purpose of acquisition. It is further observed and held that the purpose of acquisition can never be a factor to increase the market value of the acquired land.13. Now, so far as the compensation determined differently for different lands acquired with respect to the same village Bhoyar, ranging from Rs. 1,50,000/- per hectare to Rs. 2,00,000/- per hectare is concerned, different market value/compensation can be determined for different lands located differently in the same village or locality. In the case of Tarlochan Singh (supra), it is observed and held that it is common knowledge that all the lands in the same village may not possess the same quality and command a common market price.13.1 In the case of Basant Kumar (supra), it is observed and held that even in the same village, no two lands command same market value. The lands abutting the main road or national highway would command a higher market value and as the location of the land is interior, the market value of such land would be lesser despite the quality of land being similar to the land on the main road or highway.13.2 In the case of Kanwar Singh (supra), it is observed and held that generally there would be difference in the potentiality of lands situated in two different villages.14. In the present case, as such, there is already a sale exemplar at Ex. 41 with respect to very village Bhoyar which as observed hereinabove can be said to be the best exemplar while determining the compensation with respect to the lands acquired of the same village Bhoyar. TheHigh Court has rightly relied uponand considered the sale deed at Ex. 41 being land survey no. 20/2 and determined the market value at Rs.1,00,000/- per hectare in the year 1992 and has rightly determined the compensation relying upon the sale exemplar produced at Ex. 41.However, at the same time, as observed hereinabove, instead of 10% cumulative increase, the High Court ought to have added 12% increase cumulatively for about three years. To that extent, the impugned common judgment and order passed by the High Court is required to be modified and the appeals preferred by the original claimants are required to be partly allowed to the aforesaid extent. Thus, the market value of the acquired land would be Rs. 1,40,492/- per hectare and after rounding off, it will become Rs.1,50,000/- per hectare. Further adding 50% towards the non-agricultural potentiality, the fair market value for determining the compensation would be Rs. 2,25,000/- per hectare in the cases where the High Court has determined and awarded the compensation at Rs. 2,00,000/- per hectare. There shall be corresponding reduction in the compensation with respect to other lands as made by the High Court looking to the location of the lands. Thus, wherever the High Court has determined the compensation at Rs.1,80,000/- per hectare, it will come to Rs. 2,00,000/- per hectare and wherever the High Court has determined the compensation at Rs. 1,50,000/- per hectare, it will come to Rs. 1,75,000/- per hectare. The appeals preferred by the claimants are required to be partly allowed to the aforesaid extent.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: non-agricultural potentiality and are situated nearer to the industrial area, the High Court has further added 15% and has determined and awarded the compensation at the rate of Rs. 2,00,000/- per hectare for cultivable land. In some of the cases, the same is reduced to Rs.1,80,000/- per hectare or reduced to Rs.1,50,000/- per hectare (Civil Appeal Nos. 2733- 2734/2022), by considering the location of the lands acquired. 10. Looking to the fact that the sale deed produced at Ex. 41 with respect to the land bearing Survey No. 20/2 was with respect to the very village Bhoyar which was the only sale exemplar of the same village and other sale exemplars/sale deeds were with respect to another village Lohara and also with respect to small pieces of land, we are of the considered view that the High Court has rightly relied upon and considered the sale exemplar at Ex. 41 while determining the compensation in the present cases with respect to the lands of very village Bhoyar. However, at the same time, bearing in mind the decision of this Court in the case of Pehlad Ram (supra), by which this Court has observed and held that a cumulative increase of 10 to 15% per year in the market value of the land may be accepted, in the facts and circumstances of the case, we are of the opinion that instead of 10% cumulative increase as adopted by the High Court, if 12% cumulative increase would have been adopted, it would have been just and proper and in the fitness of things. 11. Now, so far as the submission on behalf of the claimants that the lands in question were acquired for the industrial corporation and were to be used for the industries/commercial purpose and accordingly the compensation should have been paid is concerned, what is required to be considered is that the lands in question were agricultural lands. Even for the purpose of industrial use and/or industries, the corporation is required to incur the expenditure towards its development and therefore the development charges would have to be deducted while determining the compensation. However, in the present case, the development charges are not deducted. Even otherwise, the future use of the acquired land cannot be the main criteria to determine the compensation for the lands acquired. 12. In the case of Hookiyar Singh (supra), it is observed and held that while determining the compensation, the future use of the land is not the relevant consideration. 12.1 In the case of Subh Ram (supra), it is observed and held that the purpose of acquisition is also a relevant factor. However, the said observation may not apply in all cases and all circumstances as the general rule is that the landowner is being compensated for what he has lost and not with reference to the purpose of acquisition. It is further observed and held that the purpose of acquisition can never be a factor to increase the market value of the acquired land. 13. Now, so far as the compensation determined differently for different lands acquired with respect to the same village Bhoyar, ranging from Rs. 1,50,000/- per hectare to Rs. 2,00,000/- per hectare is concerned, different market value/compensation can be determined for different lands located differently in the same village or locality. In the case of Tarlochan Singh (supra), it is observed and held that it is common knowledge that all the lands in the same village may not possess the same quality and command a common market price. 13.1 In the case of Basant Kumar (supra), it is observed and held that even in the same village, no two lands command same market value. The lands abutting the main road or national highway would command a higher market value and as the location of the land is interior, the market value of such land would be lesser despite the quality of land being similar to the land on the main road or highway. 13.2 In the case of Kanwar Singh (supra), it is observed and held that generally there would be difference in the potentiality of lands situated in two different villages. 14. In the present case, as such, there is already a sale exemplar at Ex. 41 with respect to very village Bhoyar which as observed hereinabove can be said to be the best exemplar while determining the compensation with respect to the lands acquired of the same village Bhoyar. The High Court has rightly relied upon and considered the sale deed at Ex. 41 being land survey no. 20/2 and determined the market value at Rs.1,00,000/- per hectare in the year 1992 and has rightly determined the compensation relying upon the sale exemplar produced at Ex. 41. However, at the same time, as observed hereinabove, instead of 10% cumulative increase, the High Court ought to have added 12% increase cumulatively for about three years. To that extent, the impugned common judgment and order passed by the High Court is required to be modified and the appeals preferred by the original claimants are required to be partly allowed to the aforesaid extent. Thus, the market value of the acquired land would be Rs. 1,40,492/- per hectare and after rounding off, it will become Rs.1,50,000/- per hectare. Further adding 50% towards the non-agricultural potentiality, the fair market value for determining the compensation would be Rs. 2,25,000/- per hectare in the cases where the High Court has determined and awarded the compensation at Rs. 2,00,000/- per hectare. There shall be corresponding reduction in the compensation with respect to other lands as made by the High Court looking to the location of the lands. Thus, wherever the High Court has determined the compensation at Rs.1,80,000/- per hectare, it will come to Rs. 2,00,000/- per hectare and wherever the High Court has determined the compensation at Rs. 1,50,000/- per hectare, it will come to Rs. 1,75,000/- per hectare. The appeals preferred by the claimants are required to be partly allowed to the aforesaid extent. ### Response: 1

Bhatia Co-Operative Housingsociety Ltd Vs. D. C. Patel

of security for the preservation of the building which, on the expiry or sooner determination of the lease, will vest in the lessor. This line of reasoning has found favour with the High court which has held that although in form the building belongs to the Bombay Municipality who are the successors-in-interest of the lessors, in ,substance the building belongs to the appellant, the assignee of the lessee, and not to the Bombay Municipality. We are unable to accept this reasoning for, we see no reason to hold, in the circumstance of this case, that the substance does not follow the form. By the operative part of the lease, the demise is not only of the land but also of the building standing thereon. This demise is certainly an act of ownership exercised by the lessor over the land as well as the buildings. Under s. 105, T. P. Act, a lease is a transfer only of a right to enjoy the demised premises, but there is no transfer of ownership or interest in the demised premises to the lessee such as there is in a sale (s. 54) or a mortgage (s. 58). In the present case, the lessee cannot, on his own covenant, use the buildings in any way he likes. He has to use the same only as offices or schools or for residential purposes and cannot, without the lessors consent, use them for purposes of any trade or business. He cannot pull down the buildings or make any additions or alterations without the lessors consent. He cannot build upon the open space. He must, if the premises are destroyed by fire or otherwise, reinstate it. The lessor has the right to enter upon and inspect the premises at any time on giving 48 hours notice. All these covenants clearly indicate that the lessor has the dominant voice and the real ownership. What are called attributes of ownership of the lessee are only the rights of enjoyment which are common to all lessees under well-drawn leases, but the ownership in the land and in the building is in the lessor. It is true that the lessee erected the building at his own cost but he did so for the lessor and on the lessors land on agreed terms. The fact that the lessee incurred expenses in putting up the building is precisely the consideration for the lessor granting him a lease for 999 years not only of the building but of the land as well at what may, for all we know, be a cheap rent which the lessor may not have otherwise agreed to do. By the agreement the building became the property of the lessor and the lessor demised the land and the building which, in the circumstances, in law, and in fact belonged to the lessor. The law of fixtures under s. 108, T. P. Act, may be different from the English law, but s. 108 is subject to any agreement that the parties may choose to make. Here by the agreement the building became part, of the land and the property of the. lessor and the lessee took a lease on that footing. The lessee or a person claiming title through him cannot now be heard to say that the building does not belong to the lessor, Forfeiture does not, for the first time, give title to the lower. On forfeiture he re-enters upon what has. all along been his own property. said Lord Macnaghten in Heritable Reversionary Company v. Mullar,L. R. (1892) A. C. 598 at p. 621 :"The words property and belonging to are not technical words in the law of Scotland. They are to be understood, I think in their ordinary signification. They are in fact convertible terms; You can hardly explain the one except. by using the other. A mans property that which, is his own, that which. belongs to him. What belongs to, him is his Property."15. In our opinion the interest of the lessor in the demised premises cannot possibly be described as a contingent interest which will become vested on the expiry or sooner determination of the lease, for then the lessor could not have demised the premises including the building as he did or before the determination of the lease exercise any act of ownership or any control over it as he obviously has the right to do under the covenants referred to above. The truth is that the lesser, after the building was erected, became the owner of it and all the time thereafter the demised premises which include the building have belonged to him subject to the right of enjoyment of the lessee in terms of the lease. If it were to be held that the building belonged to the lessee by reason of his having pur it up at his own cost and by reason of the attributes of ownership relied on by learned counsel, then as between the local authority (the lessor) and the lessee also the building must for the same reason founded on what have been called the attributes of ownership be held to belong to the lessee and the Act will apply. Surely that could not possibly be the case, for, it would mean that the Government or a local authority will always be bound by the Act in respect of the building put up by the lessee under building leases granted by it in respect of land belonging to it.In that case the immunity given to the Government or a local authority will be wholly illusory and worthless. In our view, in the case before us, the demised premises including the building belong to a local authority and are outside the operation of the Act. This Act being out of the way, the appellants were well within their rights to file the suit in ejectment in the City Civil Court and that Court had jurisdiction to entertain the suit and to pass the decree that it did.

1[ds]13. It is said that if the first part of the section is so construed as to . exempt the premises from the operation of the Act, not only as between the Government or a local authority on the one hand and its lessee on the other, but also as between that lessee, and histhen the whole purpose of the Act will be frustrated, for it is, well known that most of the lands in Greater Bombay belong to the Government or one or other local authority, e. g., Bombay Port Trust and Bombay Municipality and the greater number of tenants will not be able to avail themselves of the benefit and protection of the Act. In the first place, the preamble to the Act clearly shows that the object of the Act was to consolidate the law relating to the control of rents and repairs of certain premises and not of all premises. The Legislature may well have thought that an immunity given to premises belonging to the Government or a local authority will facilitate the speedy development of its lands by inducing lessees to take up building leases on terms advantageous to the Government or a local authority. Further as Pointed out by Romer L. J., in clarkv. Downes, (1931) 145 L. T.20, which case was approved by Lord Goddard C. J. in Rudlerv. Franks, (1947) 1 K.B.530, such immunity will increase the value of the right of reversion belonging to the Government or a local authority. The fact that the Government or a local authority may be trusted to act fairly and reasonably may have induced the Legislature all the more readily to give such immunity to premises belonging to the Government or a local authority but it cannot be overlooked that the primary object of giving this immunity was to protect the interests of the Government or a local authority. This protection requires that the immunity should be held to attach to the premises itself and the benefit of it should be available not only to the Government or a local authority but also to the lessee deriving title from it. If the benefit of the immunity was given only to the Government or a local authority and not to its lessee as suggested bycounsel for therespondent and the Act applied to the premises as against the lessee, then it must follow that under s. 15 of the Act it will not be lawful for the lessee to sublet the premises or any part of it. If such were the consequences, nobody will take a building lease from the Government or a local authority and the immunity given to the Government or a local authority will, for all practical purposes and in so far at any rate as the building leases are concerned, be wholly illusory and worthless and the underlying purpose for bestowing such immunity will be rendered wholly ineffective. In our opinion, therefore, the consideration of the protection of the interests of thein premises belonging to the Government or a local authority. cannot override. the plain meaning of the preamble or the first part of s.4(1) and frustrate the real purpose of protecting and furthering the interests of the Government or a local authority by conferring on its property an immunity from the operation of theis pointed out that it was the lessee who erected the building at his own cost, he is to hold it for 999 years, he has the right of subletting the building in Whole or in part on rent and terms to be fixed by him, of ejectingand of assigning the lease. Therefore, it may fairly be said that the premises or, at any rate, the building belongs to the lessee and the rights reserved by the lease to the lessor are only by way of security for the preservation of the building which, on the expiry or sooner determination of the lease, will vest in the lessor. This line of reasoning has found favour with the High court which has held that although in form the building belongs to the Bombay Municipality who are theof the lessors, in ,substance the building belongs to the appellant, the assignee of the lessee, and not to the Bombay Municipality. We are unable to accept this reasoning for, we see no reason to hold, in the circumstance of this case, that the substance does not follow the form. By the operative part of the lease, the demise is not only of the land but also of the building standing thereon. This demise is certainly an act of ownership exercised by the lessor over the land as well as the buildings. Under s. 105, T. P. Act, a lease is a transfer only of a right to enjoy the demised premises, but there is no transfer of ownership or interest in the demised premises to the lessee such as there is in a sale (s. 54) or a mortgage (s. 58). In the present case, the lessee cannot, on his own covenant, use the buildings in any way he likes. He has to use the same only as offices or schools or for residential purposes and cannot, without the lessors consent, use them for purposes of any trade or business. He cannot pull down the buildings or make any additions or alterations without the lessors consent. He cannot build upon the open space. He must, if the premises are destroyed by fire or otherwise, reinstate it. The lessor has the right to enter upon and inspect the premises at any time on giving 48 hours notice. All these covenants clearly indicate that the lessor has the dominant voice and the real ownership. What are called attributes of ownership of the lessee are only the rights of enjoyment which are common to all lessees underleases, but the ownership in the land and in the building is in the lessor. It is true that the lessee erected the building at his own cost but he did so for the lessor and on the lessors land on agreed terms. The fact that the lessee incurred expenses in putting up the building is precisely the consideration for the lessor granting him a lease for 999 years not only of the building but of the land as well at what may, for all we know, be a cheap rent which the lessor may not have otherwise agreed to do. By the agreement the building became the property of the lessor and the lessor demised the land and the building which, in the circumstances, in law, and in fact belonged to the lessor. The law of fixtures under s. 108, T. P. Act, may be different from the English law, but s. 108 is subject to any agreement that the parties may choose to make. Here by the agreement the building became part, of the land and the property of the. lessor and the lessee took a lease on that footing. The lessee or a person claiming title through him cannot now be heard to say that the building does not belong to the lessor, Forfeiture does not, for the first time, give title to the lower. On forfeiture heupon what has. all along been his own property. said Lord Macnaghten in HeritableReversionary Company v. Mullar,L. R. (1892) A. C. 598 at p.e words property and belonging to are not technical words in the law of Scotland. They are to be understood, I think in their ordinary signification. They are in fact convertible terms; You can hardly explain the one except. by using the other. A mans property that which, is his own, that which. belongs to him. What belongs to, him is his Property.In our opinion the interest of the lessor in the demised premises cannot possibly be described as a contingent interest which will become vested on the expiry or sooner determination of the lease, for then the lessor could not have demised the premises including the building as he did or before the determination of the lease exercise any act of ownership or any control over it as he obviously has the right to do under the covenants referred to above. The truth is that the lesser, after the building was erected, became the owner of it and all the time thereafter the demised premises which include the building have belonged to him subject to the right of enjoyment of the lessee in terms of the lease. If it were to be held that the building belonged to the lessee by reason of his having pur it up at his own cost and by reason of the attributes of ownership relied on by, then as between the local authority (the lessor) and the lessee also the building must for the same reason founded on what have been called the attributes of ownership be held to belong to the lessee and the Act will apply. Surely that could not possibly be the case, for, it would mean that the Government or a local authority will always be bound by the Act in respect of the building put up by the lessee under building leases granted by it in respect of land belonging to it.In that case the immunity given to the Government or a local authority will be wholly illusory and worthless. In our view, in the case before us, the demised premises including the building belong to a local authority and are outside the operation of the Act. This Act being out of the way, the appellants were well within their rights to file the suit in ejectment in the City Civil Court and that Court had jurisdiction to entertain the suit and to pass the decree that it did.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: of security for the preservation of the building which, on the expiry or sooner determination of the lease, will vest in the lessor. This line of reasoning has found favour with the High court which has held that although in form the building belongs to the Bombay Municipality who are the successors-in-interest of the lessors, in ,substance the building belongs to the appellant, the assignee of the lessee, and not to the Bombay Municipality. We are unable to accept this reasoning for, we see no reason to hold, in the circumstance of this case, that the substance does not follow the form. By the operative part of the lease, the demise is not only of the land but also of the building standing thereon. This demise is certainly an act of ownership exercised by the lessor over the land as well as the buildings. Under s. 105, T. P. Act, a lease is a transfer only of a right to enjoy the demised premises, but there is no transfer of ownership or interest in the demised premises to the lessee such as there is in a sale (s. 54) or a mortgage (s. 58). In the present case, the lessee cannot, on his own covenant, use the buildings in any way he likes. He has to use the same only as offices or schools or for residential purposes and cannot, without the lessors consent, use them for purposes of any trade or business. He cannot pull down the buildings or make any additions or alterations without the lessors consent. He cannot build upon the open space. He must, if the premises are destroyed by fire or otherwise, reinstate it. The lessor has the right to enter upon and inspect the premises at any time on giving 48 hours notice. All these covenants clearly indicate that the lessor has the dominant voice and the real ownership. What are called attributes of ownership of the lessee are only the rights of enjoyment which are common to all lessees under well-drawn leases, but the ownership in the land and in the building is in the lessor. It is true that the lessee erected the building at his own cost but he did so for the lessor and on the lessors land on agreed terms. The fact that the lessee incurred expenses in putting up the building is precisely the consideration for the lessor granting him a lease for 999 years not only of the building but of the land as well at what may, for all we know, be a cheap rent which the lessor may not have otherwise agreed to do. By the agreement the building became the property of the lessor and the lessor demised the land and the building which, in the circumstances, in law, and in fact belonged to the lessor. The law of fixtures under s. 108, T. P. Act, may be different from the English law, but s. 108 is subject to any agreement that the parties may choose to make. Here by the agreement the building became part, of the land and the property of the. lessor and the lessee took a lease on that footing. The lessee or a person claiming title through him cannot now be heard to say that the building does not belong to the lessor, Forfeiture does not, for the first time, give title to the lower. On forfeiture he re-enters upon what has. all along been his own property. said Lord Macnaghten in Heritable Reversionary Company v. Mullar,L. R. (1892) A. C. 598 at p. 621 :"The words property and belonging to are not technical words in the law of Scotland. They are to be understood, I think in their ordinary signification. They are in fact convertible terms; You can hardly explain the one except. by using the other. A mans property that which, is his own, that which. belongs to him. What belongs to, him is his Property."15. In our opinion the interest of the lessor in the demised premises cannot possibly be described as a contingent interest which will become vested on the expiry or sooner determination of the lease, for then the lessor could not have demised the premises including the building as he did or before the determination of the lease exercise any act of ownership or any control over it as he obviously has the right to do under the covenants referred to above. The truth is that the lesser, after the building was erected, became the owner of it and all the time thereafter the demised premises which include the building have belonged to him subject to the right of enjoyment of the lessee in terms of the lease. If it were to be held that the building belonged to the lessee by reason of his having pur it up at his own cost and by reason of the attributes of ownership relied on by learned counsel, then as between the local authority (the lessor) and the lessee also the building must for the same reason founded on what have been called the attributes of ownership be held to belong to the lessee and the Act will apply. Surely that could not possibly be the case, for, it would mean that the Government or a local authority will always be bound by the Act in respect of the building put up by the lessee under building leases granted by it in respect of land belonging to it.In that case the immunity given to the Government or a local authority will be wholly illusory and worthless. In our view, in the case before us, the demised premises including the building belong to a local authority and are outside the operation of the Act. This Act being out of the way, the appellants were well within their rights to file the suit in ejectment in the City Civil Court and that Court had jurisdiction to entertain the suit and to pass the decree that it did. ### Response: 1

Lal Chand Vs. Oriental Insurance Co. Ltd

delay. After notice, the respondent Insurance Company has also filed a counter affidavit and the matter was listed today for final hearing. At this stage no purpose would be served to dismiss the civil appeal on the ground of delay in filing the appeal. Since the notice was ordered on special leave petition and on the delay and the counter affidavit has already been filed, we condone the delay and heard the learned counsel appearing on either side, on merits of the rival claims. 6. Mr. Mahabir Singh, learned Senior Counsel appearing for the appellant submitted that the High Court has not noticed the finding of the Tribunal, which is based on evidence, and that the Tribunal had recorded the evidence and had given its award after examining the evidence on record and the material facts, and therefore, the said considered order should not have been set aside by the High Court. He would further submit that the owner of the vehicle has taken adequate care and caution to verify the genuineness of the licence held by the driver. The Insurance Company also did not lead any evidence to show that due and adequate care was not taken by the owner. He would further submit that the High Court has failed to appreciate that there was no evidence that the appellant, who had employed the driver, had knowledge that the driver was not holding a valid driving licence. Our attention was also drawn to the evidence tendered. The appellant was examined as RW/1. He deposed that he was the owner of the truck in question and that he had employed Mam Chand as driver of this truck in August, 1998 and had checked his driving licence. He would further depose that he had also taken his driving test and satisfied that the driver was fully competent and conversant to the driving. It is further stated that the driver would not have been employed if he had no driving licence. In the cross-examination, nothing has been elicited from the appellant to discredit his testimony as RW/1. 7. Mr. M.K. Dua, learned counsel appearing for the respondent-Insurance Company submitted that the appellant has no case on merits as the order of the High Court is well supported by the law laid down by this Court in the case of New India Assurance Co. Ltd. versus Kamla & Ors., etc., reported in 2004(4)SCC 342. He would further submit that the licence issued to the driver was found to be fake and the High Court gave categorical finding that the driver was not holding a valid driving licence and that the appellant committed breach of terms and conditions of the insurance policy. He, therefore, submitted that the order passed by the High Court is not liable to be interfered with. 8. We have perused the pleadings and the orders passed by the Tribunal and also of the High Court and the annexures filed along with the appeal. This Court in the case of United India Insurance Co. Ltd. vs. Lehru & Ors., reported in 2003 (3) SCC 338 , in paragraph 20 has observed that where the owner has satisfied himself that the driver has a licence and is driving competently there would be no breach of Section 149(2)(a)(ii). He will, therefore, have to check whether the driver has a driving licence and if the driver produces a driving licence, which on the face of it looks genuine, the owner is not expected to find out whether the licence has in fact been issued by a competent authority or not. The owner would then take test of the driver, and if he finds that the driver is competent to drive the vehicle, he will hire the driver. 9. In the instant case, the owner has not only seen and examined the driving licence produced by the driver but also took the test of the driving of the driver and found that the driver was competent to drive the vehicle and thereafter appointed him as driver of the vehicle in question. Thus, the owner has satisfied himself that the driver has a licence and is driving competently, there would be no breach of Section 149(2)(a)(ii) and the Insurance Company would not then be absloved of its liability. 10. Another decision rendered by a three Judges Bench of this Court in the case of National Insurance Co. Ltd. vs. Swaran Singh & Ors., reported in 2004 (3) SCC 297 , can also be usefully referred to in the present context. This Court in para 110 of this judgment gave the summary of their findings to the various issues as raised in those petitions. We are concerned only with sub para (iii) of paragraph 110. The said sub para (iii) reads thus: ..................................... (iii) The breach of policy condition e.g. Disqualification of the driver or invalid driving licence of the driver, as contained in sub- section (1)(a)(ii) of Section 149, has to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards the insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by a duly licensed driver or one who was not disqualified to drive at the relevant time. 11. As observed in the above paragraph, the insurer, namely the Insurance Company, has to prove that the insured, namely the owner of the vehicle, was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by a duly licensed driver or one who was not disqualified to drive at the relevant point of time. 12.

1[ds]In the instant case, the owner has not only seen and examined the driving licence produced by the driver but also took the test of the driving of the driver and found that the driver was competent to drive the vehicle and thereafter appointed him as driver of the vehicle in question. Thus, the owner has satisfied himself that the driver has a licence and is driving competently, there would be no breach of Section 149(2)(a)(ii) and the Insurance Company would not then be absloved of its liability(iii) The breach of policy condition e.g. Disqualification of the driver or invalid driving licence of the driver, as contained in sub- section (1)(a)(ii) of Section 149, has to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards the insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by a duly licensed driver or one who was not disqualified to drive at the relevant time11. As observed in the above paragraph, the insurer, namely the Insurance Company, has to prove that the insured, namely the owner of the vehicle, was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by a duly licensed driver or one who was not disqualified to drive at the relevant point of time.

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: delay. After notice, the respondent Insurance Company has also filed a counter affidavit and the matter was listed today for final hearing. At this stage no purpose would be served to dismiss the civil appeal on the ground of delay in filing the appeal. Since the notice was ordered on special leave petition and on the delay and the counter affidavit has already been filed, we condone the delay and heard the learned counsel appearing on either side, on merits of the rival claims. 6. Mr. Mahabir Singh, learned Senior Counsel appearing for the appellant submitted that the High Court has not noticed the finding of the Tribunal, which is based on evidence, and that the Tribunal had recorded the evidence and had given its award after examining the evidence on record and the material facts, and therefore, the said considered order should not have been set aside by the High Court. He would further submit that the owner of the vehicle has taken adequate care and caution to verify the genuineness of the licence held by the driver. The Insurance Company also did not lead any evidence to show that due and adequate care was not taken by the owner. He would further submit that the High Court has failed to appreciate that there was no evidence that the appellant, who had employed the driver, had knowledge that the driver was not holding a valid driving licence. Our attention was also drawn to the evidence tendered. The appellant was examined as RW/1. He deposed that he was the owner of the truck in question and that he had employed Mam Chand as driver of this truck in August, 1998 and had checked his driving licence. He would further depose that he had also taken his driving test and satisfied that the driver was fully competent and conversant to the driving. It is further stated that the driver would not have been employed if he had no driving licence. In the cross-examination, nothing has been elicited from the appellant to discredit his testimony as RW/1. 7. Mr. M.K. Dua, learned counsel appearing for the respondent-Insurance Company submitted that the appellant has no case on merits as the order of the High Court is well supported by the law laid down by this Court in the case of New India Assurance Co. Ltd. versus Kamla & Ors., etc., reported in 2004(4)SCC 342. He would further submit that the licence issued to the driver was found to be fake and the High Court gave categorical finding that the driver was not holding a valid driving licence and that the appellant committed breach of terms and conditions of the insurance policy. He, therefore, submitted that the order passed by the High Court is not liable to be interfered with. 8. We have perused the pleadings and the orders passed by the Tribunal and also of the High Court and the annexures filed along with the appeal. This Court in the case of United India Insurance Co. Ltd. vs. Lehru & Ors., reported in 2003 (3) SCC 338 , in paragraph 20 has observed that where the owner has satisfied himself that the driver has a licence and is driving competently there would be no breach of Section 149(2)(a)(ii). He will, therefore, have to check whether the driver has a driving licence and if the driver produces a driving licence, which on the face of it looks genuine, the owner is not expected to find out whether the licence has in fact been issued by a competent authority or not. The owner would then take test of the driver, and if he finds that the driver is competent to drive the vehicle, he will hire the driver. 9. In the instant case, the owner has not only seen and examined the driving licence produced by the driver but also took the test of the driving of the driver and found that the driver was competent to drive the vehicle and thereafter appointed him as driver of the vehicle in question. Thus, the owner has satisfied himself that the driver has a licence and is driving competently, there would be no breach of Section 149(2)(a)(ii) and the Insurance Company would not then be absloved of its liability. 10. Another decision rendered by a three Judges Bench of this Court in the case of National Insurance Co. Ltd. vs. Swaran Singh & Ors., reported in 2004 (3) SCC 297 , can also be usefully referred to in the present context. This Court in para 110 of this judgment gave the summary of their findings to the various issues as raised in those petitions. We are concerned only with sub para (iii) of paragraph 110. The said sub para (iii) reads thus: ..................................... (iii) The breach of policy condition e.g. Disqualification of the driver or invalid driving licence of the driver, as contained in sub- section (1)(a)(ii) of Section 149, has to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards the insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by a duly licensed driver or one who was not disqualified to drive at the relevant time. 11. As observed in the above paragraph, the insurer, namely the Insurance Company, has to prove that the insured, namely the owner of the vehicle, was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by a duly licensed driver or one who was not disqualified to drive at the relevant point of time. 12. ### Response: 1

M/S Shinhan Apex Corporation Vs. M/S Euro Apex B.V

alteration in the draft deed forwarded by the respondent to the appellant when the final deed was executed in the deed dated 4.4.2012 and consequently, the appellant is bound to execute a transfer deed of assignment as per the draft sent by the award holder, namely, the respondent as was originally forwarded to the appellant.10. With that view, the learned Judge directed the appellant to execute the deed of transfer and assignment of Patent Nos. 2143/MUM/2008 and 2144/MUM/2008 in favour of the award holder in terms of Annexure P6 to the Execution Application incorporating therein the complete recital B and the Arbitration Clause 5.5 showing the future arbitration in Netherlands within two weeks from the date of the order. Aggrieved by the impugned order, the appellant is before us.11. We heard Mr. K.V. Vishwanathan, learned senior counsel appearing for the appellant and Mr. Manoj K. Singh, learned counsel appearing for the respondent. 12. Having drawn our attention to the above factual details which emanated after the passing of PFA dated 23.12.2011, Mr. Vishwanathan, learned senior counsel, contended that when the application was initially moved, the respondent failed to bring to the notice of the Court about the extensive correspondence which took place between 19.1.2012 and 15.6.2013, that after the appellant in its Chamber Summons brought to the notice of the Court the relevant information, namely, the re-draft sent by the respondent on 3.4.2012 which contained the variation in para B as between the one contained in the earlier draft of 19.1.2012 and 3.4.2012 as well as the arbitration clause and the governing law contained in paragraphs 5.5 and 5.6, the respondent for the first time in their rejoinder referred to those documents. The learned senior counsel pointed out that learned Judge completely omitted to take note of such relevant factors and proceeded to hold as though the draft sent by the respondent on 19.1.2012 alone was material and that the changes found in the final deed dated 4.4.2012 was at the instance of the appellant which unfortunately led to the passing of the impugned order.13. In reply, Mr. Singh, learned counsel appearing for the respondent, was not able to controvert the factual position, namely, that the first request of the respondent after the PFA dated 23.12.2011 was 19.1.2012, that along with the said communication the draft deed of transfer to be executed by the appellant was forwarded to it, that after detailed discussions between January and March, 2012, the re-draft was forwarded by the respondent on 3.4.2012 wherein the reference to PFA in the opening paragraph of the earlier draft was omitted and that the paragraphs relating to consideration was specified apart from the change about the venue and the applicable Rules of the Arbitral Tribunal was noted as Singapore instead of Netherlands and the governing law applicable was also changed from Netherlands to India. Learned counsel was also not able to controvert any of the other subsequent correspondence exchanged between the appellant and the respondent between 11.4.2012 and 15.6.2013.14. Having regard to the said development which had taken place after the PFA dated 23.12.2011 which discloses that the appellant did not commit any default in complying with the direction of the said Award and, therefore, the present direction of the learned Judge in the impugned order was wholly unwarranted. If the respondent failed to act based on the final transfer deed executed by the appellant on 4.4.4012, which was in tune with the draft forwarded by the respondent themselves, the appellant cannot be in any way blamed for the misfeasance committed by the respondent. 15. In the above-stated background, when we consider the prayer of the respondent as claimed in the application, the prayer was for a direction to the appellant to execute the deed of transfer and assignment of Patent Nos. 2143/MUM/2008 and 2144/MUM/2008 in favour of the respondent in terms of the draft deed in Annexure P6, which was dated 4.4.2012. In fact the learned Judge, as rightly pointed out by Mr. Vishwanathan, learned senior counsel for the appellant, completely missed to note that based on the correspondence exchanged between the respondent and the appellant between 19.1.2012 and 3.4.2012 Annexure P6 which was dated 4.4.2012 was the ultimate transfer deed which the appellant was obliged to execute, that the appellant duly executed the said document by signing the same on 4.4.2012 and forwarded to the respondents lawyers on 9.4.2012 and the due execution of which was also confirmed on behalf of the respondent by their lawyers on 11.4.2012. A further confirmation was made by the respondents counsel to the respondent themselves on the same day, i.e. 11.4.2012 as to the execution of the transfer deed dated 4.4.2012. The original documents were also forwarded by the appellant on 12.4.2012. After the above referred sequence of events as regards Annexure P6 dated 4.4.2012 are noted, it must be held that the direction contained in paragraph 7 of the PFA of the Arbitral Tribunal was duly carried out by the appellant based on the first request of the respondent themselves as made on 19.1.2012 and as per the modified request dated 3.4.2012. If that was the real fact situation in regard to the execution of the transfer deed, which was completely omitted to be noted by the learned Single Judge, it must be held that there was no occasion for the respondent to have any grievance in regard to the execution of the transfer deed as directed in paragraph 7 of the PFA of the Arbitral Tribunal dated 23.12.2011. The failure on the part of the learned Judge in having noted the fact that the transfer deed dated 4.4.2012 was as per the re-draft forwarded by the respondent themselves which was duly executed and sent back by the appellant by 9.4.2012 and the original by 12.4.2012 unfortunately resulted in the passing of the impugned order. In the light of the said patent illegality in the impugned order, the same is liable to be set aside.16. In the said circumstances, the

1[ds]14. Having regard to the said development which had taken place after the PFA dated 23.12.2011 which discloses that the appellant did not commit any default in complying with the direction of the said Award and, therefore, the present direction of the learned Judge in the impugned order was wholly unwarranted. If the respondent failed to act based on the final transfer deed executed by the appellant on 4.4.4012, which was in tune with the draft forwarded by the respondent themselves, the appellant cannot be in any way blamed for the misfeasance committed by thefailure on the part of the learned Judge in having noted the fact that the transfer deed dated 4.4.2012 was as per the re-draft forwarded by the respondent themselves which was duly executed and sent back by the appellant by 9.4.2012 and the original by 12.4.2012 unfortunately resulted in the passing of the impugned order. In the light of the said patent illegality in the impugned order, the same is liable to be set aside.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: alteration in the draft deed forwarded by the respondent to the appellant when the final deed was executed in the deed dated 4.4.2012 and consequently, the appellant is bound to execute a transfer deed of assignment as per the draft sent by the award holder, namely, the respondent as was originally forwarded to the appellant.10. With that view, the learned Judge directed the appellant to execute the deed of transfer and assignment of Patent Nos. 2143/MUM/2008 and 2144/MUM/2008 in favour of the award holder in terms of Annexure P6 to the Execution Application incorporating therein the complete recital B and the Arbitration Clause 5.5 showing the future arbitration in Netherlands within two weeks from the date of the order. Aggrieved by the impugned order, the appellant is before us.11. We heard Mr. K.V. Vishwanathan, learned senior counsel appearing for the appellant and Mr. Manoj K. Singh, learned counsel appearing for the respondent. 12. Having drawn our attention to the above factual details which emanated after the passing of PFA dated 23.12.2011, Mr. Vishwanathan, learned senior counsel, contended that when the application was initially moved, the respondent failed to bring to the notice of the Court about the extensive correspondence which took place between 19.1.2012 and 15.6.2013, that after the appellant in its Chamber Summons brought to the notice of the Court the relevant information, namely, the re-draft sent by the respondent on 3.4.2012 which contained the variation in para B as between the one contained in the earlier draft of 19.1.2012 and 3.4.2012 as well as the arbitration clause and the governing law contained in paragraphs 5.5 and 5.6, the respondent for the first time in their rejoinder referred to those documents. The learned senior counsel pointed out that learned Judge completely omitted to take note of such relevant factors and proceeded to hold as though the draft sent by the respondent on 19.1.2012 alone was material and that the changes found in the final deed dated 4.4.2012 was at the instance of the appellant which unfortunately led to the passing of the impugned order.13. In reply, Mr. Singh, learned counsel appearing for the respondent, was not able to controvert the factual position, namely, that the first request of the respondent after the PFA dated 23.12.2011 was 19.1.2012, that along with the said communication the draft deed of transfer to be executed by the appellant was forwarded to it, that after detailed discussions between January and March, 2012, the re-draft was forwarded by the respondent on 3.4.2012 wherein the reference to PFA in the opening paragraph of the earlier draft was omitted and that the paragraphs relating to consideration was specified apart from the change about the venue and the applicable Rules of the Arbitral Tribunal was noted as Singapore instead of Netherlands and the governing law applicable was also changed from Netherlands to India. Learned counsel was also not able to controvert any of the other subsequent correspondence exchanged between the appellant and the respondent between 11.4.2012 and 15.6.2013.14. Having regard to the said development which had taken place after the PFA dated 23.12.2011 which discloses that the appellant did not commit any default in complying with the direction of the said Award and, therefore, the present direction of the learned Judge in the impugned order was wholly unwarranted. If the respondent failed to act based on the final transfer deed executed by the appellant on 4.4.4012, which was in tune with the draft forwarded by the respondent themselves, the appellant cannot be in any way blamed for the misfeasance committed by the respondent. 15. In the above-stated background, when we consider the prayer of the respondent as claimed in the application, the prayer was for a direction to the appellant to execute the deed of transfer and assignment of Patent Nos. 2143/MUM/2008 and 2144/MUM/2008 in favour of the respondent in terms of the draft deed in Annexure P6, which was dated 4.4.2012. In fact the learned Judge, as rightly pointed out by Mr. Vishwanathan, learned senior counsel for the appellant, completely missed to note that based on the correspondence exchanged between the respondent and the appellant between 19.1.2012 and 3.4.2012 Annexure P6 which was dated 4.4.2012 was the ultimate transfer deed which the appellant was obliged to execute, that the appellant duly executed the said document by signing the same on 4.4.2012 and forwarded to the respondents lawyers on 9.4.2012 and the due execution of which was also confirmed on behalf of the respondent by their lawyers on 11.4.2012. A further confirmation was made by the respondents counsel to the respondent themselves on the same day, i.e. 11.4.2012 as to the execution of the transfer deed dated 4.4.2012. The original documents were also forwarded by the appellant on 12.4.2012. After the above referred sequence of events as regards Annexure P6 dated 4.4.2012 are noted, it must be held that the direction contained in paragraph 7 of the PFA of the Arbitral Tribunal was duly carried out by the appellant based on the first request of the respondent themselves as made on 19.1.2012 and as per the modified request dated 3.4.2012. If that was the real fact situation in regard to the execution of the transfer deed, which was completely omitted to be noted by the learned Single Judge, it must be held that there was no occasion for the respondent to have any grievance in regard to the execution of the transfer deed as directed in paragraph 7 of the PFA of the Arbitral Tribunal dated 23.12.2011. The failure on the part of the learned Judge in having noted the fact that the transfer deed dated 4.4.2012 was as per the re-draft forwarded by the respondent themselves which was duly executed and sent back by the appellant by 9.4.2012 and the original by 12.4.2012 unfortunately resulted in the passing of the impugned order. In the light of the said patent illegality in the impugned order, the same is liable to be set aside.16. In the said circumstances, the ### Response: 1

Friends Colony Dev. Committee Vs. State Of Orissa

or by connivance. 21. The conduct of the builder in the present case deserves to be noticed. He knew it fully well what was the permissible construction as per the sanctioned building plans and yet he not only constructed additional built up area on each floor but also added an additional fifth floor on the building, and such a floor was totally unauthorized. In spite of the disputes and litigation pending he parted with his interest in the property and inducted occupants on all the floors, including the additional one. Probably he was under the impression that he would be able to either escape the clutches of the law or twist the arm of the law by some manipulation. This impression must prove to be wrong. 22. In all developed and developing countries there is emphasis on planned development of cities which is sought to be achieved by zoning, planning and regulating building construction activity. Such planning, though highly complex, is a matter based on scientific research, study and experience leading to rationalization of laws by way of legislative enactments and rules and regulations framed thereunder. Zoning and planning do result in hardship to individual property owners as their freedom to use their property in the way they like, is subjected to regulation and control. The private owners are to some extent prevented from making the most profitable use of their property. But for this reason alone the controlling regulations cannot be termed as arbitrary or unreasonable. The private interest stands subordinated to the public good. It can be stated in a way that power to plan development of city and to regulate the building activity therein flows from the police power of the state. The exercise of such governmental power is justified on account of its being reasonably necessary for the public health, safety, morals or general welfare and ecological considerations; though an unnecessary or unreasonable inter-meddling with the private ownership of the property may not be justified. 23. The municipal laws regulating the building construction activity may provide for regulations as to floor area, the number of floors, the extent of height rise and the nature of use to which a built-up property may be subjected in any particular area. The individuals as property owners have to pay some price for securing peace, good order, dignity, protection and comfort and safety of the community. Not only fifth, stench and unhealthy places have to be eliminated, but the layout helps in achieving family values, youth values, seclusion and clean air to make the locality a better place to live. Building regulations also help in reduction or elimination of fire hazards, the avoidance of traffic dangers and the lessening of prevention of traffic congestion in the streets and roads. Zoning and building regulations are also legitimized from the point of view of the control of community development, the prevention of over-crowding of land, the furnishing of recreational facilities like parks and playgrounds and the availability of adequate water, sewerage and other governmental or utility services.24. Structural and lot-area regulations authorize the municipal authorities to regulate and restrict the height, number of stories and other structures; the percentage of a plot that may be occupied; the size of yards, courts, and open spaces; the density of population; and the location and use of buildings and structures. All these have in view and do achieve the larger purpose of the public health, safety or general welfare. So are front setback provisions, average alignments and structural alterations. Any violation of zoning and regulation laws takes the toll in terms of public welfare and convenience being sacrificed apart from the risk, inconvenience and hardship which is posed to the occupants of the building. (For a detailed discussion reference may be had to the chapter on Zoning and Planning in American Jurisprudence, 2d, Vol. 82.)25. Though the municipal laws permit deviations from sanctioned constructions being regularized by compounding but that is by way of exception. Unfortunately, the exception, with the lapse of time and frequent exercise of the discretionary power conferred by such exception, has become the rule. Only such deviations deserve to be condoned as are bona fide or are attributable to some mis-understanding or are such deviations as where the benefit gained by demolition would be far less than the disadvantage suffered. Other than these, deliberate deviations do not deserve to be condoned and compounded. Compounding of deviations ought to be kept at a bare minimum. The cases of professional builders stand on a different footing from an individual constructing his own building. A professional builder is supposed to understand the laws better and deviations by such builders can safely be assumed to be deliberate and done with the intention of earning profits and hence deserve to be dealt with sternly so as to act as a deterrent for future. It is common knowledge that the builders enter into under hand dealings. Be that as it may, the State Governments should think of levying heavy penalties on such builders and therefrom develop a welfare fund which can be utilized for compensating and rehabilitating such innocent or unwary buyers who are displaced on account of demolition of illegal constructions. 26. The application for compounding the deviations made by the builders should always be dealt with at a higher level by multi-membered High Powered Committee so that the builders cannot manipulate. The officials who have connived at unauthorized or illegal constructions should not be spared. In developing cities the strength of staff which is supposed to keep a watch on building activities should be suitably increased in the interest of constant and vigilant watch on illegal or unauthorized constructions.27. In the facts and circumstances of the present case, we are of the opinion that the controversy should not have been brought to an end by the High Court merely by directing reconsideration of the application of revised building plans submitted by the respondent builder. The matter needs a further probe and hearing in public interest.

1[ds]23. The municipal laws regulating the building construction activity may provide for regulations as to floor area, the number of floors, the extent of height rise and the nature of use to which a built-up property may be subjected in any particular area. The individuals as property owners have to pay some price for securing peace, good order, dignity, protection and comfort and safety of the community. Not only fifth, stench and unhealthy places have to be eliminated, but the layout helps in achieving family values, youth values, seclusion and clean air to make the locality a better place to live. Building regulations also help in reduction or elimination of fire hazards, the avoidance of traffic dangers and the lessening of prevention of traffic congestion in the streets and roads. Zoning and building regulations are also legitimized from the point of view of the control of community development, the prevention of over-crowding of land, the furnishing of recreational facilities like parks and playgrounds and the availability of adequate water, sewerage and other governmental or utility services.24. Structural and lot-area regulations authorize the municipal authorities to regulate and restrict the height, number of stories and other structures; the percentage of a plot that may be occupied; the size of yards, courts, and open spaces; the density of population; and the location and use of buildings and structures. All these have in view and do achieve the larger purpose of the public health, safety or general welfare. So are front setback provisions, average alignments and structural alterations. Any violation of zoning and regulation laws takes the toll in terms of public welfare and convenience being sacrificed apart from the risk, inconvenience and hardship which is posed to the occupants of the building. (For a detailed discussion reference may be had to the chapter on Zoning and Planning in American Jurisprudence, 2d, Vol. 82.)25. Though the municipal laws permit deviations from sanctioned constructions being regularized by compounding but that is by way of exception. Unfortunately, the exception, with the lapse of time and frequent exercise of the discretionary power conferred by such exception, has become the rule. Only such deviations deserve to be condoned as are bona fide or are attributable to some mis-understanding or are such deviations as where the benefit gained by demolition would be far less than the disadvantage suffered. Other than these, deliberate deviations do not deserve to be condoned and compounded. Compounding of deviations ought to be kept at a bare minimum. The cases of professional builders stand on a different footing from an individual constructing his own building. A professional builder is supposed to understand the laws better and deviations by such builders can safely be assumed to be deliberate and done with the intention of earning profits and hence deserve to be dealt with sternly so as to act as a deterrent for future. It is common knowledge that the builders enter into under hand dealings. Be that as it may, the State Governments should think of levying heavy penalties on such builders and therefrom develop a welfare fund which can be utilized for compensating and rehabilitating such innocent or unwary buyers who are displaced on account of demolition of illegal constructions.constructions.27. In the facts and circumstances of the present case, we are of the opinion that the controversy should not have been brought to an end by the High Court merely by directing reconsideration of the application of revised building plans submitted by the respondent builder. The matter needs a further probe and hearing in public interest.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: or by connivance. 21. The conduct of the builder in the present case deserves to be noticed. He knew it fully well what was the permissible construction as per the sanctioned building plans and yet he not only constructed additional built up area on each floor but also added an additional fifth floor on the building, and such a floor was totally unauthorized. In spite of the disputes and litigation pending he parted with his interest in the property and inducted occupants on all the floors, including the additional one. Probably he was under the impression that he would be able to either escape the clutches of the law or twist the arm of the law by some manipulation. This impression must prove to be wrong. 22. In all developed and developing countries there is emphasis on planned development of cities which is sought to be achieved by zoning, planning and regulating building construction activity. Such planning, though highly complex, is a matter based on scientific research, study and experience leading to rationalization of laws by way of legislative enactments and rules and regulations framed thereunder. Zoning and planning do result in hardship to individual property owners as their freedom to use their property in the way they like, is subjected to regulation and control. The private owners are to some extent prevented from making the most profitable use of their property. But for this reason alone the controlling regulations cannot be termed as arbitrary or unreasonable. The private interest stands subordinated to the public good. It can be stated in a way that power to plan development of city and to regulate the building activity therein flows from the police power of the state. The exercise of such governmental power is justified on account of its being reasonably necessary for the public health, safety, morals or general welfare and ecological considerations; though an unnecessary or unreasonable inter-meddling with the private ownership of the property may not be justified. 23. The municipal laws regulating the building construction activity may provide for regulations as to floor area, the number of floors, the extent of height rise and the nature of use to which a built-up property may be subjected in any particular area. The individuals as property owners have to pay some price for securing peace, good order, dignity, protection and comfort and safety of the community. Not only fifth, stench and unhealthy places have to be eliminated, but the layout helps in achieving family values, youth values, seclusion and clean air to make the locality a better place to live. Building regulations also help in reduction or elimination of fire hazards, the avoidance of traffic dangers and the lessening of prevention of traffic congestion in the streets and roads. Zoning and building regulations are also legitimized from the point of view of the control of community development, the prevention of over-crowding of land, the furnishing of recreational facilities like parks and playgrounds and the availability of adequate water, sewerage and other governmental or utility services.24. Structural and lot-area regulations authorize the municipal authorities to regulate and restrict the height, number of stories and other structures; the percentage of a plot that may be occupied; the size of yards, courts, and open spaces; the density of population; and the location and use of buildings and structures. All these have in view and do achieve the larger purpose of the public health, safety or general welfare. So are front setback provisions, average alignments and structural alterations. Any violation of zoning and regulation laws takes the toll in terms of public welfare and convenience being sacrificed apart from the risk, inconvenience and hardship which is posed to the occupants of the building. (For a detailed discussion reference may be had to the chapter on Zoning and Planning in American Jurisprudence, 2d, Vol. 82.)25. Though the municipal laws permit deviations from sanctioned constructions being regularized by compounding but that is by way of exception. Unfortunately, the exception, with the lapse of time and frequent exercise of the discretionary power conferred by such exception, has become the rule. Only such deviations deserve to be condoned as are bona fide or are attributable to some mis-understanding or are such deviations as where the benefit gained by demolition would be far less than the disadvantage suffered. Other than these, deliberate deviations do not deserve to be condoned and compounded. Compounding of deviations ought to be kept at a bare minimum. The cases of professional builders stand on a different footing from an individual constructing his own building. A professional builder is supposed to understand the laws better and deviations by such builders can safely be assumed to be deliberate and done with the intention of earning profits and hence deserve to be dealt with sternly so as to act as a deterrent for future. It is common knowledge that the builders enter into under hand dealings. Be that as it may, the State Governments should think of levying heavy penalties on such builders and therefrom develop a welfare fund which can be utilized for compensating and rehabilitating such innocent or unwary buyers who are displaced on account of demolition of illegal constructions. 26. The application for compounding the deviations made by the builders should always be dealt with at a higher level by multi-membered High Powered Committee so that the builders cannot manipulate. The officials who have connived at unauthorized or illegal constructions should not be spared. In developing cities the strength of staff which is supposed to keep a watch on building activities should be suitably increased in the interest of constant and vigilant watch on illegal or unauthorized constructions.27. In the facts and circumstances of the present case, we are of the opinion that the controversy should not have been brought to an end by the High Court merely by directing reconsideration of the application of revised building plans submitted by the respondent builder. The matter needs a further probe and hearing in public interest. ### Response: 1

Vijay Pandurang Palaskar Vs. The State of Maharashtra

has been acquitted by the Sessions Court although a blood stained knife was recovered at his instance. He submits that there was no reason for the Sessions Court to treat the accused Nos. 1 and 2 differently and hence the appellant is entitled to be acquitted. 5. PW-1 who is the complainant, was employed with Amar Society. He knew the deceased Chandrakant as he was his co-workman. He has deposed that the appellant often met Chandrakant in the premises of Amar Society in the evening. He has then deposed that on the fateful day he saw Chandrakant walking towards the Society together with the appellant and a stranger. They walked through the premises of the Society and went towards Hanuman Nagar. This happened at midnight. He had seen the appellant and the stranger walking on either side of Chandrakant and holding on to him. The complainant has then spoken about 10 or 12 women passing through Amar Society an hour later. After walking a certain distance from Amar Society they returned to the main gate of the Society and reported to him that a person was lying near a water tank in the vicinity of the Amar Society. He and his co-worker Manjrekar went towards the spot pointed out by the women and found Chandrakant lying there. Chandrakant had sustained several injuries from which blood was oozing out. He informed the Chairman of the Society of this incident and the police arrived at about 2.00 am. This witness has identified the shirt worn by the victim on the date of the incident. In his cross-examination, he has admitted that an entry register is maintained at the main gate but it was used only to mark the entry of vehicles. His cross-examination does not in any manner detract from the statements made by him in his examination-in-chief. 6. The deposition of PW-1 has been corroborated by PW-8. He was also on duty as a watchman at the relevant time. However, he has admitted in his cross-examination that he came to know the names of accused No.1 when Chandrakant informed him only 2 to 4 days prior to his death.7. PW-5 who has been examined by the prosecution is the Manager of the Society who alert the police about the incident when informed about the same by the complainant. He has thus corroborated the deposition of PW-1 to that extent. 8. Thus, from the testimony of PW-1, PW-5 and PW-8 it cannot be disputed that the victim was last seen together in the company of the appellant and a stranger. 9. PW-6 is the panch witness who has proved the recovery of gupti at the instance of the appellant. According to this witness, there were blood stains on the gupti. The panchanama indicates that the blade had been twisted and bent several times over so that it could fit into the pipe.10. The report of the chemical analyzer indicates that human blood was found on the gupti. However, the analysis of the blood group of the blood stains on the gupti remained inconclusive. Thus the prosecution has proved the recovery of the gupti at the instance of the appellant. The recovery of the blood stained clothes of the deceased and the accused has also been proved by the prosecution through its panch witnesses. 11. The medical evidence on record is that of the doctor who performed the post-mortem examination of the deceased. He has been examined as PW-7. The deceased sustained as many as 13 injuries. Except injuries recorded at Sr.Nos. 2 and 13, all other injuries were either incised injuries or stab injuries on the chest, neck and upper part of the body. The doctor has opined that the gupti could have caused the cut throat and stab injuries mentioned in the post-mortem report when it was in its original shape. Thus, the medical evidence on record indicates that the gupti which has been recovered at the instance of the appellant could have caused the injuries sustained by the victim, thus linking the appellant to the homicidal death of Chandrakant. 12. PW-9 has been examined to establish that the victim and the appellant frequently visited his shop together for drinking liquor. However, this witness has been declared hostile and, therefore, his deposition is of no consequence.13. The investigating officer has been examined as PW-10. He has also spoken about the recovery of the gupti at the appellants instance. 14. Taking into consideration the evidence which was led before the Sessions Court, we find that the prosecution has established the circumstances which unmistakably point to the involvement of the appellant. The victim was last seen together in the Company of the appellant. The victim was found lying in a pool of blood. The appellant was not found anywhere near the spot of the incident nor did he inform the police that the victim had been assaulted by some other person. The appellant has not been able to show that when he and the victim left the premises of Amar Society, they parted company and went their own ways. In fact, they were seen proceeding towards Hanuman Nagar. The recovery of the blood stained gupti which was found with its blade twisted, in the pipe which was embedded in the concrete foundation at the foot of Hanuman Tekdi has been proved. The medical officer has proved that the injuries could be sustained by the gupti which was recovered. Thus, the appellant has rightly been held guilty of committing murder.15. We have perused the judgment of the Trial Court. The Trial Court has rightly acquitted the accused No.2 and, therefore, the present appellant cannot seek parity. Accused No.2 was not identified by any person and on this basis he has been acquitted. Apart from this, the recovery of the knife allegedly from accused No.2 has not been proved in view of the testimony of PW-3. We find that the Sessions Court has correctly appreciated the evidence on record and drawn proper conclusions and inferences.

0[ds]14. Taking into consideration the evidence which was led before the Sessions Court, we find that the prosecution has established the circumstances which unmistakably point to the involvement of the appellant. The victim was last seen together in the Company of the appellant. The victim was found lying in a pool of blood. The appellant was not found anywhere near the spot of the incident nor did he inform the police that the victim had been assaulted by some other person. The appellant has not been able to show that when he and the victim left the premises of Amar Society, they parted company and went their own ways. In fact, they were seen proceeding towards Hanuman Nagar. The recovery of the blood stained gupti which was found with its blade twisted, in the pipe which was embedded in the concrete foundation at the foot of Hanuman Tekdi has been proved. The medical officer has proved that the injuries could be sustained by the gupti which was recovered. Thus, the appellant has rightly been held guilty of committing murder.15. We have perused the judgment of the Trial Court. The Trial Court has rightly acquitted the accused No.2 and, therefore, the present appellant cannot seek parity. Accused No.2 was not identified by any person and on this basis he has been acquitted. Apart from this, the recovery of the knife allegedly from accused No.2 has not been proved in view of the testimony ofWe find that the Sessions Court has correctly appreciated the evidence on record and drawn proper conclusions and inferences.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: has been acquitted by the Sessions Court although a blood stained knife was recovered at his instance. He submits that there was no reason for the Sessions Court to treat the accused Nos. 1 and 2 differently and hence the appellant is entitled to be acquitted. 5. PW-1 who is the complainant, was employed with Amar Society. He knew the deceased Chandrakant as he was his co-workman. He has deposed that the appellant often met Chandrakant in the premises of Amar Society in the evening. He has then deposed that on the fateful day he saw Chandrakant walking towards the Society together with the appellant and a stranger. They walked through the premises of the Society and went towards Hanuman Nagar. This happened at midnight. He had seen the appellant and the stranger walking on either side of Chandrakant and holding on to him. The complainant has then spoken about 10 or 12 women passing through Amar Society an hour later. After walking a certain distance from Amar Society they returned to the main gate of the Society and reported to him that a person was lying near a water tank in the vicinity of the Amar Society. He and his co-worker Manjrekar went towards the spot pointed out by the women and found Chandrakant lying there. Chandrakant had sustained several injuries from which blood was oozing out. He informed the Chairman of the Society of this incident and the police arrived at about 2.00 am. This witness has identified the shirt worn by the victim on the date of the incident. In his cross-examination, he has admitted that an entry register is maintained at the main gate but it was used only to mark the entry of vehicles. His cross-examination does not in any manner detract from the statements made by him in his examination-in-chief. 6. The deposition of PW-1 has been corroborated by PW-8. He was also on duty as a watchman at the relevant time. However, he has admitted in his cross-examination that he came to know the names of accused No.1 when Chandrakant informed him only 2 to 4 days prior to his death.7. PW-5 who has been examined by the prosecution is the Manager of the Society who alert the police about the incident when informed about the same by the complainant. He has thus corroborated the deposition of PW-1 to that extent. 8. Thus, from the testimony of PW-1, PW-5 and PW-8 it cannot be disputed that the victim was last seen together in the company of the appellant and a stranger. 9. PW-6 is the panch witness who has proved the recovery of gupti at the instance of the appellant. According to this witness, there were blood stains on the gupti. The panchanama indicates that the blade had been twisted and bent several times over so that it could fit into the pipe.10. The report of the chemical analyzer indicates that human blood was found on the gupti. However, the analysis of the blood group of the blood stains on the gupti remained inconclusive. Thus the prosecution has proved the recovery of the gupti at the instance of the appellant. The recovery of the blood stained clothes of the deceased and the accused has also been proved by the prosecution through its panch witnesses. 11. The medical evidence on record is that of the doctor who performed the post-mortem examination of the deceased. He has been examined as PW-7. The deceased sustained as many as 13 injuries. Except injuries recorded at Sr.Nos. 2 and 13, all other injuries were either incised injuries or stab injuries on the chest, neck and upper part of the body. The doctor has opined that the gupti could have caused the cut throat and stab injuries mentioned in the post-mortem report when it was in its original shape. Thus, the medical evidence on record indicates that the gupti which has been recovered at the instance of the appellant could have caused the injuries sustained by the victim, thus linking the appellant to the homicidal death of Chandrakant. 12. PW-9 has been examined to establish that the victim and the appellant frequently visited his shop together for drinking liquor. However, this witness has been declared hostile and, therefore, his deposition is of no consequence.13. The investigating officer has been examined as PW-10. He has also spoken about the recovery of the gupti at the appellants instance. 14. Taking into consideration the evidence which was led before the Sessions Court, we find that the prosecution has established the circumstances which unmistakably point to the involvement of the appellant. The victim was last seen together in the Company of the appellant. The victim was found lying in a pool of blood. The appellant was not found anywhere near the spot of the incident nor did he inform the police that the victim had been assaulted by some other person. The appellant has not been able to show that when he and the victim left the premises of Amar Society, they parted company and went their own ways. In fact, they were seen proceeding towards Hanuman Nagar. The recovery of the blood stained gupti which was found with its blade twisted, in the pipe which was embedded in the concrete foundation at the foot of Hanuman Tekdi has been proved. The medical officer has proved that the injuries could be sustained by the gupti which was recovered. Thus, the appellant has rightly been held guilty of committing murder.15. We have perused the judgment of the Trial Court. The Trial Court has rightly acquitted the accused No.2 and, therefore, the present appellant cannot seek parity. Accused No.2 was not identified by any person and on this basis he has been acquitted. Apart from this, the recovery of the knife allegedly from accused No.2 has not been proved in view of the testimony of PW-3. We find that the Sessions Court has correctly appreciated the evidence on record and drawn proper conclusions and inferences. ### Response: 0

State of Karnataka Vs. B. Raghurama Shetty Etc

it. The miller and the baker have consumed wheat and flour respectively in the course of their business. We have to understand the word consumes in section 6(i) of the Act in this economic sense. It may be interesting to note that this is the basis of the levy of Value Added Tax, popularly called as VAT, which is levied as an alternative to tax on turnover in some Western countries. The difference between Value Added Tax, and tax on the turnover of sales or purchases is explained by Professor Paul A. Samuelson in his book entitled Economics (Tenth Edition, 1976) at page 168 thus:"A turnover tax simply taxes every transaction made: wheat, flour, dough, bread, VAT is different because it does not include in the tax on the millers flour that part of its value which came from the wheat he bought from the farmer. Instead, it taxes him only on the wage and salary, cost of milling, and on the interest, rent, royalty, and profit cost of this milling stage of production. (That is, the raw material costs used from earlier stages are subtracted from the millers selling price in calculating his "value added" and t he VAT tax on value added........ )"7. At every stage of production, it is obvious there is consumption of goods even though at the end of it there may not be final consumption of goods but only production of goods with higher utility which may be used in further productive processes.8. While construing the word consumption which was found in the Explanation to Article 286(1)(a) as it stood prior to its deletion by the Constitution (Sixth Amendment) Act, 1956, this Court in M/s. Anwarkhan Mahboob Co. v. The State of Bombay &Ors. observed thus:"The Act of consumption with which people are most familiar occurs when they eat, or drink or smoke. Thus, we speak of people consuming bread, or fish or meat or vegetables, when they eat these articles of food; we speak of people consuming tea or coffee or water, when they drink these articles; we speak of people consuming cigars or cigarettes or bidis, when they smoke these. The production of wealth, as economists put it, consists in the creation of "utilities". Consumption consists in the act of taking such advantage of the commodities and services produced as constitutes the "utilization" thereof. For each commodity, there is ordinarily what is generally considered to be the final act of consumption. For some commodities, there may be even more than one kind of final consumption. Thus grapes may be "finally consume d" by eating them as fruits; they may also be consumed by drinking the wine prepared from "grapes". Again, the final act of consumption may in some cases be spread over a considerable period of time. Books, a rticles of furniture, paintings may be mentioned as examples. It may even happen in such cases, that after one consumer has performed part of the final act of consumption, another portion of the final act of consumption may be performed by his heir or successor-in-interest, a transferee, or even one who has obtained possession by wrongful means. But the fact that there is for each commodity what may be considered ordinarily to be the fin al act of consumption, should not make us forget that in reaching the stage at which this final act of consumption takes place the commodity may pass through different stages of production and for such different stages, there would exist one or more intermediate acts of consumption."Applying the above test, it has to be held that the assessees had consumed the paddy purchased by them when they converted it into rice which is commercially a different commodity.9. Since it is not disputed that the sales of paddy, which is a taxable commodity, in favour of the assessees had not suffered tax under section 5 in view of the circumstances in which they had taken place and it is held that the assessees had consumed paddy in the manufacture of rice which was a different commercial commodity for sale, the case of the assessees squarely falls under section 6(i) of the Act. The charge under section 6(i) should, therefore, be given due effect. This view is in ac cord with the opinion of this Court in State of Tamil Nadu v. M. K. Kandaswami etc. etc. and in Ganesh Prasad Dixit v. Commissioner of Sales-tax, where provisions corresponding to section 6(i) of the Act arose for consideration.10. It is next contended that since the assessees would be exposed to double taxation both as buyers of paddy and as sellers of rice we should hold that the levy in question is impermissible because paddy and rice are liable to be taxed at a single point. No pro vision is shown to us which bars such taxation when the commodities are different. In fact, in this case there is no double taxation on the same commodity. A similar contention was rejected by this Court in the case of Babu Ram Jagdish Kumar ( supra) thus:"We may at this stage refer to one other subsidiary argument urged on behalf of the appellants. It is argued that because paddy and rice are not different kinds of goods but one and the same, the inclusion of both paddy and rice in Schedule C to the Act would amount to imposition of double taxation under the Act. There is no merit in this contention also because the assumption that paddy and rice are one and the same is erroneous. In Ganesh Trading Co., Karnal v. State of Haryana (1973) 32 S.T.C. 623 (S.C.), arising under the Act, this Court has held that although rice is produced out of paddy, it is not true to say that paddy co ntinued to be paddy even after dehusking; that rice and paddy are two different things in ordinary parlance and, therefore, when paddy is dehusked and rice produced, there is a change in the identity of the goods."11.

1[ds]There is no merit in the submission made on behalf of the assessees that they had not consumed paddy when they produced rice from it by merely carrying out the process of dehusking at their mills. Consumption in the true economic sense does not mean only use of goods in the production of consumers goods or final utilisation of consumers goods by consumers involving activities like eating of food, drinking of beverages, wearing of clothes or using of an automobile by its owner for domestic purposes. A manufacturer also consumes commodities which are ordinarily called raw materials when he produces semi-finished goods which have to undergo further processes of production before t hey can be transformed into consumers goods. At every such intermediate stage of production, some utility or value is added to goods which are used as raw materials and at every such stage the raw materials are consumed. Take the case of b read. It passes through the first stage of production when wheat is grown by the farmer, the second stage of production when wheat is converted into flour by the miller and the third stage of production when flour is utilised by the baker to manufacture bread out of it. The miller and the baker have consumed wheat and flour respectively in the course of their business. We have to understand the word consumes in section 6(i) of the Act in this economic sense. It may be interesting to note that this is the basis of the levy of Value Added Tax, popularly called as VAT, which is levied as an alternative to tax on turnover in some Westernit is not disputed that the sales of paddy, which is a taxable commodity, in favour of the assessees had not suffered tax under section 5 in view of the circumstances in which they had taken place and it is held that the assessees had consumed paddy in the manufacture of rice which was a different commercial commodity for sale, the case of the assessees squarely falls under section 6(i) of the Act. The charge under section 6(i) should, therefore, be given dueis next contended that since the assessees would be exposed to double taxation both as buyers of paddy and as sellers of rice we should hold that the levy in question is impermissible because paddy and rice are liable to be taxed at a single point. No pro vision is shown to us which bars such taxation when the commodities are different. In fact, in this case there is no double taxation on the same commodity.Paddy and rice have been held to be different commodities by this Court in Ganesh Trading Co., Karnal v. State of Haryana &Anr. in which it is observedthe question for our decision is whether it could be said that when paddy was dehusked and rice was produced its identity remained. It was true that rice was produced out of paddy but it is not true to say that paddy continued to be paddy even after dehusking. It had changed its identity. Rice is not known as paddy. It is a misnomer to call rice as paddy. They are two different things in ordinary parlance. Hence quite clearly when paddy is dehusked and rice produced, there has been a change in the identity of theabove view has been followed by this Court in Babu Ram Jagdish Kumar and Co. v. The State of Punjab &Ors.5. It is unfortunate that the High Court as well as the Tribunal have tried to distinguish the decision of t his Court in Ganesh Trading Co.s case (supra) on insubstantial grounds, a detailed reference to which is unnecessary We reiterate the view expressed in the above two cases and hold that paddy and rice are two distinct commodities and that the milling of paddy involves a manufacturing process.

### Instruction: Given the specifics of the case proceeding, anticipate the court's ruling: will it favor (1) or oppose (0) the appellant’s request? ### Input: it. The miller and the baker have consumed wheat and flour respectively in the course of their business. We have to understand the word consumes in section 6(i) of the Act in this economic sense. It may be interesting to note that this is the basis of the levy of Value Added Tax, popularly called as VAT, which is levied as an alternative to tax on turnover in some Western countries. The difference between Value Added Tax, and tax on the turnover of sales or purchases is explained by Professor Paul A. Samuelson in his book entitled Economics (Tenth Edition, 1976) at page 168 thus:"A turnover tax simply taxes every transaction made: wheat, flour, dough, bread, VAT is different because it does not include in the tax on the millers flour that part of its value which came from the wheat he bought from the farmer. Instead, it taxes him only on the wage and salary, cost of milling, and on the interest, rent, royalty, and profit cost of this milling stage of production. (That is, the raw material costs used from earlier stages are subtracted from the millers selling price in calculating his "value added" and t he VAT tax on value added........ )"7. At every stage of production, it is obvious there is consumption of goods even though at the end of it there may not be final consumption of goods but only production of goods with higher utility which may be used in further productive processes.8. While construing the word consumption which was found in the Explanation to Article 286(1)(a) as it stood prior to its deletion by the Constitution (Sixth Amendment) Act, 1956, this Court in M/s. Anwarkhan Mahboob Co. v. The State of Bombay &Ors. observed thus:"The Act of consumption with which people are most familiar occurs when they eat, or drink or smoke. Thus, we speak of people consuming bread, or fish or meat or vegetables, when they eat these articles of food; we speak of people consuming tea or coffee or water, when they drink these articles; we speak of people consuming cigars or cigarettes or bidis, when they smoke these. The production of wealth, as economists put it, consists in the creation of "utilities". Consumption consists in the act of taking such advantage of the commodities and services produced as constitutes the "utilization" thereof. For each commodity, there is ordinarily what is generally considered to be the final act of consumption. For some commodities, there may be even more than one kind of final consumption. Thus grapes may be "finally consume d" by eating them as fruits; they may also be consumed by drinking the wine prepared from "grapes". Again, the final act of consumption may in some cases be spread over a considerable period of time. Books, a rticles of furniture, paintings may be mentioned as examples. It may even happen in such cases, that after one consumer has performed part of the final act of consumption, another portion of the final act of consumption may be performed by his heir or successor-in-interest, a transferee, or even one who has obtained possession by wrongful means. But the fact that there is for each commodity what may be considered ordinarily to be the fin al act of consumption, should not make us forget that in reaching the stage at which this final act of consumption takes place the commodity may pass through different stages of production and for such different stages, there would exist one or more intermediate acts of consumption."Applying the above test, it has to be held that the assessees had consumed the paddy purchased by them when they converted it into rice which is commercially a different commodity.9. Since it is not disputed that the sales of paddy, which is a taxable commodity, in favour of the assessees had not suffered tax under section 5 in view of the circumstances in which they had taken place and it is held that the assessees had consumed paddy in the manufacture of rice which was a different commercial commodity for sale, the case of the assessees squarely falls under section 6(i) of the Act. The charge under section 6(i) should, therefore, be given due effect. This view is in ac cord with the opinion of this Court in State of Tamil Nadu v. M. K. Kandaswami etc. etc. and in Ganesh Prasad Dixit v. Commissioner of Sales-tax, where provisions corresponding to section 6(i) of the Act arose for consideration.10. It is next contended that since the assessees would be exposed to double taxation both as buyers of paddy and as sellers of rice we should hold that the levy in question is impermissible because paddy and rice are liable to be taxed at a single point. No pro vision is shown to us which bars such taxation when the commodities are different. In fact, in this case there is no double taxation on the same commodity. A similar contention was rejected by this Court in the case of Babu Ram Jagdish Kumar ( supra) thus:"We may at this stage refer to one other subsidiary argument urged on behalf of the appellants. It is argued that because paddy and rice are not different kinds of goods but one and the same, the inclusion of both paddy and rice in Schedule C to the Act would amount to imposition of double taxation under the Act. There is no merit in this contention also because the assumption that paddy and rice are one and the same is erroneous. In Ganesh Trading Co., Karnal v. State of Haryana (1973) 32 S.T.C. 623 (S.C.), arising under the Act, this Court has held that although rice is produced out of paddy, it is not true to say that paddy co ntinued to be paddy even after dehusking; that rice and paddy are two different things in ordinary parlance and, therefore, when paddy is dehusked and rice produced, there is a change in the identity of the goods."11. ### Response: 1

M/s. Soul Jewels & Others Vs. M/s. Hanjer Biotech Energies P. Ltd. & Others

R.F. Nariman, J. 1. Leave granted. 2. By our order dated 21.08.2017, we recorded that the arguments have been concluded and liberty granted to the parties to file written submissions. We have perused the written submissions so filed. 3. The order under appeal dated 14.2.2014 notices that by an order dated 29.10.2013, the Company Law Board had rejected the application for appointment of a special auditor. However, despite this order never having been challenged, a second order of the Company Law Board dated 31.01.2014 granted the interim relief of appointing a special auditor. The learned single Judge went on to find that in point of fact there are already three auditors and the only justification for appointing a special auditor found by the CLB order dated 31.1.2014 is that a contractual right existed under clauses of the SHA. Clause 5.2.3.2 makes it clear that the investor must reasonably believe that there is a material misstatement or irregularity in the financial statements of the Company for the investor to have the right to appoint a special auditor of its choice at the cost of the Company. As correctly stated by the learned single Judge, this contractual right has to be exercised reasonably and could not ever have been intended to reopen closed and settled matters. 4. Apart from this, the learned single Judge held: Mr. Chaglas charge is direct and pointed: this is nothing but an attempt to extract the buy-out price and enforce the SPA. It is an exercise in harassment pure and simple and is no more complicated than that. That there was a proposed buy-out is not in dispute. Hanjer Energies is today unable to fulfill its obligations under the SPA to buy out a part of IIFs stake. That Hanjer Energies is in financial straits is conceded; hence the CDR and the special investigative audit. IIF took a 26% stake in Hanjer Energies in 2009-2010 for L 250 crores. Three years later, in 2012, it agreed to sell 7% of its stake for L 157.5 crores. This had to be done because Hanjer Energies institutional lenders insisted on a majority stake being with the Furniturewala Group. A further infusion of L 57 crores has recently been made. But how does any of this give IIF the right to a special audit under the SSA, the SHA and the Articles? The impugned order does not say. Before Mr. Dwarkadas can get to his argument that the impugned order does not prejudice Hanjer Energies he must first show IIF has demonstrated an entitlement to such a relief, and that sufficient grounds have been made out. They have not; and the prejudice is certain. A fourth auditor with as sweeping a remit as the impugned order proposes can only hamper and hinder Hanjer Energies and, perhaps more importantly, the CDR itself. An auditor is a watchdog. Hanjer Energies has three. That is more than enough. What IIF wants is a bloodhound. That is uncalled for and unjustified; there are more than enough sentinels on Hanjer Energies ramparts.

0[ds]Clause 5.2.3.2 makes it clear that the investor must reasonably believe that there is a material misstatement or irregularity in the financial statements of the Company for the investor to have the right to appoint a special auditor of its choice at the cost of the Company. As correctly stated by the learned single Judge, this contractual right has to be exercised reasonably and could not ever have been intended to reopen closed and settled matters4. Apart from this, the learned single Judge held:Mr. Chaglas charge is direct and pointed: this is nothing but an attempt to extract thet price and enforce the SPA. It is an exercise in harassment pure and simple and is no more complicated than that. That there was a proposedt is not in dispute. Hanjer Energies is today unable to fulfill its obligations under the SPA to buy out a part of IIFs stake. That Hanjer Energies is in financial straits is conceded; hence the CDR and the special investigative audit. IIF took a 26% stake in Hanjer Energies in0 for L 250 crores. Three years later, in 2012, it agreed to sell 7% of its stake for L 157.5 crores. This had to be done because Hanjer Energies institutional lenders insisted on a majority stake being with the Furniturewala Group. A further infusion of L 57 crores has recently been made. But how does any of this give IIF the right to a special audit under the SSA, the SHA and the Articles? The impugned order does not say. Before Mr. Dwarkadas can get to his argument that the impugned order does not prejudice Hanjer Energies he must first show IIF has demonstrated an entitlement to such a relief, and that sufficient grounds have been made out. They have not; and the prejudice is certain. A fourth auditor with as sweeping a remit as the impugned order proposes can only hamper and hinder Hanjer Energies and, perhaps more importantly, the CDR itself. An auditor is a watchdog. Hanjer Energies has three. That is more than enough. What IIF wants is a bloodhound. That is uncalled for and unjustified; there are more than enough sentinels on Hanjer Energies ramparts.

### Instruction: Analyze the case proceeding and predict whether the appeal/petition will be accepted (1) or rejected (0). ### Input: R.F. Nariman, J. 1. Leave granted. 2. By our order dated 21.08.2017, we recorded that the arguments have been concluded and liberty granted to the parties to file written submissions. We have perused the written submissions so filed. 3. The order under appeal dated 14.2.2014 notices that by an order dated 29.10.2013, the Company Law Board had rejected the application for appointment of a special auditor. However, despite this order never having been challenged, a second order of the Company Law Board dated 31.01.2014 granted the interim relief of appointing a special auditor. The learned single Judge went on to find that in point of fact there are already three auditors and the only justification for appointing a special auditor found by the CLB order dated 31.1.2014 is that a contractual right existed under clauses of the SHA. Clause 5.2.3.2 makes it clear that the investor must reasonably believe that there is a material misstatement or irregularity in the financial statements of the Company for the investor to have the right to appoint a special auditor of its choice at the cost of the Company. As correctly stated by the learned single Judge, this contractual right has to be exercised reasonably and could not ever have been intended to reopen closed and settled matters. 4. Apart from this, the learned single Judge held: Mr. Chaglas charge is direct and pointed: this is nothing but an attempt to extract the buy-out price and enforce the SPA. It is an exercise in harassment pure and simple and is no more complicated than that. That there was a proposed buy-out is not in dispute. Hanjer Energies is today unable to fulfill its obligations under the SPA to buy out a part of IIFs stake. That Hanjer Energies is in financial straits is conceded; hence the CDR and the special investigative audit. IIF took a 26% stake in Hanjer Energies in 2009-2010 for L 250 crores. Three years later, in 2012, it agreed to sell 7% of its stake for L 157.5 crores. This had to be done because Hanjer Energies institutional lenders insisted on a majority stake being with the Furniturewala Group. A further infusion of L 57 crores has recently been made. But how does any of this give IIF the right to a special audit under the SSA, the SHA and the Articles? The impugned order does not say. Before Mr. Dwarkadas can get to his argument that the impugned order does not prejudice Hanjer Energies he must first show IIF has demonstrated an entitlement to such a relief, and that sufficient grounds have been made out. They have not; and the prejudice is certain. A fourth auditor with as sweeping a remit as the impugned order proposes can only hamper and hinder Hanjer Energies and, perhaps more importantly, the CDR itself. An auditor is a watchdog. Hanjer Energies has three. That is more than enough. What IIF wants is a bloodhound. That is uncalled for and unjustified; there are more than enough sentinels on Hanjer Energies ramparts. ### Response: 0

New Savan Sugar & Gur Refining Co. Ltd Vs. Commissioner Of Income-Tax, Calcutta

behalf of the assessee to the decision in Narain Swadeshi Weaving Mills v. Commissioner of Excess Profit Tax, 1954-26 ITR 765 = (AIR 1955 SC 176 ), in which the assessee firm carrying on a manufacturing business consisted of three partners, N and his two sons R and G. In April, 1940, a public limited company was incorporated with the object of taking over the business of the assessee firm. This company was director-controlled and the directors were N, his three sons R, G and S and a brother-in-law of G. The company purchased only the building and leasehold rights from the assessee firm but took over from it on lease at an annual rent the plant and machinery. The assessee firm did not there, after manufacture anything and it had accordingly no further trading or commercial activity. In the circumstances, it was held that letting out of the plant and the machinery by the assessee to the company could not fall within the definition of "business" under Section 2 (5) and as the assessee firm had no business during the relevant period to which the Act applied, Section 10-A could not be invoked by the Excess Profit Tax Authorities. It was however pointed out that whether a particular activity amounts to any trade, commerce or manufacture or any adventure in the nature of trade, commerce or manufacture is always a difficult question to answer and no general principle can be laid down which would be applicable to all cases and each case must be decided in the setting and background of its own facts. It is evident that the material facts in the present case are somewhat different from those of Narain Swadeshi Weaving Mills case, 1954-26 ITR 765 =(AIR 1955 SC 176 ) (supra) for there is no outright sale of the building of the factory but only a lease of the factory premises together with the machinery for a long period of years.8. For the reasons already expressed our conclusion is that the intention of the assessee was not to treat the factory, etc., as a commercial asset during the subsistence of the lease. In other words, the intention of the assessee was to go out of the business altogether so far as the factory and the machinery was concerned with effect from 1st June, 1945 and the intention was to use the income arising from the royalty in its capacity as the owner of the factory.It follows therefore that the first question was rightly answered by the High Court in favour of the Commissioner of Income-tax.9. As regards the second question the argument was stressed by Mr. Choudhury that clauses (vi-a) and (vi-b) of Section 10 (2) are ancillary to clause (vi) and should be taken to be included within Cl. (vi) as mentioned in sub-section (3) of S. 12. It appears that clause (vi-a) was inserted by Section it of the Taxation Laws (Extension to Merged States and Amendment Act, 1949). Clause (vi-b) was inserted by Section 8 of the Finance Act, 1955 with effect from 1st April, 1955. At the time of making the amendment under the said Acts, no amendment was made to Section 12 (3) of the Act. It was argued by Mr. Choudhury that although this was not done specifically it followed by implication that additional depreciation allowance in respect of new assets and development rebate would come within the ambit of Section 12 (3).It appears to us that clauses (vi-a) and (vi-b) are not ancillary to clause (vi) because the scheme of clauses (vi-a) and (vi-b) is somewhat different.Clause (vi-a) which was inserted in 1949 gives additional depreciation allowance over and above the initial allowance which was formerly available under the second paragraph of clause (vi) in respect of buildings newly erected and new machinery and plant but not furniture installed after the 31st March, 1948. The additional allowance under this clause is confined to not more than five successive assessments falling within the period from 1-4-1949 and 31-3-1959. Further, it is deductible in determining the written down value, unlike the initial allowance granted under the second paragraph of clause (vi), Clause (vi-b) was inserted by the Finance Act, 1955. It grants development rebate in respect of machinery and plant provided that the machinery or plant is new and has been installed after the 31st March, 1954; and provided further that it is used wholly for the purpose of the assessees business and the particulars prescribed for the purpose of clause (vi) have been furnished. It is manifest that clauses (vi-a) and (vi-b) introduce a new scheme and cannot be treated as an integral part of clause (vi) by implication. Apart from this consideration it appears to us that these clauses were not specifically engrafted by Parliament in S. 12 (3) and Section 12 (4) while amending Section 10 (2) of the Act.It is therefore not permissible for the Court to read these same clauses by implication in Section 12 (3) and Section 12 (4) of the Act.The duty of the Court is to interpret the words that Parliament has used, it cannot supply the gap disclosed in an Act or to make of the deficiencies."If", said Lord Brougham, in Gwynne v. Burnell, (1840) 7 CL F 572, 696 "we depart from the plain and obvious meaning on account of such views (as those pressed in argument on 43 Geo. 3, c. 99) we do not in truth construe the Act, but alter it. We add words to it, or vary the words in which its provisions are couched. We supply a defect which the legislature could easily have supplied, and are making the law, not interpreting it". (Cf. Kamalaranjan Roy v. Secretary of State, 66 Ind App 1 at p. 10 = (AIR 1938 PC 281 at p. 283).Accordingly, we are of opinion that the assessee is not entitled to additional depreciation and development rebate and the second question was rightly answered by the High Court in the negative.

1[ds]In order to examine the validity of this argument it is necessary to set out the relevant clauses of the indenture of lease.Clause (1) of the lease provided that the lease was for a term of five years commencing from 1st June, 1945, with an option to continue for a further term of five years and thereafter two further options of five years in each case on the same terms and conditions subject to higher payment of rates of royalties.Clauselessee shall be entitled to run the said sugar factory and all other machinery annexed to the same and use all the tools and implements, buildings and premises, offices, and erections and utensils and all other things which are now in or upon the said premises and which may be added from time to time thereto provided always that the lessees shall not at any time remove the plant and/or machinery, etc., hereby demised or any part thereof from the said premises elsewhere for the purpose of or in connection with the lessees othere lessees shall at the time of taking over possession of the factory from the lessors be entitled free of payment to the goods already manufactured during the current crushing season, i.e., 1945-46 or in the process of manufacture and/or to be hereafter manufactured by the lessees and the lessees shall have absolute discretion to sell and deal with the same in such manner as they think fit ande lessees shall also be entitled to erect, construct and maintain any other machinery as the lessees may think fit and proper. All machinery brought in and erected by the lessees would remain the lessees property and after the termination of the lease the lessees shall be entitled to remove the same provided always that the lessees shall forthwith repair and make good all damage caused to the demised premises by such removal of the lesseese 7 provides for the payment of royalty. The royalty on sugar was to be computed at the rate of Rupees Seventyfive per 100 maunds of sugar manufactured for the first five years as well as next five years then at the rate of Rupees eighty-two and annas eight per l00 maunds of sugar manufactured for the third five years and Rs. 90 for the fourth five years. The royalty on molasses was computed at three pies per maund on all molasses sold during each year of the original lease period and any renewals thereof subject to the payment of a minimum royalty of Rs. 6,500 pers clause provides that the lessee shall in addition to the royalty reserved be responsible for all the running expenses of the factory including salaries and wages and all factory staff and labour and shall pay all sugar excise duty, etc. excepting the ground rents payable to the landlords and taxes on income chargeable to the lessors and shall fully reimburse the lessors in respect of such expenses which have already been incurred by the lessors since the first day of one thousand nine hundred and forty five and property) The lessors will keep the demised premises insured to the full value thereof and shall pay all expenses which will be incurred for insuring the demised premises.(b) The lesson shall pay all expenses of running the lessors company e.g., Directors fees, Audit fees, Ground rents, etc., but not the running expenses of the factory and premises hereby demised and shall also pay for all the expenditure for additions, alterations, breakdown and/or renewals and replacement of capital nature (i.e., debitable to block account) to buildings and machineries, etc. and other similar expenses of a capital nature on the demised premises.It appears from clauses 2 and 5 that the existing machinery which was owned by the lessor could not be removed and that the lessee would be entitled to set up additional machinery without interference from the lessor and that on the termination of the lease the lessee would be entitled to remove the same without causing any damage to the property demised. Clause 3 contemplates that if during the period 1945-46 the lessors sell the commodity manufactured the price thereof should go back to theorder to examine the validity of this argument it is necessary to set out the relevant clauses of the indenture of lease.Clause (1) of the lease provided that the lease was for a term of five years commencing from 1st June, 1945, with an option to continue for a further term of five years and thereafter two further options of five years in each case on the same terms and conditions subject to higher payment of rates of royalties.Clauselessee shall be entitled to run the said sugar factory and all other machinery annexed to the same and use all the tools and implements, buildings and premises, offices, and erections and utensils and all other things which are now in or upon the said premises and which may be added from time to time thereto provided always that the lessees shall not at any time remove the plant and/or machinery, etc., hereby demised or any part thereof from the said premises elsewhere for the purpose of or in connection with the lessees othere lessees shall at the time of taking over possession of the factory from the lessors be entitled free of payment to the goods already manufactured during the current crushing season, i.e., 1945-46 or in the process of manufacture and/or to be hereafter manufactured by the lessees and the lessees shall have absolute discretion to sell and deal with the same in such manner as they think fit ande lessees shall also be entitled to erect, construct and maintain any other machinery as the lessees may think fit and proper. All machinery brought in and erected by the lessees would remain the lessees property and after the termination of the lease the lessees shall be entitled to remove the same provided always that the lessees shall forthwith repair and make good all damage caused to the demised premises by such removal of the lesseese 7 provides for the payment of royalty. The royalty on sugar was to be computed at the rate of Rupees Seventyfive per 100 maunds of sugar manufactured for the first five years as well as next five years then at the rate of Rupees eighty-two and annas eight per l00 maunds of sugar manufactured for the third five years and Rs. 90 for the fourth five years. The royalty on molasses was computed at three pies per maund on all molasses sold during each year of the original lease period and any renewals thereof subject to the payment of a minimum royalty of Rs. 6,500 pers clause provides that the lessee shall in addition to the royalty reserved be responsible for all the running expenses of the factory including salaries and wages and all factory staff and labour and shall pay all sugar excise duty, etc. excepting the ground rents payable to the landlords and taxes on income chargeable to the lessors and shall fully reimburse the lessors in respect of such expenses which have already been incurred by the lessors since the first day of one thousand nine hundred and forty five and property) The lessors will keep the demised premises insured to the full value thereof and shall pay all expenses which will be incurred for insuring the demised premises.(b) The lesson shall pay all expenses of running the lessors company e.g., Directors fees, Audit fees, Ground rents, etc., but not the running expenses of the factory and premises hereby demised and shall also pay for all the expenditure for additions, alterations, breakdown and/or renewals and replacement of capital nature (i.e., debitable to block account) to buildings and machineries, etc. and other similar expenses of a capital nature on the demised premises.It appears from clauses 2 and 5 that the existing machinery which was owned by the lessor could not be removed and that the lessee would be entitled to set up additional machinery without interference from the lessor and that on the termination of the lease the lessee would be entitled to remove the same without causing any damage to the property demised. Clause 3 contemplates that if during the period 1945-46 the lessors sell the commodity manufactured the price thereof should go back to thematerial facts of Lakshmi Silk Mills Ltd., 1951-20 ITR 451 = (AIR 1951 SC 454 ) (supra) are that only a part of the machinery was let out on lease and the rest of the machinery was worked by the assessee. The letting out of the machinery was for a short period of five months. There was also no letting out of the premises of the factory by the assessee. The ratio of the decision in Lakshmi Silk Mills Ltd., 1951-20 ITR 451 = (AIR 1951 SC 454 ) (supra) is therefore not applicable to the presentFor the reasons already expressed our conclusion is that the intention of the assessee was not to treat the factory, etc., as a commercial asset during the subsistence of the lease. In other words, the intention of the assessee was to go out of the business altogether so far as the factory and the machinery was concerned with effect from 1st June, 1945 and the intention was to use the income arising from the royalty in its capacity as the owner of the factory.It follows therefore that the first question was rightly answered by the High Court in favour of the Commissioner ofappears that clause (vi-a) was inserted by Section it of the Taxation Laws (Extension to Merged States and Amendment Act, 1949). Clause (vi-b) was inserted by Section 8 of the Finance Act, 1955 with effect from 1st April, 1955. At the time of making the amendment under the said Acts, no amendment was made to Section 12 (3) of thesaid Lord Brougham, inGwynne v. Burnell, (1840) 7 CL F 572, 696"we depart from the plain and obvious meaning on account of such views (as those pressed in argument on 43 Geo. 3, c. 99) we do not in truth construe the Act, but alter it. We add words to it, or vary the words in which its provisions are couched. We supply a defect which the legislature could easily have supplied, and are making the law, not interpreting it". (Cf. Kamalaranjan Roy v. Secretary of State, 66 Ind App 1 at p. 10 = (AIR 1938 PC 281 at p. 283).Accordingly, we are of opinion that the assessee is not entitled to additional depreciation and development rebate and the second question was rightly answered by the High Court in the negative.

### Instruction: Delve into the case proceeding and predict the outcome: is the judgment expected to be in support (1) or in denial (0) of the appeal? ### Input: behalf of the assessee to the decision in Narain Swadeshi Weaving Mills v. Commissioner of Excess Profit Tax, 1954-26 ITR 765 = (AIR 1955 SC 176 ), in which the assessee firm carrying on a manufacturing business consisted of three partners, N and his two sons R and G. In April, 1940, a public limited company was incorporated with the object of taking over the business of the assessee firm. This company was director-controlled and the directors were N, his three sons R, G and S and a brother-in-law of G. The company purchased only the building and leasehold rights from the assessee firm but took over from it on lease at an annual rent the plant and machinery. The assessee firm did not there, after manufacture anything and it had accordingly no further trading or commercial activity. In the circumstances, it was held that letting out of the plant and the machinery by the assessee to the company could not fall within the definition of "business" under Section 2 (5) and as the assessee firm had no business during the relevant period to which the Act applied, Section 10-A could not be invoked by the Excess Profit Tax Authorities. It was however pointed out that whether a particular activity amounts to any trade, commerce or manufacture or any adventure in the nature of trade, commerce or manufacture is always a difficult question to answer and no general principle can be laid down which would be applicable to all cases and each case must be decided in the setting and background of its own facts. It is evident that the material facts in the present case are somewhat different from those of Narain Swadeshi Weaving Mills case, 1954-26 ITR 765 =(AIR 1955 SC 176 ) (supra) for there is no outright sale of the building of the factory but only a lease of the factory premises together with the machinery for a long period of years.8. For the reasons already expressed our conclusion is that the intention of the assessee was not to treat the factory, etc., as a commercial asset during the subsistence of the lease. In other words, the intention of the assessee was to go out of the business altogether so far as the factory and the machinery was concerned with effect from 1st June, 1945 and the intention was to use the income arising from the royalty in its capacity as the owner of the factory.It follows therefore that the first question was rightly answered by the High Court in favour of the Commissioner of Income-tax.9. As regards the second question the argument was stressed by Mr. Choudhury that clauses (vi-a) and (vi-b) of Section 10 (2) are ancillary to clause (vi) and should be taken to be included within Cl. (vi) as mentioned in sub-section (3) of S. 12. It appears that clause (vi-a) was inserted by Section it of the Taxation Laws (Extension to Merged States and Amendment Act, 1949). Clause (vi-b) was inserted by Section 8 of the Finance Act, 1955 with effect from 1st April, 1955. At the time of making the amendment under the said Acts, no amendment was made to Section 12 (3) of the Act. It was argued by Mr. Choudhury that although this was not done specifically it followed by implication that additional depreciation allowance in respect of new assets and development rebate would come within the ambit of Section 12 (3).It appears to us that clauses (vi-a) and (vi-b) are not ancillary to clause (vi) because the scheme of clauses (vi-a) and (vi-b) is somewhat different.Clause (vi-a) which was inserted in 1949 gives additional depreciation allowance over and above the initial allowance which was formerly available under the second paragraph of clause (vi) in respect of buildings newly erected and new machinery and plant but not furniture installed after the 31st March, 1948. The additional allowance under this clause is confined to not more than five successive assessments falling within the period from 1-4-1949 and 31-3-1959. Further, it is deductible in determining the written down value, unlike the initial allowance granted under the second paragraph of clause (vi), Clause (vi-b) was inserted by the Finance Act, 1955. It grants development rebate in respect of machinery and plant provided that the machinery or plant is new and has been installed after the 31st March, 1954; and provided further that it is used wholly for the purpose of the assessees business and the particulars prescribed for the purpose of clause (vi) have been furnished. It is manifest that clauses (vi-a) and (vi-b) introduce a new scheme and cannot be treated as an integral part of clause (vi) by implication. Apart from this consideration it appears to us that these clauses were not specifically engrafted by Parliament in S. 12 (3) and Section 12 (4) while amending Section 10 (2) of the Act.It is therefore not permissible for the Court to read these same clauses by implication in Section 12 (3) and Section 12 (4) of the Act.The duty of the Court is to interpret the words that Parliament has used, it cannot supply the gap disclosed in an Act or to make of the deficiencies."If", said Lord Brougham, in Gwynne v. Burnell, (1840) 7 CL F 572, 696 "we depart from the plain and obvious meaning on account of such views (as those pressed in argument on 43 Geo. 3, c. 99) we do not in truth construe the Act, but alter it. We add words to it, or vary the words in which its provisions are couched. We supply a defect which the legislature could easily have supplied, and are making the law, not interpreting it". (Cf. Kamalaranjan Roy v. Secretary of State, 66 Ind App 1 at p. 10 = (AIR 1938 PC 281 at p. 283).Accordingly, we are of opinion that the assessee is not entitled to additional depreciation and development rebate and the second question was rightly answered by the High Court in the negative. ### Response: 1

Hemiben Ladhabhai Bhanderi Vs. Saurashta Gramin Bank & Anr

SCDRC . 3. The spouse of the appellant, Ladhabhai Thakarsibhai Bhanderi, was an account holder with the first respondent at its Dhutarpur Branch in the District of Jamnagar in Gujarat. Oriental Insurance Company Limited had launched a group individual accident policy for the account holders of the Bank. Under the terms of the agreement between the insurer and the Bank, the account holder was required to submit a form to the concerned officer of the Bank in order to avail of an insurance cover. The Bank would deduct an amount of Rs 100 as premium from the account holder and forward it to the insurer. An insurance cover of Rs 5 lakhs was offered. The case of the appellant is that on 21 July 2008, her spouse obtained an insurance form from the Bank and submitted it to its Manager. He met with an accident on 1 August 2008 while travelling on his motorcycle and succumbed to his injuries on 11 August 2008. Based on a case of accidental death, the appellant claimed an entitlement to receive a compensation of Rs 5 lakhs under the insurance claim. The insurer repudiated the claim on the ground that the premium had not been forwarded by the Bank together with the form. The Bank took the objection that the form had not been submitted in time by the deceased and that after submitting it initially on 28 July 2008, he had taken it back to discuss the matter with his relatives. 4. The District Consumer Disputes Redressal Forum District Forum allowed the complaint on 28 January 2013 and came to the conclusion that the Bank had been negligent in not forwarding the form submitted by the deceased to the insurer within time after completion of all the formalities. There being no insurance cover, the insured was held not to be liable. The Bank was directed to pay the appellant an amount of Rs 5 lakhs with interest at the rate of 6 per cent per annum from 20 August 2009 together with an additional amount of Rs 2,000 towards mental agony ad Rs1,500 towards costs. 5. The order was confirmed in appeal by the SCDRC on 28 June 2013. In a revision filed by the Bank, the NCDRC reiterated the finding that the insurer could not be held liable in the absence of an insurance cover. However, the Bank was held guilty of a deficiency of service and was directed to pay an amount of Rs 2 lakhs (instead of Rs 5 lakhs as awarded by the consumer fora) within a period of 45 days. 6. The appellant, as the legal heir of the deceased, is hence in appeal. 7. The submission which has been urged on behalf of the appellant is that the NCDRC has accepted the position that the Bank was guilty of a deficiency of service. However, it was urged that the amount of compensation has been reduced from Rs 5 lakhs to Rs 2 lakhs without any justification. On the other hand, it has been urged on behalf of the first respondent that the Bank had all along taken the defence that the form, though initially filled up on 28 July 2008, had been taken back by the deceased and that it was resubmitted only after office hours on 9 August 2008. In the meantime, as a result of the accident which took place on 1 August 2008, the account holder died on 10 August 2008 of which the Bank was intimated on the next day. In these circumstances, it was urged that there was no deficiency of service on the part of the Bank. The Bank has complied with the order of the NCDRC by handing over a cheque in an amount of Rs 2 lakhs to the appellant. The appellant has declined to encash the cheque of Rs 2 lakhs paid towards compensation on the ground that she is entitled to the full compensation of Rs 5 lakhs as awarded by the District Forum. 8. Insofar as the deficiency of service on the part of the Bank is concerned, there are concurrent findings. The NCDRC confirmed that there was a deficiency of service on the part of the Bank. Before it, the Bank admitted that no receipt was given by it to anyone depositing the application form. As a matter of fact, it has also emerged from the record that three persons Rasik Gordhanbhai Dobariya, Harjibhai Bhanderi and the spouse of the appellant had submitted forms on the same day which had Serial Nos 351, 352 and 353. The defence of the Bank that the deceased had withdrawn the form and that it was eventually submitted on 9 August 2008, when a fresh Serial No 358 was allotted has been rejected by the District Forum and by the SCDRC. The NCDRC has observed that the Bank has not explained the details of the application form mentioned at Serial No 352. There is a specific finding of fact that it was the failure of the Bank to deduct the premium and to pay it over the insurer which resulted in the insurer repudiating the claim on the ground that no insurance cover existed. No insurance cover came into existence. There are concurrent findings of fact by the three fora. We have no reason to take a different view, particularly, when the Bank has not challenged the judgment of the NCDRC. The Banks explanations are an eye-wash and a thinly disguised attempt to defeat a legitimate grievance. There was an evident deficiency of service on its part. Evidently, there was a deficiency of service on the part of the Bank in failing to forward the application form to the insurer and in deducting the insurance premium on time. Had the Bank not been deficient in the performance of its services, the deceased would have been entitled to an insurance cover in the same terms as was provided by the insurer to all other account holders desirous of obtaining insurance.

1[ds]The Bank has complied with the order of the NCDRC by handing over a cheque in an amount of Rs 2 lakhs to the appellant. The appellant has declined to encash the cheque of Rs 2 lakhs paid towards compensation on the ground that she is entitled to the full compensation of Rs 5 lakhs as awarded by the District Forum8. Insofar as the deficiency of service on the part of the Bank is concerned, there are concurrent findings. The NCDRC confirmed that there was a deficiency of service on the part of the Bank. Before it, the Bank admitted that no receipt was given by it to anyone depositing the application form. As a matter of fact, it has also emerged from the record that three persons Rasik Gordhanbhai Dobariya, Harjibhai Bhanderi and the spouse of the appellant had submitted forms on the same day which had Serial Nos 351, 352 and 353. The defence of the Bank that the deceased had withdrawn the form and that it was eventually submitted on 9 August 2008, when a fresh Serial No 358 was allotted has been rejected by the District Forum and by the SCDRC. The NCDRC has observed that the Bank has not explained the details of the application form mentioned at Serial No 352. There is a specific finding of fact that it was the failure of the Bank to deduct the premium and to pay it over the insurer which resulted in the insurer repudiating the claim on the ground that no insurance cover existed. No insurance cover came into existence. There are concurrent findings of fact by the three fora. We have no reason to take a different view, particularly, when the Bank has not challenged the judgment of the NCDRC. The Banks explanations are an eye-wash and a thinly disguised attempt to defeat a legitimate grievance. There was an evident deficiency of service on its part. Evidently, there was a deficiency of service on the part of the Bank in failing to forward the application form to the insurer and in deducting the insurance premium on time. Had the Bank not been deficient in the performance of its services, the deceased would have been entitled to an insurance cover in the same terms as was provided by the insurer to all other account holders desirous of obtaining insurance.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: SCDRC . 3. The spouse of the appellant, Ladhabhai Thakarsibhai Bhanderi, was an account holder with the first respondent at its Dhutarpur Branch in the District of Jamnagar in Gujarat. Oriental Insurance Company Limited had launched a group individual accident policy for the account holders of the Bank. Under the terms of the agreement between the insurer and the Bank, the account holder was required to submit a form to the concerned officer of the Bank in order to avail of an insurance cover. The Bank would deduct an amount of Rs 100 as premium from the account holder and forward it to the insurer. An insurance cover of Rs 5 lakhs was offered. The case of the appellant is that on 21 July 2008, her spouse obtained an insurance form from the Bank and submitted it to its Manager. He met with an accident on 1 August 2008 while travelling on his motorcycle and succumbed to his injuries on 11 August 2008. Based on a case of accidental death, the appellant claimed an entitlement to receive a compensation of Rs 5 lakhs under the insurance claim. The insurer repudiated the claim on the ground that the premium had not been forwarded by the Bank together with the form. The Bank took the objection that the form had not been submitted in time by the deceased and that after submitting it initially on 28 July 2008, he had taken it back to discuss the matter with his relatives. 4. The District Consumer Disputes Redressal Forum District Forum allowed the complaint on 28 January 2013 and came to the conclusion that the Bank had been negligent in not forwarding the form submitted by the deceased to the insurer within time after completion of all the formalities. There being no insurance cover, the insured was held not to be liable. The Bank was directed to pay the appellant an amount of Rs 5 lakhs with interest at the rate of 6 per cent per annum from 20 August 2009 together with an additional amount of Rs 2,000 towards mental agony ad Rs1,500 towards costs. 5. The order was confirmed in appeal by the SCDRC on 28 June 2013. In a revision filed by the Bank, the NCDRC reiterated the finding that the insurer could not be held liable in the absence of an insurance cover. However, the Bank was held guilty of a deficiency of service and was directed to pay an amount of Rs 2 lakhs (instead of Rs 5 lakhs as awarded by the consumer fora) within a period of 45 days. 6. The appellant, as the legal heir of the deceased, is hence in appeal. 7. The submission which has been urged on behalf of the appellant is that the NCDRC has accepted the position that the Bank was guilty of a deficiency of service. However, it was urged that the amount of compensation has been reduced from Rs 5 lakhs to Rs 2 lakhs without any justification. On the other hand, it has been urged on behalf of the first respondent that the Bank had all along taken the defence that the form, though initially filled up on 28 July 2008, had been taken back by the deceased and that it was resubmitted only after office hours on 9 August 2008. In the meantime, as a result of the accident which took place on 1 August 2008, the account holder died on 10 August 2008 of which the Bank was intimated on the next day. In these circumstances, it was urged that there was no deficiency of service on the part of the Bank. The Bank has complied with the order of the NCDRC by handing over a cheque in an amount of Rs 2 lakhs to the appellant. The appellant has declined to encash the cheque of Rs 2 lakhs paid towards compensation on the ground that she is entitled to the full compensation of Rs 5 lakhs as awarded by the District Forum. 8. Insofar as the deficiency of service on the part of the Bank is concerned, there are concurrent findings. The NCDRC confirmed that there was a deficiency of service on the part of the Bank. Before it, the Bank admitted that no receipt was given by it to anyone depositing the application form. As a matter of fact, it has also emerged from the record that three persons Rasik Gordhanbhai Dobariya, Harjibhai Bhanderi and the spouse of the appellant had submitted forms on the same day which had Serial Nos 351, 352 and 353. The defence of the Bank that the deceased had withdrawn the form and that it was eventually submitted on 9 August 2008, when a fresh Serial No 358 was allotted has been rejected by the District Forum and by the SCDRC. The NCDRC has observed that the Bank has not explained the details of the application form mentioned at Serial No 352. There is a specific finding of fact that it was the failure of the Bank to deduct the premium and to pay it over the insurer which resulted in the insurer repudiating the claim on the ground that no insurance cover existed. No insurance cover came into existence. There are concurrent findings of fact by the three fora. We have no reason to take a different view, particularly, when the Bank has not challenged the judgment of the NCDRC. The Banks explanations are an eye-wash and a thinly disguised attempt to defeat a legitimate grievance. There was an evident deficiency of service on its part. Evidently, there was a deficiency of service on the part of the Bank in failing to forward the application form to the insurer and in deducting the insurance premium on time. Had the Bank not been deficient in the performance of its services, the deceased would have been entitled to an insurance cover in the same terms as was provided by the insurer to all other account holders desirous of obtaining insurance. ### Response: 1

Jawahar Lal Sazawal Vs. State Of J & K

should have been followed. It was not even referred to. We could have allowed the appeal before us on this short ground, but since the issue raised affects a large number of employees, it is necessary to decide the issue on merits. 16. On the merits we may start by reaffirming the statement of the law laid down by this Court in Roshan Lal Tandon vs. Union of India [AIR 1967 SC 1889 ] that: "once appointed to his post or office the Government servant acquires a status and his rights and obligations are no longer determined by consent of both parties, but by statute or statutory rules which may be framed and altered unilaterally by the Government". 17. No statute or statutory rules have been drawn to our attention by which the permanent posts held by the appellants were abolished. The High Court held that the appellants status had been determined under Article 207 of the Regulations. The conclusion is based on an erroneous interpretation of the Article. To start with the High Court ignored Article 1-(a) of the Regulations which clarifies that these. "Regulations are intended to define the conditions under which Salaries, Leave, Pension, Travelling or other allowances are earned by Service in the Civil Departments and in what manner they are calculated. They do not deal otherwise than indirectly and incidentally with matters relating to recruitment, promotion, official duties, discipline or the like". (Emphasis supplied) 18. Article 207 is contained in Chapter XVII of the Regulations which deals with the conditions of grant of pension. It was, in this context that the Article had been framed. It deals with pension and its computation. It does not purport to determine status at all. It reads: "207. If an officer is selected for discharge owing to the abolition of his permanent post he shall, unless he is appointed to another post the conditions of which are deemed to be at least equal to those of this own, have the option -(a) of taking any compensation pension or gratuity to which he may be entitled for the service he has rendered; or(b) of accepting another appointment on such pay as may be offered and continuing to court his previous service for pension". 19. It is clear that the Article does not itself provide for the procedure for abolition of a permanent post nor the mode of appointment to another post nor for the manner in which the employee has to exercise the option. It only provides for the consequences of a permanent post being abolished, the consequence being that the employee shall have the option of accepting another appointment in which event he can count his previous service for the purpose of calculating the qualifying period for pension. Since there was in fact no abolition of the Government posts under Article 207, there was no question of the appellants exercising any option or surrendering their status under that Article at all. The reliance by the High Court on Article 207 to decide the appellants status was, in the circumstances wholly misplaced.20. The High Court also proceeded on the erroneous assumption, namely, that as a consequence of the "order dated 8th" October 1963 all the Government industrial undertakings stood abolished with the formation of the Company". Firstly what is referred to as an ‘order’ by the High Court was not an "order" at all but an "instruction" under Article 89 of the Articles of Association of the Company. It had no statutory force. Neither the Government Industrial Undertakings nor the posts of its employees could be abolished by such an instruction. The Governor could not in exercise of powers under the Articles of Association of the Company abolish industrial units belonging to the State Government and then transfer the undertakings to the Company. It would amount to an unilateral taking over of the industrial units by the Company without any instrument of transfer being executed by the State Government either in the form of an agreement or statute. In fact and in law there was no abolition of the posts held by the appellants and none was intended. 21. There is nothing in the instructions which could remotely be construed as an order abolishing the posts held by the appellants. Had the appellants been appointed as employees of the Company they should have been issued letters of appointment by the Company. No appointment letter was issued to any of the appellants by the Company. The irresistible conclusion is that the appellants were and continue to be servants of the State Government and as permanent residents of the State of Jammu and Kashmir are entitled under Section 10 of the State Constitution to be treated on par with other Government servants in keeping with Article 14 and 16 of the Constitution of India. By the impugned orders, the State Government has sought to deny the appellants such equality. The impugned orders cannot, therefore, be constitutionally sustained and must consequently be quashed. 22. But should the appellants be denied their right to relief because of the finding of delay and laches by the High Court? We think not. The narration of facts clearly shows that there was in fact no delay or laches on the part of the appellants. Till 1972 at least, the High Court in Ghulam Mohammad’s case (supra) found the State had not denied parity of status and the employees were granted the right to challenge any denial of status if and when it took place. The appellants were in fact treated on par with other Government employees till the impugned orders were issued on the basis of the 1980 Wages Committee Report. These were challenged in 1981 before this Court and in 1982 before the High Court by the appellants. The fact that the High Court took 16 years to dispose of the matter cannot operate against the appellants. The dismissal of the writ petitions on the ground of delay and laches is, in the circumstances, unsustainable. 23.

1[ds]No statute or statutory rules have been drawn to our attention by which the permanent posts held by the appellants were abolished. The High Court held that the appellants status had been determined under Article 207 of the Regulations. The conclusion is based on an erroneous interpretation of the Article. To start with the High Court ignored Article 1-(a) of the Regulations which clarifies thatis clear that the Article does not itself provide for the procedure for abolition of a permanent post nor the mode of appointment to another post nor for the manner in which the employee has to exercise the option. It only provides for the consequences of a permanent post being abolished, the consequence being that the employee shall have the option of accepting another appointment in which event he can count his previous service for the purpose of calculating the qualifying period for pension. Since there was in fact no abolition of the Government posts under Article 207, there was no question of the appellants exercising any option or surrendering their status under that Article at all. The reliance by the High Court on Article 207 to decide the appellants status was, in the circumstances wholly misplaced.20. The High Court also proceeded on the erroneous assumption, namely, that as a consequence of the "order dated 8th" October 1963 all the Government industrial undertakings stood abolished with the formation of the Company". Firstly what is referred to as anby the High Court was not an "order" at all but an "instruction" under Article 89 of the Articles of Association of the Company. It had no statutory force. Neither the Government Industrial Undertakings nor the posts of its employees could be abolished by such an instruction. The Governor could not in exercise of powers under the Articles of Association of the Company abolish industrial units belonging to the State Government and then transfer the undertakings to the Company. It would amount to an unilateral taking over of the industrial units by the Company without any instrument of transfer being executed by the State Government either in the form of an agreement or statute. In fact and in law there was no abolition of the posts held by the appellants and none wasshould the appellants be denied their right to relief because of the finding of delay and laches by the High Court? We think not. The narration of facts clearly shows that there was in fact no delay or laches on the part of the appellants. Till 1972 at least, the High Court in Ghulamcase (supra) found the State had not denied parity of status and the employees were granted the right to challenge any denial of status if and when it took place. The appellants were in fact treated on par with other Government employees till the impugned orders were issued on the basis of the 1980 Wages Committee Report. These were challenged in 1981 before this Court and in 1982 before the High Court by the appellants. The fact that the High Court took 16 years to dispose of the matter cannot operate against the appellants. The dismissal of the writ petitions on the ground of delay and laches is, in the circumstances, unsustainable.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: should have been followed. It was not even referred to. We could have allowed the appeal before us on this short ground, but since the issue raised affects a large number of employees, it is necessary to decide the issue on merits. 16. On the merits we may start by reaffirming the statement of the law laid down by this Court in Roshan Lal Tandon vs. Union of India [AIR 1967 SC 1889 ] that: "once appointed to his post or office the Government servant acquires a status and his rights and obligations are no longer determined by consent of both parties, but by statute or statutory rules which may be framed and altered unilaterally by the Government". 17. No statute or statutory rules have been drawn to our attention by which the permanent posts held by the appellants were abolished. The High Court held that the appellants status had been determined under Article 207 of the Regulations. The conclusion is based on an erroneous interpretation of the Article. To start with the High Court ignored Article 1-(a) of the Regulations which clarifies that these. "Regulations are intended to define the conditions under which Salaries, Leave, Pension, Travelling or other allowances are earned by Service in the Civil Departments and in what manner they are calculated. They do not deal otherwise than indirectly and incidentally with matters relating to recruitment, promotion, official duties, discipline or the like". (Emphasis supplied) 18. Article 207 is contained in Chapter XVII of the Regulations which deals with the conditions of grant of pension. It was, in this context that the Article had been framed. It deals with pension and its computation. It does not purport to determine status at all. It reads: "207. If an officer is selected for discharge owing to the abolition of his permanent post he shall, unless he is appointed to another post the conditions of which are deemed to be at least equal to those of this own, have the option -(a) of taking any compensation pension or gratuity to which he may be entitled for the service he has rendered; or(b) of accepting another appointment on such pay as may be offered and continuing to court his previous service for pension". 19. It is clear that the Article does not itself provide for the procedure for abolition of a permanent post nor the mode of appointment to another post nor for the manner in which the employee has to exercise the option. It only provides for the consequences of a permanent post being abolished, the consequence being that the employee shall have the option of accepting another appointment in which event he can count his previous service for the purpose of calculating the qualifying period for pension. Since there was in fact no abolition of the Government posts under Article 207, there was no question of the appellants exercising any option or surrendering their status under that Article at all. The reliance by the High Court on Article 207 to decide the appellants status was, in the circumstances wholly misplaced.20. The High Court also proceeded on the erroneous assumption, namely, that as a consequence of the "order dated 8th" October 1963 all the Government industrial undertakings stood abolished with the formation of the Company". Firstly what is referred to as an ‘order’ by the High Court was not an "order" at all but an "instruction" under Article 89 of the Articles of Association of the Company. It had no statutory force. Neither the Government Industrial Undertakings nor the posts of its employees could be abolished by such an instruction. The Governor could not in exercise of powers under the Articles of Association of the Company abolish industrial units belonging to the State Government and then transfer the undertakings to the Company. It would amount to an unilateral taking over of the industrial units by the Company without any instrument of transfer being executed by the State Government either in the form of an agreement or statute. In fact and in law there was no abolition of the posts held by the appellants and none was intended. 21. There is nothing in the instructions which could remotely be construed as an order abolishing the posts held by the appellants. Had the appellants been appointed as employees of the Company they should have been issued letters of appointment by the Company. No appointment letter was issued to any of the appellants by the Company. The irresistible conclusion is that the appellants were and continue to be servants of the State Government and as permanent residents of the State of Jammu and Kashmir are entitled under Section 10 of the State Constitution to be treated on par with other Government servants in keeping with Article 14 and 16 of the Constitution of India. By the impugned orders, the State Government has sought to deny the appellants such equality. The impugned orders cannot, therefore, be constitutionally sustained and must consequently be quashed. 22. But should the appellants be denied their right to relief because of the finding of delay and laches by the High Court? We think not. The narration of facts clearly shows that there was in fact no delay or laches on the part of the appellants. Till 1972 at least, the High Court in Ghulam Mohammad’s case (supra) found the State had not denied parity of status and the employees were granted the right to challenge any denial of status if and when it took place. The appellants were in fact treated on par with other Government employees till the impugned orders were issued on the basis of the 1980 Wages Committee Report. These were challenged in 1981 before this Court and in 1982 before the High Court by the appellants. The fact that the High Court took 16 years to dispose of the matter cannot operate against the appellants. The dismissal of the writ petitions on the ground of delay and laches is, in the circumstances, unsustainable. 23. ### Response: 1

Amulya Chandra Dey Vs. State of West Bengal

1. The petitioner challenge the validity of a detention order and prays for the issue of a writ or order in the nature of habeas corpus and for releasing him from custody. 2. On November 25, 1971, the District Magistrate, 24 Paraganas, West Bengal, in the exercise of his power under the provisions of sub-section (1), read with sub-section (2) of Section 3 of the Maintenance of Internal Security Act, 1971 (Act 26 of 1971) passed an order for the detention of the petitioner. In pursuance of it, the petitioner was arrested on November 27, 1971 and he was served with the order of detention together with the ground of detention on the same day. On November 30, 1971 the District Magistrate reported to the State Government about the passing of the detention order together with grounds of detention and the particulars having bearing on the case. The report and the particulars were considered by the State Government and the order of detention was approved by it on December 6, 1971. On the same day, the State Government submitted a report to the Central Government in accordance with the provisions of sub-section (4) of Section 3 of the Act. On December 24, 1971, the State Government placed the case of the petitioner before the Advisory Board under Section 10 of the Act. On or about December 3, 1971, the State Government in its Home Department (Special Section) received a representation from the petitioner. The representation was considered by the State Government and the State Government, by its order dated 22-12-1971, rejected the same but forwarded the representation to the Advisory Board for its consideration. The Advisory Board, after consideration of the materials placed before it and the representation, submitted its report to the State Government on February 4, 1972. The Advisory Board was of the opinion that there was sufficient cause for detention of the petitioner. By its order, dated February 12, 1972, the State Government, in exercise of the powers conferred by sub-section (1) of Section 12 of the Act confirmed the order of detention and communicated it to the petitioner by its Memo, dated February, 15, 1972.3.The petitioners counsel contended that the representation made by the petitioner, though received by the State Government on December 3, 1971, was disposed of only on December 22, 1971 and there was, therefore, undue delay in its disposal. To explain the delay, an affidavit was filed on behalf of the State Government on June 17, 1972, and in that it is averred that the delay in the disposal was due to the dislocation of work in the office due to demonstration of the State Government employees including those of the Home Department (Special Section) from September, 12 to end of November 1971. It is further stated in the affidavit that during this period there was no regular work or movement of files. Even assuming that the above averment is correct, it furnishes no reason for the delay in the disposal of the representation of the petitioner, as the dislocation of work was only from September 12 to end of November, 1971 whereas the representation was received by the Government on December 3, 1971. In Jayanarayan Sukul v. State of West Bengal, (1970) 3 SCR 225 = (AIR 1970 SC 675 ) this Court said : The fundamental right of the detenu to have his representation considered by the appropriate Government would be rendered meaningless if the Government does not deal with the matter expeditiously but at its own sweet-will and convenience. 4. In the circumstances of this case I think the State Government did not dispose of the representation as early as practicable.

1[ds]3.The petitioners counsel contended that the representation made by the petitioner, though received by the State Government on December 3, 1971, was disposed of only on December 22, 1971 and there was, therefore, undue delay in its disposal.To explain the delay, an affidavit was filed on behalf of the State Government on June 17, 1972, and in that it is averred that the delay in the disposal was due to the dislocation of work in the office due to demonstration of the State Government employees including those of the Home Department (Special Section) from September, 12 to end of November 1971. It is further stated in the affidavit that during this period there was no regular work or movement of files. Even assuming that the above averment is correct, it furnishes no reason for the delay in the disposal of the representation of the petitioner, as the dislocation of work was only from September 12 to end of November, 1971 whereas the representation was received by the Government on December 3, 1971. In Jayanarayan Sukul v. State of West Bengal, (1970) 3 SCR 225 = (AIR 1970 SC 675 ) this Court said :The fundamental right of the detenu to have his representation considered by the appropriate Government would be rendered meaningless if the Government does not deal with the matter expeditiously but at its own4. In the circumstances of this case I think the State Government did not dispose of the representation as early as practicable.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: 1. The petitioner challenge the validity of a detention order and prays for the issue of a writ or order in the nature of habeas corpus and for releasing him from custody. 2. On November 25, 1971, the District Magistrate, 24 Paraganas, West Bengal, in the exercise of his power under the provisions of sub-section (1), read with sub-section (2) of Section 3 of the Maintenance of Internal Security Act, 1971 (Act 26 of 1971) passed an order for the detention of the petitioner. In pursuance of it, the petitioner was arrested on November 27, 1971 and he was served with the order of detention together with the ground of detention on the same day. On November 30, 1971 the District Magistrate reported to the State Government about the passing of the detention order together with grounds of detention and the particulars having bearing on the case. The report and the particulars were considered by the State Government and the order of detention was approved by it on December 6, 1971. On the same day, the State Government submitted a report to the Central Government in accordance with the provisions of sub-section (4) of Section 3 of the Act. On December 24, 1971, the State Government placed the case of the petitioner before the Advisory Board under Section 10 of the Act. On or about December 3, 1971, the State Government in its Home Department (Special Section) received a representation from the petitioner. The representation was considered by the State Government and the State Government, by its order dated 22-12-1971, rejected the same but forwarded the representation to the Advisory Board for its consideration. The Advisory Board, after consideration of the materials placed before it and the representation, submitted its report to the State Government on February 4, 1972. The Advisory Board was of the opinion that there was sufficient cause for detention of the petitioner. By its order, dated February 12, 1972, the State Government, in exercise of the powers conferred by sub-section (1) of Section 12 of the Act confirmed the order of detention and communicated it to the petitioner by its Memo, dated February, 15, 1972.3.The petitioners counsel contended that the representation made by the petitioner, though received by the State Government on December 3, 1971, was disposed of only on December 22, 1971 and there was, therefore, undue delay in its disposal. To explain the delay, an affidavit was filed on behalf of the State Government on June 17, 1972, and in that it is averred that the delay in the disposal was due to the dislocation of work in the office due to demonstration of the State Government employees including those of the Home Department (Special Section) from September, 12 to end of November 1971. It is further stated in the affidavit that during this period there was no regular work or movement of files. Even assuming that the above averment is correct, it furnishes no reason for the delay in the disposal of the representation of the petitioner, as the dislocation of work was only from September 12 to end of November, 1971 whereas the representation was received by the Government on December 3, 1971. In Jayanarayan Sukul v. State of West Bengal, (1970) 3 SCR 225 = (AIR 1970 SC 675 ) this Court said : The fundamental right of the detenu to have his representation considered by the appropriate Government would be rendered meaningless if the Government does not deal with the matter expeditiously but at its own sweet-will and convenience. 4. In the circumstances of this case I think the State Government did not dispose of the representation as early as practicable. ### Response: 1

H.S. Goutham and Anr Vs. Rama Murthy and Anr. Etc

O.S. No. 3376 of 1995 was maintainable. No error has been committed by the High Court in holding so. 13. Now, so far as the dismissal of I.A. No. 4 of 1999 by the learned Executing Court in the Execution Petition No. 232 of 1996 which was filed by the judgment debtors to set aside the court auction/sale dated 11.02.1999 and 18.02.1999 with respect to the subject mortgaged property is concerned, it is not in dispute that the judgment debtors as such did not deposit the amount of Rs.4,50,000/- i.e. sale consideration together with interest in terms of Order XXI Rule 90 CPC. Where any immovable property has been sold in execution of a decree, the decree-holder, or the purchaser, or any other person entitled to share in a rateable distribution of assets, or whose interests are affected by the sale, may apply to the Court to set aside the sale on the ground of a material irregularity or fraud in publishing or conducting it. Therefore, as per Order XXI Rule 90, an application to set aside the sale on the ground of irregularity or fraud may be made by the decree holder on the ground of material irregularity or fraud in publishing or conducting it. It is required to be noted that in the present case, as such, it is not the case of the judgment debtors that there was any material irregularity or fraud in publishing or conducting the sale. No such submissions have been made before this Court. Their objection is that the decree was obtained by fraud. Therefore also, the application submitted by the original judgment debtors under Order XXI Rule 90 i.e. I.A. No. 4 of 1999 was required to be dismissed and was rightly dismissed by the learned Executing Court. 14. Now, so far as the impugned judgment and order passed by the High Court in CRP No. 3297 of 2000 quashing and setting aside the order passed by the Executing Court dated 03.03.1998 is concerned, from the impugned judgment and order passed by the High Court, it appears that the sale has been set aside by the High Court in view of the finding on Point No. 1 i.e. the decree was obtained by fraud and mis-representation and considering the report filed by the learned Principal City Civil Judge. However, it is required to be noted that at the time when learned Executing Court passed the order dated 03.03.1998 no evidence was led by the judgment debtors. The allegation that the decree was obtained by fraud and mis-representation was not substantiated. The High Court ought to have appreciated that even the order dated 03.03.1998 was not challenged by the judgment debtors till the year 2000 and, in the meantime, two applications being I.A. 3 of 1999 and I.A. No. 4 of 1999 were submitted by the judgment debtors under Order XXI Rule 90, which came to be dismissed and the mortgaged property was sold in the court auction and even the sale was confirmed and the sale certificate was issued and the same was registered with the Sub-Registrar. As observed hereinabove, as per Order XXI Rule 92, where an application is made under Order XXI Rule 89, Order XXI Rule 90 and Order XXI Rule 91 and the same is disallowed, the Court shall make an order confirming the sale and thereafter the sale shall become absolute. As per Order XXI Rule 94, where a sale of immovable property has become absolute, the Court shall grant a certificate specifying the property sold and the name of the person who at the time of sale is declared to be the purchaser. Such certificate shall bear the date on which the sale became absolute. Therefore, when after the order dated 03.03.1998 overruling the objections raised by the judgment debtors and thereafter the order was passed in I.A. No. 4 of 1999 and thereafter when the sale was confirmed and the sale certificate was issued, the High Court ought not to have thereafter set aside the order dated 03.03.1998 overruling the objections raised by the judgment debtors, which order was not challenged by the judgment debtors before the High Court till the year 2000. Under the circumstances, the impugned judgment and order passed by the High Court in CRP No. 3297 of 2000 quashing and setting aside the order dated 03.03.1998 cannot be sustained and the same deserves to be quashed and set aside. 15. Now, so far as the impugned judgment and order passed by the High Court in MFA No. 3934 of 2000 quashing and setting aside the order dated 30.10.1999 dismissing I.A. No. 4 of 1999 which was filed by the judgment debtors under Order XXI Rule 90 is concerned, the High Court has set aside the same observing that the auction purchaser cannot be said to be the bona fide purchaser as he was related to the judgment creditor and that he was a partner of the firm in whose favour the mortgage was executed. However, it is required to be noted that I.A. No. 4 of 1999 was not filed to set aside the sale on the aforesaid grounds. The said application was submitted on the ground that no proper publication was made to get the adequate market value. Therefore, the High Court has gone beyond the case of the judgment debtors in I.A. No. 4 of 1999. Even on merits also and factually, the High Court is not correct in observing that the auction purchaser was not a bona fide purchaser. According to the judgment creditor, the partnership firm was already dissolved much before and thereafter the plaintiff inherited the assets, claims and liabilities of the firm. Even as observed by the learned Executing Court while passing the order in I.A. No. 4 of 1999 the judgment debtors even did not deposit the entire amount. Under the circumstances, the High Court therefore committed an error in quashing and setting aside order dated 30.10.1999 passed in I.A. No. 4 of 1999.

1[ds]9. At this stage, it is required to be noted that as per the relevant provisions of the Code of Civil Procedure, more particularly, Order XXI Rule 92 read with Order XXI Rule 94, once the sale is confirmed and the sale certificate has been issued in favour of the purchaser, the same shall become final.10. Now, so far as the procedure adopted by the High Court calling for the report from the learned Principal City Civil Judge on whether the decree was obtained by fraud or not is concerned, at the outset, it is required to be noted that at the time when the High Court passed such an order, there was already an order passed by the learned Executing Court dated 03.03.1998 overruling the objections raised by the judgment debtors that the decree was obtained by fraud and mis-representation. As observed by the learned Executing Court in the order dated 03.03.1998, the judgment debtors except the averments that the decree was obtained by fraud, mis-representation, neither any further submissions were made on that nor even the judgment debtors led any evidence in support of the same. Therefore, as such, learned Executing Court was justified in overruling the objection that the decree was obtained by fraud, mis-representation etc. As per the settled principle of law, when the fraud is alleged the same is required to be pleaded and established by leading evidence. Mere allegation that there was a fraud is not sufficient. Therefore, subsequent order passed by the High Court calling for the report from the learned Principal City Civil Judge on the question whether the decree was obtained by fraud or not, can be said to be giving an opportunity to the judgment debtors to fill in the lacuna. Therefore, the course adopted by the High Court calling for the report from the learned Principal City Civil Judge cannot be approved.10.1 Even otherwise, it is required to be noted that as per the provisions of Order XLI, the appellate court may permit additional evidence to be produced whether oral or documentary, if the conditions mentioned in Order XLI Rule 27 are satisfied after the additional evidence is permitted to be produced in exercise of powers under Order XLI Rule 27. Thereafter, the procedure under Order XLI Rules 28 and 29 is required to be followed. Therefore, unless and until the procedure under Order XLI Rules 27, 28 and 29 are followed, the parties to the appeal cannot be permitted to lead additional evidence and/or the appellate court is not justified to direct the court from whose decree the appeal is preferred or any other subordinate court, to take such evidence and to send it when taken to the Appellate Court. From the material produced on record, it appears that the said procedure has not been followed by the High Court while calling for the report from the learned Principal City Civil Judge.10.2 Even otherwise, it is required to be noted that at the time when the learned Principal City Civil Judge permitted the parties to lead the evidence and submitted the report/finding that the decree was obtained by fraud, there was already an order passed by the Executing Court-Co-ordinate Court overruling the objections made by the judgment debtors that the decree was obtained by fraud. Therefore, unless and until the order dated 03.03.1998 was set aside, neither the High Court was justified in calling for the report from the learned Principal City Civil Judge nor even the learned Principal City Civil Judge was justified in permitting the judgment debtors to lead the evidence on the allegation that the decree was obtained by fraud, mis-representation, when the judgment debtors failed to lead any evidence earlier before the Executing Court when such objections were raised.11. From the impugned judgment and order passed by the High Court, it appears that the High Court has heavily relied upon the report submitted by the learned Principal City Civil Judge and thereafter has come to the conclusion that the decree was obtained by fraud, mis-representation. Therefore, in the facts and circumstances of the case and for the reasons stated above, the High Court has committed an error in relying upon the report submitted by the learned Principal City Civil Judge holding that the decree was obtained by fraud.11.1 Even otherwise, on perusal of the evidence led before the learned Principal City Civil Judge and even the findings recorded by the learned Principal City Civil Judge and the reasoning given by the High Court while holding that the decree was obtained by fraud, we are of the opinion that, in the facts and circumstances of the case, and even on the evidence led, the High Court has erred in holding that the decree was obtained by fraud. The judgment debtors-original defendants have put their signatures on the written statement or on the consent terms. The mortgaged property and the promissory note are not in dispute. Therefore, when the suit was filed and the judgment debtors wanted to get more time to repay the amount and when it was agreed to pay Rs.4,50,000/- (suit claim) in a monthly installment of Rs.5,000/- within three years, nothing was unnatural.12. Now, so far as the objection raised on behalf of the appellant herein that the appeal before the High Court against a consent decree was not maintainable is concerned, the same has no substance. The High Court has elaborately dealt with the same in detail and has considered the relevant provisions of the Code of Civil Procedure, namely, Section 96, Order XXIII Rule 3, Order XLIII Rule 1 (m) and order XLIII Rule 1A(2). It is true that, as per Section 96(3), the appeal against the decree passed with the consent of the parties shall be barred. However, it is also true that as per Order XXIII Rule 3A no suit shall lie to set aside a decree on the ground that the compromise on which the decree is based was not lawful. However, it is required to be noted that when Order XLIII Rule 1(m) came to be omitted by Act 104 of 1976, simultaneously, Rule XLIII Rule 1A came to be inserted by the very Act 104 of 1976, which provides that in an appeal against the decree passed in a suit for recording a compromise or refusing to record a compromise, it shall be open to the appellant to contest the decree on the ground that the compromise should or should not have been recorded. Therefore, the High Court has rightly relied upon the decision of this Court in Banwari Lal v. Chando Devi AIR 1993 SC 1139 (para 9) and has rightly come to the conclusion that the appeal before the High Court against the judgment and decree passed in O.S. No. 3376 of 1995 was maintainable. No error has been committed by the High Court in holding so.13. Now, so far as the dismissal of I.A. No. 4 of 1999 by the learned Executing Court in the Execution Petition No. 232 of 1996 which was filed by the judgment debtors to set aside the court auction/sale dated 11.02.1999 and 18.02.1999 with respect to the subject mortgaged property is concerned, it is not in dispute that the judgment debtors as such did not deposit the amount of Rs.4,50,000/- i.e. sale consideration together with interest in terms of Order XXI Rule 90 CPC. Where any immovable property has been sold in execution of a decree, the decree-holder, or the purchaser, or any other person entitled to share in a rateable distribution of assets, or whose interests are affected by the sale, may apply to the Court to set aside the sale on the ground of a material irregularity or fraud in publishing or conducting it. Therefore, as per Order XXI Rule 90, an application to set aside the sale on the ground of irregularity or fraud may be made by the decree holder on the ground of material irregularity or fraud in publishing or conducting it. It is required to be noted that in the present case, as such, it is not the case of the judgment debtors that there was any material irregularity or fraud in publishing or conducting the sale. No such submissions have been made before this Court. Their objection is that the decree was obtained by fraud. Therefore also, the application submitted by the original judgment debtors under Order XXI Rule 90 i.e. I.A. No. 4 of 1999 was required to be dismissed and was rightly dismissed by the learned Executing Court.14. Now, so far as the impugned judgment and order passed by the High Court in CRP No. 3297 of 2000 quashing and setting aside the order passed by the Executing Court dated 03.03.1998 is concerned, from the impugned judgment and order passed by the High Court, it appears that the sale has been set aside by the High Court in view of the finding on Point No. 1 i.e. the decree was obtained by fraud and mis-representation and considering the report filed by the learned Principal City Civil Judge. However, it is required to be noted that at the time when learned Executing Court passed the order dated 03.03.1998 no evidence was led by the judgment debtors. The allegation that the decree was obtained by fraud and mis-representation was not substantiated. The High Court ought to have appreciated that even the order dated 03.03.1998 was not challenged by the judgment debtors till the year 2000 and, in the meantime, two applications being I.A. 3 of 1999 and I.A. No. 4 of 1999 were submitted by the judgment debtors under Order XXI Rule 90, which came to be dismissed and the mortgaged property was sold in the court auction and even the sale was confirmed and the sale certificate was issued and the same was registered with the Sub-Registrar. As observed hereinabove, as per Order XXI Rule 92, where an application is made under Order XXI Rule 89, Order XXI Rule 90 and Order XXI Rule 91 and the same is disallowed, the Court shall make an order confirming the sale and thereafter the sale shall become absolute. As per Order XXI Rule 94, where a sale of immovable property has become absolute, the Court shall grant a certificate specifying the property sold and the name of the person who at the time of sale is declared to be the purchaser. Such certificate shall bear the date on which the sale became absolute. Therefore, when after the order dated 03.03.1998 overruling the objections raised by the judgment debtors and thereafter the order was passed in I.A. No. 4 of 1999 and thereafter when the sale was confirmed and the sale certificate was issued, the High Court ought not to have thereafter set aside the order dated 03.03.1998 overruling the objections raised by the judgment debtors, which order was not challenged by the judgment debtors before the High Court till the year 2000. Under the circumstances, the impugned judgment and order passed by the High Court in CRP No. 3297 of 2000 quashing and setting aside the order dated 03.03.1998 cannot be sustained and the same deserves to be quashed and set aside.15. Now, so far as the impugned judgment and order passed by the High Court in MFA No. 3934 of 2000 quashing and setting aside the order dated 30.10.1999 dismissing I.A. No. 4 of 1999 which was filed by the judgment debtors under Order XXI Rule 90 is concerned, the High Court has set aside the same observing that the auction purchaser cannot be said to be the bona fide purchaser as he was related to the judgment creditor and that he was a partner of the firm in whose favour the mortgage was executed. However, it is required to be noted that I.A. No. 4 of 1999 was not filed to set aside the sale on the aforesaid grounds. The said application was submitted on the ground that no proper publication was made to get the adequate market value. Therefore, the High Court has gone beyond the case of the judgment debtors in I.A. No. 4 of 1999. Even on merits also and factually, the High Court is not correct in observing that the auction purchaser was not a bona fide purchaser. According to the judgment creditor, the partnership firm was already dissolved much before and thereafter the plaintiff inherited the assets, claims and liabilities of the firm. Even as observed by the learned Executing Court while passing the order in I.A. No. 4 of 1999 the judgment debtors even did not deposit the entire amount. Under the circumstances, the High Court therefore committed an error in quashing and setting aside order dated 30.10.1999 passed in I.A. No. 4 of 1999.That, after a period of five years from the date of passing of the judgment and decree dated 01.06.1995 the judgment debtors preferred RFA No. 274 of 2001 challenging the decree dated 01.06.1995 passed by the learned Trial Court on the ground that the same has been obtained by fraud and mis-representation. After a period of five years from the date of filing of the appeal, the High Court called for a finding/report from the learned Principal City Civil Judge and directed him to hold an enquiry as to whether the decree dated 01.06.1995 was obtained by fraud. The legality and propriety of the said order shall be dealt with hereinbelow at an appropriate stage. Before the learned Principal City Civil Judge, the judgment debtors led the evidence in support of their claim that the judgment and decree was obtained by fraud and mis-representation, which evidence was not led by them before the Executing Court when they submitted the objections and contended that the decree was obtained by fraud. That, thereafter, the learned Principal City Civil Judge submitted the report that the decree was obtained by fraud and on the basis of the report submitted by learned Principal City Civil Judge mainly, the High Court has set aside the judgment and decree by the impugned judgment and order. Thus, from the aforesaid it is crystal clear that all through-out there was a delay and negligence on the part of the judgment debtors in not initiating the appropriate proceedings at appropriate stage. Order dated 03.03.1998 overruling the objections submitted by the judgment debtors to the effect that the judgment was obtained by fraud and mis-representation was not challenged by the judgment debtors till the mortgaged property was auctioned; sale of the mortgaged property was confirmed in favour of the auction purchaser and even the sale certificate was issued in favour of the auction purchaser and sale was registered with the Sub-Registrar and even also the dismissal of I.A. No. 3 of 1999 and I.A. No. 4 of 1999. Not only that, till that time even no appeal was assailed/challenged before the higher forum. The first appeal was filed in the year 2000 and by that time the mortgaged property was already sold in the execution proceedings and the sale was confirmed in favour of the auction purchaser and even the sale certificate was issued in favour of the auction purchaser.

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: O.S. No. 3376 of 1995 was maintainable. No error has been committed by the High Court in holding so. 13. Now, so far as the dismissal of I.A. No. 4 of 1999 by the learned Executing Court in the Execution Petition No. 232 of 1996 which was filed by the judgment debtors to set aside the court auction/sale dated 11.02.1999 and 18.02.1999 with respect to the subject mortgaged property is concerned, it is not in dispute that the judgment debtors as such did not deposit the amount of Rs.4,50,000/- i.e. sale consideration together with interest in terms of Order XXI Rule 90 CPC. Where any immovable property has been sold in execution of a decree, the decree-holder, or the purchaser, or any other person entitled to share in a rateable distribution of assets, or whose interests are affected by the sale, may apply to the Court to set aside the sale on the ground of a material irregularity or fraud in publishing or conducting it. Therefore, as per Order XXI Rule 90, an application to set aside the sale on the ground of irregularity or fraud may be made by the decree holder on the ground of material irregularity or fraud in publishing or conducting it. It is required to be noted that in the present case, as such, it is not the case of the judgment debtors that there was any material irregularity or fraud in publishing or conducting the sale. No such submissions have been made before this Court. Their objection is that the decree was obtained by fraud. Therefore also, the application submitted by the original judgment debtors under Order XXI Rule 90 i.e. I.A. No. 4 of 1999 was required to be dismissed and was rightly dismissed by the learned Executing Court. 14. Now, so far as the impugned judgment and order passed by the High Court in CRP No. 3297 of 2000 quashing and setting aside the order passed by the Executing Court dated 03.03.1998 is concerned, from the impugned judgment and order passed by the High Court, it appears that the sale has been set aside by the High Court in view of the finding on Point No. 1 i.e. the decree was obtained by fraud and mis-representation and considering the report filed by the learned Principal City Civil Judge. However, it is required to be noted that at the time when learned Executing Court passed the order dated 03.03.1998 no evidence was led by the judgment debtors. The allegation that the decree was obtained by fraud and mis-representation was not substantiated. The High Court ought to have appreciated that even the order dated 03.03.1998 was not challenged by the judgment debtors till the year 2000 and, in the meantime, two applications being I.A. 3 of 1999 and I.A. No. 4 of 1999 were submitted by the judgment debtors under Order XXI Rule 90, which came to be dismissed and the mortgaged property was sold in the court auction and even the sale was confirmed and the sale certificate was issued and the same was registered with the Sub-Registrar. As observed hereinabove, as per Order XXI Rule 92, where an application is made under Order XXI Rule 89, Order XXI Rule 90 and Order XXI Rule 91 and the same is disallowed, the Court shall make an order confirming the sale and thereafter the sale shall become absolute. As per Order XXI Rule 94, where a sale of immovable property has become absolute, the Court shall grant a certificate specifying the property sold and the name of the person who at the time of sale is declared to be the purchaser. Such certificate shall bear the date on which the sale became absolute. Therefore, when after the order dated 03.03.1998 overruling the objections raised by the judgment debtors and thereafter the order was passed in I.A. No. 4 of 1999 and thereafter when the sale was confirmed and the sale certificate was issued, the High Court ought not to have thereafter set aside the order dated 03.03.1998 overruling the objections raised by the judgment debtors, which order was not challenged by the judgment debtors before the High Court till the year 2000. Under the circumstances, the impugned judgment and order passed by the High Court in CRP No. 3297 of 2000 quashing and setting aside the order dated 03.03.1998 cannot be sustained and the same deserves to be quashed and set aside. 15. Now, so far as the impugned judgment and order passed by the High Court in MFA No. 3934 of 2000 quashing and setting aside the order dated 30.10.1999 dismissing I.A. No. 4 of 1999 which was filed by the judgment debtors under Order XXI Rule 90 is concerned, the High Court has set aside the same observing that the auction purchaser cannot be said to be the bona fide purchaser as he was related to the judgment creditor and that he was a partner of the firm in whose favour the mortgage was executed. However, it is required to be noted that I.A. No. 4 of 1999 was not filed to set aside the sale on the aforesaid grounds. The said application was submitted on the ground that no proper publication was made to get the adequate market value. Therefore, the High Court has gone beyond the case of the judgment debtors in I.A. No. 4 of 1999. Even on merits also and factually, the High Court is not correct in observing that the auction purchaser was not a bona fide purchaser. According to the judgment creditor, the partnership firm was already dissolved much before and thereafter the plaintiff inherited the assets, claims and liabilities of the firm. Even as observed by the learned Executing Court while passing the order in I.A. No. 4 of 1999 the judgment debtors even did not deposit the entire amount. Under the circumstances, the High Court therefore committed an error in quashing and setting aside order dated 30.10.1999 passed in I.A. No. 4 of 1999. ### Response: 1

Prima Realty Vs. Union Of India And Ors

66 lakhs and not Rs. 60 lakhs for which the cheque was sent on May 31, 1995, since the total amount paid as earnest money by the appellant was Rs. 66 lakhs. In the facts of the present case, we do not find any merit even in this contention. There is no dispute that the total amount of Rs. 3, 58, 84, 384, inclusive of Rs. 60 lakhs sent to the appellant/transferee was tendered by cheque by the concerned authority collectively to the persons entitled to the payment. The payment of the entire consideration due under the purchase order was, therefore, made collectively to the persons entitled to receive the payment, even though there was some difference in the amount tendered to the appellant/transferee. The adjustment of the exact amount due to each, between the several persons who had to share the total amount of consideration was an internal arrangement between them, and this by itself would not vitiate the tender of the amount of consideration as required by section 269UG(1). This contention also fails The question now is of the effect of the description of the payee in the cheque for the sum of Rs. 60 lakhs which was sent to the appellant on May 31, 1995. In the cheque, the payee was described as " Prime Reality Ltd.". The question is : whether this can be treated as a valid tender of the amount to the appellant ? The contention of Shri Nariman is that it was not a valid tender to the appellant since the description of the payee in the cheque was of a different legal entity, i.e., a limited company other than the partnership firm which is the correct description of the appellant. The point for consideration is : whether the description of the payee in the cheque was of a legal entity distinct from, and other than the appellant. If it be so, as contended by Shri Nariman, it was not a valid tender to the appellant/transferee. The result would be a deficiency in tender of the amount of consideration to this extent and, therefore, non-compliance with section 269UG(1) resulting in the consequences provided in section 269UHAdmittedly, the correct description of the appellant/transferee is Prima Realty which is a partnership-firm. It is settled that the firm name is a compendious mode of describing the partners collectively ; and a limited company, by itself a legal entity, is a distinct person or legal entity. The description of the payee in the cheque was of a limited company named as " Prime Reality " and not even " Prima Realty " which is the firm name of the appellants partnership firm. Does it describe the appellant as the payee ? In Davies v. Elsby Brothers Ltd. 1960 (3) ALLER 672(CA), at page 676, Devlin L. J., indicated the test for deciding whether a misdescription of this kind is merely a misnomer or the description of a different person or legal entity. The test is " ....... I cannot tell from the document itself whether they mean me or not and I shall have to make inquiries , then it seems to me that one is getting beyond the realm of misnomer. One of the factors which must operate on the mind of the recipient of a document, and which operates in this case, is whether there is or is not another entity to whom the description on the writ might refer." * In that decision the amendment was sought to change the defendant from " EB (a firm) " to " EB (Ltd.) " and it was held that these were two different entities, the firm and the company ; and, therefore, it was not a case of mere amendment to correct the misnomer but one of substitution by one entity for another. The position in the present case is similar The appellant/transferee is a partnership-firm with the name Prima Realty but the cheque described the payee as Prime Reality Ltd. which referred to a different legal entity, a limited company, instead of a firm. The tender of the cheque could not, therefore, be treated as tender to the appellant. It was reasonable to assume that the cheque would not be honoured by the banker to credit the amount of that cheque to the account of the appellant, since it would relate to another legal entity, a limited company. In such a situation, the appellants were justified in taking the view that the cheque was not meant for them, and they could not lawfully require the bank to deposit the amount of the cheque in their account. The result is that the tender of the amount of consideration was short to the extent of Rs. 60 lakhs for which amount this cheque was made. There was, thus, clear non-compliance with the requirement of section 269UG(1) of the Act. The consequence envisaged by section 269UH of the Act ensued. Accordingly, the order dated April 24, 1995, made under section 269UD(1) by the appropriate authority stood abrogated and the property was revested in the transferors in terms of sub-section (1) of section 269UH of the Act with the other consequential results including those specified in sub-section (2) of section 269UH and sub-section (3) of section 269UD. It is not necessary to detail all the consequences which follow as a result thereof, in terms of the Income-tax Act, 1961, and any other laws which may be applicable. In view of the fact that the cheque for the amount of Rs. 60 lakhs has not been encashed, the remaining amount of Rs. 2, 98, 84, 384 has become refundable to the Central Government as on June 1, 1995, which would be refunded by the appellants with interest at 12 per cent. per annum from June 1, 1995, till the date of payment. It is directed accordingly. All the consequences in accordance with law including the requirement of execution of the conveyance in favour of the appellants follow as already indicated

1[ds]The appellant/transferee is awith the name Prima Realty but the cheque described the payee as Prime Reality Ltd. which referred to a different legal entity, a limited company, instead of a firm. The tender of the cheque could not, therefore, be treated as tender to the appellant. It was reasonable to assume that the cheque would not be honoured by the banker to credit the amount of that cheque to the account of the appellant, since it would relate to another legal entity, a limited company. In such a situation, the appellants were justified in taking the view that the cheque was not meant for them, and they could not lawfully require the bank to deposit the amount of the cheque in their account. The result is that the tender of the amount of consideration was short to the extent of Rs. 60 lakhs for which amount this cheque was made. There was, thus, clearwith the requirement of section 269UG(1) of the Act. The consequence envisaged by section 269UH of the Act ensued. Accordingly, the order dated April 24, 1995, made under section 269UD(1) by the appropriate authority stood abrogated and the property was revested in the transferors in terms of(1) of section 269UH of the Act with the other consequential results including those specified in(2) of section 269UH and(3) of section 269UD. It is not necessary to detail all the consequences which follow as a result thereof, in terms of theAct, 1961, and any other laws which may be applicable. In view of the fact that the cheque for the amount of Rs. 60 lakhs has not been encashed, the remaining amount of Rs. 2, 98, 84, 384 has become refundable to the Central Government as on June 1, 1995, which would be refunded by the appellants with interest at 12 per cent. per annum from June 1, 1995, till the date of payment. It is directed accordingly. All the consequences in accordance with law including the requirement of execution of the conveyance in favour of the appellants follow as already indicated

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: 66 lakhs and not Rs. 60 lakhs for which the cheque was sent on May 31, 1995, since the total amount paid as earnest money by the appellant was Rs. 66 lakhs. In the facts of the present case, we do not find any merit even in this contention. There is no dispute that the total amount of Rs. 3, 58, 84, 384, inclusive of Rs. 60 lakhs sent to the appellant/transferee was tendered by cheque by the concerned authority collectively to the persons entitled to the payment. The payment of the entire consideration due under the purchase order was, therefore, made collectively to the persons entitled to receive the payment, even though there was some difference in the amount tendered to the appellant/transferee. The adjustment of the exact amount due to each, between the several persons who had to share the total amount of consideration was an internal arrangement between them, and this by itself would not vitiate the tender of the amount of consideration as required by section 269UG(1). This contention also fails The question now is of the effect of the description of the payee in the cheque for the sum of Rs. 60 lakhs which was sent to the appellant on May 31, 1995. In the cheque, the payee was described as " Prime Reality Ltd.". The question is : whether this can be treated as a valid tender of the amount to the appellant ? The contention of Shri Nariman is that it was not a valid tender to the appellant since the description of the payee in the cheque was of a different legal entity, i.e., a limited company other than the partnership firm which is the correct description of the appellant. The point for consideration is : whether the description of the payee in the cheque was of a legal entity distinct from, and other than the appellant. If it be so, as contended by Shri Nariman, it was not a valid tender to the appellant/transferee. The result would be a deficiency in tender of the amount of consideration to this extent and, therefore, non-compliance with section 269UG(1) resulting in the consequences provided in section 269UHAdmittedly, the correct description of the appellant/transferee is Prima Realty which is a partnership-firm. It is settled that the firm name is a compendious mode of describing the partners collectively ; and a limited company, by itself a legal entity, is a distinct person or legal entity. The description of the payee in the cheque was of a limited company named as " Prime Reality " and not even " Prima Realty " which is the firm name of the appellants partnership firm. Does it describe the appellant as the payee ? In Davies v. Elsby Brothers Ltd. 1960 (3) ALLER 672(CA), at page 676, Devlin L. J., indicated the test for deciding whether a misdescription of this kind is merely a misnomer or the description of a different person or legal entity. The test is " ....... I cannot tell from the document itself whether they mean me or not and I shall have to make inquiries , then it seems to me that one is getting beyond the realm of misnomer. One of the factors which must operate on the mind of the recipient of a document, and which operates in this case, is whether there is or is not another entity to whom the description on the writ might refer." * In that decision the amendment was sought to change the defendant from " EB (a firm) " to " EB (Ltd.) " and it was held that these were two different entities, the firm and the company ; and, therefore, it was not a case of mere amendment to correct the misnomer but one of substitution by one entity for another. The position in the present case is similar The appellant/transferee is a partnership-firm with the name Prima Realty but the cheque described the payee as Prime Reality Ltd. which referred to a different legal entity, a limited company, instead of a firm. The tender of the cheque could not, therefore, be treated as tender to the appellant. It was reasonable to assume that the cheque would not be honoured by the banker to credit the amount of that cheque to the account of the appellant, since it would relate to another legal entity, a limited company. In such a situation, the appellants were justified in taking the view that the cheque was not meant for them, and they could not lawfully require the bank to deposit the amount of the cheque in their account. The result is that the tender of the amount of consideration was short to the extent of Rs. 60 lakhs for which amount this cheque was made. There was, thus, clear non-compliance with the requirement of section 269UG(1) of the Act. The consequence envisaged by section 269UH of the Act ensued. Accordingly, the order dated April 24, 1995, made under section 269UD(1) by the appropriate authority stood abrogated and the property was revested in the transferors in terms of sub-section (1) of section 269UH of the Act with the other consequential results including those specified in sub-section (2) of section 269UH and sub-section (3) of section 269UD. It is not necessary to detail all the consequences which follow as a result thereof, in terms of the Income-tax Act, 1961, and any other laws which may be applicable. In view of the fact that the cheque for the amount of Rs. 60 lakhs has not been encashed, the remaining amount of Rs. 2, 98, 84, 384 has become refundable to the Central Government as on June 1, 1995, which would be refunded by the appellants with interest at 12 per cent. per annum from June 1, 1995, till the date of payment. It is directed accordingly. All the consequences in accordance with law including the requirement of execution of the conveyance in favour of the appellants follow as already indicated ### Response: 1

Maimoona Khatun And Anr Vs. State Of U.P. And Anr

suspension from September 16, 1943 till December 12, 1953 when he was reinstated and again suspended from January 19, 1954 till February 23, 1956 when he was dismissed, his suit on October 6, 1956 is within a period of three years from the date of his reinstatement on December 12, 1953. Second, during the period of suspension he was not entitled to salary under Fundamental Rule 53. Further decision to that effect was taken by the Madhya Pradesh Government on January 28, 1956 under Fundamental Rule 54. Therefore, the plain tiffs cause of action for salary for the period of suspension did not accrue until he was reinstated on December 12, 1953. The plaintiffs salary accrued only when he was reinstated as a result of the decree setting aside the orders of suspension and not of dismissal..... The rulings of this Court in Jai Chand Sawhneys case and Sakal Deeps case do not apply to the present appeal because there was no aspect of any suspension order remaining operative until the fact of reinstatement pursuant to the decree.......Therefore, there would be no question of salary accruing or accruing due so long as order of suspension and dismissal stands. The High Court was correct in the conclusion that the plaintiffs claim for salary accrued due only on the order of dismissal dated February 23, 1956 being set aside. 18. It is, therefore, manifest from a perusal of the observations made by this Court in the aforesaid case that the plaintiffs salary accrued only when the employee was reinstated as a result of the decree setting aside the order of suspension or dismissal. 19. In that case, the employee was suspended as far back as 16t h September 1943 and after an enquiry, the employee was removed from service on 7th November 1945. The employee filed a suit on the 6th of January 1949 and claimed his salary from 16th September 1943, the date when he was suspended, up to the date of his reinstatement on December 12, 1953 when the decree was passed. Indeed, if the view taken by the High Court in the instant case was correct, the suit of the employee would have been hopelessly barred by limitation and he could no t have got a decree for more than three years from 1949, the date when he filed the suit. This Court, however, held that as the starting point of limitation was not the date of the suit but the date when the removal of the employee was held to be void and he was reinstated, the suit was not barred by limitation. We might also mention that this Court also held that under Fundamental Rule 52 of the U. P. Rules, the pay and allowances of a Government servant ceased from th e date of dismissal and therefore there was no question of his claiming any arrears so long as his dismissal or removal stood. The facts of the present case seem to us to be directly covered by the decision rendered by this Court in the aforesaid case. 20. Thus, this Court has fully endorsed the view taken by the Madras and the Bombay High Court, referred to above. It seems to us that if we take the view that the right to sue for the arrears of salary accrues from the date whe n the salary would have been payable but for the order of dismissal and not from the date when the order of dismissal is set aside by the civil court, it will cause gross and substantial injustice to the employee concerned who having been found by a court of law to have been wrongly dismissed and who in the eye of law would have been deemed to be in service, would still be deprived for no fault of his, of the arrears of his salary beyond three years of the suit which, in spite of his best efforts he could not have claimed, until the order of dismissal was declared to be void. Such a course would in fact place the Government employees in a strange predicament and give an undeserving benefit to the employers who by wrongfully dis missing the employees would be left only with the responsibility of paying them for a period of three years prior to the suit and swallow the entire arrears beyond this period without any legal or moral justification. This aspect does not appear to have been noticed by the courts which have taken the view that the starting point of limitation would be three years from the date of the suit and was for the first time noticed by this Court in State of Madhya Pradesh v. State of Maharashtra &ors. (supra) which seems to us to have righted a wrong which was long overdue. 21. For these reasons, therefore, we are clearly of the opinion that in cases where an employee is dismissed or removed from service and is reinstated either by the appointing authority or by virtue of the order of dismissal or removal being set aside by a civil court, the starting point of limitation would be not the date of the order of dismissal or removal but the date when the right actually accrues, that is to say, the date of the reinstatement, by the appointing authority where no suit is filed or the date of the decree where a suit is filed and decreed. In this view of the matter, the High Court was in error in modifying the decree of the trial court and the lower Appellate Court and limiting the claim of the appellant to a period of only three years prior to the suit. In view of the findings given by the courts on facts, which have not been reversed by the High Court, it is manifest that the appellants are entitled to the entire decretal amount claimed by them and for which a decree was granted by the trial court and the lower appellate court.

1[ds]3. We have heard learned counsel for the parties and although we find that the question is not free from difficulty, the decisions of this Court show that the view taken by the High Court is legally erroneous.9. Thus, a careful perusal of the decision would clearly reveal that the actual question at issue in the present appeal was neither raised nor involved in the aforesaid decision. This decision was noticed by a Division Bench of the Madras High Court in the case of State of Madras v. A. V. Anantharaman where the Court distinguished the case referred to above on the ground that the question of the starting point of limitation was neither raised nor decided by this Court. In this connection, the Madras High Court observed as follows:As we said, the terms of F. R. 52 are clear and no public servant who had been dismissed albeit only by an invalid order can ask the Government to pay him his salary. His right to it will flow only when the order of dismissal has been set aside....... AIR 1962 SC 8 was not a case in which F. R. 52 prevented the accrual of salary, there the Government servant had been reverted from an officiating post to his substantive post resulting in loss of seniority in that post. Such reversion was later held to be one by way of punishment and the procedure under Article 311 of the Constitution not having been followed it was held to be invalid. The only point argued in that case was whether the salary due to the Government servant would come within Article 102 of the Limitation Act and that question was answered in the affirmative.10. On the other hand, this point was specifically raised before the Madras High Court which fully went into it and held that the right to sue under Article 102 of the Limitation Act would accrue only after the order of dismissal of the employee is set aside or he is reinstated by the appointing authority concerned. Until this stage is reached the right to recover arrears of salary does not accrue at all and there is no question of suing for the arrears of salary when no order of reinstatement, as indicated above, had been passed or the order of dismissal has not been held by a court of law to be void. In this connection, the Madras High Court observed as follows (supra):-But where a public servant had been dismissed or removed, his pay and allowance would cease from the date of such dismissal or removal. That is what is provided in F. R. 52. The question then will arise as to when in such cases, that is, where there has been a dismissal or removal which has been later on set aside as a result of subsequent proceedings the right to recover arrears of salary will accrue or arise. In neither of the two cases cited above was that question raised or considered...... The terminus a quo for a suit under that provision is the accrual of the salary. In other words, the cause of action is not any fixed point of time (e.g., on the 1st of the succeeding month) but when it accrues. By reason of F. R. 52 the right to salary ceases the moment an order for dismissal or removal is made.11. The High Court has rightly pointed out that the terminus quo for the suit under Article 102 is the accrual of the salary which by reason of F R. 52 ceases the moment an order of dismissal or removal is made. Thus, until a decree holding the order of dismissal or removal to be void i s passed by the court, it is not open to the employee to take any steps for recovering his salary. The Madras High Court then concluded by holding that the right to recover arrears of salary would accrue only after an order of dismissal has been set aside either in a departmental appeal or by a decree in a civil court. In this connection, the High Court observed as follows:-We are therefore of opinion that in the case of the dismissal of a public servant which ha s been subsequently set aside as in the present case, the right to recover arrears of salary would accrue only when that order of dismissal has been set aside either in departmental appeal or by a Civil Court. Viewed in that light, the instant claim must be held to be in time.12. We find ourselves in complete agreement with all the observations made by the Madras High Court in the aforesaid case.In support of his argument, he relied on the case of Devendra Pratap Narain Rai Sharma v. State of Uttar Pradesh where after extracting Rule 54 of the Fundamental Rules framed by the State of Uttar Pradesh under Art. 309 of the Constitution, this Court held thus:This rule has no application to cases like the present in which the dismissal of a public servant is declared invalid by a civil court and he is reinstated.13. Assuming that this was so, the principle contained in Rule 54 would however, apply in any case and the position would be that until a Government servant is reinstated, he cannot claim any arrears of salary or pay. Moreover, in the instant case, Rule 54 applies in terms because the employee was serving in the State of U. P. and was governed by Rule 54 and was reinstated by the Superintending Engineer, after his representation was accepted. It is, therefore, manifest that the employee could not have claimed any arrears of his salary until he was reinstated. Thus, even according t o the decision relied upon by the respondent, it is clear that the right to sue for arrears of salary accrued only after the employee was reinstated. This Court further observed in the aforesaid case:-effect of the decree of the civi l suit was that the appellant was never to be deemed to have been lawfully dismissed from service and the order of reinstatement was superfluous. The effect of the adjudication of the civil court is to declare that the appellant had been wrongfully prevented from attending to his duties as a public servant. It would not in such a contingency be open to the authority to deprive the public servant of the remuneration which he would have earned had he been permitted to work.14. In view of this observation once the civil court held that the direction given by the Superintending Engineer to treat the period of suspension as on leave being non est, the position would be that the employee continued to remain in service and the effect of the adjudication was to declare that he was wrongfully prevented from attending his duties as a public servant. In other words, the right to emoluments accrued on the date when the suit was decreed and the starting point of limitation will be that date because at no time prior there was any accrual of the right and hence the starting point of limitation would not be the date of reinstatement but the date when the Court held that the direction given by the Superintending Engineer was bad because until such a declaration was made, it was not open to the employee to have claimed the arrears of his salary.15. So far as the question when the right would accrue and whether the period of three years was to be counted from the date of the suit or the date of the reinstatement was a point that was neither raised nor answered even in this decision.17. So far as this Court is concerned, the matter stands concluded by a decision of this Court in case of The State of Madhya Pradesh v. The State of Maharashtra. where a Bench of three Judges considered this specific question and distinguished the earlier decisions of this Court in Jai Chand Sawhney v. Union of India and Sakal Deep Sahai Srivastava v. Union of India. While expounding the law regarding as to when the right to sue actually accrues, this Court observed as follows:-Three features are to be borne in mind in appreciating the plaintiffs case from the point of view of limitation. First the plaintiff became entitled to salary for the period September 16, 1943 upto the date of reinstatement on December 12, 1953, only when pursuant to the decree dated August 30, 1953 there was actual reinstatement of the plaintiff on December 12, 1953......On these facts two consequences arise in the present appeal. First, since the plaintiff was under suspension from September 16, 1943 till December 12, 1953 when he was reinstated and again suspended from January 19, 1954 till February 23, 1956 when he was dismissed, his suit on October 6, 1956 is within a period of three years from the date of his reinstatement on December 12, 1953. Second, during the period of suspension he was not entitled to salary under Fundamental Rule 53. Further decision to that effect was taken by the Madhya Pradesh Government on January 28, 1956 under Fundamental Rule 54. Therefore, the plain tiffs cause of action for salary for the period of suspension did not accrue until he was reinstated on December 12, 1953. The plaintiffs salary accrued only when he was reinstated as a result of the decree setting aside the orders of suspension and not of dismissal.....rulings of this Court in Jai Chand Sawhneys case and Sakal Deeps case do not apply to the present appeal because there was no aspect of any suspension order remaining operative until the fact of reinstatement pursuant to the decree.......Therefore, there would be no question of salary accruing or accruing due so long as order of suspension and dismissal stands. The High Court was correct in the conclusion that the plaintiffs claim for salary accrued due only on the order of dismissal dated February 23, 1956 being set aside.18. It is, therefore, manifest from a perusal of the observations made by this Court in the aforesaid case that the plaintiffs salary accrued only when the employee was reinstated as a result of the decree setting aside the order of suspension or dismissal.19. In that case, the employee was suspended as far back as 16t h September 1943 and after an enquiry, the employee was removed from service on 7th November 1945. The employee filed a suit on the 6th of January 1949 and claimed his salary from 16th September 1943, the date when he was suspended, up to the date of his reinstatement on December 12, 1953 when the decree was passed. Indeed, if the view taken by the High Court in the instant case was correct, the suit of the employee would have been hopelessly barred by limitation and he could no t have got a decree for more than three years from 1949, the date when he filed the suit. This Court, however, held that as the starting point of limitation was not the date of the suit but the date when the removal of the employee was held to be void and he was reinstated, the suit was not barred by limitation. We might also mention that this Court also held that under Fundamental Rule 52 of the U. P. Rules, the pay and allowances of a Government servant ceased from th e date of dismissal and therefore there was no question of his claiming any arrears so long as his dismissal or removal stood. The facts of the present case seem to us to be directly covered by the decision rendered by this Court in the aforesaid case.20. Thus, this Court has fully endorsed the view taken by the Madras and the Bombay High Court, referred to above. It seems to us that if we take the view that the right to sue for the arrears of salary accrues from the date whe n the salary would have been payable but for the order of dismissal and not from the date when the order of dismissal is set aside by the civil court, it will cause gross and substantial injustice to the employee concerned who having been found by a court of law to have been wrongly dismissed and who in the eye of law would have been deemed to be in service, would still be deprived for no fault of his, of the arrears of his salary beyond three years of the suit which, in spite of his best efforts he could not have claimed, until the order of dismissal was declared to be void. Such a course would in fact place the Government employees in a strange predicament and give an undeserving benefit to the employers who by wrongfully dis missing the employees would be left only with the responsibility of paying them for a period of three years prior to the suit and swallow the entire arrears beyond this period without any legal or moral justification. This aspect does not appear to have been noticed by the courts which have taken the view that the starting point of limitation would be three years from the date of the suit and was for the first time noticed by this Court in State of Madhya Pradesh v. State of Maharashtra. (supra) which seems to us to have righted a wrong which was long overdue.21. For these reasons, therefore, we are clearly of the opinion that in cases where an employee is dismissed or removed from service and is reinstated either by the appointing authority or by virtue of the order of dismissal or removal being set aside by a civil court, the starting point of limitation would be not the date of the order of dismissal or removal but the date when the right actually accrues, that is to say, the date of the reinstatement, by the appointing authority where no suit is filed or the date of the decree where a suit is filed and decreed. In this view of the matter, the High Court was in error in modifying the decree of the trial court and the lower Appellate Court and limiting the claim of the appellant to a period of only three years prior to the suit.In view of the findings given by the courts on facts, which have not been reversed by the High Court, it is manifest that the appellants are entitled to the entire decretal amount claimed by them and for which a decree was granted by the trial court and the lower appellate court.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: suspension from September 16, 1943 till December 12, 1953 when he was reinstated and again suspended from January 19, 1954 till February 23, 1956 when he was dismissed, his suit on October 6, 1956 is within a period of three years from the date of his reinstatement on December 12, 1953. Second, during the period of suspension he was not entitled to salary under Fundamental Rule 53. Further decision to that effect was taken by the Madhya Pradesh Government on January 28, 1956 under Fundamental Rule 54. Therefore, the plain tiffs cause of action for salary for the period of suspension did not accrue until he was reinstated on December 12, 1953. The plaintiffs salary accrued only when he was reinstated as a result of the decree setting aside the orders of suspension and not of dismissal..... The rulings of this Court in Jai Chand Sawhneys case and Sakal Deeps case do not apply to the present appeal because there was no aspect of any suspension order remaining operative until the fact of reinstatement pursuant to the decree.......Therefore, there would be no question of salary accruing or accruing due so long as order of suspension and dismissal stands. The High Court was correct in the conclusion that the plaintiffs claim for salary accrued due only on the order of dismissal dated February 23, 1956 being set aside. 18. It is, therefore, manifest from a perusal of the observations made by this Court in the aforesaid case that the plaintiffs salary accrued only when the employee was reinstated as a result of the decree setting aside the order of suspension or dismissal. 19. In that case, the employee was suspended as far back as 16t h September 1943 and after an enquiry, the employee was removed from service on 7th November 1945. The employee filed a suit on the 6th of January 1949 and claimed his salary from 16th September 1943, the date when he was suspended, up to the date of his reinstatement on December 12, 1953 when the decree was passed. Indeed, if the view taken by the High Court in the instant case was correct, the suit of the employee would have been hopelessly barred by limitation and he could no t have got a decree for more than three years from 1949, the date when he filed the suit. This Court, however, held that as the starting point of limitation was not the date of the suit but the date when the removal of the employee was held to be void and he was reinstated, the suit was not barred by limitation. We might also mention that this Court also held that under Fundamental Rule 52 of the U. P. Rules, the pay and allowances of a Government servant ceased from th e date of dismissal and therefore there was no question of his claiming any arrears so long as his dismissal or removal stood. The facts of the present case seem to us to be directly covered by the decision rendered by this Court in the aforesaid case. 20. Thus, this Court has fully endorsed the view taken by the Madras and the Bombay High Court, referred to above. It seems to us that if we take the view that the right to sue for the arrears of salary accrues from the date whe n the salary would have been payable but for the order of dismissal and not from the date when the order of dismissal is set aside by the civil court, it will cause gross and substantial injustice to the employee concerned who having been found by a court of law to have been wrongly dismissed and who in the eye of law would have been deemed to be in service, would still be deprived for no fault of his, of the arrears of his salary beyond three years of the suit which, in spite of his best efforts he could not have claimed, until the order of dismissal was declared to be void. Such a course would in fact place the Government employees in a strange predicament and give an undeserving benefit to the employers who by wrongfully dis missing the employees would be left only with the responsibility of paying them for a period of three years prior to the suit and swallow the entire arrears beyond this period without any legal or moral justification. This aspect does not appear to have been noticed by the courts which have taken the view that the starting point of limitation would be three years from the date of the suit and was for the first time noticed by this Court in State of Madhya Pradesh v. State of Maharashtra &ors. (supra) which seems to us to have righted a wrong which was long overdue. 21. For these reasons, therefore, we are clearly of the opinion that in cases where an employee is dismissed or removed from service and is reinstated either by the appointing authority or by virtue of the order of dismissal or removal being set aside by a civil court, the starting point of limitation would be not the date of the order of dismissal or removal but the date when the right actually accrues, that is to say, the date of the reinstatement, by the appointing authority where no suit is filed or the date of the decree where a suit is filed and decreed. In this view of the matter, the High Court was in error in modifying the decree of the trial court and the lower Appellate Court and limiting the claim of the appellant to a period of only three years prior to the suit. In view of the findings given by the courts on facts, which have not been reversed by the High Court, it is manifest that the appellants are entitled to the entire decretal amount claimed by them and for which a decree was granted by the trial court and the lower appellate court. ### Response: 1

Khazan Singh & Ors Vs. Hukam Singh & Ors

KHANNA, J.1. This appeal on certificate is against the order of Allahabad High Court whereby that Court dismissed in limine the writ petition filed by the appellants, seeking a writ of certiorari to quash the order dated June 15, 1964 of the Settlement officer and the order dated September 17, 1964 of the Deputy Director of Consolidation of Holdings.2. The dispute between the parties relates to khata No. 50. The appellants raised objection before the consolidation authorities on the ground that they along with the respondents were joint tenants in Khatas Nos. 150, 369 and 391. The Consolidation Officer rejected the claims of the appellants in respect of khatas Nos. 369 and 391. He, however, held that the appellants were joint tenants along with the respondents in khata. No. 150. The respondents went up in appeal against the order of the Consolidation Officer in so far as had held that the appellants were joint tenants in khata No. 150 Cross-objections were filed by the appellants in respect of the disallowance of their objection regarding khata Nos. 369 and 391. The cross-objections of the appellants were dismissed by the Settlement Officer on the ground that they were barred by time. So far as khata No. 150 is concerned, the Settlement Officer held that the appellants were not joint tenants in that khata. The appeal filed by the respondents was consequently allowed and the objection filed by the appellants before the Consolidation Officer was dismissed in toro. The order of the Settlement-Officer in this respect is dated June 15, 1964. The appellants then went up in revision, but the revision was dismissed by the Deputy Director of Consolidation as per order dated September 17, 1964. The appellants thereafter filed the writ petition for a writ of certiorari to quash the orders dated June 15, 1964 and September 17, 1964. The said petition, as stated above, was dismissed.We have heard Mr. Sen on behalf of the appellants and Mr. Goyal behalf of the respondents and are of the opinion that there is no merit in this appeal. The question with which we are concerned is whether the appellants are joint tenants in khata No. 150 along with the respondents. In this respect we find that the Settlement Officer examined the entries in the revenue records. It was found that so far as the land in dispute is concerned, it was held in Fasli 1280 by Hriday Singh, who was the common ancestor of the parties. In 1307 Fasli, Himmat Singh, an ancestor of the appellants and Suraj Mall, an ancestor of the respondents, jointly held that land. Subsequent to that, the land in dispute was held exclusively by the respondents and their ancestors. The Settlement Officer inferred from these circumstances that subsequent to 1307 Fasli, there was some partition between the parties or some other arrangement similar to partition, as a result of which the land in dispute fell to the share of the respondents. As this finding of the Settlement Officer is essentially a finding of fact and was arrived at after consideration of the relevant entries in the revenue records, the same cannot be interfered with in a writ petition. It may be that some other view, and what according to Mr. Sen was a better view, could have been arrived at on the facts, but the position in law is clear that the High Court in a writ petition cannot interfere with a finding of fact as long as that finding is based upon the relevant circumstances and is not shown to be perverse.3. We find no such infirmity in the finding arrived at by the Settlement Officer. The finding was not also interfered with when the appellants went up in revision before the Deputy Director of Consolidation. The High Court in the circumstances cannot be said to be in error in dismissing the writ petition in limine.We may add that Mr. Goyal during the course of arguments has not disputed the proposition that the respondents are not entitled t o any share in the land which is exclusively held by the appellants and is recorded exclusively in their. names in the revenue records of 1346 Fasli.4.

0[ds]In this respect we find that the Settlement Officer examined the entries in the revenue records. It was found that so far as the land in dispute is concerned, it was held in Fasli 1280 by Hriday Singh, who was the common ancestor of the parties. In 1307 Fasli, Himmat Singh, an ancestor of the appellants and Suraj Mall, an ancestor of the respondents, jointly held that land. Subsequent to that, the land in dispute was held exclusively by the respondents and their ancestors. The Settlement Officer inferred from these circumstances that subsequent to 1307 Fasli, there was some partition between the parties or some other arrangement similar to partition, as a result of which the land in dispute fell to the share of the respondents. As this finding of the Settlement Officer is essentially a finding of fact and was arrived at after consideration of the relevant entries in the revenue records, the same cannot be interfered with in a writ petition. It may be that some other view, and what according to Mr. Sen was a better view, could have been arrived at on the facts, but the position in law is clear that the High Court in a writ petition cannot interfere with a finding of fact as long as that finding is based upon the relevant circumstances and is not shown to be perverse.We find no such infirmity in the finding arrived at by the Settlement Officer. The finding was not also interfered with when the appellants went up in revision before the Deputy Director of Consolidation. The High Court in the circumstances cannot be said to be in error in dismissing the writ petition in limine.We may add that Mr. Goyal during the course of arguments has not disputed the proposition that the respondents are not entitled t o any share in the land which is exclusively held by the appellants and is recorded exclusively in their. names in the revenue records of 1346 Fasli.

### Instruction: Examine the case narrative and anticipate the court's decision: will it result in an approval (1) or disapproval (0) of the appeal? ### Input: KHANNA, J.1. This appeal on certificate is against the order of Allahabad High Court whereby that Court dismissed in limine the writ petition filed by the appellants, seeking a writ of certiorari to quash the order dated June 15, 1964 of the Settlement officer and the order dated September 17, 1964 of the Deputy Director of Consolidation of Holdings.2. The dispute between the parties relates to khata No. 50. The appellants raised objection before the consolidation authorities on the ground that they along with the respondents were joint tenants in Khatas Nos. 150, 369 and 391. The Consolidation Officer rejected the claims of the appellants in respect of khatas Nos. 369 and 391. He, however, held that the appellants were joint tenants along with the respondents in khata. No. 150. The respondents went up in appeal against the order of the Consolidation Officer in so far as had held that the appellants were joint tenants in khata No. 150 Cross-objections were filed by the appellants in respect of the disallowance of their objection regarding khata Nos. 369 and 391. The cross-objections of the appellants were dismissed by the Settlement Officer on the ground that they were barred by time. So far as khata No. 150 is concerned, the Settlement Officer held that the appellants were not joint tenants in that khata. The appeal filed by the respondents was consequently allowed and the objection filed by the appellants before the Consolidation Officer was dismissed in toro. The order of the Settlement-Officer in this respect is dated June 15, 1964. The appellants then went up in revision, but the revision was dismissed by the Deputy Director of Consolidation as per order dated September 17, 1964. The appellants thereafter filed the writ petition for a writ of certiorari to quash the orders dated June 15, 1964 and September 17, 1964. The said petition, as stated above, was dismissed.We have heard Mr. Sen on behalf of the appellants and Mr. Goyal behalf of the respondents and are of the opinion that there is no merit in this appeal. The question with which we are concerned is whether the appellants are joint tenants in khata No. 150 along with the respondents. In this respect we find that the Settlement Officer examined the entries in the revenue records. It was found that so far as the land in dispute is concerned, it was held in Fasli 1280 by Hriday Singh, who was the common ancestor of the parties. In 1307 Fasli, Himmat Singh, an ancestor of the appellants and Suraj Mall, an ancestor of the respondents, jointly held that land. Subsequent to that, the land in dispute was held exclusively by the respondents and their ancestors. The Settlement Officer inferred from these circumstances that subsequent to 1307 Fasli, there was some partition between the parties or some other arrangement similar to partition, as a result of which the land in dispute fell to the share of the respondents. As this finding of the Settlement Officer is essentially a finding of fact and was arrived at after consideration of the relevant entries in the revenue records, the same cannot be interfered with in a writ petition. It may be that some other view, and what according to Mr. Sen was a better view, could have been arrived at on the facts, but the position in law is clear that the High Court in a writ petition cannot interfere with a finding of fact as long as that finding is based upon the relevant circumstances and is not shown to be perverse.3. We find no such infirmity in the finding arrived at by the Settlement Officer. The finding was not also interfered with when the appellants went up in revision before the Deputy Director of Consolidation. The High Court in the circumstances cannot be said to be in error in dismissing the writ petition in limine.We may add that Mr. Goyal during the course of arguments has not disputed the proposition that the respondents are not entitled t o any share in the land which is exclusively held by the appellants and is recorded exclusively in their. names in the revenue records of 1346 Fasli.4. ### Response: 0

Hindustan Steelworks Constrn Vs. Commr. Of Labour

the workmen of the contractor shall be the same as applicable to the workmen directly employed by the principal employer of the establishment on the same or similar kind of work:Provided that in the case of any disagreement with regard to the type of work, the same shall be decided by the Commissioner of Labour, Andhra Pradesh, whose decision shall be final. 11. The 4th respondent has, in the present case, obtained a licence under Section 12(1) of the Contract Labour (Regulation and Abolition) Act, 1970 in accordance with the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. The 4th respondent had applied for a licence under Rule 21 and the licence which was granted to the 4th respondent contained, inter alia, the condition specified in Rule 25(v)(a) to the effect that the 4th respondent was required to pay to the workmen employed by it the same wages as those paid by the appellant in its establishment to workmen performing the same or similar kind of work. Apparently, the 4th respondent-contractor did not comply with this term of its licence. 12. The short question that arises for determination is whether the appellant who is the principal employer is liable to pay to the contract workers any amount which constitutes the difference between the wages payable to the contract labour by the contractor and the wages paid by the appellant to its own employees doing similar work. The Division Bench seems to have relied upon Section 21(4) of the said Act for this purpose. Section 21(1), however, provides that the contractor shall be responsible for the payment of wages to each worker employed by him. Section 21(4) provides that if the contractor fails to make this payment or any part thereof, the principal employer is liable to make this payment and may recover the same from the contractor as set out in that sub-section. Looking to the definition of wages under the said Act read with the definition of wages in the Payment of Wages Act, which we have set out earlier, it is clear that Section 2 only deals with the payment of contractual wages by the contractor to each of his workers. The definition of wages would cover within its scope, inter alia, also those amounts which the contractor is liable to pay to his workers under any award, settlement or order of court as well as other amounts falling within the definition of ``wages under the Payment of Wages Act. Sub-section (2) provides for a representative of the principal employer supervising this payment. Clearly, therefore, the wages which are the subject-matter of Section 21 are specified sums which are payable in praesenti by the contractor under the terms of his contract of employment with each worker as well as under any existing award, settlement or order of the court. Section 21 does not deal with, nor does it cover the obligations which are imposed upon a contractor under the provisions such as the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. Hence Section 21(4) will not apply to such obligations of the contractor which may be the subject-matter of dispute between the contractor and his workers at the time of disbursement of wages and which do not fall within the definition of ``wages under the Act.13. Rule 25 of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971 imposes on the contractor certain conditions subject to which a licence is granted to him. One such condition is to the effect that the contractor shall not pay to the contract labour in his employment wages which are lower than the wages paid by the principal employer to his own workers which do the same or similar kind of work. This is a condition of the contractors licence. There is no provision under these rules by which the principal employer is made liable for payment in the event of non- compliance by the contractor with this condition. If the contractor commits a breach of the conditions of his licence he alone will take the consequences. The right of the workers to recover any additional wages which may be so determined would be against the contractor. Section 21(4) has no application to a situation where a contractor may have paid the wages but has not complied with the condition imposed by Rule 25(v)(a) of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. The definition of wages under Section 2 of Contract Labour (Regulation and Abolition) Act, 1970 read with the definition of wages under the Payment of Wages Act, 1936, does not cover any additional amount found payable under Rule 25(v)(a) if the principal employer has its own workers doing similar work. If the principal employer does not have any employees doing similar work that question will not arise. Such contingencies are not covered by Section 21 of the Contract Labour (Regulation and Abolition) Act, 1970. The contractor cannot recover any such additional amount from the principal employer under Section 21(4). Significantly, in the present proceedings the workers are not a party at all. It is the contractor who sought to quash a finding given by the Commissioner of Labour under the proviso to Rule 25(v)(a) of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. In the present appeal before us also the contract workers employed by the 4th respondent are not a party. The dispute is between the contractor and the principal employer. We are, therefore, not called upon to pronounce on the rights of the contract labour employed by the 4th respondent to recover these amounts. The appellant, however, who is the principal employer, is not liable to pay this additional amount under Section 21(4). The appellant would, however, be liable under Section 21(4) to pay to the workers any difference between the wages contracted for under its agreement with the 4th respondent-contractor and the lesser wages actually paid by the contractor to contract labour, and recover the same from the contractor.

1[ds]11. The 4th respondent has, in the present case, obtained a licence under Section 12(1) ofthe Contract Labour (Regulation and Abolition) Act, 1970 in accordance with the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. The 4th respondent had applied for a licence under Rule 21 and the licence which was granted to the 4th respondent contained, inter alia, the condition specified in Rule 25(v)(a) to the effect that the 4th respondent was required to pay to the workmen employed by it the same wages as those paid by the appellant in its establishment to workmen performing the same or similar kind of work. Apparently, the 4th respondent-contractor did not comply with this term of itsDivision Bench seems to have relied upon Section 21(4) of the said Act for this purpose. Section 21(1), however, provides that the contractor shall be responsible for the payment of wages to each worker employed by him. Section 21(4) provides that if the contractor fails to make this payment or any part thereof, the principal employer is liable to make this payment and may recover the same from the contractor as set out in that sub-section. Looking to the definition of wages under the said Act read with the definition of wages in the Payment of Wages Act, which we have set out earlier, it is clear that Section 2 only deals with the payment of contractual wages by the contractor to each of his workers. The definition of wages would cover within its scope, inter alia, also those amounts which the contractor is liable to pay to his workers under any award, settlement or order of court as well as other amounts falling within the definition of ``wages under the Payment of Wages Act. Sub-section (2) provides for a representative of the principal employer supervising this payment. Clearly, therefore, the wages which are the subject-matter of Section 21 are specified sums which are payable in praesenti by the contractor under the terms of his contract of employment with each worker as well as under any existing award, settlement or order of the court. Section 21 does not deal with, nor does it cover the obligations which are imposed upon a contractor under the provisions such as the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. Hence Section 21(4) will not apply to such obligations of the contractor which may be the subject-matter of dispute between the contractor and his workers at the time of disbursement of wages and which do not fall within the definition of ``wages under the Act.13. Rule 25 of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971 imposes on the contractor certain conditions subject to which a licence is granted to him. One such condition is to the effect that the contractor shall not pay to the contract labour in his employment wages which are lower than the wages paid by the principal employer to his own workers which do the same or similar kind of work. This is a condition of the contractors licence. There is no provision under these rules by which the principal employer is made liable for payment in the event of non- compliance by the contractor with this condition. If the contractor commits a breach of the conditions of his licence he alone will take the consequences. The right of the workers to recover any additional wages which may be so determined would be against the contractor. Section 21(4) has no application to a situation where a contractor may have paid the wages but has not complied with the condition imposed by Rule 25(v)(a) of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. The definition of wages under Section 2 of Contract Labour (Regulation and Abolition) Act, 1970 read with the definition of wages underthe Payment of Wages Act, 1936, does not cover any additional amount found payable under Rule 25(v)(a) if the principal employer has its own workers doing similar work. If the principal employer does not have any employees doing similar work that question will not arise. Such contingencies are not covered by Section 21 ofthe Contract Labour (Regulation and Abolition) Act, 1970. The contractor cannot recover any such additional amount from the principal employer under Section 21(4). Significantly, in the present proceedings the workers are not a party at all. It is the contractor who sought to quash a finding given by the Commissioner of Labour under the proviso to Rule 25(v)(a) of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. In the present appeal before us also the contract workers employed by the 4th respondent are not a party. The dispute is between the contractor and the principal employer. We are, therefore, not called upon to pronounce on the rights of the contract labour employed by the 4th respondent to recover these amounts. The appellant, however, who is the principal employer, is not liable to pay this additional amount under Section 21(4). The appellant would, however, be liable under Section 21(4) to pay to the workers any difference between the wages contracted for under its agreement with the 4th respondent-contractor and the lesser wages actually paid by the contractor to contract labour, and recover the same from the contractor.

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: the workmen of the contractor shall be the same as applicable to the workmen directly employed by the principal employer of the establishment on the same or similar kind of work:Provided that in the case of any disagreement with regard to the type of work, the same shall be decided by the Commissioner of Labour, Andhra Pradesh, whose decision shall be final. 11. The 4th respondent has, in the present case, obtained a licence under Section 12(1) of the Contract Labour (Regulation and Abolition) Act, 1970 in accordance with the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. The 4th respondent had applied for a licence under Rule 21 and the licence which was granted to the 4th respondent contained, inter alia, the condition specified in Rule 25(v)(a) to the effect that the 4th respondent was required to pay to the workmen employed by it the same wages as those paid by the appellant in its establishment to workmen performing the same or similar kind of work. Apparently, the 4th respondent-contractor did not comply with this term of its licence. 12. The short question that arises for determination is whether the appellant who is the principal employer is liable to pay to the contract workers any amount which constitutes the difference between the wages payable to the contract labour by the contractor and the wages paid by the appellant to its own employees doing similar work. The Division Bench seems to have relied upon Section 21(4) of the said Act for this purpose. Section 21(1), however, provides that the contractor shall be responsible for the payment of wages to each worker employed by him. Section 21(4) provides that if the contractor fails to make this payment or any part thereof, the principal employer is liable to make this payment and may recover the same from the contractor as set out in that sub-section. Looking to the definition of wages under the said Act read with the definition of wages in the Payment of Wages Act, which we have set out earlier, it is clear that Section 2 only deals with the payment of contractual wages by the contractor to each of his workers. The definition of wages would cover within its scope, inter alia, also those amounts which the contractor is liable to pay to his workers under any award, settlement or order of court as well as other amounts falling within the definition of ``wages under the Payment of Wages Act. Sub-section (2) provides for a representative of the principal employer supervising this payment. Clearly, therefore, the wages which are the subject-matter of Section 21 are specified sums which are payable in praesenti by the contractor under the terms of his contract of employment with each worker as well as under any existing award, settlement or order of the court. Section 21 does not deal with, nor does it cover the obligations which are imposed upon a contractor under the provisions such as the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. Hence Section 21(4) will not apply to such obligations of the contractor which may be the subject-matter of dispute between the contractor and his workers at the time of disbursement of wages and which do not fall within the definition of ``wages under the Act.13. Rule 25 of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971 imposes on the contractor certain conditions subject to which a licence is granted to him. One such condition is to the effect that the contractor shall not pay to the contract labour in his employment wages which are lower than the wages paid by the principal employer to his own workers which do the same or similar kind of work. This is a condition of the contractors licence. There is no provision under these rules by which the principal employer is made liable for payment in the event of non- compliance by the contractor with this condition. If the contractor commits a breach of the conditions of his licence he alone will take the consequences. The right of the workers to recover any additional wages which may be so determined would be against the contractor. Section 21(4) has no application to a situation where a contractor may have paid the wages but has not complied with the condition imposed by Rule 25(v)(a) of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. The definition of wages under Section 2 of Contract Labour (Regulation and Abolition) Act, 1970 read with the definition of wages under the Payment of Wages Act, 1936, does not cover any additional amount found payable under Rule 25(v)(a) if the principal employer has its own workers doing similar work. If the principal employer does not have any employees doing similar work that question will not arise. Such contingencies are not covered by Section 21 of the Contract Labour (Regulation and Abolition) Act, 1970. The contractor cannot recover any such additional amount from the principal employer under Section 21(4). Significantly, in the present proceedings the workers are not a party at all. It is the contractor who sought to quash a finding given by the Commissioner of Labour under the proviso to Rule 25(v)(a) of the Andhra Pradesh Contract Labour (Regulation and Abolition) Rules, 1971. In the present appeal before us also the contract workers employed by the 4th respondent are not a party. The dispute is between the contractor and the principal employer. We are, therefore, not called upon to pronounce on the rights of the contract labour employed by the 4th respondent to recover these amounts. The appellant, however, who is the principal employer, is not liable to pay this additional amount under Section 21(4). The appellant would, however, be liable under Section 21(4) to pay to the workers any difference between the wages contracted for under its agreement with the 4th respondent-contractor and the lesser wages actually paid by the contractor to contract labour, and recover the same from the contractor. ### Response: 1

Essco Fabs Pvt. Ltd. Vs. State Of Haryana

‘urgency and ‘unforeseen emergency. In case of ‘urgency falling under sub-section (1) of Section 17 or of ‘unforeseen emergency covered by sub-section (2) of Section 17, special powers may be exercised by appropriate Government but as held by a three Judge Bench decisions before more than four decades in Nandeshwar Prasad and reiterated by a three Judge Bench decision in Mukesh Hans, even in such cases, inquiry and hearing of objections under Section 5A cannot ipso facto be dispensed with unless a notification under sub-section (4) of Section 17 of the Act is issued. The legislative scheme is amply clear which merely enables the appropriate Government to issue such notification under sub-section (4) of Section 17 of the Act dispensing with inquiry under Section 5A if the Government intends to exercise the said power. The use of the expression ‘may in sub-section (4) of Section 17 leaves no room of doubt that it is discretionary power of the Government to direct that the provisions of Section 5A would not apply to such cases covered by sub-section (1) or (2) of Section 17 of the Act. 45. In our opinion, therefore, the contention of learned counsel for the respondent authorities is not well founded and cannot be upheld that once a case is covered by sub-section (1) or (2) of Section 17 of the Act, sub-section (4) of Section 17 would necessarily apply and there is no question of holding inquiry or hearing objections under Section 5A of the Act. Acceptance of such contention or upholding of this argument will make sub-section (4) of Section 17 totally otiose, redundant and nugatory. 46. It is true that in Chameli Singh and Jai Narain, a two Judge Bench has observed that acquisition of land for housing accommodation or for construction of residential quarters for dalits and tribals can be said to be of an urgent nature falling under Section 17(1) of the Act. But as already held in Nandeshwar Prasad and Mukesh Hans, even in such cases, procedure required to be followed under Section 5A cannot be dispensed with unless notification under sub-section (4) of Section 17 is issued. In Mukesh Hans, the Court also held that the provision cannot be pressed in service by officers who were negligent and due to their lethargy, proceedings could not be initiated for a quite long time. 47. In the instant case, the facts are eloquent. Initial action of acquisition of land was taken as early as in 1982 but the proceedings lapsed. In 1991, when Essco made an application praying for change of user of land, it was rejected on the ground that the land was likely to be required for public purpose. Nothing, however, was done for about a decade. It is only in 2001 that again Notification under Section 4 was issued and urgency clause was applied. We are, therefore, satisfied that the ratio lad down in Mukesh Hans squarely applies to the facts of the case. No urgency clause could have been invoked by the respondents and inquiry and hearing of objections provided by Section 5A of the Act could not have been dispensed with. The actions of issuance of urgency clause under sub-section (4) of Section 17, dispensing with inquiry under Section 5A and issuance of final notification under sub-section (1) of Section 6 are required to be quashed and they are accordingly quashed.48. The learned counsel for the appellant also contended that even if it is held that the respondent could have issued final notification without holding inquiry and hearing of objections under Section 5A of the Act, the notification under Section 6 of the Act is illegal and unlawful in view of the fact that the said notification has not been issued after the last of the dates of the publication and giving of public notice referred to as "the date of publication of the notification" under sub-section (1) of Section 4 of the Act. 49. It was submitted that even the said point is concluded by a decision of this Court in State of Uttar Pradesh & Ors. v. Radhey Shyam Nigam & Ors, (1989) 1 SCC 591. 50. The learned counsel for the respondents, on the other hand, relying on State of Haryana & Anr. v. Raghubir Dayal, (1995) 1 SCC 133 and Mohan Singh & Ors. v. International Airport Authority of India & Ors., (1997) 9 SCC 132 submitted that if urgency clause under Section 17(4) is applied by the appropriate Government, final notification under Section 6 of the Act can be issued on the next day of the issuance of preliminary notification under Section 4 of the Act. In the case on hand, the said procedure is followed. Notification under Section 4 was issued on August 1, 2001. Urgency clause was applied and the case was covered by Section 17 (4) of the Act. On the very next day i.e. on August 2, 2001, final notification under Section 6 was issued. Therefore, the procedure required by law has been strictly followed as held by this Court in Raghubir Dayal and Mohan Singh. 51. We would have entered into the said question had it been absolutely necessary for us to decide it in the case on hand. But as observed hereinabove, we are of the view that the appellants are entitled to succeed on the first ground that on the facts and in the circumstances of the case, the appropriate Government was not justified in invoking urgency clause under sub-section (4) of Section 17 of the Act by dispensing with inquiry and hearing of objections under Section 5A of the Act and the final notification issued under Section 6 of the Act deserves to be set aside on that ground alone, we express no opinion one way or the other on the interpretation of the expression "the date of publication of the notification" used in sub-section (1) of Section 4, sub-section (4) of Section 17 and Section 6 of the Act.52. For the foregoing reasons, both

1[ds]In our opinion, therefore, the contention of learned counsel for the respondent authorities is not well founded and cannot be upheld that once a case is covered by sub-section (1) or (2) of Section 17 of the Act, sub-section (4) of Section 17 would necessarily apply and there is no question of holding inquiry or hearing objections under Section 5A of the Act. Acceptance of such contention or upholding of this argument will make sub-section (4) of Section 17 totally otiose, redundant andis true that in Chameli Singh and Jai Narain, a two Judge Bench has observed that acquisition of land for housing accommodation or for construction of residential quarters for dalits and tribals can be said to be of an urgent nature falling under Section 17(1) of the Act. But as already held in Nandeshwar Prasad and Mukesh Hans, even in such cases, procedure required to be followed under Section 5A cannot be dispensed with unless notification under sub-section (4) of Section 17 is issued. In Mukesh Hans, the Court also held that the provision cannot be pressed in service by officers who were negligent and due to their lethargy, proceedings could not be initiated for a quite longthe instant case, the facts are eloquent. Initial action of acquisition of land was taken as early as in 1982 but the proceedings lapsed. In 1991, when Essco made an application praying for change of user of land, it was rejected on the ground that the land was likely to be required for public purpose. Nothing, however, was done for about a decade. It is only in 2001 that again Notification under Section 4 was issued and urgency clause was applied. We are, therefore, satisfied that the ratio lad down in Mukesh Hans squarely applies to the facts of the case. No urgency clause could have been invoked by the respondents and inquiry and hearing of objections provided by Section 5A of the Act could not have been dispensed with. The actions of issuance of urgency clause under sub-section (4) of Section 17, dispensing with inquiry under Section 5A and issuance of final notification under sub-section (1) of Section 6 are required to be quashed and they are accordingly quashed.48. Thelearned counsel for the appellant also contended that even if it is held that the respondent could have issued final notification without holding inquiry and hearing of objections under Section 5A of the Act, the notification under Section 6 of the Act is illegal and unlawful in view of the fact that the said notification has not been issued after the last of the dates of the publication and giving of public notice referred to as "the date of publication of the notification" under sub-section (1) of Section 4 of thewould have entered into the said question had it been absolutely necessary for us to decide it in the case on hand. But as observed hereinabove, we are of the view that the appellants are entitled to succeed on the first ground that on the facts and in the circumstances of the case, the appropriate Government was not justified in invoking urgency clause under sub-section (4) of Section 17 of the Act by dispensing with inquiry and hearing of objections under Section 5A of the Act and the final notification issued under Section 6 of the Act deserves to be set aside on that ground alone, we express no opinion one way or the other on the interpretation of the expression "the date of publication of the notification" used in sub-section (1) of Section 4, sub-section (4) of Section 17 and Section 6 of the Act.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: ‘urgency and ‘unforeseen emergency. In case of ‘urgency falling under sub-section (1) of Section 17 or of ‘unforeseen emergency covered by sub-section (2) of Section 17, special powers may be exercised by appropriate Government but as held by a three Judge Bench decisions before more than four decades in Nandeshwar Prasad and reiterated by a three Judge Bench decision in Mukesh Hans, even in such cases, inquiry and hearing of objections under Section 5A cannot ipso facto be dispensed with unless a notification under sub-section (4) of Section 17 of the Act is issued. The legislative scheme is amply clear which merely enables the appropriate Government to issue such notification under sub-section (4) of Section 17 of the Act dispensing with inquiry under Section 5A if the Government intends to exercise the said power. The use of the expression ‘may in sub-section (4) of Section 17 leaves no room of doubt that it is discretionary power of the Government to direct that the provisions of Section 5A would not apply to such cases covered by sub-section (1) or (2) of Section 17 of the Act. 45. In our opinion, therefore, the contention of learned counsel for the respondent authorities is not well founded and cannot be upheld that once a case is covered by sub-section (1) or (2) of Section 17 of the Act, sub-section (4) of Section 17 would necessarily apply and there is no question of holding inquiry or hearing objections under Section 5A of the Act. Acceptance of such contention or upholding of this argument will make sub-section (4) of Section 17 totally otiose, redundant and nugatory. 46. It is true that in Chameli Singh and Jai Narain, a two Judge Bench has observed that acquisition of land for housing accommodation or for construction of residential quarters for dalits and tribals can be said to be of an urgent nature falling under Section 17(1) of the Act. But as already held in Nandeshwar Prasad and Mukesh Hans, even in such cases, procedure required to be followed under Section 5A cannot be dispensed with unless notification under sub-section (4) of Section 17 is issued. In Mukesh Hans, the Court also held that the provision cannot be pressed in service by officers who were negligent and due to their lethargy, proceedings could not be initiated for a quite long time. 47. In the instant case, the facts are eloquent. Initial action of acquisition of land was taken as early as in 1982 but the proceedings lapsed. In 1991, when Essco made an application praying for change of user of land, it was rejected on the ground that the land was likely to be required for public purpose. Nothing, however, was done for about a decade. It is only in 2001 that again Notification under Section 4 was issued and urgency clause was applied. We are, therefore, satisfied that the ratio lad down in Mukesh Hans squarely applies to the facts of the case. No urgency clause could have been invoked by the respondents and inquiry and hearing of objections provided by Section 5A of the Act could not have been dispensed with. The actions of issuance of urgency clause under sub-section (4) of Section 17, dispensing with inquiry under Section 5A and issuance of final notification under sub-section (1) of Section 6 are required to be quashed and they are accordingly quashed.48. The learned counsel for the appellant also contended that even if it is held that the respondent could have issued final notification without holding inquiry and hearing of objections under Section 5A of the Act, the notification under Section 6 of the Act is illegal and unlawful in view of the fact that the said notification has not been issued after the last of the dates of the publication and giving of public notice referred to as "the date of publication of the notification" under sub-section (1) of Section 4 of the Act. 49. It was submitted that even the said point is concluded by a decision of this Court in State of Uttar Pradesh & Ors. v. Radhey Shyam Nigam & Ors, (1989) 1 SCC 591. 50. The learned counsel for the respondents, on the other hand, relying on State of Haryana & Anr. v. Raghubir Dayal, (1995) 1 SCC 133 and Mohan Singh & Ors. v. International Airport Authority of India & Ors., (1997) 9 SCC 132 submitted that if urgency clause under Section 17(4) is applied by the appropriate Government, final notification under Section 6 of the Act can be issued on the next day of the issuance of preliminary notification under Section 4 of the Act. In the case on hand, the said procedure is followed. Notification under Section 4 was issued on August 1, 2001. Urgency clause was applied and the case was covered by Section 17 (4) of the Act. On the very next day i.e. on August 2, 2001, final notification under Section 6 was issued. Therefore, the procedure required by law has been strictly followed as held by this Court in Raghubir Dayal and Mohan Singh. 51. We would have entered into the said question had it been absolutely necessary for us to decide it in the case on hand. But as observed hereinabove, we are of the view that the appellants are entitled to succeed on the first ground that on the facts and in the circumstances of the case, the appropriate Government was not justified in invoking urgency clause under sub-section (4) of Section 17 of the Act by dispensing with inquiry and hearing of objections under Section 5A of the Act and the final notification issued under Section 6 of the Act deserves to be set aside on that ground alone, we express no opinion one way or the other on the interpretation of the expression "the date of publication of the notification" used in sub-section (1) of Section 4, sub-section (4) of Section 17 and Section 6 of the Act.52. For the foregoing reasons, both ### Response: 1

Puttamma & Others Vs. K.L. Narayana Reddy & Another

not earlier than the date of making the claim as may be specified in this behalf. Earlier, 12% was found to be the reasonable rate of simple interest. With a change in economy and the policy of Reserve Bank of India the interest rate has been lowered. The nationalised banks are now granting interest at the rate of 9% on fixed deposits for one year. We, therefore, direct that the compensation amount fixed hereinbefore shall bear interest at the rate of 9% per annum from the date of the claim made by the appellants. The amount of Rs 50,000 paid by the Insurance Company under Section 140 shall be deducted from the principal amount as on the date of its payment, and interest would be recalculated on the balance amount of the principal sum from such date. 60. This Court in Abati Bezbaruah v. Deputy Director General, Geological Survey of India & Anr. (2003) 3 SCC 148 noticed that varying rate of interest is being awarded by the Tribunals, High Courts and this Court. In the said case, this Court held that the rate of interest must be just and reasonable depending on the facts and circumstances of the case and should be decided after taking into consideration relevant factors like inflation, change in economy, policy being adopted by the Reserve Bank of India from time to time, how long the case is pending, loss of enjoyment of life etc. 61. In Supe Dei v. National Insurance Co. Ltd.& Anr. (2009) 4 SCC 513 this Court held that proper interest would be 9% per annum. 62. In view of the aforesaid provisions of the Act, 1988 (Section 171) and the observation of this Court, as noticed above, we keep this question open for Tribunals and Courts to decide the rate of interest after taking into consideration the rate of interest allowed by this Court in similar case and other factors such as inflation, change in economy, policy adopted by the Reserve Bank of India from time to time and the period since when the case is pending. Present Case 63. In the present case, the following fact emerges: The deceased was drawing gross salary of Rs. 13,331/- per month and he was paying a sum of Rs.789/- per month towards income tax and an amount of Rs. 100/- per month towards professional tax. Thus he was paying total amount of Rs.889/- per month towards tax and if that amount is deducted from the gross income of the deceased it comes to Rs.12,442/- per month. The deceased was 48 years old at the time of death. He would have continued in service for another 12 years and he would have been entitled for pension. Therefore, if increase in the future income is taken at 50% it will come to Rs.18,663/- (Rs.12,442/- + Rs. 6221). As per decision in Sarla Verma the deduction towards personal and living expenses of the deceased should be one-third (1/3rd) where the number of dependent family members is 2 to 3; one-fourth (1/4th) where the number of dependent family members is 4 to 6 and one-fifth (1/5th) where the number of dependent family members exceeds 6. In the present case, there are four dependent family members. Therefore, the deduction towards personal and living expenses of the deceased should be 1/4th. If 1/4th amount is deducted from the income of the deceased it will come to Rs.13,998/- (Rs. 12,442/- + Rs. 6,221 – Rs. 4665). At the time of accident, the deceased was 48 years old, hence on the basis of decision in Sarla Verma multiplier of 13 will be applicable. In that case the claimants should be entitled to get the following benefits: (i) Amount of compensation with 12 months salary and 13 as multiplier (13,998/- x 12 x13) - Rs. 21,83,688/- (ii) Compensation to the family members (children and family members other than wife) for loss of love and affection, deprivation of protection, social security etc. - Rs. 1,00,000/- (iii) Compensation to the widow of the deceased for loss of love and affection, pains and sufferings, loss of consortium, deprivation of protection, social security etc. - Rs. 50,000/- (iv) Cost incurred on account of funeral and ritual expenses - Rs. 10,000/- Total Compensation Rs.23,43,688/- 64. In the appeal which was filed by the claimants before the High Court, the High Court instead of deciding the just compensation allowed meager enhancement of compensation. In doing so, the High Court introduced the concept of split multiplier and departed from the multiplier system generally used in light of the decision in Sarla Verma (supra) case without disclosing any reason. The High Court has also not considered the question of prospect of future increase in salary of the deceased though it noticed that the deceased would have continued in pensionable services for more than 10 years. When the age of the deceased was 48 years at the time of death it wrongly applied multiplier of 10 and not 13 as per decision in Sarla Verma. Thus, we fail to appreciate as to why the High Court chose to apply split multiplier and applied multiplier of 10. We, thus, find that the judgment of the High Court is perverse and contrary to the evidence on record and is fit to be set aside for having not considered the future prospects of the deceased and also for adopting split multiplier method against the law laid down by this Court. In view of our aforesaid finding, we hold that the judgment of the High Court deserves to be set aside. We, accordingly, set aside the impugned judgment and hold that the claimants are entitled for total compensation of Rs.23,43,688/-. They shall also get interest on the enhanced compensation at the rate of 12% per annum from the date of filing of the complaint petition. Respondent No.2-Insurance Company is directed to pay enhanced/additional compensation and interest to the claimants within a period of three months by getting prepared a demand draft in their name.

0[ds]64. In the appeal which was filed by the claimants before the High Court, the High Court instead of deciding the just compensation allowed meager enhancement of compensation. In doing so, the High Court introduced the concept of split multiplier and departed from the multiplier system generally used in light of the decision in Sarla Verma (supra) case without disclosing any reason. The High Court has also not considered the question of prospect of future increase in salary of the deceased though it noticed that the deceased would have continued in pensionable services for more than 10 years. When the age of the deceased was 48 years at the time of death it wrongly applied multiplier of 10 and not 13 as per decision in Sarla Verma. Thus, we fail to appreciate as to why the High Court chose to apply split multiplier and applied multiplier of 10. We, thus, find that the judgment of the High Court is perverse and contrary to the evidence on record and is fit to be set aside for having not considered the future prospects of the deceased and also for adopting split multiplier method against the law laid down by this Court. In view of our aforesaid finding, we hold that the judgment of the High Court deserves to be set aside. We, accordingly, set aside the impugned judgment and hold that the claimants are entitled for total compensation of Rs.. They shall also get interest on the enhanced compensation at the rate of 12% per annum from the date of filing of the complaint petition. Respondente Company is directed to pay enhanced/additional compensation and interest to the claimants within a period of three months by getting prepared a demand draft in their name.

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: not earlier than the date of making the claim as may be specified in this behalf. Earlier, 12% was found to be the reasonable rate of simple interest. With a change in economy and the policy of Reserve Bank of India the interest rate has been lowered. The nationalised banks are now granting interest at the rate of 9% on fixed deposits for one year. We, therefore, direct that the compensation amount fixed hereinbefore shall bear interest at the rate of 9% per annum from the date of the claim made by the appellants. The amount of Rs 50,000 paid by the Insurance Company under Section 140 shall be deducted from the principal amount as on the date of its payment, and interest would be recalculated on the balance amount of the principal sum from such date. 60. This Court in Abati Bezbaruah v. Deputy Director General, Geological Survey of India & Anr. (2003) 3 SCC 148 noticed that varying rate of interest is being awarded by the Tribunals, High Courts and this Court. In the said case, this Court held that the rate of interest must be just and reasonable depending on the facts and circumstances of the case and should be decided after taking into consideration relevant factors like inflation, change in economy, policy being adopted by the Reserve Bank of India from time to time, how long the case is pending, loss of enjoyment of life etc. 61. In Supe Dei v. National Insurance Co. Ltd.& Anr. (2009) 4 SCC 513 this Court held that proper interest would be 9% per annum. 62. In view of the aforesaid provisions of the Act, 1988 (Section 171) and the observation of this Court, as noticed above, we keep this question open for Tribunals and Courts to decide the rate of interest after taking into consideration the rate of interest allowed by this Court in similar case and other factors such as inflation, change in economy, policy adopted by the Reserve Bank of India from time to time and the period since when the case is pending. Present Case 63. In the present case, the following fact emerges: The deceased was drawing gross salary of Rs. 13,331/- per month and he was paying a sum of Rs.789/- per month towards income tax and an amount of Rs. 100/- per month towards professional tax. Thus he was paying total amount of Rs.889/- per month towards tax and if that amount is deducted from the gross income of the deceased it comes to Rs.12,442/- per month. The deceased was 48 years old at the time of death. He would have continued in service for another 12 years and he would have been entitled for pension. Therefore, if increase in the future income is taken at 50% it will come to Rs.18,663/- (Rs.12,442/- + Rs. 6221). As per decision in Sarla Verma the deduction towards personal and living expenses of the deceased should be one-third (1/3rd) where the number of dependent family members is 2 to 3; one-fourth (1/4th) where the number of dependent family members is 4 to 6 and one-fifth (1/5th) where the number of dependent family members exceeds 6. In the present case, there are four dependent family members. Therefore, the deduction towards personal and living expenses of the deceased should be 1/4th. If 1/4th amount is deducted from the income of the deceased it will come to Rs.13,998/- (Rs. 12,442/- + Rs. 6,221 – Rs. 4665). At the time of accident, the deceased was 48 years old, hence on the basis of decision in Sarla Verma multiplier of 13 will be applicable. In that case the claimants should be entitled to get the following benefits: (i) Amount of compensation with 12 months salary and 13 as multiplier (13,998/- x 12 x13) - Rs. 21,83,688/- (ii) Compensation to the family members (children and family members other than wife) for loss of love and affection, deprivation of protection, social security etc. - Rs. 1,00,000/- (iii) Compensation to the widow of the deceased for loss of love and affection, pains and sufferings, loss of consortium, deprivation of protection, social security etc. - Rs. 50,000/- (iv) Cost incurred on account of funeral and ritual expenses - Rs. 10,000/- Total Compensation Rs.23,43,688/- 64. In the appeal which was filed by the claimants before the High Court, the High Court instead of deciding the just compensation allowed meager enhancement of compensation. In doing so, the High Court introduced the concept of split multiplier and departed from the multiplier system generally used in light of the decision in Sarla Verma (supra) case without disclosing any reason. The High Court has also not considered the question of prospect of future increase in salary of the deceased though it noticed that the deceased would have continued in pensionable services for more than 10 years. When the age of the deceased was 48 years at the time of death it wrongly applied multiplier of 10 and not 13 as per decision in Sarla Verma. Thus, we fail to appreciate as to why the High Court chose to apply split multiplier and applied multiplier of 10. We, thus, find that the judgment of the High Court is perverse and contrary to the evidence on record and is fit to be set aside for having not considered the future prospects of the deceased and also for adopting split multiplier method against the law laid down by this Court. In view of our aforesaid finding, we hold that the judgment of the High Court deserves to be set aside. We, accordingly, set aside the impugned judgment and hold that the claimants are entitled for total compensation of Rs.23,43,688/-. They shall also get interest on the enhanced compensation at the rate of 12% per annum from the date of filing of the complaint petition. Respondent No.2-Insurance Company is directed to pay enhanced/additional compensation and interest to the claimants within a period of three months by getting prepared a demand draft in their name. ### Response: 0

Pepsu Roadways Transport Corpn. Through Its M.D. Vs. S.K.Sharma

therefore entitled to retiral benefits instead of CPF is acceptable or not. In this controversy, a judgment of this Court though rendered in slightly different factual matrix is substantially relevant and helpful. In D.R. Gurushantappa v. Abdul Khuddus Anwar and Ors., 1969 (1) SCC 466 an issue arose in the context of election of the Mysore Legislative Assembly as to whether the respondent was holding office of profit under the Government. The respondent no. 1 of that case was initially a Government servant but subsequently the Government concern where he was working was taken over by a company registered under the Indian Companies Act, 1956. The shares of the company were fully owned by the Government but after the Government undertaking was taken over by the company, the employees were no longer governed by the Mysore Civil Services Regulations, their conditions of service came to be determined by the standing orders of the company. The first contention against respondent no. 1 was that since he was initially a Government servant, even after the concern was taken over by the company he would continue to be in the service of the Government. While dealing with this issue in paragraph 3, this Court rejected the contention in the following words: "3. So far as the first point is concerned, reliance is placed primarily on the circumstance that, when the concern was taken over by the Company from the Government there were no specific agreements terminating the Government service of Respondent 1, or bringing into existence a relationship of master and servant between the Company and Respondent 1. That circumstance, by itself, cannot lead to the conclusion that Respondent 1 continued to be in government service. When the undertaking was taken over by the Company as a going concern, the employees working in the undertaking were also taken over and since, in law, the Company has to be treated as an entity distinct and separate from the Government, the employees, as a result of the transfer of the undertaking, became employees of the Company and ceased to be employees of the Government." 17. In the facts of the case, we have no hesitation to hold that the High Court erred in allowing the writ petition and second appeal of the respondents and in dismissing the Letters Patent Appeal of the appellants. The judgments on which the respondents have relied upon for advancing the submission that they cannot lose the status of a Government servant till they are absorbed in the Corporation after offering an option in favour of such absorption is entirely misconceived and inapplicable in the facts of the present case. The stand of the respondents could have been acceptable had there been no decision of the PEPSU State as evidenced by the letter of Chief Secretary dated 16.10.1956 which finds mention and reiteration by way of admission by the Corporation in order dated 30.11.1956. There can be no such belated challenge to the decision of PEPSU State whereby PEPSU Roadways, one of the departments came into and merged with the Corporation lock, stock and barrel before the merger of PEPSU with Punjab on 01.11.1956. Hence, the provisions of the States Reorganization Act ceased to have any significance in the matter because the respondents ceased to be employees of State Government of PEPSU prior to 01.11.1956. They accepted such merger and alteration of their service conditions without any protest. Since 1957, under the Regulations of the Corporation they participated and contributed to the scheme of CPF and obtained the benefits of retirement from the Corporation between 1985 and 1991 without any protest. The High Court clearly erred in ignoring such conduct of the respondents, the effect of the Chief Secretarys letter dated 16.10.1956 containing decision of PEPSU State and its acceptance by the Corporation reflected by the order dated 30.11.1956. The High Court further erred in relying upon law which is applicable when there is no merger of Government concern with the private concern but only individual employees are transferred on deputation or on foreign service to other organizations/services. The ordinary rules providing for asking of option or issuance of letters of absorption depend upon nature of stipulations which may get attracted to a case of deputation. There may be similar stipulations in case of merger by transfer. But if there are no such stipulations like in the present case then the transferee concern like the Corporation has no obligation to ask for options and to issue letters of options to individual employees who become employees of the transferee organization simply by virtue of order and action of transfer of the whole concern leading to merger. No doubt in case of any hardship, the affected employees have the option to protest and challenge either the merger itself or any adverse stipulation. However, if the employees choose to accept the transition of their service from one concern to another and acquiesce then after decades and especially after their retirement they cannot be permitted to turn back and challenge the entire developments after a gap of decades. 18. On the basis of laws and facts discussed above, we are constrained to hold that the respondents had accepted to continue as employees of Corporation pursuant to order of merger/transfer of PEPSU Roadways with effect from 16.10.1956 and on completing their service under the Corporation and reaching the age of retirement they were entitled to receive only the benefits of CPF and gratuity as admissible to them under then prevailing regulations of the Corporation. Since they accepted those retiral benefits there is no relationship left between the Corporation and the respondents and in such a situation further claim against the Corporation that it should treat the respondents to be Government servants and adjust their retiral benefits accordingly was totally untenable and wrongly allowed by the High Court. The impugned judgment of the High Court granting relief to the respondents is therefore set aside. The second appeal and the writ petition of the respondents shall stand dismissed.

1[ds]are constrained to hold that the respondents had accepted to continue as employees of Corporation pursuant to order of merger/transfer of PEPSU Roadways with effect from 16.10.1956 and on completing their service under the Corporation and reaching the age of retirement they were entitled to receive only the benefits of CPF and gratuity as admissible to them under then prevailing regulations of the Corporation. Since they accepted those retiral benefits there is no relationship left between the Corporation and the respondents and in such a situation further claim against the Corporation that it should treat the respondents to be Government servants and adjust their retiral benefits accordingly was totally untenable and wrongly allowed by the High Court. The impugned judgment of the High Court granting relief to the respondents is therefore set aside. The second appeal and the writ petition of the respondents shall stand dismissed.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: therefore entitled to retiral benefits instead of CPF is acceptable or not. In this controversy, a judgment of this Court though rendered in slightly different factual matrix is substantially relevant and helpful. In D.R. Gurushantappa v. Abdul Khuddus Anwar and Ors., 1969 (1) SCC 466 an issue arose in the context of election of the Mysore Legislative Assembly as to whether the respondent was holding office of profit under the Government. The respondent no. 1 of that case was initially a Government servant but subsequently the Government concern where he was working was taken over by a company registered under the Indian Companies Act, 1956. The shares of the company were fully owned by the Government but after the Government undertaking was taken over by the company, the employees were no longer governed by the Mysore Civil Services Regulations, their conditions of service came to be determined by the standing orders of the company. The first contention against respondent no. 1 was that since he was initially a Government servant, even after the concern was taken over by the company he would continue to be in the service of the Government. While dealing with this issue in paragraph 3, this Court rejected the contention in the following words: "3. So far as the first point is concerned, reliance is placed primarily on the circumstance that, when the concern was taken over by the Company from the Government there were no specific agreements terminating the Government service of Respondent 1, or bringing into existence a relationship of master and servant between the Company and Respondent 1. That circumstance, by itself, cannot lead to the conclusion that Respondent 1 continued to be in government service. When the undertaking was taken over by the Company as a going concern, the employees working in the undertaking were also taken over and since, in law, the Company has to be treated as an entity distinct and separate from the Government, the employees, as a result of the transfer of the undertaking, became employees of the Company and ceased to be employees of the Government." 17. In the facts of the case, we have no hesitation to hold that the High Court erred in allowing the writ petition and second appeal of the respondents and in dismissing the Letters Patent Appeal of the appellants. The judgments on which the respondents have relied upon for advancing the submission that they cannot lose the status of a Government servant till they are absorbed in the Corporation after offering an option in favour of such absorption is entirely misconceived and inapplicable in the facts of the present case. The stand of the respondents could have been acceptable had there been no decision of the PEPSU State as evidenced by the letter of Chief Secretary dated 16.10.1956 which finds mention and reiteration by way of admission by the Corporation in order dated 30.11.1956. There can be no such belated challenge to the decision of PEPSU State whereby PEPSU Roadways, one of the departments came into and merged with the Corporation lock, stock and barrel before the merger of PEPSU with Punjab on 01.11.1956. Hence, the provisions of the States Reorganization Act ceased to have any significance in the matter because the respondents ceased to be employees of State Government of PEPSU prior to 01.11.1956. They accepted such merger and alteration of their service conditions without any protest. Since 1957, under the Regulations of the Corporation they participated and contributed to the scheme of CPF and obtained the benefits of retirement from the Corporation between 1985 and 1991 without any protest. The High Court clearly erred in ignoring such conduct of the respondents, the effect of the Chief Secretarys letter dated 16.10.1956 containing decision of PEPSU State and its acceptance by the Corporation reflected by the order dated 30.11.1956. The High Court further erred in relying upon law which is applicable when there is no merger of Government concern with the private concern but only individual employees are transferred on deputation or on foreign service to other organizations/services. The ordinary rules providing for asking of option or issuance of letters of absorption depend upon nature of stipulations which may get attracted to a case of deputation. There may be similar stipulations in case of merger by transfer. But if there are no such stipulations like in the present case then the transferee concern like the Corporation has no obligation to ask for options and to issue letters of options to individual employees who become employees of the transferee organization simply by virtue of order and action of transfer of the whole concern leading to merger. No doubt in case of any hardship, the affected employees have the option to protest and challenge either the merger itself or any adverse stipulation. However, if the employees choose to accept the transition of their service from one concern to another and acquiesce then after decades and especially after their retirement they cannot be permitted to turn back and challenge the entire developments after a gap of decades. 18. On the basis of laws and facts discussed above, we are constrained to hold that the respondents had accepted to continue as employees of Corporation pursuant to order of merger/transfer of PEPSU Roadways with effect from 16.10.1956 and on completing their service under the Corporation and reaching the age of retirement they were entitled to receive only the benefits of CPF and gratuity as admissible to them under then prevailing regulations of the Corporation. Since they accepted those retiral benefits there is no relationship left between the Corporation and the respondents and in such a situation further claim against the Corporation that it should treat the respondents to be Government servants and adjust their retiral benefits accordingly was totally untenable and wrongly allowed by the High Court. The impugned judgment of the High Court granting relief to the respondents is therefore set aside. The second appeal and the writ petition of the respondents shall stand dismissed. ### Response: 1

Acc Ltd Vs. State Of Kerala

the trade mark or brand name, the sale by the brand name holder or the trade mark holder within the state shall be the first sale for the purposes of this Act." 5. The learned senior counsel would contend that the Cochin Cement Limited is the brand name holder of the present appellant and, therefore, the sale at its hand has to be treated as first sale for the purposes of this Act. In this regard, we think it appropriate to refer to Section 5(2A) and 5(2B) of the Act, which read thus:- "5(2A) Where a dealer liable to tax under sub-section (1), sells any goods to a trade mark or brand name holder for sale a trade mark or brand name, no such dealer shall be liable to pay tax under the said sub-section, if he produces before the assessing authority a declaration in the prescribed form from that trade mark or brand name holder.5(2B) Where a trade mark or brand name holder consumes the goods purchased by under-section 2(A), in the manufacture of other goods or uses or disposes of such goods in any manner otherwise than by way of sale within the State or despatches such goods to any place outside the State, otherwise than by way of inter-state sale, such trade mark or brand name holder shall be liable to pay tax on the turnover relating to such purchase for the year irrespective of the quantum of his total turnover." 6. On a conjoint reading of the aforesaid provisions, it is discernible that the Legislature has clearly expressed its intention to treat the sale by the brand name holder or the trade mark holder as the first sale. In the case of Cryptom Confectioneries Pvt. Ltd. Vs. State of Kerala , Section 5(2A) came up for consideration and a two-Judge Bench, analysing the anatomy of the provision, has laid down thus:- "The aforesaid sub-section commences with a non obstante clause i.e., irrespective of Section 5(1) of the Act or any other provision under the Act. The said sub-section speaks of a sale made by a brand name holder of the trade mark holder within the State. The Legislature deems that such a sale by the brand name holder or the trade mark holder shall be the first sale within the State. In our opinion this is the only possible construction that can be given to sub-section (2) of section 5 of the Act. Keeping in view the aforesaid provision, let us once again trace the transaction between the appellant and the licensee, namely, M/s. Bristo Foods Pvt. Ltd." 7. On a scrutiny of the facts of the said case, it is manifest that the issue that squarely fell for consideration is whether the sale at the hands of the appellant therein would be treated as the first sale. Dealing with the stand of the appellant, this Court stated:- "According to the appellant/ assessee who is a branded name holder, M/s Bristo Foods Pvt. Ltd., has licence and is permitted to use the branded name "CRYTM". The licensee manufactures the goods, namely, confectioneries and effect supply of sale to the brand name holder. It is the brand name holder, who effects the sale of the confectioneries which are to be taxed as item 39 of the First Schedule to the Act within the State. Therefore, it is the brand name holder, who has to be pay tax under section 5(2) of the Act. If for any reason M/s Bristo Foods Pvt. Ltd. has paid the tax while effecting the supply of the manufactored commodity to the appellant/assessee, the appellant/assessee and M/s Bristo Foods Pvt. Ltd. can approach the authorities for claiming the refund of the tax paid by them." 8. On a careful appreciation of the aforesaid decision, we find the factual matrix therein is explicitly the same as is in the present case. However, Mr. S. Ganesh, learned senior counsel, would submit that in the said case, there has been no consideration of the concepts like brand name holder and trade mark holder and, therefore, the said decision should not be treated as a precedent. On the basis of the aforesaid submission, Mr. Ganesh contends that the said decision requires reconsideration and this Court should refer it to a larger Bench. Mr. Ganesh further submits that the ratio of the decision has to be understood in the background of the facts of the case and a decision is an authority for what is actually decides, not what logically follows from it. According to him, as the relevant provisions have not been construed, it cannot be regarded as a binding precedent. 9. Needless to say, the proposition canvassed by Mr. Ganesh neither invites a dispute nor calls for a debate. It is so the said proposition has been stated in Quinn v. Leathem which has been followed in Ambica Quarry Works v. State of Gujarat and others . But such is not the case here. First of all, in the earlier decision Section 5(2) was considered and a view has been expressed and, therefore, it cannot be said that a provision has not been referred to or not considered. Hence, it is a binding precedent.10. The second issue, which has been ambitiously projected by Mr. Ganesh, is that the decision, even if a binding precedent, requires reconsideration as the relevant terms employed in Section 5(2), have not been appositely considered. What is limpid is that Section 5(2) is an expression of the Legislative intention that the sales at the hands of the brand name holder and trade mark holder would be treated as the first sale. On a perusal of the agreement entered into between the parties, it is not remotely suggestive of the fact that Cochin Cement Limited is a brand name holder or trade mark holder. Hence, the ambitious submission of Mr. Ganesh has to melt as a glacier, and we say so. Ergo, the decision in Cryptom Confectioneries Pvt. Ltd. does not require reconsideration.

0[ds]6. On a conjoint reading of the aforesaid provisions, it is discernible that the Legislature has clearly expressed its intention to treat the sale by the brand name holder or the trade mark holder as the first sale.On a careful appreciation of the aforesaid decision, we find the factual matrix therein is explicitly the same as is in the present case. However, Mr.S. Ganesh, learned senior counsel, would submit that in the said case, there has been no consideration of the concepts like brand name holder and trade mark holder and, therefore, the said decision should not be treated as a precedent. On the basis of the aforesaid submission, Mr. Ganesh contends that the said decision requires reconsideration and this Court should refer it to a larger Bench. Mr. Ganesh further submits that the ratio of the decision has to be understood in the background of the facts of the case and a decision is an authority for what is actually decides, not what logically follows from it. According to him, as the relevant provisions have not been construed, it cannot be regarded as a bindinga perusal of the agreement entered into between the parties, it is not remotely suggestive of the fact that Cochin Cement Limited is a brand name holder or trade mark holder. Hence, the ambitious submission of Mr. Ganesh has to melt as a glacier, and we say so. Ergo, the decision in Cryptom Confectioneries Pvt. Ltd. does not require reconsideration.

### Instruction: Assess the case proceedings and provide a prediction: is the court likely to rule in favor of (1) or against (0) the appellant/petitioner? ### Input: the trade mark or brand name, the sale by the brand name holder or the trade mark holder within the state shall be the first sale for the purposes of this Act." 5. The learned senior counsel would contend that the Cochin Cement Limited is the brand name holder of the present appellant and, therefore, the sale at its hand has to be treated as first sale for the purposes of this Act. In this regard, we think it appropriate to refer to Section 5(2A) and 5(2B) of the Act, which read thus:- "5(2A) Where a dealer liable to tax under sub-section (1), sells any goods to a trade mark or brand name holder for sale a trade mark or brand name, no such dealer shall be liable to pay tax under the said sub-section, if he produces before the assessing authority a declaration in the prescribed form from that trade mark or brand name holder.5(2B) Where a trade mark or brand name holder consumes the goods purchased by under-section 2(A), in the manufacture of other goods or uses or disposes of such goods in any manner otherwise than by way of sale within the State or despatches such goods to any place outside the State, otherwise than by way of inter-state sale, such trade mark or brand name holder shall be liable to pay tax on the turnover relating to such purchase for the year irrespective of the quantum of his total turnover." 6. On a conjoint reading of the aforesaid provisions, it is discernible that the Legislature has clearly expressed its intention to treat the sale by the brand name holder or the trade mark holder as the first sale. In the case of Cryptom Confectioneries Pvt. Ltd. Vs. State of Kerala , Section 5(2A) came up for consideration and a two-Judge Bench, analysing the anatomy of the provision, has laid down thus:- "The aforesaid sub-section commences with a non obstante clause i.e., irrespective of Section 5(1) of the Act or any other provision under the Act. The said sub-section speaks of a sale made by a brand name holder of the trade mark holder within the State. The Legislature deems that such a sale by the brand name holder or the trade mark holder shall be the first sale within the State. In our opinion this is the only possible construction that can be given to sub-section (2) of section 5 of the Act. Keeping in view the aforesaid provision, let us once again trace the transaction between the appellant and the licensee, namely, M/s. Bristo Foods Pvt. Ltd." 7. On a scrutiny of the facts of the said case, it is manifest that the issue that squarely fell for consideration is whether the sale at the hands of the appellant therein would be treated as the first sale. Dealing with the stand of the appellant, this Court stated:- "According to the appellant/ assessee who is a branded name holder, M/s Bristo Foods Pvt. Ltd., has licence and is permitted to use the branded name "CRYTM". The licensee manufactures the goods, namely, confectioneries and effect supply of sale to the brand name holder. It is the brand name holder, who effects the sale of the confectioneries which are to be taxed as item 39 of the First Schedule to the Act within the State. Therefore, it is the brand name holder, who has to be pay tax under section 5(2) of the Act. If for any reason M/s Bristo Foods Pvt. Ltd. has paid the tax while effecting the supply of the manufactored commodity to the appellant/assessee, the appellant/assessee and M/s Bristo Foods Pvt. Ltd. can approach the authorities for claiming the refund of the tax paid by them." 8. On a careful appreciation of the aforesaid decision, we find the factual matrix therein is explicitly the same as is in the present case. However, Mr. S. Ganesh, learned senior counsel, would submit that in the said case, there has been no consideration of the concepts like brand name holder and trade mark holder and, therefore, the said decision should not be treated as a precedent. On the basis of the aforesaid submission, Mr. Ganesh contends that the said decision requires reconsideration and this Court should refer it to a larger Bench. Mr. Ganesh further submits that the ratio of the decision has to be understood in the background of the facts of the case and a decision is an authority for what is actually decides, not what logically follows from it. According to him, as the relevant provisions have not been construed, it cannot be regarded as a binding precedent. 9. Needless to say, the proposition canvassed by Mr. Ganesh neither invites a dispute nor calls for a debate. It is so the said proposition has been stated in Quinn v. Leathem which has been followed in Ambica Quarry Works v. State of Gujarat and others . But such is not the case here. First of all, in the earlier decision Section 5(2) was considered and a view has been expressed and, therefore, it cannot be said that a provision has not been referred to or not considered. Hence, it is a binding precedent.10. The second issue, which has been ambitiously projected by Mr. Ganesh, is that the decision, even if a binding precedent, requires reconsideration as the relevant terms employed in Section 5(2), have not been appositely considered. What is limpid is that Section 5(2) is an expression of the Legislative intention that the sales at the hands of the brand name holder and trade mark holder would be treated as the first sale. On a perusal of the agreement entered into between the parties, it is not remotely suggestive of the fact that Cochin Cement Limited is a brand name holder or trade mark holder. Hence, the ambitious submission of Mr. Ganesh has to melt as a glacier, and we say so. Ergo, the decision in Cryptom Confectioneries Pvt. Ltd. does not require reconsideration. ### Response: 0

SHREE AMBICA MEDICAL STORES Vs. THE SURAT PEOPLES CO-OPERATIVE BANK LTD

his commission within twenty-four hours of the collection excluding bank and postal holidays. (5) The Central Government may, by rules, relax the requirements of sub-section (1) in respect of particular categories in insurance policies. (6) The Authority may, from time to time, specify, by the regulations made by it, the manner of receipt of premium by the insurer. 23. The above provision states that no risk can be assumed by the insurer unless the premium payable is received in advance. Sub-Section (3) of Section 64 (VB) provides for refund of the premium amount to the insured in case of cancellation or alteration of the terms and conditions of the policy. In the present case, the premium of Rs 992 to cover STFI perils was refunded by the insurer to the bank and the amount was deposited in the insureds account. The proposal does not conclude the contract. A contract postulates an agreement between the parties. In the present case, the insurer while issuing the new policy at a fresh location specifically excluded STFI perils and refunded the premium. The insured at the time when the loss occurred was covered by a policy that excluded STFI perils. Therefore, the insurer cannot be held to be liable. To hold to the contrary would be rewriting the agreement between the parties and creating a fresh contract to which the parties had not agreed. 24. The bank in its written statement filed before the State Commission, specifically averred in paragraph 2 that: ..The real fact is that one copy of the Policy is given to the Complainant and from this the Complainant can know the fact. One copy of the said Policy was given to them. Moreover, the Premium Amount which was returned back was debited in their Account. They could have inquired from this that what this Premium Amount was returned by the Insurance Company. The appellants in their rejoinder did not specifically deny the averment that they were furnished with a copy of the policy. The appellants have also not denied the fact that the premium on account of STFI perils which was refunded by the insurer was credited to their account. This being the position, it is not open to the appellants to disavow knowledge of the exclusion of the STFI perils in the insurance cover of Rs 60 lakhs which was issued for 2005-06 and renewed for 2006-07. 25. The appellants have placed reliance on the decision of this Court in Biman Krishna Bose v United India Insurance Co Ltd (2001) 6 SCC 477 , where this court while dealing with a mediclaim policy, observed: 5. A renewal of an insurance policy means repetition of the original policy. When renewed, the policy is extended and the renewed policy in the identical terms from a different date of its expiration comes into force. In common parlance, by renewal, the old policy is revived and it is sort of a substitution of obligations under the old policy unless such policy provides otherwise. It may be that on renewal, a new contract comes into being, but the said contract is on the same terms and conditions as that of the original policy. Where an insurance company which has exclusive privilege to carry on insurance business has refused to renew the mediclaim policy of an insured on extraneous and irrelevant consideration, any disease which an insured had contacted during the period when the policy was not renewed, such decease cannot be covered under a fresh insurance policy in view of the exclusion clause. The exclusion clause provides that the pre-existing diseases would not be covered under the fresh insurance policy. If we take the view that the mediclaim policy cannot be renewed with retrospective effect, it would give handle to the insurance company to refuse the renewal of the policy on extraneous consideration thereby deprive the claim of insured for treatment of diseases which have appeared during the relevant time and further deprive the insured for all time to come to cover those diseases under an insurance policy by virtue of the exclusion clause. This being the disastrous effect of wrongful refusal of renewal of the insurance policy, the mischief and harm done to the insured must be remedied. We are, therefore, of the view that once it is found that the act of an insurance company was arbitrary in refusing to renew the policy, the policy is required to be renewed with effect from the date when it fell due for its renewal. (Emphasis supplied) 26. The above case, as the extract indicates, dealt with a situation where the act of the insurer in refusing to renew the mediclaim policy was held to be arbitrary. This Court noted the serious consequence flowing out of the arbitrary refusal to renew the contract since it would result in the exclusion of the cover and the rejection of the claim in respect of a disease which the insured had contracted during the period when the policy was not renewed. The situation in the present case is clearly distinguishable. The terms and conditions of the new policy specifically excluded STFI perils and evidently there was a change in the obligations of the insurer. There was no renewal but the issuance of a new policy. The change in the location of the premises in the present case led to the issuance of a new policy. It was open to the insurer to specifically exclude STFI perils as a commercial decision. The appellants had knowledge of the exclusion of the STFI perils as they were provided with a copy of the policy and also received the refund of the premium. Having lodged no protest with the insurer during 2005-06 or in the renewed term of 2006-07, the insured cannot lay a claim that they had no knowledge that the STFI cover was excluded from the insurance cover. Nothing prevented the appellants from either approaching the insurer or any other insurance company for obtaining a policy that covered STFI perils.

0[ds]21. In the present case, the policy of insurance with a cover of Rs 60 lakhs for the period 2004-05 was issued for the location at B 205, Plot No 17-B, Village Karnaj. The insurance policy for 2005-06 was sought for different premises situated at 12/1123-1124, Basement, Meghdoot Apartment, Surat. The address mentioned in the policy for 2004-05 differs from that of 2005-06. The insurer proceeded on the basis that this was a fresh contract of insurance. Theinsurance policy for 1 August 2005 to 31 July 2006 was issued with the exclusion of STFI perils. This is clear from the use of words Warranted that STFI risk is excluded from the risk in the above insurance policy. The terms of the policy will govern the contract between the parties. The STFI risks were specifically excluded from the coverage of the policy. The extra premium of Rs 992 was refunded by the insurer to bank and the bank deposited the amount in the appellants account23. The above provision states that no risk can be assumed by the insurer unless the premium payable is received in advance. Sub-Section (3) of Section 64 (VB) provides for refund of the premium amount to the insured in case of cancellation or alteration of the terms and conditions of the policy. In the present case, the premium of Rs 992 to cover STFI perils was refunded by the insurer to the bank and the amount was deposited in the insureds account. The proposal does not conclude the contract. A contract postulates an agreement between the parties. In the present case, the insurer while issuing the new policy at a fresh location specifically excluded STFI perils and refunded the premium. The insured at the time when the loss occurred was covered by a policy that excluded STFI perils. Therefore, the insurer cannot be held to be liable. To hold to the contrary would be rewriting the agreement between the parties and creating a fresh contract to which the parties had not agreed25. The appellants have placed reliance on the decision of this Court in Biman Krishna Bose v United India Insurance Co Ltd (2001) 6 SCC 477 ,20. This Court, while interpreting the contract of insurance must interpret the words of the contract by giving effect to the meaning and intent which emerges from the terms of the agreementThe court through its interpretative process cannot rewrite or create a new contract between the parties. The court has to simply apply the terms and conditions of the agreement as agreed between the partiesThe appellants in their rejoinder did not specifically deny the averment that they were furnished with a copy of the policy. The appellants have also not denied the fact that the premium on account of STFI perils which was refunded by the insurer was credited to their account. This being the position, it is not open to the appellants to disavow knowledge of the exclusion of the STFI perils in the insurance cover of Rs 60 lakhs which was issued for 2005-06 and renewed for 2006-0726. The above case, as the extract indicates, dealt with a situation where the act of the insurer in refusing to renew the mediclaim policy was held to be arbitrary. This Court noted the serious consequence flowing out of the arbitrary refusal to renew the contract since it would result in the exclusion of the cover and the rejection of the claim in respect of a disease which the insured had contracted during the period when the policy was not renewed. The situation in the present case is clearly distinguishable. The terms and conditions of the new policy specifically excluded STFI perils and evidently there was a change in the obligations of the insurer. There was no renewal but the issuance of a new policy. The change in the location of the premises in the present case led to the issuance of a new policy. It was open to the insurer to specifically exclude STFI perils as a commercial decision. The appellants had knowledge of the exclusion of the STFI perils as they were provided with a copy of the policy and also received the refund of the premium. Having lodged no protest with the insurer during 2005-06 or in the renewed term of 2006-07, the insured cannot lay a claim that they had no knowledge that the STFI cover was excluded from the insurance cover. Nothing prevented the appellants from either approaching the insurer or any other insurance company for obtaining a policy that covered STFI perils.

### Instruction: Analyze the case proceeding and predict whether the appeal/petition will be accepted (1) or rejected (0). ### Input: his commission within twenty-four hours of the collection excluding bank and postal holidays. (5) The Central Government may, by rules, relax the requirements of sub-section (1) in respect of particular categories in insurance policies. (6) The Authority may, from time to time, specify, by the regulations made by it, the manner of receipt of premium by the insurer. 23. The above provision states that no risk can be assumed by the insurer unless the premium payable is received in advance. Sub-Section (3) of Section 64 (VB) provides for refund of the premium amount to the insured in case of cancellation or alteration of the terms and conditions of the policy. In the present case, the premium of Rs 992 to cover STFI perils was refunded by the insurer to the bank and the amount was deposited in the insureds account. The proposal does not conclude the contract. A contract postulates an agreement between the parties. In the present case, the insurer while issuing the new policy at a fresh location specifically excluded STFI perils and refunded the premium. The insured at the time when the loss occurred was covered by a policy that excluded STFI perils. Therefore, the insurer cannot be held to be liable. To hold to the contrary would be rewriting the agreement between the parties and creating a fresh contract to which the parties had not agreed. 24. The bank in its written statement filed before the State Commission, specifically averred in paragraph 2 that: ..The real fact is that one copy of the Policy is given to the Complainant and from this the Complainant can know the fact. One copy of the said Policy was given to them. Moreover, the Premium Amount which was returned back was debited in their Account. They could have inquired from this that what this Premium Amount was returned by the Insurance Company. The appellants in their rejoinder did not specifically deny the averment that they were furnished with a copy of the policy. The appellants have also not denied the fact that the premium on account of STFI perils which was refunded by the insurer was credited to their account. This being the position, it is not open to the appellants to disavow knowledge of the exclusion of the STFI perils in the insurance cover of Rs 60 lakhs which was issued for 2005-06 and renewed for 2006-07. 25. The appellants have placed reliance on the decision of this Court in Biman Krishna Bose v United India Insurance Co Ltd (2001) 6 SCC 477 , where this court while dealing with a mediclaim policy, observed: 5. A renewal of an insurance policy means repetition of the original policy. When renewed, the policy is extended and the renewed policy in the identical terms from a different date of its expiration comes into force. In common parlance, by renewal, the old policy is revived and it is sort of a substitution of obligations under the old policy unless such policy provides otherwise. It may be that on renewal, a new contract comes into being, but the said contract is on the same terms and conditions as that of the original policy. Where an insurance company which has exclusive privilege to carry on insurance business has refused to renew the mediclaim policy of an insured on extraneous and irrelevant consideration, any disease which an insured had contacted during the period when the policy was not renewed, such decease cannot be covered under a fresh insurance policy in view of the exclusion clause. The exclusion clause provides that the pre-existing diseases would not be covered under the fresh insurance policy. If we take the view that the mediclaim policy cannot be renewed with retrospective effect, it would give handle to the insurance company to refuse the renewal of the policy on extraneous consideration thereby deprive the claim of insured for treatment of diseases which have appeared during the relevant time and further deprive the insured for all time to come to cover those diseases under an insurance policy by virtue of the exclusion clause. This being the disastrous effect of wrongful refusal of renewal of the insurance policy, the mischief and harm done to the insured must be remedied. We are, therefore, of the view that once it is found that the act of an insurance company was arbitrary in refusing to renew the policy, the policy is required to be renewed with effect from the date when it fell due for its renewal. (Emphasis supplied) 26. The above case, as the extract indicates, dealt with a situation where the act of the insurer in refusing to renew the mediclaim policy was held to be arbitrary. This Court noted the serious consequence flowing out of the arbitrary refusal to renew the contract since it would result in the exclusion of the cover and the rejection of the claim in respect of a disease which the insured had contracted during the period when the policy was not renewed. The situation in the present case is clearly distinguishable. The terms and conditions of the new policy specifically excluded STFI perils and evidently there was a change in the obligations of the insurer. There was no renewal but the issuance of a new policy. The change in the location of the premises in the present case led to the issuance of a new policy. It was open to the insurer to specifically exclude STFI perils as a commercial decision. The appellants had knowledge of the exclusion of the STFI perils as they were provided with a copy of the policy and also received the refund of the premium. Having lodged no protest with the insurer during 2005-06 or in the renewed term of 2006-07, the insured cannot lay a claim that they had no knowledge that the STFI cover was excluded from the insurance cover. Nothing prevented the appellants from either approaching the insurer or any other insurance company for obtaining a policy that covered STFI perils. ### Response: 0

State Of Assam & Anr Vs. Gauhati Municipal, Board

natural justice required that the Board should have been given a personal hearing and an opportunity to produce materials in support of the explanation. We should have thought that when the Board is given a notice as required by S. 298 it would naturally submit its explanation supported by facts and figures and all relevant material in support thereof. However, we are definitely of opinion that the provisions of S. 298 being fully complied with it cannot be said that there was violation of principles of natural justice in this case when the Board never demanded what is called a personal hearing and never intimated to the Government that it would like to produce materials in support of its explanation at some later stage. Therefore where a provision like S. 298 is fully complied with as in this case and the Board does not ask for an opportunity for personal hearing or for production of materials in support of its explanation, principles of natural justice do not require that the State Government should ask the Board to appear for a personal healing and to produce materials in support of the explanation. In the absence of any demand by the Board of the nature indicated above, we cannot agree with the High Court that merely because the State Government did not call upon the Board to appear for a personal hearing and to produce material in support of its explanation it violated the principles of natural justice. This ground in support of the order of the High Court therefore fails.Re. (ii).8. Then we come to the finding of the High Court that the charges found proved in the notification were different from the charges levelled in the notice. We regret to say that the High Court did not carefully look into the matter. If it had done so, it would have found that there was no difference in substance between what wars charged and what was found proved. Eight charges were indicated in the notice of June 9, 1964. Six of them related to acts of omission and commission by the Board; the seventh and eighth charges were mere matters of inference from the first six charges and were not strictly speaking charges of which any explanation was necessary. In the notification superseding the Board the appellant found six charges proved. We have compared the notification of December 9, 1964 with the notice of June 9, l964 and find that the first charge found proved in the notification is the third charge in the notice; the second charge found proved in the notification is the fifth charge in the notice; the third charge found proved in the notification is the fourth charge in the notice; the fourth charge found proved in the notification is the second charge in the notice; the fifth charge found proved in the notification is the sixth charge in the notice and the sixth charge found proved in the notification is the first charge in the notice. It will thus be seen that though there was a change in the order in which charges were enumerated, the charges found proved were substantially the same as the charges leveled. We have already indicated that the seventh and eighth charges in the notice were really not charges and wore mere inferences and that is why we find no mention of them in the notification. The view of the High Court that the charges proved were different from the charges levelled therefore also fails.Re. (iii).9. Finally the High Court found that in the notice the State Government indicated its tentative conclusion to the effect that the Board should be superseded and thus it had made up its mind already even before considering the explanation of the Board that it should be superseded, and that the rest of the proceedings were a farce. The High Court thought that the appellant should not have indicated its tentative conclusion because S. 298 provides for two courses, i. e. supersession or dissolution, and the appellant could not decide between the two alternatives even tentatively before taking into consideration the explanation of the Board. In this connection the High Court relied on decision under Art. 311 of the Constitution relating to removal, dismissal and reduction in rank of public servants and was apparently of the view that the State Government should first have considered the explanation and then made up its mind as to which one of the two alternatives provided in S. 298 should be used and then presumably given a second notice to the Board to show cause why one of the alternatives tentatively decided upon should not be pursued. We are of opinion that it is not correct to use the analogy of Article 311 for the purpose of S. 298 of the Act. The issue of two notices under Article 311 is a very special procedure depending upon the language of that Article. We find no comparable words in S. 298. We also see no reason why when giving notice the State Government should not indicate to the Board tentatively which of the two alternatives it intends to pursue. Such tentative conclusion communicated to the Board does not mean that the State Government is not open to conviction at all and whatever the explanation it would pass an order in accordance with its tentative conclusion. There is therefore no reason to think that all proceedings subsequent to the issue of notice dated June 9, 1964 were in this case a farce. The third ground on which the High Court decided in favour of the respondent must fail.10. It appears that the respondent had secured a stay order and practically continued to function for the full period of four year under the cover of the stay order. Before, us, though the respondent has appeared, it did not seriously contest the appeal for the period of all members who took office on July 7, 1962 came to an end on July 6, 1966.

1[ds]6. We are of opinion that the appeal must succeed.(i)7. It is not necessary in the present appeal to decide whether the proceedings resulting in an order under S. 298 of the Act are quasi-judicial proceedings or merely administrativeit is clear from these facts that the appellant acted in full compliance with the procedure provided in S. 298. Ordinarily therefore there is no reason why it should be held, when the procedure provided in S. 298 was complied with, that the principles of natural justice were violated. But the High Court was of the view that the appellant should have given an oral hearing to the Board which should also have been given an opportunity to produce materials before the appellant in support of the explanation. According to the High Court, the right of hearing includes the right to produce evidence in support of an explanation and this opportunity was not given to the Board. Here again it is unnecessary to decide whether S. 298 which merely says that the State Government should give opportunity to the Board for submitting an explanation in regard to the matter envisages production of evidence - oral or documentary - at some later stage by the Board in support of its explanation. The High Court has conceded that a personal hearing of the nature indicated above is not always a concomitant of the principles of natural justice. But it was of the view that in the present case principles of natural justice required that the Board should have been given a personal hearing and an opportunity to produce materials in support of the explanation. We should have thought that when the Board is given a notice as required by S. 298 it would naturally submit its explanation supported by facts and figures and all relevant material in support thereof. However, we are definitely of opinion that the provisions of S. 298 being fully complied with it cannot be said that there was violation of principles of natural justice in this case when the Board never demanded what is called a personal hearing and never intimated to the Government that it would like to produce materials in support of its explanation at some later stage. Therefore where a provision like S. 298 is fully complied with as in this case and the Board does not ask for an opportunity for personal hearing or for production of materials in support of its explanation, principles of natural justice do not require that the State Government should ask the Board to appear for a personal healing and to produce materials in support of the explanation. In the absence of any demand by the Board of the nature indicated above, we cannot agree with the High Court that merely because the State Government did not call upon the Board to appear for a personal hearing and to produce material in support of its explanation it violated the principles of natural justice. This ground in support of the order of the High Court therefore fails.Re. (ii).8. Then we come to the finding of the High Court that the charges found proved in the notification were different from the charges levelled in the notice. We regret to say that the High Court did not carefully look into the matter. If it had done so, it would have found that there was no difference in substance between what wars charged and what was found proved. Eight charges were indicated in the notice of June 9, 1964. Six of them related to acts of omission and commission by the Board; the seventh and eighth charges were mere matters of inference from the first six charges and were not strictly speaking charges of which any explanation was necessary. In the notification superseding the Board the appellant found six charges proved. We have compared the notification of December 9, 1964 with the notice of June 9, l964 and find that the first charge found proved in the notification is the third charge in the notice; the second charge found proved in the notification is the fifth charge in the notice; the third charge found proved in the notification is the fourth charge in the notice; the fourth charge found proved in the notification is the second charge in the notice; the fifth charge found proved in the notification is the sixth charge in the notice and the sixth charge found proved in the notification is the first charge in the notice. It will thus be seen that though there was a change in the order in which charges were enumerated, the charges found proved were substantially the same as the charges leveled. We have already indicated that the seventh and eighth charges in the notice were really not charges and wore mere inferences and that is why we find no mention of them in the notification. The view of the High Court that the charges proved were different from the charges levelled therefore also fails.Re. (iii).9. Finally the High Court found that in the notice the State Government indicated its tentative conclusion to the effect that the Board should be superseded and thus it had made up its mind already even before considering the explanation of the Board that it should be superseded, and that the rest of the proceedings were a farce. The High Court thought that the appellant should not have indicated its tentative conclusion because S. 298 provides for two courses, i. e. supersession or dissolution, and the appellant could not decide between the two alternatives even tentatively before taking into consideration the explanation of the Board. In this connection the High Court relied on decision under Art. 311 of the Constitution relating to removal, dismissal and reduction in rank of public servants and was apparently of the view that the State Government should first have considered the explanation and then made up its mind as to which one of the two alternatives provided in S. 298 should be used and then presumably given a second notice to the Board to show cause why one of the alternatives tentatively decided upon should not be pursued. We are of opinion that it is not correct to use the analogy of Article 311 for the purpose of S. 298 of the Act. The issue of two notices under Article 311 is a very special procedure depending upon the language of that Article. We find no comparable words in S. 298. We also see no reason why when giving notice the State Government should not indicate to the Board tentatively which of the two alternatives it intends to pursue. Such tentative conclusion communicated to the Board does not mean that the State Government is not open to conviction at all and whatever the explanation it would pass an order in accordance with its tentative conclusion. There is therefore no reason to think that all proceedings subsequent to the issue of notice dated June 9, 1964 were in this case a farce. The third ground on which the High Court decided in favour of the respondent must fail.10. It appears that the respondent had secured a stay order and practically continued to function for the full period of four year under the cover of the stay order. Before, us, though the respondent has appeared, it did not seriously contest the appeal for the period of all members who took office on July 7, 1962 came to an end on July 6, 1966.

### Instruction: From the information provided in the case proceeding, infer whether the court's decision will be positive (1) or negative (0) for the appellant. ### Input: natural justice required that the Board should have been given a personal hearing and an opportunity to produce materials in support of the explanation. We should have thought that when the Board is given a notice as required by S. 298 it would naturally submit its explanation supported by facts and figures and all relevant material in support thereof. However, we are definitely of opinion that the provisions of S. 298 being fully complied with it cannot be said that there was violation of principles of natural justice in this case when the Board never demanded what is called a personal hearing and never intimated to the Government that it would like to produce materials in support of its explanation at some later stage. Therefore where a provision like S. 298 is fully complied with as in this case and the Board does not ask for an opportunity for personal hearing or for production of materials in support of its explanation, principles of natural justice do not require that the State Government should ask the Board to appear for a personal healing and to produce materials in support of the explanation. In the absence of any demand by the Board of the nature indicated above, we cannot agree with the High Court that merely because the State Government did not call upon the Board to appear for a personal hearing and to produce material in support of its explanation it violated the principles of natural justice. This ground in support of the order of the High Court therefore fails.Re. (ii).8. Then we come to the finding of the High Court that the charges found proved in the notification were different from the charges levelled in the notice. We regret to say that the High Court did not carefully look into the matter. If it had done so, it would have found that there was no difference in substance between what wars charged and what was found proved. Eight charges were indicated in the notice of June 9, 1964. Six of them related to acts of omission and commission by the Board; the seventh and eighth charges were mere matters of inference from the first six charges and were not strictly speaking charges of which any explanation was necessary. In the notification superseding the Board the appellant found six charges proved. We have compared the notification of December 9, 1964 with the notice of June 9, l964 and find that the first charge found proved in the notification is the third charge in the notice; the second charge found proved in the notification is the fifth charge in the notice; the third charge found proved in the notification is the fourth charge in the notice; the fourth charge found proved in the notification is the second charge in the notice; the fifth charge found proved in the notification is the sixth charge in the notice and the sixth charge found proved in the notification is the first charge in the notice. It will thus be seen that though there was a change in the order in which charges were enumerated, the charges found proved were substantially the same as the charges leveled. We have already indicated that the seventh and eighth charges in the notice were really not charges and wore mere inferences and that is why we find no mention of them in the notification. The view of the High Court that the charges proved were different from the charges levelled therefore also fails.Re. (iii).9. Finally the High Court found that in the notice the State Government indicated its tentative conclusion to the effect that the Board should be superseded and thus it had made up its mind already even before considering the explanation of the Board that it should be superseded, and that the rest of the proceedings were a farce. The High Court thought that the appellant should not have indicated its tentative conclusion because S. 298 provides for two courses, i. e. supersession or dissolution, and the appellant could not decide between the two alternatives even tentatively before taking into consideration the explanation of the Board. In this connection the High Court relied on decision under Art. 311 of the Constitution relating to removal, dismissal and reduction in rank of public servants and was apparently of the view that the State Government should first have considered the explanation and then made up its mind as to which one of the two alternatives provided in S. 298 should be used and then presumably given a second notice to the Board to show cause why one of the alternatives tentatively decided upon should not be pursued. We are of opinion that it is not correct to use the analogy of Article 311 for the purpose of S. 298 of the Act. The issue of two notices under Article 311 is a very special procedure depending upon the language of that Article. We find no comparable words in S. 298. We also see no reason why when giving notice the State Government should not indicate to the Board tentatively which of the two alternatives it intends to pursue. Such tentative conclusion communicated to the Board does not mean that the State Government is not open to conviction at all and whatever the explanation it would pass an order in accordance with its tentative conclusion. There is therefore no reason to think that all proceedings subsequent to the issue of notice dated June 9, 1964 were in this case a farce. The third ground on which the High Court decided in favour of the respondent must fail.10. It appears that the respondent had secured a stay order and practically continued to function for the full period of four year under the cover of the stay order. Before, us, though the respondent has appeared, it did not seriously contest the appeal for the period of all members who took office on July 7, 1962 came to an end on July 6, 1966. ### Response: 1

Subrata Roy Sahara Vs. Uoi & Ors

Court in, Rupa Ashok Hurra’s case (supra), the relevant observations wherefrom, have already been extracted hereinabove. 142. Last of all, we shall endavour to deal with the submission advanced by Dr. Rajeev Dhawan, learned Senior Counsel, to the effect that the instant petition was maintainable in exercise of the jurisdiction vested in this Court, under Articles 129 and 142 of the Constitution of India. The above provisions are being extracted hereunder;- “129. Supreme Court to be a court of record - The Supreme Court shall be a court of record and shall have all the powers of such a court including the power to punish for contempt of itself.142. Enforcement of decrees and orders of the Supreme Court and orders as to discovery, etc. - (1) The Supreme Court in the exercise of its jurisdiction may pass such decree or make such order as is necessary for doing complete justice in any cause or matter pending before it, and any decree so passed or order so made shall be enforceable throughout the territory of India in such manner as may be prescribed by or under any law made by Parliament and, until provision in that behalf is so made, in such manner as the President may by order prescribe(2) Subject to the provisions of any law made in this behalf by Parliament, the Supreme Court shall, as respects the whole of the territory of India, have all and every power to make any order for the purpose of securing the attendance of any person, the discovery or production of any documents, or the investigation or punishment of any contempt of itself.”Relying on the above provisions, learned Senior Counsel asserted, that “maintainability exists, because we can all make mistakes, and the mistakes that we make, need to be corrected”. The submission of the learned counsel in this behalf was, that in the above view of the matter, jurisdiction could truly be traced, to Articles 129 and 142 for correcting mistakes. It was the submission of the learned counsel, that this Court being a Court of record, had unlimited jurisdiction to correct all mistakes committed by it. Referring to Article 142 of the Constitution of India it was submitted, that it was the pious obligation of Court to do complete justice, and accordingly, whenever injustice was traceable, it was imperative for this Court to rectify the same. On the subject under reference, learned Senior Counsel relied on the decision in Rupa Ashok Hurra’s case (supra) and invited our pointed attention to following observations recorded therein:-“23. These contentions pose the question, whether an order passed by this Court can be corrected under its inherent powers after dismissal of the review petition on the ground that it was passed either without jurisdiction or in violation of the principles of natural justice or due to unfair procedure giving scope for bias which resulted in abuse of the process of the Court or miscarriage of justice to an aggrieved person.xxx xxx xxx49. The upshot of the discussion in our view is that this Court, to prevent abuse of its process and to cure a gross miscarriage of justice, may re-consider its judgments in exercise of its inherent power.50. The next step is to specify the requirements to entertain such a curative petition under the inherent power of this Court so that floodgates are not opened for filing a second review petition as a matter of course in the guise of a curative petition under inherent power. It is common ground that except when very strong reasons exist, the Court should not entertain an application seeking reconsideration of an order of this Court which has become final on dismissal of a review petition. It is neither advisable nor possible to enumerate all the grounds on which such a petition may be entertained.”(emphasis is ours) 143. It is not possible for us to accept the contention advanced at the hands of the learned Senior Counsel. By placing reliance on the decision rendered by this Court in Rupa Ashok Hurra’s case (supra), learned counsel must be deemed to have impliedly conceded the issue, against himself. In Rupa Ashok Hurra’s case (supra), this Court examined the remedies available to an individual. In the above judgment, this Court examined the ambit and scope of Article 137 of the Constitution of India, whereunder, a review petition could be filed for the correction of an error apparent on the face of the record. In the judgment relied upon, this Court also expressed the view, that a curative petition could be filed for corrections of such like errors, after a review petition had been dismissed. It is relevant to mention, that in furtherance of the directions issued by this Court in Rupa Ashok Hurra’s case (supra), this Court has framed rules, for entertaining curative petitions. Such curative petitions, when entertained, are placed before a five-Judge Bench including the senior most three Judges of this Court. Placing reliance on Rupa Ashok Hurra’s case (supra) evidences, that the petitioner was aware of the jurisdiction of this Court under Article 137 of the Constitution of India for filing a review petition, as also, the permissibility of filing a curative petition, after the concerned party had not succeeded, in the review petition. Unfortunately, the petitioner has not chosen either of the above jurisdictions. The instant petition has been styled as a criminal writ petition. The instant petition is not maintainable as no fresh petition is shown to be maintainable, under the provisions (Articles 129 and 142 of the Constitution of India), relied upon by the learned Senior Counsel. Moreover, our deliberations on the merits of the controversy further reveals, that there is neither any jurisdictional error, nor any error in law has been shown to be made out, from the impugned order dated 4.3.2014.144. For all the reasons recorded hereinabove we are of the view, that the instant petition is not maintainable and the same is, therefore, liable to be dismissed on the ground of maintainability. XI. Conclusions

1[ds]. We are of the view, thata genuine plea of bias alone, could have caused us to withdraw from the matter, and require it to be heard by some other Bench. Detailed submissions on the allegations constituting bias, were addressed well after proceedings had gone on for a few weeks, the same have been dealt with separately (under heading VIII,the impugned order dated 4.3.2014, is vitiated on account ofBased on the submissions advanced by learned counsel, we could not persuade ourselves in accepting the prayer for recusal.10. We have recorded the above narration, lest we are accused of not correctly depicting the submissions, as they were canvassed before us. In our understanding, the oath of our office, required us to go ahead with the hearing. And not to be overawed by such submissions. In our view, not hearing the matter, would constitute an act in breach of our oath of office, which mandates us to perform the duties of our office, to the best of our ability, without fear or favour, affection or ill will. This is certainly not the first time, when solicitation for solicitation for recusal has been sought by learned counsel. Such a recorded peremptory prayer, was made by Mr. R.K. Anand, an eminent Senior Advocate, before the High Court of Delhi, seeking the recusal of Mr. Justice Manmohan Sarin from hearing his personal case.One of the reasons for retaining the instant petition for hearing with ourselves was, that we had heard eminent Senior Counsel engaged by the two companies exclusively for over three weeks during the summer vacation of 2012. We had been taken through thousands of pages of pleadings. We had the occasion to watch the demeanour and defences adopted by the two companies and the contemnors from time to time, from close quarters. Writing the judgment, had occupied the entire remaining period of the summer vacation of 2012, as also, about two months of further time. The judgment dated 31.8.2012 runs into 269 printed pages. Both of us had rendered separate judgments, concurring with one another, on each aspect of the matter. During the course of writing the judgment, we had the occasion to minutely examine numerous communications, exchanged between the rival parties. That too had resulted in a different kind of understanding, about the controversy. For any other Bench to understand the nuances of the controversy determined through our order dated 31.8.2012, would require prolonged hearing of the matter. Months of time, just in the same manner as we had taken while passing the order dated 31.8.2012, would have to be spent again. Possibly the submissions made by the learned counsel seeking our recusal, was consciously aimed at the above objective. Was this the reason for the theatrics, of some of the learned Senior Counsel? Difficult to say for sure. But deep within,we all understand? It was also for the sake of saving precious time of this Court, that we decided to bear the brunt and the rhetoric, of some of the learned Senior Counsel representing the petitioner. We are therefore satisfied, that it would not be better, for another Bench to hear this case.Even though responses to the contempt petitions referred to above, had been filed, and we were hearing learned counsel representing the contemnors, on the subject of contempt, we were also trying to cajole the two companies, into an understanding that they were obliged to comply with the orders dated 31.8.2012 and 5.12.2012. In our view, compliance of the above orders would reduce the seriousness of the issue. The effort on our part was always to avoid hardship, to any of the concerned parties. But in our above effort, we could not compromise, the interest of the investors. As already noticed, in the discussion recorded under the preceding heading, the two companies never supplied any authentic details of their investors. Nor the details of the moneys collected. Whatever the two companies asserted, had to be accepted on its face value, to proceed further. When learned counsel for the petitioner, made a proposal to secure the amount payable to the investors of the two companies, we were not averse to the proposal. We wished to explore some intermediary means to secure compliance. That would have deferred adoption of harsher measures. With the above object in mind, we accepted the proposal of the learned counsel for the petitioner (and the other contemnors), to furnish a list of unencumbered immovable properties, which would secure the liability of the two companies (for compliance of the order dated 31.8.2012, as well as, the subsequent order dated 5.12.2012). The list of properties furnished to this Court, could not have been so furnished, without theexpress approval. There can be no doubt about the aforesaid inference, because the stance now adopted by the petitioner shows, that the petitioner is in absolute charge of all the affairs of the companies. And nothing can move without his active involvement. During the course of hearing of the present petition, learned counsel have repeatedly emphasized that further deposits will be possible, only after the petitioner is released from judicial custody. This stance shows, that in the affairs of the Sahara Group, Mr. Subrata Roy Sahara, is the only person who matters. And therefore, the other individual directors, may have hardly any say in the matter.48. The lists of properties which were provided by the two companies during the above exercise, were rejected by the SEBI, for good reason. It is not necessary for us to record the details herein, why the lists of properties furnished to this Court were found to be unacceptable. We may, however, record, that we were satisfied with the submissions advanced at the behest of the SEBI, that the proposed properties, would not secure the amount of the refund contemplated by the orders of this court. It is therefore, that another attempt was made, consequent upon an offer made on behalf of the two companies, that other companies within the framework of the Sahara Group, would also make available to the SEBI, their unencumbered immovable properties. Is it possible for anyone to say, after the petitioner agreed to provide the list of immovable properties, that he was not aware of the nature of proceedings being conducted in this Court, or their gravity? Is it possible for the petitioner to say, that he was not aware of the reason, why these lists were being furnished to this Court? There can be no doubt, that it was abundantly clear to the petitioner, that the properties mentioned in the lists furnished, would be sold if necessary, to comply with thisorder dated 31.8.2012. This was sufficient notice to the petitioner, of the seriousness of the situation.49. Since our efforts of this Court, to secure theinterests, determined vide its order dated 31.8.2012, were being systematically frustrated this Court in order to demonstrate the seriousness of the issue, directed thatthe alleged contemnors (respondents) shall not leave the country without the permission of thistill compliance of the above order. The above direction was issued on 28.10.2013. Is it open to the learned counsel for the petitioner, after the above restraint order was passed, to contend that the petitioner was not aware of the happenings in Court? He was aware that the above restraint order was passed, during the pendency of the contempt proceedings, which were initiated because of non-compliance of the orders dated 31.8.2012 and 5.12.2012. It is therefore incorrect to contend, that the petitioner had no notice, and was taken unawares. During the course of one of the subsequent hearings (on the subject), learned counsel representing the contemnors, clarified, that the properties in the list provided to this Court, could not be put to sale, in execution of the orders dated 31.8.2012 and 5.12.2012. What was the purpose sought to be achieved, if the properties (included in the list furnished to this Court) could not be sold, for the satisfaction of the judgment dated 31.8.2012? Surely, the contemnors, were taking this Court for a ride. The demeanour of the contemnors to stonewall the process of law, from the time investigation was commenced by the SEBI in 2009, continued even after the judicial process had attained finality, by thisorder dated 31.8.2012. All along the petitioner feigns ignorance of everything.50. Even though this Court had no intention to grant any relaxation to the contemnors, on the restraint order passed on 28.10.2013 (by which the contemnors, were stopped from leaving this country), yet when Interlocutory Application no. 4 was filed (in Contempt Petition (Civil) no. 260 of 2013), contending that Mr. Subrata Roy Sahara, had foreign commitments, the Court relaxed the above order, and permitted the petitioner to go abroad. But, simultaneously the Court directed the petitioner, to immediately return back, and be present in the country, in case of non-compliance of thisdirections, (to submit original title deeds of unencumbered properties of the Sahara Group of Companies). On 21.11.2013, the Court was informed by the learned counsel for the contemnors, that the properties depicted in the list furnished to this Court (in furtherance of the order dated 28.10.2013), could not be sold without the approval of the Board of Directors, of the concerned companies (to which the individual properties belonged). The Court was then constrained to record, that the order dated 28.10.2013 passed by this Court, had not been complied with, in its letter and spirit. It is, therefore, the Court took one further step to demonstrate to the petitioner, as also, the other contemnors, the seriousness of the issue, by ordering on 21.11.2013that the Sahara Group of Companies shall not part with any movable or immovable property, until furtherIs it open to the petitioner to contend, that he had no notice, of the above Court proceedings? The business obligations of the petitioner, were bound to have been seriously affected, by the above order. The petitioner would have to be hugely unconcerned and disinterested, if he was still unaware of the nature of the ongoing contempt proceedings; and where the proceedings were leading to. The Court further directed (by the same order), that all the alleged contemnors would not leave the country, without the permission of this Court. By this, the Court restored its earlier order dated 28.10.2013. This order also had serious repercussions, for the petitioner. When the above order was passed, should the petitioner be permitted to contend, that he did not have any adverse business consequences? If it did, was it open for him to assert, that he had no notice, and was unaware about the direction towards which, the contempt proceedings wereHaving done the utmost, in requiring the contemnors to comply with the orders dated 31.8.2012 and 5.12.2012, wherein this Bench would meet exclusively for the benefit of the contemnors, the Court felt that it had miserably failed, to persuade the contemnors to comply with its directions. Accordingly on 4.3.2014, in exercise of the powers conferred under Articles 129 and 142 of the Constitution of India, this Court ordered the arrest and detention of all the contemnors (except Mrs. Vandana Bhargava) in judicial custody at Delhi, till the next date of hearing. By the order dated 4.3.2014, the Court expressly granted liberty to the contemnors to propose an acceptable solution, for execution of its orders. Mrs. Vandana Bhargava, who was excused from the order of detention, was permitted to coordinate with those whose detention the Court had ordered, so as to enable them to formulate an acceptable solution for execution of the above orders. It is apparent, that right from the beginning, and even after ordering the detention of the contemnors including the petitioner herein, The Court was only endeavouring, to ensure the compliance of the orders passed by this Court on 31.8.2012 and 5.12.2012. On the following date of hearing i.e., on 7.3.2014, at the asking of the learned counsel representing the contemnors, we enhanced the visitation times permissible to the detenues, so as to enable them to meet their financial consultants and lawyers for two hours every day.Our leniency is apparent from the fact, that we have by our order dated 26.3.2014 ordered the petitioner and the other contemnors to be released on bail, on the receipt of a payment of Rs.10,000 crores, which is less than a third of the amount presently due. That would constitute, the first small step, taken by the contemnors, for the satisfaction of the orders passed by this Court on 31.8.2012 and 5.12.2012. The above orders must, under all circumstances, be given effect to in letter and spirit, and till that is done, the process of enforcing compliance, shall have to go on. The petitioner may be released from judicial custody, if he complies with our order dated 26.3.2014. That would however not excuse the petitioner from making the balance payment, in terms of the orders dated 31.8.2012 and 5.12.2012, even if it means the re-arrest of the petitioner again and again, for the purpose of compliance of this. One of the emphatic contentions advanced by some of the learned counsel for the petitioner was, that execution of a money-decree by way of arrest was a procedureRecourse to arrest of an individual for recovery of money, according to one learned counsel, constituted a. During the course of their submissions, learned counsel for the petitioner, chose to address the Court by using language, which we had not heard (either as practicing Advocates, or even as Judges in the High Courts or this Court). We would, however, unhesitatingly state, that it is not possible for us to accept, that learned counsel who addressed the instant submission, were unaware of the relevant provisions of law. It is however interesting to notice, that in the written submissions handed over to us during the course of hearing, reference was actually made to such a provision. It was asserted in the written submissions prepared by Mr. Ram Jethmalani, thatimprisonment for failure to comply with a decree or order for payment of money can be inflicted on a person liable to pay in compliance, without complying with the conditions of Section 51 proviso (b) of the CPC.A contradiction in terms. But there were many such contradictions, even on facts. A new phase of advocacy seems to have dawned.From the above provisions of the CPC, as also, the Cr.P.C. it is apparent, that to enforce a financial liability ordered by a Court, one of the permissible means is, by way of arrest and detention. The submissions advanced by the learned counsel for the petitioner, that there is no provision, whereunder, an order of arrest and detention can be passed, for the execution of a money-decree, cannot therefore be accepted. It is also not possible for us to infer, that learned counsel were oblivious of the provisions contained in the civil/criminal procedure codes. It may be pointed out, that there are a large number of standalone statutory enactments, whereunder arrest and detention is ordered for the execution of a financial liability.e are of the view that the conditions contemplated in Section 51 of the CPC as preconditions, for the arrest and detention of a judgment-debtor for executing aorder, can be demonstrated as having been duly complied with, before this Court passed the impugned order dated 04.03.2014. The proviso to Section 51 of the CPC contemplates certain preconditions for execution of a money-decree by way of arrest and detention in prison. As already discussed above, on the satisfaction of any one of the preconditions, a money-decree can be executed, by ordering arrest and detention of the judgment-debtor in prison.We are prima facie satisfied, that yet another pre-condition contemplated in the proviso to Section 51 of the CPC was also made out. The reason for expressing the instant view is, that no clear responses were ever given by the two companies. The position remained the same whether those answers were sought by the SEBI(FTM), or the SAT, or even by this Court.The three preceding paragraphs clearly demonstrate, that three different conditions contemplated in the proviso to Section 51 of the CPC, were satisfied, before we ordered the arrest and detention of the contemnors, for enforcement of the orders passed by this Court. Satisfaction of any one of the conditions, expressed in the foregoing three paragraphs, would have been sufficient to order the arrest and detention of the petitioner, under Section 51 of the CPC. Our instant determination should not be understood to mean, that Section 51 of the CPC is applicable to the facts and circumstances of this case. The instant determination should only be understood to mean, that the parameters laid down in Section 51 of the CPC, stood fully satisfied, before the arrest and detention order dated 4.3.2014 was passed.74. For the same reasons as have been recorded in the foregoing paragraph, even rules 37 and 40 of Order XXI of the CPC, would be inapplicable for the execution of thisorders dated 31.8.2012 and 5.12.2012. Firstly, because the above provisions of the CPC, relating to execution, have not been made applicable for enforcement of orders passed under the SEBI Act. Secondly, a perusal of rule 37(1) of Order XXI of the CPC reveals, that where a Court is satisfied that the judgment-debtor is likely to abscond or leave the local limits of the jurisdiction of the Court, the procedural requirements of the aforesaid rules is expressly excluded. Likewise, sub-rule (2) of rule 37 of Order XXI of the CPC provides, that the procedural requirements depicted therein, would be inapplicable when the judgment-debtor does not enter appearance before a Court in obedience of a notice issued to him. The impression of this Court, that the appellant would abscond, and the fact, that the appellant did not enter appearance when summoned to do so, is apparent from the orders passed by this Court (already extract above). Yet, at the cost of repetition, we may reiterate, that by an order dated 28.10.2013, this Court directed, thatalleged contemnors (respondents) shall not leave the country without the permission of thisEven though the above order was relaxed by this Court on a request made by the petitioner, yet once again on 21.11.2013 this Court directedthe alleged contemnors shall not leave the country without the permission of this Court.The above restraint order was subsisting when theorder of arrest and detention was passed. Furthermore, having expressed its satisfaction, that the information furnished by the contemnors (including the petitioner) did not establish the stance adopted by them, this Court by its order dated 20.2.2014 noticing the defiant and non-cooperative attitude of the contemnors, had directedpersonal presence of the alleged contemnors and the directors of the respondent companies in Court on February 26, 2014 at 2.00On 25.2.2014, a mention was made on behalf of the petitioner herein, for exemption from personal presence on 26.2.2014. The same was declined. Despite the above refusal, Mr. Subrata Roy Sahara did not enter appearance before this Court on 26.2.2014. The other directors were present. Thus there is no room for any doubt, that the above provision was rendered inapplicable, insofar as the petitioner is concerned. A perusal of rule 40 of Order XXI of the CPC reveals, that the procedural requirements expressed in the same, would come into play inter alia, after the person concernedis brought before the Court after being arrested in execution of a decree for payment ofReference to above rule, on behalf of the petitioner, is therefore wholly misconceived. The above deliberations, should not be understood to mean, that the aforesaid provisions of the CPC, relied upon by the learned counsel, were applicable to this case. The above deliberations only demonstrated, that the parameters laid down in the above provisions cannot be stated to have been disregarded, when the impugned order dated 4.3.2014 was passed.75. Insofar as rule 6 of Order XIII of the Supreme Court Rules, 1966, is concerned, the same mandates the enforcement of an order passed by this Court, by transmitting the order to be enforced to theor Tribunal in the way prescribed byWe have already concluded hereinabove, that no executing mechanism was in place under the provisions of the SEBI Act, when the orders dated 31.8.2012 and 5.12.2012 were passed. Thus viewed, even rule 6 of Order XIII of the Supreme Court Rules, 1966 would be inapplicable to deal with the issue in hand, as it was not possible for this Court to transmitto the Court or Tribunal from which the appeal was broughtfor execution of thisorders dated 31.8.2012 and 5.12.2012.We find each one of the submissions advanced by Mr. Arvind Datar on behalf of the SEBI, as fully justified. We have recorded our own observations, at the end of each of the above paragraphs, dealing with the factual position brought to our notice, by the learned Senior Counsel for the SEBI. We are satisfied, that Mr. Subrata Roy Sahara was well aware of the proceedings before this Court. He was well aware of the prayers made in Interlocutory Application nos. 68 and 69 of 2013. He filed his written response thereto, by way of an affidavit. The petitioner was aware of the seriousness of the issue, on account of various restraining, corrective and deterrent orders passed by this Court, from time to time, each graver than the previous ones. He remained unaffected to all the efforts made by this Court, to enforce refund of the moneys collected by the two companies, to those who had invested in theiralong with interest, in terms of thisorders dated 31.8.2012 and 5.12.2012.It is, therefore, that this Court was left with no other option, but to order the arrest and detention of two of the directors, and Mr. Subrata Roy Sahara. We were satisfied, that the above order was necessary to ensure the observance of the due process of law, in the facts and circumstances of the case. The above order was also imperative, if we were to perform our duties and functions effectively, and if we were to maintain the majesty of law and/or the dignity of the Supreme Court.The assertion, that we would not be satisfied under any circumstances, with thearguments and submissions on merits, is clearly misconceived. The assertion made by the petitioner, that we had already prejudged the matter, and no relief could be expected from us, is likewise a total misconstruction of the proceedings we are dealing with. It needs to be understood, that there is no lis pending before us, wherein we have to determine the merits of the claims raised by the rival parties. In a situation, where rival claims of parties, have to be decided on merits, such a submission could have possibly been made. Merits of the claims (and counter-claims) have already been settled by thisorder dated 31.8.2012. The proceeding wherein the impugned order was passed, was being conducted in the contempt jurisdiction of this Court (under Article 129 of the Constitution of India). The scope of the instant contempt jurisdiction extends to, punishing contemnors for violatingorders; punishing contemnors for disobeyingorders; punishing contemnors for breach of undertakings given to Courts. It also extends to enforcement oforders. Contempt jurisdiction even extends to punishing those who scandalize (or lower the authority of) any Court; punishing those who interfere in due course of judicial proceedings; and punishing those who obstruct the administration of justice. During the course of hearing, learned counsel again and again, admitted breach of thisorders, dated 31.8.2012 and 5.12.2012. It was inter alia admitted, that payments could not be made within the time frame stipulated. Contempt by way of breach of thisorders having been admitted, the allegation of bias is clearly a plea which is not available to the petitioner. In such consideration, there is no room which remains for further adjudication on merits. There cannot, therefore be a prejudged mind (all that has to be decided, has already been adjudged). For the same reason, there is no scope for a compromise. Issues of compromise arise between parties, while merits of rival claims are pending. The dispute between the parties has already been settled, and contempt by way of breach has already been admitted. The question of compromise does not arise at all. We therefore reject all the above submissions advanced by the learned counsel for the petitioner.107.are satisfied that none of the disguised aspersions cast by learned Senior Counsel, would be sufficient to justify the invocation of the maxim, that justice must not actually be done, but must also appear to be done. As already noticed above, even though our combination as a Bench, did not exist at the time, when the present petition was filed, a Special Bench, with the present composition, was constituted bythe Chief Justice, as a matter of his conscious determination. No litigant, can be permitted to dissuade us, in discharging the onerous responsibility assigned to us bye of the proposals is just not possible, in the teeth of the order dated 5.12.2012, passed by a three-Judge Division Bench, requiring the two companies to make a deposit of Rs.10,000 crores in the first week of January, 2013. By now, about 17 further months have elapsed without the petitioner and the two companies having made any deposit whatsoever. Within the framework of the requirement depicted in the order dated 5.12.2012, we, by our own order dated 26.3.2014 (extracted above), softened the modus of payment. It is, therefore, not possible for us to accept, that there has beenplay in thefor the enforcement of the orders passed by this Court. We find the submission made by the learned counsel for the petitioner to the effect, that our order dated 26.3.2013 cannot be complied with, because it was premised on impossible conditions, is wholly unjustified. The assets of the Sahara Group are sufficient to discharge the entire liability, without much difficulty.110. Insofar as the assertion made by Dr. Rajeev Dhawan, learned Senior Counsel, that the factual position expressed in the order dated 4.3.2014 was not correct, is concerned, we may at the cost of repetition once again notice, that it is also important for us to record that the positive position expressed by the SEBI before this Court (during the disposal of Civil Appeal Nos.9813 and 9833 of 2011) was, that neither SIRECL nor SHICL ever provided details of its investors to the SEBI (FTM). They contested the proceedings initiated by the SEBI (FTM) only on technical grounds. We were told that even before the SAT, no details were furnished. As against the above, the position adopted by the SIRECL before us, during the course of appellate proceedings was, that SIRECL had furnished a compact disc with all details to the SEBI (FTM), along with its operating key. Whilst it was acknowledged by the SEBI before this Court, that a compact disc (allegedly containing details about the investors) was furnished by SIRECL, yet it was emphatically pointed out, that its operating key was withheld. This was another ploy, in the series of moves adopted by the two companies to withhold the providing of any details to the SEBI. Resultantly, no details whatsoever were ever disclosed by SIRECL either before the SEBI (FTM) or the SAT. The position adopted by SHICL was even worse. It is necessary to place on record the fact, that the SHICL has never ever disclosed, the names and other connected details of even a single investor to the SEBI, despite this prolonged litigation. We had repeatedly made a poser, during the hearing of the present petition, about SHICL, as indicated above. The position was confirmed by learned Senior Counsel representing the SEBI. Unfortunately, Mr. S. Ganesh, learned Senior Counsel for the petitioner, on the last day of hearing, ventured to contest the above position. He handed over to us two volumes of papers running into 260 pages (under the title – Note on information provided by SHICL to the SEBI). We required him to invite our attention, to documents indicating disclosure of the above information. His ploy stood exposed, when no material depicting disclosure of names, and other connected details of SHICL to the SEBI, could be brought to our notice. That apart, what is essential to record is, that till date SHICL has never ever supplied investor related details to the SEBI. A fact about which there is now no ambiguity, specially after learned Senior Counsel filed the two volumes of papers referred to above. The above factual position remained unaltered before the SAT and even before this Court. Does it lie in the mouth of learned Senior Counsel to assert, that unjustified conclusions had been recorded against the two companies, without anyr as the instant aspect of the matter is concerned, it is necessary to highlight the fact, that the order dated 31.8.2012 directed the two companies, to deposit with the SEBI, the entire redeemable amount along with interest at the rate of 15%. The above deposit had to be made within a period of three months, i.e., by 30.11.2012. The case set up by the two companies has been, that SIRECL had already refunded Rs.17,443 crores to the investors, and SHICL had likewise refunded Rs.5,442 crores. The two companies therefore assert, that they cannot be required to make the same payment to the investors, for the second time. It would be pertinent to mention, that the two companies had approached this Court by filing Civil Appeal no. 8643 of 2012 (and Writ Petition (Civil) no. 527 of 2012). In the said proceedings, the two companies had sought exemption from depositing the amounts, which they had allegedly redeemed. The three-Judge Division Bench, which heard the matter(s), did not accept the redemption theory projected by the two companies. Accordingly, the prayer made by the two companies in Civil Appeal no.8643 of 2012 (and Writ Petition (Civil) no. 527 of 2012) for deduction of the above amount, was not accepted by this Court, when it passed the final order dated 5.12.2012. Accordingly, the companies were directed to deposit the entire balance amount of Rs.17,400 crores. It is, therefore imperative to conclude, that the issue of deduction of allegedly redeemed funds, stood concluded against the two companies, when this Court passed its order dated 5.12.2012. This plea is no longer available to the two companies, in law. To continue to harp on the alleged redemptions, is clearly a misrepresentation, specially when the order dated 5.12.2012 has attained finality.121. Therefore, viewed from any angle, there is no substance in the contention advanced on behalf of the two companies, that the moneys payable to the investors had been refunded to them. Accordingly, there is no merit in the prayer, that while making payments in compliance with thisorders dated 31.8.2012 and 5.12.2012, the two companies were entitled to make deductions of Rs.17,443 crores (insofar as SIRECL is concerned) and Rs.5,442 crores (insofar as SHICL is concerned). Be that as it may, we have still retained a safety valve, inasmuch as, the SEBI has been directed to examine the authenticity of the documents produced by the two companies, and in case the SEBI finds, that redemptions have actually been made, the two companies will be refunded the amounts, equal to the redemptions found to have been genuinely made.122. We are persuaded to record, that either the submissions made to this Court on the subject of refunds made by the two companies were false; or the present projection of the two companies of their inability to pay the investors is false. One learned Senior Counsel for the petitioner, Mr. S. Ganesh, during the course of his narration, in order to substantiate the redemption ofto the tune of thousands of crores of rupees, referred to the collection of thousands of crores of rupees in successive months, during the year 2012, from the account books of the two companies. On a single day (31.5.2012), the cash inflow is shown as Rs.15,535,89,65,601.00 (i.e. more than Rupees fifteen thousand five hundred and thirty five crores). This was done by collecting funds from all companies (and firms, under the conglomerate) of the Sahara Group. If it was possible to do that, at that juncture, in order to redeem the payments claimed by investors, we fail to understand why the same cannot be done now. Specially when, as already noticed hereinabove, the book value/market value of the properties of the Sahara Group conglomerate, is to the tune of Rs.1,52,500 crores (as per its own website). It is after all, close to 2 years (about 20 months) since the order dated 31.8.2012 was pronounced, and close to 1½ years (about 17 months) since the order dated 5.12.2012 was passed.It is apparent from the submissions advanced at the hands of the learned counsel for the petitioner, that even learned counsel representing the petitioner, were not sure about the maintainability of the instant petition. Each of them while adopted an independent stance, and was unwilling to accept the position adopted by his other two colleagues. In the above view of the matter, we would have been happy to follow a simple course. To reject themaintainability, on the basis of the majority view, expressed by the learned counsel representing the petitioner himself. Such rejection would be, by a majority of 2:1. Learned counsel were probably independently conscious of the legal position, that the petition was not maintainable. Unfortunately, this course is not open to a Court of law. We will have to examine the maintainability of the petition, by taking into consideration all the perspectives presented before us. The burden will naturally be three-folds than the usual. However, keeping in mind the eminence of the learned Senior Counsel who represented the petitioner, it is not possible for us, at first blush, to draw any such inference. We shall endeavour to independently determine the issue of maintainability, canvassed at the hands of all the learned counsel representing the petitioner. In case we arrive at the conclusion, that the submission of any one of the learned counsel is acceptable, we would treat the instant petition as maintainable.We are of the view, thatreliance by the learned Senior Counsel for the petitioner on Supreme Court Barcase (supra) and on M.S.case (supra) is wholly misconceived on account of the determination rendered by this Court in Rupa Ashok. We are in absolute agreement with the submissions advanced by Mr. Arvind Datar, learned Senior Counsel for the respondent. In view of the factual position depicted in this judgment (under the heading:the impugned order dated 4.3.2014 was passed, in violation of the rules of naturalbased on the pleas advanced by the petitioner on merits, it is apparent, that the rules of natural justice were followed to the hilt, before the impugned order dated 4.3.2014 was passed. Accordingly, the principle of actus curiae neminem gravabit is not available to the petitioner.138. We have recorded hereinabove, that the instant petition is not maintainable, because the challenge raised by the petitioner herein, on the grounds of a jurisdictional error, or non compliance of the rules of natural justice have been found to be not made out in this case. That was the only basis of interference in Naresh Sridharcase (supra). We are however persuaded, to record another reason for not accepting the maintainability of the present writ petition, on the basis of Naresh Sridharcase (supra). In this behalf it is relevant to notice, from the factual background of Naresh Sridharcase (supra) which has been traced hereinabove, that A.R. Antulay, had earlier approached this Court, by filing a writ petition under Article 32 of the Constitution of India (just in the same manner, as the petitioner herein has approached this Court). A two-Judge Division Bench of this Court dismissed the petition by observing inter alia, that a writ petition challenging the validity of an order and judgment passed by the Supreme Court as nullity or otherwise incorrect, could not be entertained. The said writ petition was accordingly dismissed (Abdul Rehman Antulay v. Union of India, Writ Petition (Criminal) no. 708 of 1984, decided on 17.4.1984; reported as Appendix, (1988) 2 SCC 764). In the above view of the matter also, even on the basis of the very judgment relied upon by the learned counsel, we have no other alternative but to conclude, that the instant writ petition is not maintainable, to assail the impugned order passed by this Court on 4.3.2014.4.3.2014.144. For all the reasons recorded hereinabove we are of the view, that the instant petition is not maintainable and the same is, therefore, liable to be dismissed on the ground of maintainability.

### Instruction: Review the case details and predict the decision: will the court accept (1) or deny (0) the appeal/petition? ### Input: Court in, Rupa Ashok Hurra’s case (supra), the relevant observations wherefrom, have already been extracted hereinabove. 142. Last of all, we shall endavour to deal with the submission advanced by Dr. Rajeev Dhawan, learned Senior Counsel, to the effect that the instant petition was maintainable in exercise of the jurisdiction vested in this Court, under Articles 129 and 142 of the Constitution of India. The above provisions are being extracted hereunder;- “129. Supreme Court to be a court of record - The Supreme Court shall be a court of record and shall have all the powers of such a court including the power to punish for contempt of itself.142. Enforcement of decrees and orders of the Supreme Court and orders as to discovery, etc. - (1) The Supreme Court in the exercise of its jurisdiction may pass such decree or make such order as is necessary for doing complete justice in any cause or matter pending before it, and any decree so passed or order so made shall be enforceable throughout the territory of India in such manner as may be prescribed by or under any law made by Parliament and, until provision in that behalf is so made, in such manner as the President may by order prescribe(2) Subject to the provisions of any law made in this behalf by Parliament, the Supreme Court shall, as respects the whole of the territory of India, have all and every power to make any order for the purpose of securing the attendance of any person, the discovery or production of any documents, or the investigation or punishment of any contempt of itself.”Relying on the above provisions, learned Senior Counsel asserted, that “maintainability exists, because we can all make mistakes, and the mistakes that we make, need to be corrected”. The submission of the learned counsel in this behalf was, that in the above view of the matter, jurisdiction could truly be traced, to Articles 129 and 142 for correcting mistakes. It was the submission of the learned counsel, that this Court being a Court of record, had unlimited jurisdiction to correct all mistakes committed by it. Referring to Article 142 of the Constitution of India it was submitted, that it was the pious obligation of Court to do complete justice, and accordingly, whenever injustice was traceable, it was imperative for this Court to rectify the same. On the subject under reference, learned Senior Counsel relied on the decision in Rupa Ashok Hurra’s case (supra) and invited our pointed attention to following observations recorded therein:-“23. These contentions pose the question, whether an order passed by this Court can be corrected under its inherent powers after dismissal of the review petition on the ground that it was passed either without jurisdiction or in violation of the principles of natural justice or due to unfair procedure giving scope for bias which resulted in abuse of the process of the Court or miscarriage of justice to an aggrieved person.xxx xxx xxx49. The upshot of the discussion in our view is that this Court, to prevent abuse of its process and to cure a gross miscarriage of justice, may re-consider its judgments in exercise of its inherent power.50. The next step is to specify the requirements to entertain such a curative petition under the inherent power of this Court so that floodgates are not opened for filing a second review petition as a matter of course in the guise of a curative petition under inherent power. It is common ground that except when very strong reasons exist, the Court should not entertain an application seeking reconsideration of an order of this Court which has become final on dismissal of a review petition. It is neither advisable nor possible to enumerate all the grounds on which such a petition may be entertained.”(emphasis is ours) 143. It is not possible for us to accept the contention advanced at the hands of the learned Senior Counsel. By placing reliance on the decision rendered by this Court in Rupa Ashok Hurra’s case (supra), learned counsel must be deemed to have impliedly conceded the issue, against himself. In Rupa Ashok Hurra’s case (supra), this Court examined the remedies available to an individual. In the above judgment, this Court examined the ambit and scope of Article 137 of the Constitution of India, whereunder, a review petition could be filed for the correction of an error apparent on the face of the record. In the judgment relied upon, this Court also expressed the view, that a curative petition could be filed for corrections of such like errors, after a review petition had been dismissed. It is relevant to mention, that in furtherance of the directions issued by this Court in Rupa Ashok Hurra’s case (supra), this Court has framed rules, for entertaining curative petitions. Such curative petitions, when entertained, are placed before a five-Judge Bench including the senior most three Judges of this Court. Placing reliance on Rupa Ashok Hurra’s case (supra) evidences, that the petitioner was aware of the jurisdiction of this Court under Article 137 of the Constitution of India for filing a review petition, as also, the permissibility of filing a curative petition, after the concerned party had not succeeded, in the review petition. Unfortunately, the petitioner has not chosen either of the above jurisdictions. The instant petition has been styled as a criminal writ petition. The instant petition is not maintainable as no fresh petition is shown to be maintainable, under the provisions (Articles 129 and 142 of the Constitution of India), relied upon by the learned Senior Counsel. Moreover, our deliberations on the merits of the controversy further reveals, that there is neither any jurisdictional error, nor any error in law has been shown to be made out, from the impugned order dated 4.3.2014.144. For all the reasons recorded hereinabove we are of the view, that the instant petition is not maintainable and the same is, therefore, liable to be dismissed on the ground of maintainability. XI. Conclusions ### Response: 1

UNION OF INDIA & ORS Vs. M/S. RAJ GROW IMPEX LLP & ORS

judiciously and with due regard to the relevant factors. 92. In addition to the general principles for exercise of discretion, as discussed hereinbefore, a few features specific to the matters of interim relief need special mention. It is rather elementary that in the matters of grant of interim relief, satisfaction of the Court only about existence of prima facie case in favour of the suitor is not enough. The other elements i.e., balance of convenience and likelihood of irreparable injury, are not of empty formality and carry their own relevance; and while exercising its discretion in the matter of interim relief and adopting a particular course, the Court needs to weigh the risk of injustice, if ultimately the decision of main matter runs counter to the course being adopted at the time of granting or refusing the interim relief. We may usefully refer to the relevant principle stated in the decision of Chancery Division in Films Rover International Ltd. and Ors. v. Cannon Film Sales Ltd.: [1986] 3 All ER 772 as under: - ….The principal dilemma about the grant of interlocutory injunctions, whether prohibitory or mandatory, is that there is by definition a risk that the court may make the wrong decision, in the sense of granting an injunction to a party who fails to establish his right at the trial (or would fail if there was a trial) or alternatively, in failing to grant an injunction to a party who succeeds (or would succeed) at trial. A fundamental principle is therefore that the court should take whichever course appears to carry the lower risk of injustice if it should turn out to have been wrong in the sense I have described. The guidelines for the grant of both kinds of interlocutory injunctions are derived from this principle. (emphasis in bold supplied) 92.1. While referring to various expositions in the said decision, this Court, in the case of Dorab Cawasji Warden v. Coomi Sorab Warden and Ors.: (1990) 2 SCC 117 observed as under: - 16. The relief of interlocutory mandatory injunctions are thus granted generally to preserve or restore the status quo of the last non-contested status which preceded the pending controversy until the final hearing when full relief may be granted or to compel the undoing of those acts that have been illegally done or the restoration of that which was wrongfully taken from the party complaining. But since the granting of such an injunction to a party who fails or would fail to establish his right at the trial may cause great injustice or irreparable harm to the party against whom it was granted or alternatively not granting of it to a party who succeeds or would succeed may equally cause great injustice or irreparable harm, courts have evolved certain guidelines. Generally stated these guidelines are: (1) The plaintiff has a strong case for trial. That is, it shall be of a higher standard than a prima facie case that is normally required for a prohibitory injunction. (2) It is necessary to prevent irreparable or serious injury which normally cannot be compensated in terms of money. (3) The balance of convenience is in favour of the one seeking such relief. 17. Being essentially an equitable relief the grant or refusal of an interlocutory mandatory injunction shall ultimately rest in the sound judicial discretion of the court to be exercised in the light of the facts and circumstances in each case. Though the above guidelines are neither exhaustive nor complete or absolute rules, and there may be exceptional circumstances needing action, applying them as prerequisite for the grant or refusal of such injunctions would be a sound exercise of a judicial discretion. (emphasis in bold supplied) 93. In keeping with the principles aforesaid, one of the simple questions to be adverted to at the threshold stage in the present cases was, as to whether the importers (writ petitioners) were likely to suffer irreparable injury in case the interim relief was denied and they were to ultimately succeed in the writ petitions. A direct answer to this question would have made it clear that their injury, if at all, would have been of some amount of loss of profit, which could always be measured in monetary terms and, usually, cannot be regarded as an irreparable one. Another simple but pertinent question would have been concerning the element of balance of convenience; and a simple answer to the same would have further shown that the inconvenience which the importers were going to suffer because of the notifications in question was far lesser than the inconvenience which the appellants were going to suffer (with ultimate impact on national interest) in case operation of the notifications was stayed and thereby, the markets of India were allowed to be flooded with excessive quantity of the said imported peas/pulses. 94. In fact, the repercussion of the stay orders passed in the earlier years were duly noticed by this Court in Agricas (supra); and unfortunately, more or less same adverse consequences had been hovering over the markets because of the imports made under the cover of the interim orders passed in relation to the notifications dated 29.03.2019. This, in our view, was not likely to happen if the material factors relating to balance of convenience and irreparable injury were taken into account while dealing with the prayers for interim relief in the writ petitions. As noticed, this Court had, in unequivocal terms, declared in Agricas (supra), that the importers cannot be said to be under any bona fide belief in effecting the imports under the cover of interim orders; and they would face the consequences in law. It gets, perforce, reiterated that all this was avoidable if the implications were taken into account before granting any interim relief in these matters. 95. We need not expand the comments in regard to the matters relating to the grant or refusal of interim relief and would close this discussion while reiterating the principles noticed above. Summation

1[ds]51. As noticed, the respondent-importers approached the High Court with the grievance that the goods were not being released despite the orders-in-original dated 28.08.2020 having been passed in their favour; and they having made the payments (in whole in the case ofand partially in the case of) and having obtained OOC. During the pendency of matters in the High Court, the Commissioner passed the orders dated 01.10.2020 in exercise of his power under Section 129D(2) and then, it was suggested before the High Court on behalf of the Department that the writ petitions were rendered infructuous because of the said orders dated 01.10.2020.52. A close look at the impugned order dated 15.10.2020 makes it clear that the High Court dealt with the issues before it in three major segments: (i) as regards the nature of jurisdiction under Section 129D(2) of the Customs Act; (ii) as regards the propriety in passing of the orders dated 01.10.2020 by the Commissioner and tenability of the grounds stated therein; and (iii) as regards the prayer for release of the goods.53. Much has been said in these matters regarding the exercise of power by the Commissioner under Section 129D(2) of the Customs Act. The High Court proceeded to observe in the impugned order dated 15.10.2020 that the Commissioners orders dated 01.10.2020 were termed as review orders but the jurisdiction conferred by Section 129D(2) was that of suo motu revision and not that of review; and in that regard, the High Court particularly referred to the expressions legality or propriety occurring in the provision.53.2. For clarification, we deem it appropriate to observe that such enactments dealing with several areas of commerce and fiscal implications, like the Customs Act, 1962 and the Central Excise Act, 1944(Hereinafter also referred to as the Central Excise Act.), do carry akin provisions reserving a residual power in the highest controlling authority of the Department, apart from the appellate powers of the departmental Appellate Authority or the Appellate Tribunal and apart from the powers of revision of the Central Government. Such residual power, as conferred by Section 129D of the Customs Act or Section 35E of Central Excise Act, is essentially to serve the purpose that the highest controlling authority of the Department (or a Committee of such highest authorities) satisfies itself as to the legality and propriety of any decision taken by the subordinate authority and, in case it finds any points arising from the decision in question, to direct the authority passing such order or any other subordinate authority to apply to the appellate forum for determination of such points/questions. In the scheme of the Customs Act, the power of revision is reserved for the Central Government, as per Section 129DD thereof. Similar power of revision in the Central Government could be seen in Section 35EE of the Central Excise Act. Thus, in the scheme and on the purpose of these enactments, it cannot be said that such residual power, of requiring the matter to be taken up before the appellate forum, is that of revision stricto sensu. However, it does not appear necessary to delve further on this aspect in this judgement because, as noticed, it is not in dispute that the Commissioner could have exercised such power under Section 129D of the Customs Act. In fact, we are unable to comprehend as to what precisely was the outcome of the detailed discussion by the High Court concerning the nature of power under Section 129D(2) because it had not been the finding that the orders dated 01.10.2020 were suffering from any want of jurisdiction or if the Commissioner, while passing the said orders, transgressed the bounds of his authority.54.1. Coming to the question of propriety in passing of the orders dated 01.10.2020 by the said Commissioner despite being aware of the pendency of the writ petitions in the High Court, in our view, the comments of the High Court, even when not incorrect in general application, do not appear apt and apposite to the facts and in the circumstances of the present case. In other words, though we are at one with the High Court that, ordinarily, when the matter is sub judice in the higher forum and that too before the Constitutional Court, the executive authorities should not attempt to bring about a new state of affairs without taking permission from the Court and/or bringing the relevant facts to the notice of the Court. However, even in this regard, before pronouncing on the impropriety on the part of an executive authority who had done anything without prior information to the Court or without taking Courts permission, all the relevant surroundings factors are also required to be examined so as to find as to whether such an action was calculated at interference with the administration of justice or was a bona fide exercise of power in the given circumstances.54.2. In the present case, though the High Court had issued notice in the writ petitions on 25.09.2020 and placed the petitions on 06.10.2020 but, it was clear on the face of record that the DGFT was taking serious exception to the orders-in-original dated 28.08.2020 and it was being asserted that the said orders were in the teeth of the pronouncement of this Court in the case of Agricas (supra). Indisputably, the Commissioner had available with him three months time to pass the order under Section 129D(2) and thereby to ensure taking up of the matter against the orders- in-original dated 28.08.2020 by the Appellate Authority but, the importers preferred the writ petitions questioning the communication of DGFT and the denial of release of goods; and sought mandamus for such release. Such a prayer for mandamus was effectively a prayer for execution of the orders-in-original dated 28.08.2020. The High Court found it unjustified on the part of the Department to suggest that the writ petitions were rendered infructuous because of the orders dated 01.10.2020; and to this extent, we are again at one with the High Court because, on the strength of any order passed by the Commissioner during the pendency of the writ petitions, it could not have been claimed that the Department, by its own actions, made the writ petitions meaningless. However, such a submission on the part of the respondents of the writ petition, even if unwarranted, could not have taken the worth and value out of orders dated 01.10.2020; and, at the same time, the High Court could not have ignored the other material circumstances.54.3. One of the fundamental and material circumstance, which the High Court totally omitted to consider, was that the writ petitions were filed as if seeking execution of the orders-in-original and that if the writ, as prayed for, was to be issued and the goods were to be released, nothing much on merits was to be left for examination by the Appellate Authority; and if, for any reason, the orders-in-original were to be interfered with at a later stage in the appellate forum, irreparable damage would have been done because the goods would have been released for the domestic market. (As noticed, it has indeed happened to a large extent in present cases, with release of a substantial quantity of goods of the respondent- importers).54.4. The purpose of our comments foregoing is that even while the High Court was right in questioning the fact that the Commissioner chose to pass the order when the matter was sub judice, the High Court missed out the relevant feature that the importers had preferred the writ petitions essentially to pre-empt any further proceedings by the statutory authority concerned under the Customs Act. In other words, the invocation of writ jurisdiction by the importers was itself questionable.55. Noticeable it is that the High Court, even after making some scathing comments on the question of propriety against the Commissioner, took up the points stated in the orders dated 01.10.2020 one by one and indicated its views that the points so raised were baseless and/or untenable. However, the High Court was also conscious of the fact that the said orders dated 01.10.2020 were not in challenge before it and the appeals preferred pursuant to those orders shall have to be examined by the Appellate Authority. Thus, the High Court qualified all its findings in paragraph 36 of the impugned order as being of its prima facie impression and specifically left the matter open for examination by the Appellate Authority.55.1. However, when the Appellate Authority ultimately passed the orders in setting aside the orders-in-original, one of the importers, despite being aware of the remedy of further appeal being available, chose to invoke, again, the writ jurisdiction of the High Court. This time the High Court, in its impugned interim order dated 05.01.2021, made the observations that the decision by the Appellate Authority was at loggerheads with its earlier findings and directions. The High Court even observed that its findings in the order dated 15.10.2020 could not have been regarded as prima facie finding only; and when the goods were directed to be released forthwith, it was beyond comprehension as to how a lower Appellate Authority could have nullified such directions by ordering absolute confiscation.56. We find it very difficult to reconcile the observations of the High Court in these matters. Paragraph 36 of the order dated 15.10.2020 left nothing for a doubt with anyone that whatever the High Court had observed in that order as regards the orders dated 01.10.2020 was not of final determination; and the matter was left open, to be decided by the Commissioner (Appeals). Significantly, if the purport of the order dated 15.10.2020 had been that even if Commissioner (Appeals) would be deciding the matter in appeal, he could not order absolute confiscation of the goods because the High Court had ordered their release, it would immediately lead to the position that the order dated 15.10.2020 of the High Court carried inherent contradictions. In other words, if release of goods was the only option available with the authorities, the material part of consideration of the Appellate Authority had already been rendered redundant.57. For what has been discussed hereinabove, it is at once clear that when the matter was left for decision by the Commissioner (Appeals), there was neither any occasion nor any justification for the High Court to pass the order for release of the goods for the simple reason that any order for release of goods was to render the material part of the matter a fait accompli. This, simply, could not have been done. Putting it differently, a little pause after paragraph 36 of the impugned order 15.10.2020 and before the directions in the next paragraph would make it clear that for what had been observed in the said paragraph 36 of the impugned order (as regards leaving of the matter for decision by the Appellate Authority), any direction for release of goods pursuant to the order-in-original could not have been issued. To put it in yet other words, despite making several observations so as to indicate that the review orders dated 01.10.2020 were unjustified and the points stated therein were baseless or untenable, the High Court stopped short of setting aside the orders dated 01.10.2020 and also did not pronounce finally on the validity of the orders-in-original dated 28.08.2020 because the said orders-in-original were the subject matter of appeal. Having rightly left the matter for decision in appeal, the High Court committed a serious error in yet issuing such a writ as if the orders-in-original dated 28.08.2020 had become rule of the Court and as if the Court was ensuring its due execution. It gets, perforce, reiterated that if the orders-in-original dated 28.08.2020 were to be executed under the mandate of the High Court, the appeals were going to be practically redundant after release of the goods and nothing material was to remain for decision by the Appellate Authority on the main subject matter of the appeal.58. What has been indicated from different angles hereinabove leads only to one conclusion that the order dated 15.10.2020 passed by the High Court suffers from inherent contradictions and inconsistencies; and cannot be approved.59. Apart from the fundamental flaws of contradictions, the order passed by the High Court on 15.10.2020 further suffers from the shortcomings that while issuing mandamus for release of goods, the High Court omitted to take into account the relevant facts as also the material factors concerning the imports in question, including the reasons for issuance of the notifications in question that the same were to safeguard the agriculture market economy of India; and the observations and findings of this Court in the case of Agricas (supra). An examination of the impugned order dated 15.10.2020 in its entirety makes it clear that the reasons for directing release of goods in favour of the importers are to be found only in paragraph 37 thereof. Therein, the High Court has taken into account a few factors standing in favour of the importers like the orders-in-original holding the field; the importers having made the necessary payments; and the importers incurring expenditure because of warehousing. An additional factor had been the High Courts dissatisfaction that the orders dated 01.10.2020 were passed in an improper manner and grounds given therein were not justifying the withholding of the goods. While proceeding on these reasons and considerations, it appears that the other overriding factors like the interest of domestic agriculture market economy as also the findings and observations of this Court in Agricas (supra) totally escaped the attention of the High Court. Thus, the impugned order dated 15.10.2020, having been passed while ignoring the relevant considerations, cannot be approved.60. For what has been observed hereinabove, the other order dated 05.01.2021 passed by the High Court in the second writ petition filed by the importerM/s. Raj Grow Impexalso deserves to be disapproved.60.1. As noticed, in the said order dated 05.01.2021, the High Court even observed that the Appellate Authority wrongly construed that its earlier decision for release of goods has been prima facie; and further questioned as to how a lower Appellate Authority could have nullified its directions for release of goods by ordering confiscation. The construction of its own order dated 15.10.2020, as put by the High Court in its later order dated 05.01.2021, only fortifies the inconsistencies we have indicated hereinabove. This apart, the expression prima facie in regard to the order of the High Court dated 15.10.2020 had not been a creation of the Appellate Authority but had been stated in unequivocal terms, twice over, in paragraph 36 of the order dated 15.10.2020, where the High Court also made it clear that final views were not being expressed because the matter was to be examined in appeal.60.2. Apart from the above, while entertaining the said second writ petition, the High Court seems to have also omitted to consider that the said writ petition was filed against the order-in-appeal passed by the Appellate Authority and the alternative remedy of regular statutory appeal to CESTAT was available to the importer. In our view, on consideration of the relevant facts and circumstances in their correct perspective, the High Court would not have entertained the writ petitions so filed in these matters.61. We are, therefore, clearly of the view that the impugned orders dated 15.10.2020 (read with the modification order dated 09.12.2020) and 05.01.2021 remain unsustainable and are required to be set aside.65. The categorical findings in the case of Agricas (supra) by this Court, read with the provisions above-quoted, hardly leave anything to doubt that sub-section (3) of Section 3 of the FTDR Act applies to the goods in question and, for having been imported under the cover of the interim orders but, contrary to the notifications and the trade notice issued under the FTDR Act and without the requisite licence, these goods shall be deemed to be prohibited goods under Section 11 of the Customs Act; and all the provisions of the Customs Act shall have effect over these goods and their import accordingly. However, a long deal of arguments has been advanced before us as regards the category in which these goods are to be placed, i.e., whether they are of restricted category or prohibited category.The contentions remain baseless and are required to be rejected.66.1. A bare look at the notifications in question and the findings of this Court in Agricas (supra) make it clear that only the particular restricted quantity of the commodities covered by the said notifications could have been imported, like those upto 1.5 lakh MTs; and that too, under a licence. The learned ASG has rightly pointed out with reference to the decision in PTR Exports (supra) that an applicant has no vested right to have export or import licence; and granting of licence depends upon the policy prevalent on the date. The learned ASG has further rightly submitted, with reference to the decision in S.B. International (supra), that granting a licence to import is not a matter of formality; and the authorities have to satisfy themselves that the application satisfies all the requirements of the scheme and the applicable laws. In S.B. International, this Court observed, inter alia,as under: -9. It should be noticed that grant of licence is neither a mechanical exercise nor a formality. On receipt of the application, the authorities have to satisfy themselves about the correctness of the contents of the application. They also have to satisfy themselves that the application satisfies all the requirements of the scheme and the other applicable provisions of law, if any….66.2. As noticed, only the particular restricted quantity of the commodities covered by the said notifications could have been imported and that too, under a licence. Therefore, any import within the cap (like that of 1.5 lakh MTs) under a licence is the import of restricted goods but, every import of goods in excess of the cap so provided by the notifications, is not that of restricted goods but is clearly an import of prohibited goods.67. The applicable principles of law relating to the categorisation of goods as prohibited or other than prohibited have been clearly enunciated by this Court in the decisions referred by the learned ASG.67.1. In the case of Sheikh Mohd. Omer (supra), a particular mare was found to be not a pet animal and, therefore, its import was found to be violative of the Imports Control Order. It was, however, an admitted position that the import of horses or mares was not prohibited as such. The question was as to whether by making such import, the appellant contravened Section 111(d) read with Section 125 of the Customs Act. While answering the question, this Court held that any restriction on import or export is to an extent a prohibition; and the expression any prohibition in Section 111(d) of the Customs Act includes restrictions. This Court further underscored that any prohibition means every prohibition; and restriction is also a type of prohibition. This Court, inter alia, said, -11…. While elaborating his argument the learned counsel invited our attention to the fact that while Section 111(d) of the Act uses the word prohibition. Section 3 of the Imports and Exports (Control) Act, 1947, takes in not merely prohibition of imports and exports, it also includes restrictions or otherwise controlling all imports and exports. According to him restrictions cannot be considered as prohibition more particularly under the Imports and Exports (Control) Act, 1947, as that statute deals with restrictions or otherwise controlling separately from prohibitions. We are not impressed with this argument. What clause (d) of Section 111 says is that any goods which are imported or attempted to be imported contrary to any prohibition imposed by any law for the time being in force in this country is liable to be confiscated. Any prohibition referred to in that section applies to every type of prohibition. That prohibition may be complete or partial. Any restriction on import or export is to an extent a prohibition. The expression any prohibition in Section 111(d) of the Customs Act, 1962 includes restrictions. Merely because Section 3 of the Imports and Exports (Control) Act, 1947 uses three different expressions prohibiting, restricting or otherwise controlling, we cannot cut down the amplitude of the word any prohibition in Section 111(d) of the Act. Any prohibition means every prohibition. In other words all types of prohibitions. Restriction is one type of prohibition…..(emphasis in bold supplied)67.2. In the case of Om Prakash Bhatia (supra), over-invoicing and fraudulent claim of drawback by the exporter was held to be that of exporting prohibited goods with reference to the requirements of Foreign Exchange Regulation Act, 1973, while rejecting the contention of the exporter that Section 113(d) of the Customs Act was not applicable as the goods were not prohibited as such. A line of argument has been suggested on behalf of one of the respondents that the order ultimately passed in the case of Om Prakash Bhatia operates against the stand of the appellants. It is true that in that case, redemption fine and penalty was imposed but, the exercise of discretion in a particular manner related to the facts of that case. These aspects relating to the exercise of discretion shall be considered a little later, while dealing with the question as to whether the goods in question are liable to absolute confiscation or could be released on redemption fine. Suffice it to notice for the present purpose that the export attempted in violation of the conditions was held to be taking the goods in the category of prohibited goods.67.4.1. In the case of Atul Automations (supra), the goods imported without authorisation were found to be not prohibited but restricted items for import and the orders for their release with payment of fine in lieu of confiscation were approved. However, a close look at the factual aspects puts it beyond the pale of doubt that therein, this Court has neither laid down the law that in every case of import without authorisation, the goods are to be treated as restricted and not prohibited nor that the goods so imported without authorisation are always to be released on payment of redemption fine.67.4.2. The factual aspect of Atul Automations (supra) makes it clear that the imported Multi-Function Devices, Photocopiers and Printers (MFDs) involved in that case were restricted items, importable against authorisation under Clause 2.31 of the Foreign Trade Policy. Thus, the MFDs were found to be restricted items for import and not prohibited items. That had not been the case where import was restricted in terms of quantity in the manner that the goods were importable only up to a particular extent of quantity and that too against a licence. It was also found therein that the Central Government had permitted the import of used MFDs having utility for at least five years, keeping in mind that they were not being manufactured in the country.67.4.3. The present case is of an entirely different restriction where import of the referred peas/pulses has been restricted to a particular quantity and could be made only against a licence. The letter and spirit of this restriction, as expounded by this Court earlier, is that, any import beyond the specified quantity is clearly impermissible and is prohibited. This Court has highlighted the adverse impact of excessive quantity of imports of these commodities on the agricultural market economy in the case of Agricas (supra) whereas, it had not been the case in Atul Automations (supra) that the import was otherwise likely to affect the domestic market economy. In contrast to the case of Atul Automations, where the goods were permitted to be imported (albeit with authorisation) for the reason that they were not manufactured in the country, in the present case, the underlying feature for restricting the imports by quantum has been the availability of excessive stocks and adverse impact on the price obtainable by the farmers of the country. The decision in Atul Automations (supra), by no stretch of imagination, could be considered having any application to the present case.68. Thus, we have no hesitation in holding that the goods in question, having been imported in contravention of the notifications dated 29.03.2019 and trade notice dated 16.04.2019; and being of import beyond the permissible quantity and without licence, are prohibited goods for the purpose of the Customs Act(In the passing, we may observe that even in the orders-in-original dated 28.08.2020 by the Adjudicating Authority, it was clearly held that the goods in question were prohibited goods (vide the findings reproduced hereinbefore in paragraph 22.2).).68.1. The unnecessary and baseless arguments raised on behalf of the importers that the goods in question are of restricted category, with reference to the expression restricted having been used for the purpose of the notifications in question or with reference to the general answers given by DGFT or other provisions of FTDR Act are, therefore, rejected. The goods in question fall in the category of prohibited goods.69. Once it is clear that the goods in question are improperly imported and fall in the category of prohibited goods, the provisions contained in Chapter XIV of the Customs Act, 1962 come into operation and the subject goods are liable to confiscation apart from other consequences.69.1. A bare reading of the provision aforesaid makes it evident that a clear distinction is made between prohibited goods and other goods. As has rightly been pointed out, the latter part of Section 125 obligates the release of confiscated goods (i.e., other than prohibited goods) against redemption fine but, the earlier part of this provision makes no such compulsion as regards the prohibited goods; and it is left to the discretion of the Adjudicating Authority that it may give an option for payment of fine in lieu of confiscation. It is innate in this provision that if the Adjudicating Authority does not choose to give such an option, the result would be of absolute confiscation. The Adjudicating Authority in the present matters had given such an option of payment of fine in lieu of confiscation with imposition of penalty whereas the Appellate Authority has found faults in such exercise of discretion and has ordered absolute confiscation with enhancement of the amount of penalty. This takes us to the principles to be applied for exercise of the discretion so available in the first part of Section 125(1) of the Customs Act.70.1. In the case of Sant Raj (supra), referred to and relied upon by both the sides, this Court dealt with the matter as regards the discretion of Labour Court to award compensation in lieu of reinstatement and observedas under: -4…..Whenever, it is said that something has to be done within the discretion of the authority then that something has to be done according to the rules of reason and justice and not according to private opinion, according to law and not humor. It is to be not arbitrary, vague and fanciful but legal and regular and it must be exercised within the limit to which an honest man to the discharge of his office ought to find himself….. Discretion means sound discretion guided by law. It must be governed by rule, not by humor, it must not be arbitrary, vague and fanciful…..(emphasis in bold supplied)70.3. In the case of U.P. State Road Transport Corporation (supra), while dealing with the case of non-exercise of discretion by the authority, this Court expounded on the contours of discretion as also on limitations on the powers of the Courts when the matter is of the discretion of the competent authority, in the following terms: -12. 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.13. 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. ……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 of discretion it cannot, however, deny itself the discretion which the statute requires it to exercise in individual cases. ……xxx xxx xxx15.……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 abovesaid 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…..(emphasis in bold supplied)70.4. In the case of Glaxo Smith Kline (supra), this Court expounded on the principles that the Constitutional Courts, even in exercise of their wide jurisdictions, cannot disregard the substantive provisions of statute while observing, inter alia,as under: -12. Indubitably, the powers of the High Court under Article 226 of the Constitution are wide, but certainly not wider than the plenary powers bestowed on this Court under Article 142 of the Constitution. Article 142 is a conglomeration and repository of the entire judicial powers under the Constitution, to do complete justice to the parties.Even while exercising that power, this Court is required to bear in mind the legislative intent and not to render the statutory provision otiose.71. Thus, when it comes to discretion, the exercise thereof has to be guided by law; has to be according to the rules of reason and justice; and has to be based on the relevant considerations. The exercise of discretion is essentially the discernment of what is right and proper; and such discernment is the critical and cautious judgment of what is correct and proper by differentiating between shadow and substance as also between equity and pretence. A holder of public office, when exercising discretion conferred by the statute, has to ensure that such exercise is in furtherance of accomplishment of the purpose underlying conferment of such power. The requirements of reasonableness, rationality, impartiality, fairness and equity are inherent in any exercise of discretion; such an exercise can never be according to the private opinion.71.1. It is hardly of any debate that discretion has to be exercised judiciously and, for that matter, all the facts and all the relevant surrounding factors as also the implication of exercise of discretion either way have to be properly weighed and a balanced decision is required to be taken.72. It is true that the statutory authority cannot be directed to exercise its discretion in a particular manner but, as noticed in the present case, the exercise of discretion by the Adjudicating Authority has been questioned on various grounds and the Appellate Authority has, in fact, set aside the orders-in-original whereby the Adjudicating Authority had exercised the discretion to release the goods with redemption fine and penalty. Having found that the goods in question fall in the category of prohibited goods coupled with the relevant background aspects, including the reasons behind issuance of the notifications in question and the findings of this Court in Agricas (supra), the question is as to whether the exercise of discretion by the Adjudicating Authority in these matters, giving option of payment of fine in lieu of confiscation, could be approved?73. As regards the question at hand, we may usefully take note of the relevant decisions cited by learned counsel for the parties. However, it may be observed that the decision of the Punjab and Haryana High Court in Horizon Ferro Alloys (supra), dealing with a particular class of goods that were restricted and not prohibited, needs no elaboration.76.1. From the decision in Hargovind Das K. Joshi (supra), it is not borne out as to what was the reason for which the goods (zip fasteners) became subject to confiscation and it appears that at a later point of time, free import of the item had also been allowed. Be that as it may, what this Court found therein was that the Adjudicating Authority omitted to take into consideration one part of the discretion available for him i.e., of giving an option for redemption with payment of fine in lieu of confiscation and for that reason alone, the matter was remitted. The said decision cannot be read as an authority for the proposition that in every case of confiscation, invariably, the discretion has to be exercised by the Adjudicating Authority to give an option for redemption by payment of fine. In our view, the said decision does not make out any case in favour of the importers.76.2. In fact, the observations made in Hargovind Das K. Joshi (supra) rather operate against the orders-in-original in the present appeals because therein, the Adjudicating Authority, after finding the goods liable to confiscation, straightaway proceeded as if the option for payment of fine in lieu of confiscation has to be given and did not consider the other part of discretion available with him that the goods could also be confiscated absolutely.77. Thus, for what has been noticed above, the Kerala High Court has approved absolute confiscation of similar goods while following the decision of this Court in Agricas (supra) and after finding unsustainable the order of Tribunal for release of goods. In the case of Garg Woollen Mills (supra), this Court approved absolute confiscation when fraud was involved. In Hargovind Das K. Joshi (supra), when one part of discretion of Section 125(1) of the Customs Act was not taken into account, this Court remitted the matter for proper exercise of discretion.78. It is true that, ordinarily, when a statutory authority is invested with discretion, the same deserves to be left for exercise by that authority but the significant factors in the present case are that the Adjudicating Authority had exercised the discretion in a particular manner without regard to the other alternative available; and the Appellate Authority has found such exercise of discretion by the Adjudicating Authority wholly unjustified. In the given circumstances, even the course adopted in the case of Hargovind Das K. Joshi (of remitting the matter for consideration of omitted part of discretion) cannot be adopted in the present appeals; and it becomes inevitable that a final decision is taken herein as to how the subject goods are to be dealt with under Section 125 of the Customs Act.79. As noticed, the exercise of discretion is a critical and solemn exercise, to be undertaken rationally and cautiously and has to be guided by law; has to be according to the rules of reason and justice; and has to be based on relevant considerations. The quest has to be to find what is proper. Moreover, an authority acting under the Customs Act, when exercising discretion conferred by Section 125 thereof, has to ensure that such exercise is in furtherance of accomplishment of the purpose underlying conferment of such power. The purpose behind leaving such discretion with the Adjudicating Authority in relation to prohibited goods is, obviously, to ensure that all the pros and cons shall be weighed before taking a final decision for release or absolute confiscation of goods.80. For what has been observed hereinabove, it is but evident that the orders-in-original dated 28.08.2020 cannot be said to have been passed in a proper exercise of discretion. The Adjudicating Authority did not even pause to consider if the other alternative of absolute confiscation was available to it in its discretion as per the first part of Section 125(1) of the Customs Act and proceeded as if it has to give the option of payment of fine in lieu of confiscation. Such exercise of discretion by the Adjudicating Authority was more of assumptive and ritualistic nature rather than of a conscious as also cautious adherence to the applicable principles. The Appellate Authority, on the other hand, has stated various reasons as to why the option of absolute confiscation was the only proper exercise of discretion in the present matter. We find the reasons assigned by the Appellate Authority, particularly in paragraph 54.3 of the order-in-appeal dated 24.12.2020 (reproduced in point c of paragraph 38.2 hereinabove) to be fully in accord with the principles of exercise of discretion, as indicated hereinabove and in view of the facts and peculiar circumstances of this case.81. It needs hardly any elaboration to find that the prohibition involved in the present matters, of not allowing the imports of the commodities in question beyond a particular quantity, was not a prohibition simpliciter. It was provided with reference to the requirements of balancing the interests of the farmers on the one hand and the importers on the other. Any inflow of these prohibited goods in the domestic market is going to have a serious impact on the market economy of the country. The cascading effect of such improper imports in the previous year under the cover of interim orders was amply noticed by this Court in Agricas (supra). This Court also held that the imports were not bona fide and were made by the importers only for their personal gains.82. The sum and substance of the matter is that as regards the imports in question, the personal interests of the importers who made improper imports are pitted against the interests of national economy and more particularly, the interests of farmers. This factor alone is sufficient to find the direction in which discretion ought to be exercised in these matters. When personal business interests of importers clash with public interest, the former has to, obviously, give way to the latter. Further, not a lengthy discussion is required to say that, if excessive improperly imported peas/pulses are allowed to enter the countrys market, the entire purpose of the notifications would be defeated. The discretion in the cases of present nature, involving far-reaching impact on national economy, cannot be exercised only with reference to the hardship suggested by the importers, who had made such improper imports only for personal gains. The imports in question suffer from the vices of breach of law as also lack of bona fide and the only proper exercise of discretion would be of absolute confiscation and ensuring that these tainted goods do not enter Indian markets. Imposition of penalty on such importers; and rather heavier penalty on those who have been able to get some part of goods released is, obviously, warranted.83. Before closing on this part of discussion, we may also refer to a decision of Bombay High Court in the case of Finesse Creation Inc. (supra), cited on behalf of one of the importers. In that case, the declared value of goods imported by the assessee in respect of 13 consignments over a period of about three years was rejected and the Commissioner ordered re-assessment of the value of goods; and after re-determination, differential duty was confirmed under Section 28(2) of the Customs Act with recovery of interest under Section 28AB thereof. Moreover, the imported goods were confiscated and redemption fine under Section 125 of the Customs Act was also imposed in lieu of confiscation. While confirming the differential duty and consequent penalty and interest, CESTAT quashed the imposition of redemption fine because the goods were not available for confiscation. In that context, the High Court said that the concept of redemption fine would arise in the event the goods were available and were to be redeemed; and if the goods were not available, there was no question of redemption of goods. The said decision cannot be pressed into service in the present case merely because the said importerhas been able to obtain release of all the goods after passing of the order-in-original of the Adjudicating Authority dated 28.08.2020 when the same was under challenge. The present one is not a case where the subject goods were not available on the day of passing of the order by the Adjudicating Authority.84. Hence, on the facts and in the circumstances of the present case as noticed and dilated hereinabove, the discretion could only be for absolute confiscation with levy of penalty. At the most, an option for re- export could be given to the importers and that too, on payment of redemption fine and upon discharging other statutory obligations. This option we had already left open in the order dated 18.03.2021, passed during the hearing of these matters.85. For what we have observed hereinabove, the orders-in-original dated 28.08.2020 cannot be approved. As a necessary corollary, the orders-in-appeal dated 24.12.2020 deserve to be approved. However, before final conclusion in that regard, a few more aspects need to be dealt with.86.1. In regard to the submissions invoking equity, noticeable it is that various such features of equity were taken into consideration by the Adjudicating Authority, in the orders-in-original dated 28.08.2020 and by the High Court, in the impugned order dated 15.10.2020 while directing release of goods. We have already disapproved the orders so passed by the Adjudicating Authority and the High Court. Therefore, no leniency in the name of equity can be claimed by these importers. In fact, any invocation of equity in these matters is even otherwise ruled out in view of specific rejection of the claim of bona fide imports by this Court in Agricas (supra). Once this Court has reached to the conclusion that a particular action is wanting in bona fide, the perpetrator cannot claim any relief in equity in relation to the same action. Absence of bona fide in a claimant and his claim of equity remain incompatible and cannot stand together.86.2. The overt suggestions on behalf of the interveners that demand and supply of pulses is dynamic and not static in nature have only been noted to be rejected. In our view, meeting with the requirements of demand and supply is essentially a matter for policy decision of the Government. No equity could be claimed with such submissions by the importers. Similarly, if, for whatever reason, any consignment of the subject goods has been released, such release had not been in accord with law and no equity could be claimed on that basis.86.3. Therefore, all the submissions seeking relief in equity are required to be, and are, rejected.87. We have also pondered over the prayer for keeping the opportunity of further statutory appeal to CESTAT open for the importers. Though in ordinary circumstances, such a prayer might have been of no difficulty but, we are of the view that having regard to the background and the relevant circumstances, any liberty for further rounds of litigation, at least in relation to the respondents before us, is not called for; and the matters ought to be given a finality.88. As regards the importer, as noticed, the order-in-appeal was consciously challenged by it by way of a fresh writ petition in the High Court despite being aware of the availability of statutory remedy of appeal before CESTAT. No cogent and plausible reason is forthcoming as to why it had chosen to avoid the regular remedy of appeal except that it had the keen desire to get the remaining goods (under seven bills of entry) released after it had obtained release of goods under three bills of entry; and in that attempt, filed a fresh writ petition challenging the order-in-appeal and also filed a contempt petition in the High Court.88.1. So far as the question of release of goods is concerned, the matter stands concluded once we have found that the goods covered by the notifications in question and by the judgment of this Court in Agricas (supra) are liable to absolute confiscation. Therefore, any prayer for release of any of such goods becomes redundant and cannot be granted by any authority or Court. Of course, it is true that the Appellate Authority has enhanced penalty from Rs. 1.485 crores to Rs. 5 crores but, the fact that this importer had taken release of the goods covered by three bills of entry and that aspect of the matter was required to taken as fait accompli by the Appellate Authority, in our view, effectively operates against any claim for reduction of the amount of penalty. Putting it differently, once we have approved the order-in-appeal, any attempt for further appeal by this importer shall remain an exercise in futility.89. So far as the other importeris concerned, it had obtained release of goods covered by all its eight bills of entry and, therefore, the matter was taken as fait accompli by the Appellate Authority with appropriation of redemption fine and enhancement of penalty. As noticed, this importer has even attempted to argue before us against redemption fine with the submissions that the goods were not available for confiscation. Neither the redemption fine nor even the enhancement of penalty from Rs. 2.34 crores to Rs. 10 crores could fully set off the damage caused by the actions of this importer. Needless to repeat that with our approval of the order-in-appeal, any attempt for further appeal by this importer shall also remain an exercise in futility.90. In view of above, we find no reason to allow any prayer for filing appeal against the orders-in-appeal dated 24.12.2020.91. While closing on these matters, we are constrained to observe that the root cause of the present controversy had not been that much in the notifications in question as it had been in the interim orders passed by the High Court of Rajasthan, Bench at Jaipur. It needs hardly any elaboration that only under the cover of such interim orders that the importers ventured into the import transactions which resulted in excessive quantities of peas/pulses than those permitted by the notifications reaching the Indian ports. As has been noticed in the present cases, some of the goods so imported got released and the Commissioner (Appeals) had to take that aspect as fait accompli. For what has been held by this Court in Agricas (supra), and further for what has been held in this judgment, the goods in question were not to mingle in the Indian market. Such mingling, obviously, has an adverse impact on the agricultural market economy and defeats the policy of the Government of India. This state of affairs was an avoidable one; and would have been avoided if, before passing interim orders, the respective Courts would have paused to consider the implications and impact of such interim orders, which were, for all practical purposes, going to operate as mandatory injunction, whereby the appellants were bound to allow the goods to reach the Indian ports, even if the notifications were prohibiting any such import.91.1. Having regard to the scenario that has unfolded in the present cases, we are impelled to re-state that even though granting of an interim relief is a matter of discretion, such a discretion needs to be exercised judiciously and with due regard to the relevant factors.92. In addition to the general principles for exercise of discretion, as discussed hereinbefore, a few features specific to the matters of interim relief need special mention. It is rather elementary that in the matters of grant of interim relief, satisfaction of the Court only about existence of prima facie case in favour of the suitor is not enough. The other elements i.e., balance of convenience and likelihood of irreparable injury, are not of empty formality and carry their own relevance; and while exercising its discretion in the matter of interim relief and adopting a particular course, the Court needs to weigh the risk of injustice, if ultimately the decision of main matter runs counter to the course being adopted at the time of granting or refusing the interim relief. We may usefully refer to the relevant principle stated in the decision of Chancery Division in Films Rover International Ltd. and Ors. v. Cannon Film Sales Ltd.: [1986] 3 All ER 772as under: -….The principal dilemma about the grant of interlocutory injunctions, whether prohibitory or mandatory, is that there is by definition a risk that the court may make the wrong decision, in the sense of granting an injunction to a party who fails to establish his right at the trial (or would fail if there was a trial) or alternatively, in failing to grant an injunction to a party who succeeds (or would succeed) at trial. A fundamental principle is therefore that the court should take whichever course appears to carry the lower risk of injustice if it should turn out to have been wrong in the sense I have described. The guidelines for the grant of both kinds of interlocutory injunctions are derived from this principle.(emphasis in bold supplied)A direct answer to this question would have made it clear that their injury, if at all, would have been of some amount of loss of profit, which could always be measured in monetary terms and, usually, cannot be regarded as an irreparable one. Another simple but pertinent question would have been concerning the element of balance of convenience; and a simple answer to the same would have further shown that the inconvenience which the importers were going to suffer because of the notifications in question was far lesser than the inconvenience which the appellants were going to suffer (with ultimate impact on national interest) in case operation of the notifications was stayed and thereby, the markets of India were allowed to be flooded with excessive quantity of the said imported peas/pulses.94. In fact, the repercussion of the stay orders passed in the earlier years were duly noticed by this Court in Agricas (supra); and unfortunately, more or less same adverse consequences had been hovering over the markets because of the imports made under the cover of the interim orders passed in relation to the notifications dated 29.03.2019. This, in our view, was not likely to happen if the material factors relating to balance of convenience and irreparable injury were taken into account while dealing with the prayers for interim relief in the writ petitions. As noticed, this Court had, in unequivocal terms, declared in Agricas (supra), that the importers cannot be said to be under any bona fide belief in effecting the imports under the cover of interim orders; and they would face the consequences in law. It gets, perforce, reiterated that all this was avoidable if the implications were taken into account before granting any interim relief in these matters.95. We need not expand the comments in regard to the matters relating to the grant or refusal of interim relief and would close this discussion while reiterating the principles noticed above.

### Instruction: Based on the information in the case proceeding, determine the likely outcome: acceptance (1) or rejection (0) of the appellant/petitioner's case. ### Input: judiciously and with due regard to the relevant factors. 92. In addition to the general principles for exercise of discretion, as discussed hereinbefore, a few features specific to the matters of interim relief need special mention. It is rather elementary that in the matters of grant of interim relief, satisfaction of the Court only about existence of prima facie case in favour of the suitor is not enough. The other elements i.e., balance of convenience and likelihood of irreparable injury, are not of empty formality and carry their own relevance; and while exercising its discretion in the matter of interim relief and adopting a particular course, the Court needs to weigh the risk of injustice, if ultimately the decision of main matter runs counter to the course being adopted at the time of granting or refusing the interim relief. We may usefully refer to the relevant principle stated in the decision of Chancery Division in Films Rover International Ltd. and Ors. v. Cannon Film Sales Ltd.: [1986] 3 All ER 772 as under: - ….The principal dilemma about the grant of interlocutory injunctions, whether prohibitory or mandatory, is that there is by definition a risk that the court may make the wrong decision, in the sense of granting an injunction to a party who fails to establish his right at the trial (or would fail if there was a trial) or alternatively, in failing to grant an injunction to a party who succeeds (or would succeed) at trial. A fundamental principle is therefore that the court should take whichever course appears to carry the lower risk of injustice if it should turn out to have been wrong in the sense I have described. The guidelines for the grant of both kinds of interlocutory injunctions are derived from this principle. (emphasis in bold supplied) 92.1. While referring to various expositions in the said decision, this Court, in the case of Dorab Cawasji Warden v. Coomi Sorab Warden and Ors.: (1990) 2 SCC 117 observed as under: - 16. The relief of interlocutory mandatory injunctions are thus granted generally to preserve or restore the status quo of the last non-contested status which preceded the pending controversy until the final hearing when full relief may be granted or to compel the undoing of those acts that have been illegally done or the restoration of that which was wrongfully taken from the party complaining. But since the granting of such an injunction to a party who fails or would fail to establish his right at the trial may cause great injustice or irreparable harm to the party against whom it was granted or alternatively not granting of it to a party who succeeds or would succeed may equally cause great injustice or irreparable harm, courts have evolved certain guidelines. Generally stated these guidelines are: (1) The plaintiff has a strong case for trial. That is, it shall be of a higher standard than a prima facie case that is normally required for a prohibitory injunction. (2) It is necessary to prevent irreparable or serious injury which normally cannot be compensated in terms of money. (3) The balance of convenience is in favour of the one seeking such relief. 17. Being essentially an equitable relief the grant or refusal of an interlocutory mandatory injunction shall ultimately rest in the sound judicial discretion of the court to be exercised in the light of the facts and circumstances in each case. Though the above guidelines are neither exhaustive nor complete or absolute rules, and there may be exceptional circumstances needing action, applying them as prerequisite for the grant or refusal of such injunctions would be a sound exercise of a judicial discretion. (emphasis in bold supplied) 93. In keeping with the principles aforesaid, one of the simple questions to be adverted to at the threshold stage in the present cases was, as to whether the importers (writ petitioners) were likely to suffer irreparable injury in case the interim relief was denied and they were to ultimately succeed in the writ petitions. A direct answer to this question would have made it clear that their injury, if at all, would have been of some amount of loss of profit, which could always be measured in monetary terms and, usually, cannot be regarded as an irreparable one. Another simple but pertinent question would have been concerning the element of balance of convenience; and a simple answer to the same would have further shown that the inconvenience which the importers were going to suffer because of the notifications in question was far lesser than the inconvenience which the appellants were going to suffer (with ultimate impact on national interest) in case operation of the notifications was stayed and thereby, the markets of India were allowed to be flooded with excessive quantity of the said imported peas/pulses. 94. In fact, the repercussion of the stay orders passed in the earlier years were duly noticed by this Court in Agricas (supra); and unfortunately, more or less same adverse consequences had been hovering over the markets because of the imports made under the cover of the interim orders passed in relation to the notifications dated 29.03.2019. This, in our view, was not likely to happen if the material factors relating to balance of convenience and irreparable injury were taken into account while dealing with the prayers for interim relief in the writ petitions. As noticed, this Court had, in unequivocal terms, declared in Agricas (supra), that the importers cannot be said to be under any bona fide belief in effecting the imports under the cover of interim orders; and they would face the consequences in law. It gets, perforce, reiterated that all this was avoidable if the implications were taken into account before granting any interim relief in these matters. 95. We need not expand the comments in regard to the matters relating to the grant or refusal of interim relief and would close this discussion while reiterating the principles noticed above. Summation ### Response: 1

Graham Trading Company (India) Limited Vs. Their Workmen

with the question of an implied term of the condition of service, it would be difficult to ignore the statement expressly made by the employer while making the payment from year to year.6. The question, however, whether the payment in this case was customary and traditional, still remains to be considered.In dealing with puja bonus based on an implied term of employment, it was pointed out by us in AIR 1959 SC l147, that a term may be implied, even though the payment may not have been at a uniform rate throughout and the Industrial Tribunal would be justified in deciding what should be the quantum of payment in a particular year taking into account the varying payments made in previous years. But when the question of customary and traditional bonus arises for adjudication, the considerations may be somewhat different. In such a case, the tribunal will have to consider: (i) whether the payment has been over an unbroken series of years; (ii) whether it has been for a sufficiently long period, though the length of the period might depend on the circumstances of each case: even do the period may normally have to be longer to justify an inference of traditional and customary puja bonus than may be the case with puja bonus based on an implied term of employment; (iii) the circumstance that the payment depended upon the earning of profits would have to be excluded and therefore it must be shown that payment was made in years of loss. In dealing with the question of custom, the fact that the payment was called ex gratia by the employer when it was made, would, however, make no difference in this regard because the proof of custom depends upon the effect of the relevant factors enumerated by us; and it would not be materially affected by unilateral declarations of one party when the said declarations are inconsistent with the course of conduct adopted by it; and (iv) the payment must have been at a uniform rate throughout to justify an inference that the payment at such and such rate had become customary and traditional in the particular concern. It will be seen that these tests are in substance more stringent than the tests applied for proof of puja bonus as an implied term of employment.7. Let us now see whether these tests are satisfied in the present case. The practice in the present case began in 1940 and was unbroken up to 1950. In between there was an adjudication in 1948 to which the company was a party. At that time it was said on behalf of the company before the industrial tribunal that some bonus was being paid and that there was no intention to discontinue it and consequently the tribunal did not adjudicate upon the matter, which shows that the company recognised the traditional and customary nature of the payment and it assured the tribunal that there was no intention then to discontinue the payment. The payment was continued from 1949 to 1951. In 1952, there was some dispute and originally the company paid one months wages as advance of pay and not as bonus some of the workmen, however, accepted the payment while others did not, because they were not satisfied with the amount being paid as advance of pay. The chairman of the board of directors of the company visited Calcutta in 1952 and then on the representation of the workmen the advance was converted into one months bonus and even those workmen who had not accepted the advance were allowed to draw the bonus. It cannot therefore be said that there was any break in the payment of bonus from 1940 to 1952, for if the chairman had not converted what was advance of pay into bonus in December 1952, the workmen might have raised the dispute even in that year and then there would have been no break up to 1951. So there has been unbroken payment and the period has been sufficiently long to justify an inference of customary and traditional bonus. It was pointed out that in four years during this period the payment was made in November and December and not about the time of the pujas; and, therefore, it could not be said that this was traditional and customary puja bonus. The delay in payment is not in our opinion material in this case, for one of the directors of the company, who appeared as a witness, stated as to this one months bonus that it was paid by the company to help its staff during pujas.8. The condition that the payment should have been made in years of loss also to exclude the hypothesis that it was paid only because profits had been made, has also been satisfied, for the evidence is that payments were made in at least two years of loss. Lastly, the condition that payment should have been at a uniform rate has also been satisfied because one months basic wage is the quantum of bonus from 1940 right up to 1952 without any change. It is true that in December 1951 further bonus for half a month was paid; but that year was a year of profit in which cloth-bonus for half a month was specially paid. Thus the rate so far as the puja bonus is concerned has always remained uniform at one months basic wage. It is true that the workmen pitched their demand too high for three months bonus in 1953. But that does not in our opinion betract from the inference to be drawn from the facts, proved in this case. All the conditions, therefore, of a customary and traditional bonus are satisfied in this case and there is no reason to interfere with the order of the Appellate Tribunal, though we should like to make it clear that we do not agree with the observations of the Appellate Tribunal in connection with the profits bonus aspect of the matter.

0[ds]8. The condition that the payment should have been made in years of loss also to exclude the hypothesis that it was paid only because profits had been made, has also been satisfied, for the evidence is that payments were made in at least two years of loss. Lastly, the condition that payment should have been at a uniform rate has also been satisfied because one months basic wage is the quantum of bonus from 1940 right up to 1952 without any change. It is true that in December 1951 further bonus for half a month was paid; but that year was a year of profit in which cloth-bonus for half a month was specially paid. Thus the rate so far as the puja bonus is concerned has always remained uniform at one months basic wage. It is true that the workmen pitched their demand too high for three months bonus in 1953. But that does not in our opinion betract from the inference to be drawn from the facts, proved in this case. All the conditions, therefore, of a customary and traditional bonus are satisfied in this case and there is no reason to interfere with the order of the Appellate Tribunal, though we should like to make it clear that we do not agree with the observations of the Appellate Tribunal in connection with the profits bonus aspect of the matter.

### Instruction: Considering the arguments and evidence in case proceeding, predict the verdict: is it more likely to be in favor (1) or against (0) the appellant? ### Input: with the question of an implied term of the condition of service, it would be difficult to ignore the statement expressly made by the employer while making the payment from year to year.6. The question, however, whether the payment in this case was customary and traditional, still remains to be considered.In dealing with puja bonus based on an implied term of employment, it was pointed out by us in AIR 1959 SC l147, that a term may be implied, even though the payment may not have been at a uniform rate throughout and the Industrial Tribunal would be justified in deciding what should be the quantum of payment in a particular year taking into account the varying payments made in previous years. But when the question of customary and traditional bonus arises for adjudication, the considerations may be somewhat different. In such a case, the tribunal will have to consider: (i) whether the payment has been over an unbroken series of years; (ii) whether it has been for a sufficiently long period, though the length of the period might depend on the circumstances of each case: even do the period may normally have to be longer to justify an inference of traditional and customary puja bonus than may be the case with puja bonus based on an implied term of employment; (iii) the circumstance that the payment depended upon the earning of profits would have to be excluded and therefore it must be shown that payment was made in years of loss. In dealing with the question of custom, the fact that the payment was called ex gratia by the employer when it was made, would, however, make no difference in this regard because the proof of custom depends upon the effect of the relevant factors enumerated by us; and it would not be materially affected by unilateral declarations of one party when the said declarations are inconsistent with the course of conduct adopted by it; and (iv) the payment must have been at a uniform rate throughout to justify an inference that the payment at such and such rate had become customary and traditional in the particular concern. It will be seen that these tests are in substance more stringent than the tests applied for proof of puja bonus as an implied term of employment.7. Let us now see whether these tests are satisfied in the present case. The practice in the present case began in 1940 and was unbroken up to 1950. In between there was an adjudication in 1948 to which the company was a party. At that time it was said on behalf of the company before the industrial tribunal that some bonus was being paid and that there was no intention to discontinue it and consequently the tribunal did not adjudicate upon the matter, which shows that the company recognised the traditional and customary nature of the payment and it assured the tribunal that there was no intention then to discontinue the payment. The payment was continued from 1949 to 1951. In 1952, there was some dispute and originally the company paid one months wages as advance of pay and not as bonus some of the workmen, however, accepted the payment while others did not, because they were not satisfied with the amount being paid as advance of pay. The chairman of the board of directors of the company visited Calcutta in 1952 and then on the representation of the workmen the advance was converted into one months bonus and even those workmen who had not accepted the advance were allowed to draw the bonus. It cannot therefore be said that there was any break in the payment of bonus from 1940 to 1952, for if the chairman had not converted what was advance of pay into bonus in December 1952, the workmen might have raised the dispute even in that year and then there would have been no break up to 1951. So there has been unbroken payment and the period has been sufficiently long to justify an inference of customary and traditional bonus. It was pointed out that in four years during this period the payment was made in November and December and not about the time of the pujas; and, therefore, it could not be said that this was traditional and customary puja bonus. The delay in payment is not in our opinion material in this case, for one of the directors of the company, who appeared as a witness, stated as to this one months bonus that it was paid by the company to help its staff during pujas.8. The condition that the payment should have been made in years of loss also to exclude the hypothesis that it was paid only because profits had been made, has also been satisfied, for the evidence is that payments were made in at least two years of loss. Lastly, the condition that payment should have been at a uniform rate has also been satisfied because one months basic wage is the quantum of bonus from 1940 right up to 1952 without any change. It is true that in December 1951 further bonus for half a month was paid; but that year was a year of profit in which cloth-bonus for half a month was specially paid. Thus the rate so far as the puja bonus is concerned has always remained uniform at one months basic wage. It is true that the workmen pitched their demand too high for three months bonus in 1953. But that does not in our opinion betract from the inference to be drawn from the facts, proved in this case. All the conditions, therefore, of a customary and traditional bonus are satisfied in this case and there is no reason to interfere with the order of the Appellate Tribunal, though we should like to make it clear that we do not agree with the observations of the Appellate Tribunal in connection with the profits bonus aspect of the matter. ### Response: 0

UNION OF INDIA & ANR Vs. COL. A.D. NARGOLKAR & ORS

Col AD Nargolkar if the need arose.? 33. Notwithstanding the same, the COI has come to the findings that allegations in the complaint stood proved. It has based its findings by taking into consideration the following two aspects:(a) The Officer has given an unconditional apology on September 22, 2007 to Mr. Pundir expressing regret over his action if they had caused him trouble and harassment and promising not to interfere directly or indirectly in the personal life of Mr. Pundir and his family members.(b) The allegations in the complaint lodged by the complainant were not contested by the Officer during the proceedings of the COI. In this behalf, the report records as under:?13. The allegations in the complaint lodged by Mr. D.S. Pundir have not been contested by Col AD Nargolkar during the proceedings of the COI despite the effect of the allegations on his character and military reputation and a chance to cross examine both Mr. D.S. Pundir and Col. V.S. Bhatti under provisions of Army Rule 180. In his statement to the court and answers given to various questions asked by the Court, Col AD Nargolkar has cited technicalities that the complaint is not being pursued and is presently non existent.? 34. The aforesaid approach is clearly against the basic canons of procedural fairness. It is also contrary to the principle of natural justice and the provisions of Army Rule 180. When Mr. Pundir or Col. V.S. Bhatti did not support the allegations before the COI, question of cross-examining them on these aspects did not arise at all. Moreover, the aforesaid approach depicts that COI, on mere allegations in the complaint, proceeded with the supposition that these allegations stand proved and onus was upon the Officer to prove his innocence. That cannot be countenanced.35. In the aforesaid backdrop, the only question is as to whether allegations could be treated as proved on the basis of apology letter dated September 22, 2007.36. First of all, this apology is not given by the Officer before the COI during the proceedings conducted by it. It was given to the complainant. In any case, this aspect can be ignored as the complainant had sent the copies of this apology letter to all the authorities including COI and, more importantly, the Officer has accepted having signed the said settlement. Therefore, it is an admitted document. However, the Officer had given his own version and circumstances in which the said letter was given. As already mentioned above, the circumstances do suggest that it was done to buy piece and give quietus to the matter, that too, with the intervention of a very senior Officer. The circumstances which are narrated by the Officer which led to giving the aforesaid letter have not been rebutted as neither the complainant nor Col. Bhatti or any other person came forward to give a different version of the circumstances which led to the said settlement between the Officer and the complainant. Insofar as letter of apology is concerned, it does not anywhere accepts the allegations of the complaint. It simply says that ‘do hereby apologises to Mr. D.S. Pundir resident of Village Khangesra, PO Kot, Distt Panchkula 134118 (Haryana) if it has caused him harassment and mental agony?.37. On the circumstances in which this settlement took place and apology given, there is an unrebutted version of the Officer only, on the record. Once that is to be kept in mind, it is not an unconditional apology. On the contrary, a particular pharascology was agreed upon, which was to the satisfaction of both the parties. In this background, it becomes important that the Officer has apologised ‘if? it had caused the complainant harassment and mental agony. Thus, it was not an unconditional apology. The Officer only meant that if his purported acts had adversely affected the complainant and his family members, he was apologising the same. Secondly, and more importantly, this letter of apology was given on the understanding that the complainant would be withdrawing his complaint. That is specifically mentioned in Para 2. Of course, the Officer also gave an assurance that there would not be any interference in the complainant?s personal life and the Officer would not cause future harassment/threatening. However, it is important to note that it is further mentioned that on his failure to abide by the aforesaid undertaking, Mr. Pundir would be free to initiate ‘fresh complaint? against the Officer on the same cause of action. Again, no doubt, this letter of apology states that it is given by the Officer out of his free will and without any pressure. However, it is also a matter of record that this meeting between the Officer and the complainant could be fructified with the good offices of Director General, Artillery A.S. Bajwa who had persuaded the Officer to give such an apology and bring the things acuitius. Not only that, the complainant acted upon the aforesaid understanding as he sent communication dated October 2, 2007 to the official that in view of the letter written by the Officer, the complainant was withdrawing his complaint. He specifically wrote that he had taken humanitarian approach thinking about family of the Officer and also the fact that the Officer was in the promotion list and, therefore, from his side, the matter ‘stands cleared and my presence in the COI is no longer required/necessary?.38. The cumulative effect of all the aforesaid factors including the circumstances in which the said letter of apology was given, it is difficult to term it as unconditional apology on which finding of guilt could have been returned against the Officer.39. To top it all, while giving the aforesaid findings, COI has referred to the ‘discreet inquiry? which had found the allegations to be correct. At the same time, this discreet inquiry was not proved before the COI. We fail to understand as to how it could become the basis of findings of the COI when no opportunity was given to the Officer to meet the same.

0[ds]TA No. 8 of 201317. Having regard to the aforesaid outcome of the two OAs, insofar as earlier decision of AFT dated February 18, 2014 passed inTA No. 8 of 2013is concerned, it is rendered infructuous. As mentioned above, in that order, the AFT has directed that the case of the Officer be reconsidered for the purpose of selection by the Review Board without taking into consideration Confidential Report for the year 2007-08. However, the question of reconsideration would depend upon the outcome of appeals by the Officer against the AFTs judgment dated May 29, 201730. Significantly, when the complainant received summons to appear before the COI even thereafter he sent another letter dated November 1, 2007 reiterating his earlier position and stated that said letter dated November 1, 2007 be treated as his statement and ‘it is reiterated that the matter may kindly be treated as closed from my end?31. Notwithstanding the above, the army authorities decided to proceed with the COI. The circumstances in which matter was settled between the Officer and the complainant, that too with the intervention of a very senior Officer Lt. Gen. A.S. Bajwa, it could have been given a quietus by the respondents. However, at the same time, it can also be observed that the respondents authorities were not bound by the settlement which took place between the Officer and the complainant. Since, it was thought that allegations were serious in nature and a discreet inquiry had also been held into the matter which also pointed out that prima facie there was some substance in those allegations, the army authorities were not precluded from proceeding with COI to find the truthfullness in the said allegations32. Having said that, it was for the respondents to prove the allegations. Burden was upon the authority to discharge initial onus as it had levelled the charges against the Officer. We have gone through the findings of COI which are placed on record. These findings categorically mention that insofar as Mr. Pundir is concerned, he had withdrawn his complaint by specifically stating that he did not want to pursue the same. The report also records that he did not depose in support of the allegations contained in his complaint. There is no other witness which was produced before the COI to prove those allegations33. Notwithstanding the same, the COI has come to the findings that allegations in the complaint stood proved. It has based its findings by taking into consideration the following two aspects:(a) The Officer has given an unconditional apology on September 22, 2007 to Mr. Pundir expressing regret over his action if they had caused him trouble and harassment and promising not to interfere directly or indirectly in the personal life of Mr. Pundir and his family members(b) The allegations in the complaint lodged by the complainant were not contested by the Officer during the proceedings of the COI. In this behalf, the report records as under:?13. The allegations in the complaint lodged by Mr. D.S. Pundir have not been contested by Col AD Nargolkar during the proceedings of the COI despite the effect of the allegations on his character and military reputation and a chance to cross examine both Mr. D.S. Pundir and Col. V.S. Bhatti under provisions of Army Rule 180. In his statement to the court and answers given to various questions asked by the Court, Col AD Nargolkar has cited technicalities that the complaint is not being pursued and is presently non existent.?34. The aforesaid approach is clearly against the basic canons of procedural fairness. It is also contrary to the principle of natural justice and the provisions of Army Rule 180. When Mr. Pundir or Col. V.S. Bhatti did not support the allegations before the COI, question of cross-examining them on these aspects did not arise at all. Moreover, the aforesaid approach depicts that COI, on mere allegations in the complaint, proceeded with the supposition that these allegations stand proved and onus was upon the Officer to prove his innocence. That cannot be countenanced36. First of all, this apology is not given by the Officer before the COI during the proceedings conducted by it. It was given to the complainant. In any case, this aspect can be ignored as the complainant had sent the copies of this apology letter to all the authorities including COI and, more importantly, the Officer has accepted having signed the said settlement. Therefore, it is an admitted document. However, the Officer had given his own version and circumstances in which the said letter was given. As already mentioned above, the circumstances do suggest that it was done to buy piece and give quietus to the matter, that too, with the intervention of a very senior Officer. The circumstances which are narrated by the Officer which led to giving the aforesaid letter have not been rebutted as neither the complainant nor Col. Bhatti or any other person came forward to give a different version of the circumstances which led to the said settlement between the Officer and the complainant. Insofar as letter of apology is concerned, it does not anywhere accepts the allegations of the complaint. It simply says that ‘do hereby apologises to Mr. D.S. Pundir resident of Village Khangesra, PO Kot, Distt Panchkula 134118 (Haryana) if it has caused him harassment and mental agony?37. On the circumstances in which this settlement took place and apology given, there is an unrebutted version of the Officer only, on the record. Once that is to be kept in mind, it is not an unconditional apology. On the contrary, a particular pharascology was agreed upon, which was to the satisfaction of both the parties. In this background, it becomes important that the Officer has apologised ‘if? it had caused the complainant harassment and mental agony. Thus, it was not an unconditional apology. The Officer only meant that if his purported acts had adversely affected the complainant and his family members, he was apologising the same. Secondly, and more importantly, this letter of apology was given on the understanding that the complainant would be withdrawing his complaint. That is specifically mentioned in Para 2. Of course, the Officer also gave an assurance that there would not be any interference in the complainant?s personal life and the Officer would not cause future harassment/threatening. However, it is important to note that it is further mentioned that on his failure to abide by the aforesaid undertaking, Mr. Pundir would be free to initiate ‘fresh complaint? against the Officer on the same cause of action. Again, no doubt, this letter of apology states that it is given by the Officer out of his free will and without any pressure. However, it is also a matter of record that this meeting between the Officer and the complainant could be fructified with the good offices of Director General, Artillery A.S. Bajwa who had persuaded the Officer to give such an apology and bring the things acuitius. Not only that, the complainant acted upon the aforesaid understanding as he sent communication dated October 2, 2007 to the official that in view of the letter written by the Officer, the complainant was withdrawing his complaint. He specifically wrote that he had taken humanitarian approach thinking about family of the Officer and also the fact that the Officer was in the promotion list and, therefore, from his side, the matter ‘stands cleared and my presence in the COI is no longer required/necessary?38. The cumulative effect of all the aforesaid factors including the circumstances in which the said letter of apology was given, it is difficult to term it as unconditional apology on which finding of guilt could have been returned against the Officer39. To top it all, while giving the aforesaid findings, COI has referred to the ‘discreet inquiry? which had found the allegations to be correct. At the same time, this discreet inquiry was not proved before the COI. We fail to understand as to how it could become the basis of findings of the COI when no opportunity was given to the Officer to meet the same.

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: Col AD Nargolkar if the need arose.? 33. Notwithstanding the same, the COI has come to the findings that allegations in the complaint stood proved. It has based its findings by taking into consideration the following two aspects:(a) The Officer has given an unconditional apology on September 22, 2007 to Mr. Pundir expressing regret over his action if they had caused him trouble and harassment and promising not to interfere directly or indirectly in the personal life of Mr. Pundir and his family members.(b) The allegations in the complaint lodged by the complainant were not contested by the Officer during the proceedings of the COI. In this behalf, the report records as under:?13. The allegations in the complaint lodged by Mr. D.S. Pundir have not been contested by Col AD Nargolkar during the proceedings of the COI despite the effect of the allegations on his character and military reputation and a chance to cross examine both Mr. D.S. Pundir and Col. V.S. Bhatti under provisions of Army Rule 180. In his statement to the court and answers given to various questions asked by the Court, Col AD Nargolkar has cited technicalities that the complaint is not being pursued and is presently non existent.? 34. The aforesaid approach is clearly against the basic canons of procedural fairness. It is also contrary to the principle of natural justice and the provisions of Army Rule 180. When Mr. Pundir or Col. V.S. Bhatti did not support the allegations before the COI, question of cross-examining them on these aspects did not arise at all. Moreover, the aforesaid approach depicts that COI, on mere allegations in the complaint, proceeded with the supposition that these allegations stand proved and onus was upon the Officer to prove his innocence. That cannot be countenanced.35. In the aforesaid backdrop, the only question is as to whether allegations could be treated as proved on the basis of apology letter dated September 22, 2007.36. First of all, this apology is not given by the Officer before the COI during the proceedings conducted by it. It was given to the complainant. In any case, this aspect can be ignored as the complainant had sent the copies of this apology letter to all the authorities including COI and, more importantly, the Officer has accepted having signed the said settlement. Therefore, it is an admitted document. However, the Officer had given his own version and circumstances in which the said letter was given. As already mentioned above, the circumstances do suggest that it was done to buy piece and give quietus to the matter, that too, with the intervention of a very senior Officer. The circumstances which are narrated by the Officer which led to giving the aforesaid letter have not been rebutted as neither the complainant nor Col. Bhatti or any other person came forward to give a different version of the circumstances which led to the said settlement between the Officer and the complainant. Insofar as letter of apology is concerned, it does not anywhere accepts the allegations of the complaint. It simply says that ‘do hereby apologises to Mr. D.S. Pundir resident of Village Khangesra, PO Kot, Distt Panchkula 134118 (Haryana) if it has caused him harassment and mental agony?.37. On the circumstances in which this settlement took place and apology given, there is an unrebutted version of the Officer only, on the record. Once that is to be kept in mind, it is not an unconditional apology. On the contrary, a particular pharascology was agreed upon, which was to the satisfaction of both the parties. In this background, it becomes important that the Officer has apologised ‘if? it had caused the complainant harassment and mental agony. Thus, it was not an unconditional apology. The Officer only meant that if his purported acts had adversely affected the complainant and his family members, he was apologising the same. Secondly, and more importantly, this letter of apology was given on the understanding that the complainant would be withdrawing his complaint. That is specifically mentioned in Para 2. Of course, the Officer also gave an assurance that there would not be any interference in the complainant?s personal life and the Officer would not cause future harassment/threatening. However, it is important to note that it is further mentioned that on his failure to abide by the aforesaid undertaking, Mr. Pundir would be free to initiate ‘fresh complaint? against the Officer on the same cause of action. Again, no doubt, this letter of apology states that it is given by the Officer out of his free will and without any pressure. However, it is also a matter of record that this meeting between the Officer and the complainant could be fructified with the good offices of Director General, Artillery A.S. Bajwa who had persuaded the Officer to give such an apology and bring the things acuitius. Not only that, the complainant acted upon the aforesaid understanding as he sent communication dated October 2, 2007 to the official that in view of the letter written by the Officer, the complainant was withdrawing his complaint. He specifically wrote that he had taken humanitarian approach thinking about family of the Officer and also the fact that the Officer was in the promotion list and, therefore, from his side, the matter ‘stands cleared and my presence in the COI is no longer required/necessary?.38. The cumulative effect of all the aforesaid factors including the circumstances in which the said letter of apology was given, it is difficult to term it as unconditional apology on which finding of guilt could have been returned against the Officer.39. To top it all, while giving the aforesaid findings, COI has referred to the ‘discreet inquiry? which had found the allegations to be correct. At the same time, this discreet inquiry was not proved before the COI. We fail to understand as to how it could become the basis of findings of the COI when no opportunity was given to the Officer to meet the same. ### Response: 0

NILAY GUPTA Vs. CHAIRMAN NEET PG MEDICAL AND DENTAL ADMISSION/COUNSELLING BOARD 2020 AND PRINCIPAL GOVT. DENTAL COLLEGE & ORS

of the writ petitioners before him. However, the broad nature of the relief granted resulted in creation of rights which, implicated parties had not in the first instance, approached the High Court (unlike Dr. Nilay Gupta or Dr. Surmil Sharma), at the cost of third parties who had by then been given admission based on their merit as management quota students, another set of individuals who had not professed any grievance, were given admission, post judgement of the single judge. 30. The preceding observations ought to have been dispositive of the present case. Nevertheless, the court is of the opinion that the discretion of private managements who set up and manage medical colleges cannot be left to such an untrammelled degree as to result in unfairness to candidates. Undoubtedly, these private institutions have the discretion to factor in an NRI or any other permissible quota. Yet that discretion should be tempered; if the discretion to have such a quota is exercised, it should be revised or modified reasonably, and within reasonable time. This case presents some unusual features in that the admission calendar appears to have been thrown out of gear on account of the Covid-19 pandemic. The NEET written test was held in January, and the results were declared on i.e. 31.01.2020. At that stage, and soon thereafter till the end of March, the thinking of the colleges and the board appears to be that the NRI quota in private medical colleges would be maintained (evident from the minutes of meeting dated 17.03.2020). The rapidity with which the pandemic progressed perhaps generated a broad consensus among private colleges that going ahead with the NRI quota would be inadvisable. This court cannot comment on the wisdom of such thinking as it falls within the exclusive domain of private decision-making. What is striking however is that even when this thinking was emerging, the original schedule, and the sequence for filling up of the NRI seats was maintained – and even rescheduled. Thus, in terms of the boards notification of 10.04.2020, the NRI students documents were to be verified on 14.04.2020. Apparently, immediately a day after that notification, on 11.04.2020 to be precise, the private colleges en masse appear to have decided not to proceed with the NRI quota and instead merge it with the 35% management quota seats, and proceed to fill them entirely based upon rank based merit of the management quota candidates arranged in terms of their ranking and performance in the NEET. NRI candidates were to be treated as management quota candidates, and their applications too, considered on the basis of their overall merit in that category. Viewed in isolation, this decision is perfectly valid; it gives one the impression that NRI students were not prejudiced. Undoubtedly, the decision to abolish the NRI quota was exclusively within the scope of the private institutions decision-making. Yet what is apparent is that by this time, the NRI students had not only started applying for counselling, but had also submitted all their documents for verification to determine their eligibility for the NRI quota seats, and in a sense, committed themselves as candidates for NRI quota seats in Rajasthan for whatever perceived advantages they could reasonably see in their favour. Hence, when the matter stood thus, when the final seat matrices were published on 13.04.2020, it acted to the unfair detriment of these NRI students. 31. Noticeably, the writ proceedings initiated by the two candidates (Dr. Nilay Gupta and Dr. Surmil Sharma) did not claim that it was representative in character. It only sought to highlight the arbitrariness in the admission procedure and premised it largely upon the violation of the mandate of this court in P A Inamdar (Supra n.1) . As held earlier, private medical colleges are not obliged to provide for such NRI quota seats to the extent of 15% in any given year, but the peculiarities of this case, which are: the prevailing pandemic, the various steps which impelled the NRI quota candidates to commit themselves, and the eleventh hour policy change brought about through the final matrix published on 13.04.2020, acted to the distinct disadvantage of these NRI candidates. It also appears from the record that most of the students reconciled themselves to their candidature being considered on merits at par with the management quota candidates. Many such NRI students who did not approach the court were given admission in disciplines other than their primarily choices, due to their relative standing in the state merit list of NEET eligible candidates. 32. The directions of the single judge injected in an altogether different dimension to the facts in directing that the writ petitioners before him be given admission, rather than leaving it to the board. A pandoras box of fresh claims appears to have been opened up. This resulted in a so-called second round of counselling exclusively meant for NRI candidates (in the second and third week of July, 2020), resulting in the drawing up of an NRI quota list, which was then acted upon. The resultant displacements led to those who had been given admission based upon the relatively higher merit ranking in the management quota, approaching the Division Bench with third-party appeals. The Division Bench set aside the single judges directions. Another round of admissions to postgraduate seats was given to the third-party appellants. It therefore falls upon this court to work out the most equitable manner of ensuring that the least disturbance occurs in the particular circumstances of this case. 33. As a result of the above discussion, it is evident that the NRI quota is neither sacrosanct, not inviolable in terms of existence in any given year, or its extent. However, if a medical college or institution or, for that matter, the state regulating authority, such as the board in the present case, decide to do away with it, reasonable notice of such a decision should be given to enable those aspiring to such seats to choose elsewhere, having regard to the prevailing conditions.

1[ds]20. The provisions of the Rajasthan University of Health Sciences Act, 2005 (Section 7) throws open admission to all courses, offered by medical colleges affiliated to the University, to be open to all, subject to such reservations as may be made in favour of Scheduled Caste, Scheduled tribe, Other backward classes, girl students and other categories in accordance with any law or orders of the State Government for the time being in force. By virtue of insertion of Section 10-D in the Medical Council of India Act, 1956 and regulations framed thereafter, participation in a common National Examination, ( NEET) by institutions offering medical courses – including postgraduation courses, as well as its attempt by candidates wanting admission, became compulsory. The governing enactment, which set up the respondent MGMC, is the Mahatma Gandhi University of Medical Sciences and Technology, Jaipur Act, 2011. It provides for the procedure to be adopted for admissions, as well as for reservations. Per proviso to Section 32(2), admission in professional courses is to be only through entrance test; By Section 32(3), reservations for scheduled castes, scheduled tribes, backward classes, special backward classes, women and handicapped persons shall be provided as per the policy of the State Government. Regulations framed pursuant to the amendment effected in 2016, to the Medical Council of India Act, in respect of admission to postgraduate medical courses, made it obligatory for both institutions and students alike to give effect to the common eligibility test (NEET).23. It is undoubtedly a matter of record that on 17.03.2020, when the board convened the meeting attended by representatives of all participating colleges (including private medical colleges offering seats in the postgraduate medical courses in Rajasthan), the unanimous thinking was to offer NRI/Management seats to the extent of 15% of the total admission intake. This 15% turned out to be about 22 seats in MGMC. In the same meeting, it was unanimously decided that the task of filling NRI seats would be taken up before filling the management seats; this meant as a corollary, that NRI counselling would be taken up first and after allocation of seats to suitable NRI candidates, the leftover seats would be filled by management quota candidates. This was followed by the submission of forms by NRI candidates for the purpose of verification of their documents. When the provisional seat matrix was published on 10.04.2020, it did not indicate that those opting for admission exclusively as NRI candidates would be considered as belonging to any other category. It was only on 11.04.2020 that the private colleges appear to have sent their final matrix to the board. This matrix, unbeknown to the NRI candidates, proposed deletion of the NRI quota. In the circumstances, when the final matrix was published for each college detailing the quotas for individual disciplines, the original earmarking for NRI candidates was absent.24. A plain reading of the judgement of this court in Inamdar (Supra n.1) reveals that a provision for 15% NRI quota was a not compulsory; it was only potential. This is clearly evident from the following passage in that judgment, which all counsel from either side of the bar, insisted on reading:Here itself we are inclined to deal with the question as to seats allocated for Non-Resident Indians (NRI, for short) or NRI seats. It is common knowledge that some of the institutions grant admissions to certain number of students under such quota by charging a higher amount of fee. In fact, the term NRI in relation to admissions is a misnomer. By and large, we have noticed in cases after cases coming to this Court, neither the students who get admissions under this category nor their parents are NRIs. In effect and reality, under this category, less meritorious students, but who can afford to bring more money, get admission. During the course of hearing, it was pointed out that a limited number of such seats should be made available as the money brought by such students admitted against NRI quota enables the educational institutions to strengthen its level of education and also to enlarge its educational activities. It was also pointed out that people of Indian origin, who have migrated to other countries, have a desire to bring back their children to their own country as they not only get education but also get reunited with Indian cultural ethos by virtue of being here. They also wish the money which they would be spending elsewhere on education of their children should rather reach their own motherland. A limited reservation of such seats, not exceeding 15%, in our opinion, may be made available to NRIs depending on the discretion of the management subject to two conditions. First, such seats should be utilized bona fide by the NRIs only and for their children or wards. Secondly, within this quota, the merit should not be given a complete go-by. The amount of money, in whatever form collected from such NRIs, should be utilized for benefiting students such as from economically weaker sections of the society, whom, on well-defined criteria, the educational institution may admit on subsidized payment of their fee. To prevent misutilisation of such quota or any malpractice referable to NRI quota seats, suitable legislation or regulation needs to be framed. So long as the State does not do it, it will be for the Committees constituted pursuant to Islamic Academys direction to regulate.Clearly, this court had the benefit of past experience with the concept of NRI quota: witness its skepticism about filling of such seats (in the past) by undeserving and unmerited candidates, to the detriment of more meritorious students. Therefore, the court indicated a limited quota with some essential controls in the manner of filling up of such NRI quota seats. These were:a) The NRIs, who wish to bring their children to this country not only for their education but also to get them reunited with the Indian cultural ethos by virtue of being here and to enable the NRIs to expend money, (which they would be spending elsewhere on education of their children) to reach their mother land.b) Having pointed out the reality behind the incorrect or misnamed NRI quota and found substance in the purpose behind allowing such quota, this court favoured a limited reservation, not exceeding 15% of sanctioned seats, to be made available for the NRIs, however, depending on the discretion of the management.c) This court, however, imposed two conditions for admission under the NRI quota, firstly, that such seats should be utilized bona fide by NRIs only and for their children or wards and secondly, that within this quota, merit should not be given a complete go by.25. The four crucial elements in the NRI quota, per Inamdar (Supra n.1) are: one, the discretion of the management (whether to have the quota or not); two, the limit (15%); three, that seats should be available for genuine and bona fide NRI students, and lastly that the quota was to be filled based on merit.27. Earlier, the break of seats published on 17.03.2020, stated that 15% of the total intake in PG medical courses were to be filled by NRI/management quota aspirants; the sequence to be adopted undoubtedly clarified that in the order of things, the NRI candidates applications would be considered first for counselling and admissions, and the left over seats would then be filled from amongst merited management quota applicants, in addition to the 35% management seat candidates. The colleges, however consciously decided not to go-ahead with the NRI quota - a decision, the basis of which is explained as the assessment by such private colleges offering MD courses, that there was a likelihood that many NRI seats would go unfilled.28. Given that the decision in TMA Pai Foundation (Supra n.3) was by a larger bench of 11 judges, and P A Inamdar (Supra n.1) was a judgment delivered by seven judges, this court is clear that precedentially, those and other previous judgements of this court, only declared that as a part of the private colleges autonomous decision making, they could set apart some percentage of seats for admission to students of their choice. The Inamdar (Supra n.1) decision is important, inasmuch as it declared that the set apart (or quota, so to say) for NRIs should be about 15% of the overall intake. Other decisions of this court (Modern Dental College & Research Centre (supra) and the recent decision in Christian Medical College Vellore Association v. Union of India, 2020 SCC OnLine SC 423) have underlined the paramountcy of the NEET requirement as a common standard regulating medical courses admissions in India, irrespective whether the courses are offered in publicly owned, state owned or privately owned or managed institutions. A combined effect of the provisions of the Medical Council of India Act and regulations with respect to admissions (which have been progressively amended in respect of eligibility for admission to courses, procedure for admission, etc.) and the decisions of this court, is that private colleges and institutions which offer such professional and technical courses, have some elbow room: they can decide whether, and to what extent, they wish to offer NRI or management quotas (the limits of which are again defined by either judicial precedents, enacted law or subordinate legislation). In these circumstances, it is held that the respondent management (of MGMC) possessed the discretion to indicate whether, and to what extent, NRI reservations could be provided. As is evident, there is nothing in P A Inamdar (Supra n.1) to say that a 15% NRI quota is an unqualified and unalterable part of the admission process in post graduate medical courses. It was, and remains within the discretionary authority of the management of private medical colleges, within their internal policy making domain.29. The impugned judgment, in this courts opinion, is correct, in that it held that the single judge could not have directed admission of the candidates before him. There is a body of case law (Tirumala Tirupati Devasthanams v. K. Jotheeswara Pillai, (2007) 9 SCC 461 ; Bihar Eastern Gangetic Fishermen Coop. Society Ltd. v. Sipahi Singh (1977) 4 SCC 145 ; K.V. Rajalakshmiah Setty v. State of Mysore, AIR 1967 SC 993 .) which clarifies that sans a statutory duty, a positive direction to do something in a specific manner, cannot be given (it must be shown that there is a statute which imposes a legal duty and the aggrieved party has a legal right under the statute to enforce its performance.(Bihar Eastern Gangetic Fishermen Coop. Society Ltd. v. Sipahi Singh, (1977) 4 SCC 145.) ). The NRI candidates could not assert a right to be admitted; furthermore, while granting relief, the single judge could at best have directed consideration of the cases of the writ petitioners before him. However, the broad nature of the relief granted resulted in creation of rights which, implicated parties had not in the first instance, approached the High Court (unlike Dr. Nilay Gupta or Dr. Surmil Sharma), at the cost of third parties who had by then been given admission based on their merit as management quota students, another set of individuals who had not professed any grievance, were given admission, post judgement of the single judge.30. The preceding observations ought to have been dispositive of the present case. Nevertheless, the court is of the opinion that the discretion of private managements who set up and manage medical colleges cannot be left to such an untrammelled degree as to result in unfairness to candidates. Undoubtedly, these private institutions have the discretion to factor in an NRI or any other permissible quota. Yet that discretion should be tempered; if the discretion to have such a quota is exercised, it should be revised or modified reasonably, and within reasonable time. This case presents some unusual features in that the admission calendar appears to have been thrown out of gear on account of the Covid-19 pandemic. The NEET written test was held in January, and the results were declared on i.e. 31.01.2020. At that stage, and soon thereafter till the end of March, the thinking of the colleges and the board appears to be that the NRI quota in private medical colleges would be maintained (evident from the minutes of meeting dated 17.03.2020). The rapidity with which the pandemic progressed perhaps generated a broad consensus among private colleges that going ahead with the NRI quota would be inadvisable. This court cannot comment on the wisdom of such thinking as it falls within the exclusive domain of private decision-making. What is striking however is that even when this thinking was emerging, the original schedule, and the sequence for filling up of the NRI seats was maintained – and even rescheduled. Thus, in terms of the boards notification of 10.04.2020, the NRI students documents were to be verified on 14.04.2020. Apparently, immediately a day after that notification, on 11.04.2020 to be precise, the private colleges en masse appear to have decided not to proceed with the NRI quota and instead merge it with the 35% management quota seats, and proceed to fill them entirely based upon rank based merit of the management quota candidates arranged in terms of their ranking and performance in the NEET. NRI candidates were to be treated as management quota candidates, and their applications too, considered on the basis of their overall merit in that category. Viewed in isolation, this decision is perfectly valid; it gives one the impression that NRI students were not prejudiced. Undoubtedly, the decision to abolish the NRI quota was exclusively within the scope of the private institutions decision-making. Yet what is apparent is that by this time, the NRI students had not only started applying for counselling, but had also submitted all their documents for verification to determine their eligibility for the NRI quota seats, and in a sense, committed themselves as candidates for NRI quota seats in Rajasthan for whatever perceived advantages they could reasonably see in their favour. Hence, when the matter stood thus, when the final seat matrices were published on 13.04.2020, it acted to the unfair detriment of these NRI students.31. Noticeably, the writ proceedings initiated by the two candidates (Dr. Nilay Gupta and Dr. Surmil Sharma) did not claim that it was representative in character. It only sought to highlight the arbitrariness in the admission procedure and premised it largely upon the violation of the mandate of this court in P A Inamdar (Supra n.1) . As held earlier, private medical colleges are not obliged to provide for such NRI quota seats to the extent of 15% in any given year, but the peculiarities of this case, which are: the prevailing pandemic, the various steps which impelled the NRI quota candidates to commit themselves, and the eleventh hour policy change brought about through the final matrix published on 13.04.2020, acted to the distinct disadvantage of these NRI candidates. It also appears from the record that most of the students reconciled themselves to their candidature being considered on merits at par with the management quota candidates. Many such NRI students who did not approach the court were given admission in disciplines other than their primarily choices, due to their relative standing in the state merit list of NEET eligible candidates.32. The directions of the single judge injected in an altogether different dimension to the facts in directing that the writ petitioners before him be given admission, rather than leaving it to the board. A pandoras box of fresh claims appears to have been opened up. This resulted in a so-called second round of counselling exclusively meant for NRI candidates (in the second and third week of July, 2020), resulting in the drawing up of an NRI quota list, which was then acted upon. The resultant displacements led to those who had been given admission based upon the relatively higher merit ranking in the management quota, approaching the Division Bench with third-party appeals. The Division Bench set aside the single judges directions. Another round of admissions to postgraduate seats was given to the third-party appellants33. As a result of the above discussion, it is evident that the NRI quota is neither sacrosanct, not inviolable in terms of existence in any given year, or its extent. However, if a medical college or institution or, for that matter, the state regulating authority, such as the board in the present case, decide to do away with it, reasonable notice of such a decision should be given to enable those aspiring to such seats to choose elsewhere, having regard to the prevailing conditions.35. This court clarifies that the validity of deletion of the NRI quota altogether, by colleges, and their merger as part of the larger management quota, was not questioned as a general proposition; the premise on which the parties argued their cases was that the NRI quota is inflexible and cannot be altered. The time within which an institution decides to do away with the quota during an ongoing admission process has not been prescribed, inasmuch as the observations as to unfairness in the nature of the deletion is in the specific circumstances of this case. Likewise, the directions in the previous paragraph are with regard to the circumstances of this case, and to do complete justice to all parties.

### Instruction: Review the case details and predict the decision: will the court accept (1) or deny (0) the appeal/petition? ### Input: of the writ petitioners before him. However, the broad nature of the relief granted resulted in creation of rights which, implicated parties had not in the first instance, approached the High Court (unlike Dr. Nilay Gupta or Dr. Surmil Sharma), at the cost of third parties who had by then been given admission based on their merit as management quota students, another set of individuals who had not professed any grievance, were given admission, post judgement of the single judge. 30. The preceding observations ought to have been dispositive of the present case. Nevertheless, the court is of the opinion that the discretion of private managements who set up and manage medical colleges cannot be left to such an untrammelled degree as to result in unfairness to candidates. Undoubtedly, these private institutions have the discretion to factor in an NRI or any other permissible quota. Yet that discretion should be tempered; if the discretion to have such a quota is exercised, it should be revised or modified reasonably, and within reasonable time. This case presents some unusual features in that the admission calendar appears to have been thrown out of gear on account of the Covid-19 pandemic. The NEET written test was held in January, and the results were declared on i.e. 31.01.2020. At that stage, and soon thereafter till the end of March, the thinking of the colleges and the board appears to be that the NRI quota in private medical colleges would be maintained (evident from the minutes of meeting dated 17.03.2020). The rapidity with which the pandemic progressed perhaps generated a broad consensus among private colleges that going ahead with the NRI quota would be inadvisable. This court cannot comment on the wisdom of such thinking as it falls within the exclusive domain of private decision-making. What is striking however is that even when this thinking was emerging, the original schedule, and the sequence for filling up of the NRI seats was maintained – and even rescheduled. Thus, in terms of the boards notification of 10.04.2020, the NRI students documents were to be verified on 14.04.2020. Apparently, immediately a day after that notification, on 11.04.2020 to be precise, the private colleges en masse appear to have decided not to proceed with the NRI quota and instead merge it with the 35% management quota seats, and proceed to fill them entirely based upon rank based merit of the management quota candidates arranged in terms of their ranking and performance in the NEET. NRI candidates were to be treated as management quota candidates, and their applications too, considered on the basis of their overall merit in that category. Viewed in isolation, this decision is perfectly valid; it gives one the impression that NRI students were not prejudiced. Undoubtedly, the decision to abolish the NRI quota was exclusively within the scope of the private institutions decision-making. Yet what is apparent is that by this time, the NRI students had not only started applying for counselling, but had also submitted all their documents for verification to determine their eligibility for the NRI quota seats, and in a sense, committed themselves as candidates for NRI quota seats in Rajasthan for whatever perceived advantages they could reasonably see in their favour. Hence, when the matter stood thus, when the final seat matrices were published on 13.04.2020, it acted to the unfair detriment of these NRI students. 31. Noticeably, the writ proceedings initiated by the two candidates (Dr. Nilay Gupta and Dr. Surmil Sharma) did not claim that it was representative in character. It only sought to highlight the arbitrariness in the admission procedure and premised it largely upon the violation of the mandate of this court in P A Inamdar (Supra n.1) . As held earlier, private medical colleges are not obliged to provide for such NRI quota seats to the extent of 15% in any given year, but the peculiarities of this case, which are: the prevailing pandemic, the various steps which impelled the NRI quota candidates to commit themselves, and the eleventh hour policy change brought about through the final matrix published on 13.04.2020, acted to the distinct disadvantage of these NRI candidates. It also appears from the record that most of the students reconciled themselves to their candidature being considered on merits at par with the management quota candidates. Many such NRI students who did not approach the court were given admission in disciplines other than their primarily choices, due to their relative standing in the state merit list of NEET eligible candidates. 32. The directions of the single judge injected in an altogether different dimension to the facts in directing that the writ petitioners before him be given admission, rather than leaving it to the board. A pandoras box of fresh claims appears to have been opened up. This resulted in a so-called second round of counselling exclusively meant for NRI candidates (in the second and third week of July, 2020), resulting in the drawing up of an NRI quota list, which was then acted upon. The resultant displacements led to those who had been given admission based upon the relatively higher merit ranking in the management quota, approaching the Division Bench with third-party appeals. The Division Bench set aside the single judges directions. Another round of admissions to postgraduate seats was given to the third-party appellants. It therefore falls upon this court to work out the most equitable manner of ensuring that the least disturbance occurs in the particular circumstances of this case. 33. As a result of the above discussion, it is evident that the NRI quota is neither sacrosanct, not inviolable in terms of existence in any given year, or its extent. However, if a medical college or institution or, for that matter, the state regulating authority, such as the board in the present case, decide to do away with it, reasonable notice of such a decision should be given to enable those aspiring to such seats to choose elsewhere, having regard to the prevailing conditions. ### Response: 1

UNION OF INDIA Vs. TECH MAHINDRA BUSINESS SERVICES LTD (FORMERLY KNOWN AS HUTCHINSON GLOBAL SERVICES LTD )

Kurian Joseph, J. - The whole dispute in this case stems out of a show cause notice issued to the respondent on 27.02.2013, which was challenged before the High Court of Bombay leading to judgment in Writ Petition No.529 of 2013. The relevant paragraph of the judgment reads as follows:- 4. If the petitioner is directed to deposit the amounts determined to be the loss to the DoT/Government of India due to the unauthorized telecom resources being used, it would be bound to do so and its failure to do so would be met with the consequences as per law. There can however, be no question of the petitioner being directed to furnish the undertaking to deposit the said amount as directed by the impugned order dated 27th February, 2013 unconditionally. That would deprive the petitioner the right to challenge the orders if any this regard. The petitioner is at liberty to challenge any order passed by the respondents including an order, if any, regarding the loss on account of the circumstances mentioned above in the impugned order. The impugned order would be subject to orders, if any, of the Court or Tribunal before which it is challenged. 5. The petitioner therefore shall not be required to furnish an unconditional undertaking as demanded. The undertaking shall be subject to the orders, if any, that may be passed in proceedings that the petitioner may adopt to challenge the same. 6. Needless to clarify therefore that the show-cause notice dated 20th January, 2013 remains outstanding. 7. The respondents have acceded to the petitioners request of a personal hearing in respect of the show-cause notice. No coercive action shall be taken for a period of two weeks after the service of the order pursuant to the show-cause notice, if adverse to the petitioner. 2. Pursuant to the judgment of the High Court, the appellant passed a fresh order, after hearing the parties, on 14.07.2014. The relevant portions of the order read as follows:- Establishing end to end bandwidth is licensed through UASL, IP-II, NLD & ILD licenses. Therefore, the company is liable to pay the loss incurred to Government of India due to unauthorized establishment and operation of end to end bandwidth, by the company. Therefore, M/s. Tech Mahindra Business Services Ltd (erstwhile Hutchison Global Services Pvt. Ltd.) is directed to pay a sum of Rs. 6,11,73,460/- (Rupees Six Crore Eleven Lakh Seventy Three Thousand Four Hundred and Sixty only) towards loss incurred to Government of India. This includes license fee, penalty and interest charges as prescribed in UASL license for the period April 2007 to June 2014. Ready reckoner ceiling tariff for STMs notified by TRAI vide notification no.312-7/2004-Eco. Dated 25th April, 2005 has been considered to calculate the license fee payable. Interest (compounded monthly) has been charged @ SBI PLR as on 1st April of the financial year concerned + 2%. Calculation sheet is annexured. The amount shall be paid to CAO, CCA Maharashtra, BSNL Administrative Complex, Juhu Road, Santacruz (West), Mumbai, within 21 days from the date of issue of this demand note and details of payment shall be intimated to this office. 3. This order was challenged before the Telecom Disputes Settlement and Appellate Tribunal (for short, TDSAT), leading to the order dated 01.07.2015, which is under challenge in this appeal. It has been categorically held in the order that ..the respondent has erred in calculating the loss using the ceiling rate provided in an order issued in 2005 in a regime where the rates have been continuously falling. Further, it is not fair to use the highest percentage prescribed under the UASL License to calculate the licensee fee as well as the interest and penalty provided in a UASL license to calculate the total loss. We may note here that if an ordinary subscriber had made a similar mistake, the respondent-DoT could only have imposed fine as provided in the Telegraph Rules. Just because the petitioner happens to have an OSP registration, we do not see how interest and penalties as provided in a UASL license can be imposed on it. 4. Though such a finding was rendered, in order to put a quietus, the Tribunal took the view that interest of justice will be subserved if the respondent was to calculate the loss assuming the same payments as made by the petitioner to M/s. Tata Communications Ltd., for the same bandwidth. For the period prior to the year 2010, the highest payment made for any year (Rs. 12,96,056/- for the year 2012) may be used for all the years. The license fee that M/s. Tata Communications Ltd., would have paid on this amount may be taken as the loss of licensee fee. The respondent may charge an interest of 10% from the date such license fee would have become due. 5. We have heard Ms. V. Mohana, learned senior counsel appearing for the appellant and Mr. Meet Malhotra, learned senior counsel appearing for the respondent(s) extensively. 6. Ultimately, the whole issue revolves round the authority of the appellant to levy penalty and interest. According to the learned senior counsel for the appellant, there are valid notifications in that regard having force of law and also on the quantum. However, we do not find that any such material was available before the Tribunal. Bereft of such information only, the Tribunal ultimately passed the impugned order in the interest of justice.

1[ds]According to the learned senior counsel for the appellant, there are valid notifications in that regard having force of law and also on the quantum. However, we do not find that any such material was available before the Tribunal. Bereft of such information only, the Tribunal ultimately passed the impugned order in the interest of justice.

### Instruction: Analyze the case proceeding and predict whether the appeal/petition will be accepted (1) or rejected (0). ### Input: Kurian Joseph, J. - The whole dispute in this case stems out of a show cause notice issued to the respondent on 27.02.2013, which was challenged before the High Court of Bombay leading to judgment in Writ Petition No.529 of 2013. The relevant paragraph of the judgment reads as follows:- 4. If the petitioner is directed to deposit the amounts determined to be the loss to the DoT/Government of India due to the unauthorized telecom resources being used, it would be bound to do so and its failure to do so would be met with the consequences as per law. There can however, be no question of the petitioner being directed to furnish the undertaking to deposit the said amount as directed by the impugned order dated 27th February, 2013 unconditionally. That would deprive the petitioner the right to challenge the orders if any this regard. The petitioner is at liberty to challenge any order passed by the respondents including an order, if any, regarding the loss on account of the circumstances mentioned above in the impugned order. The impugned order would be subject to orders, if any, of the Court or Tribunal before which it is challenged. 5. The petitioner therefore shall not be required to furnish an unconditional undertaking as demanded. The undertaking shall be subject to the orders, if any, that may be passed in proceedings that the petitioner may adopt to challenge the same. 6. Needless to clarify therefore that the show-cause notice dated 20th January, 2013 remains outstanding. 7. The respondents have acceded to the petitioners request of a personal hearing in respect of the show-cause notice. No coercive action shall be taken for a period of two weeks after the service of the order pursuant to the show-cause notice, if adverse to the petitioner. 2. Pursuant to the judgment of the High Court, the appellant passed a fresh order, after hearing the parties, on 14.07.2014. The relevant portions of the order read as follows:- Establishing end to end bandwidth is licensed through UASL, IP-II, NLD & ILD licenses. Therefore, the company is liable to pay the loss incurred to Government of India due to unauthorized establishment and operation of end to end bandwidth, by the company. Therefore, M/s. Tech Mahindra Business Services Ltd (erstwhile Hutchison Global Services Pvt. Ltd.) is directed to pay a sum of Rs. 6,11,73,460/- (Rupees Six Crore Eleven Lakh Seventy Three Thousand Four Hundred and Sixty only) towards loss incurred to Government of India. This includes license fee, penalty and interest charges as prescribed in UASL license for the period April 2007 to June 2014. Ready reckoner ceiling tariff for STMs notified by TRAI vide notification no.312-7/2004-Eco. Dated 25th April, 2005 has been considered to calculate the license fee payable. Interest (compounded monthly) has been charged @ SBI PLR as on 1st April of the financial year concerned + 2%. Calculation sheet is annexured. The amount shall be paid to CAO, CCA Maharashtra, BSNL Administrative Complex, Juhu Road, Santacruz (West), Mumbai, within 21 days from the date of issue of this demand note and details of payment shall be intimated to this office. 3. This order was challenged before the Telecom Disputes Settlement and Appellate Tribunal (for short, TDSAT), leading to the order dated 01.07.2015, which is under challenge in this appeal. It has been categorically held in the order that ..the respondent has erred in calculating the loss using the ceiling rate provided in an order issued in 2005 in a regime where the rates have been continuously falling. Further, it is not fair to use the highest percentage prescribed under the UASL License to calculate the licensee fee as well as the interest and penalty provided in a UASL license to calculate the total loss. We may note here that if an ordinary subscriber had made a similar mistake, the respondent-DoT could only have imposed fine as provided in the Telegraph Rules. Just because the petitioner happens to have an OSP registration, we do not see how interest and penalties as provided in a UASL license can be imposed on it. 4. Though such a finding was rendered, in order to put a quietus, the Tribunal took the view that interest of justice will be subserved if the respondent was to calculate the loss assuming the same payments as made by the petitioner to M/s. Tata Communications Ltd., for the same bandwidth. For the period prior to the year 2010, the highest payment made for any year (Rs. 12,96,056/- for the year 2012) may be used for all the years. The license fee that M/s. Tata Communications Ltd., would have paid on this amount may be taken as the loss of licensee fee. The respondent may charge an interest of 10% from the date such license fee would have become due. 5. We have heard Ms. V. Mohana, learned senior counsel appearing for the appellant and Mr. Meet Malhotra, learned senior counsel appearing for the respondent(s) extensively. 6. Ultimately, the whole issue revolves round the authority of the appellant to levy penalty and interest. According to the learned senior counsel for the appellant, there are valid notifications in that regard having force of law and also on the quantum. However, we do not find that any such material was available before the Tribunal. Bereft of such information only, the Tribunal ultimately passed the impugned order in the interest of justice. ### Response: 1

Union Of India And Anr Vs. B. N. Prasad

passing an order in terms of Section 138 of the Railways Act. The magistrate accepted the application and directed the eviction of the respondent.2. The respondent thereupon filed a writ petition in the High Court, mainly on the ground that Section 138 could not be invoked as the complaint was not made by an authorized person. It was alleged in the petition before the High Court that the complaint made by the Deputy Chief Commercial Superintendent, was not maintainable, as it should have been filed by the Chief Commercial Superintendent, according to the provisions of the Railways Act. This plea appears to have found favour with the High Court which allowed the writ petition and quashed the order of eviction.3. Appearing in support of the appeal, Mr. U. R. Lalit submitted a short point before us. He argued that Section 138 does not require that the complainant should be specifically authorized by the Railways in order to make a complaint maintainable. All that Section 138 requires is that the application should be filed on behalf of the railway administration. There can be no doubt that the appellant was a high officer of the railway administration and, therefore, in a position to file an application for eviction on behalf of the railway administration. Section 138 runs thus :-"If a railway servant is discharged or suspended from his office or dies, absconds absents himself, and he or his wife or widow, or any of his family representatives, refuses or neglects, after notice in writing for that purpose to deliver up to the railway administration, or to a person appointed by the railway administration in this behalf, any station, dwelling-house, office or other building with its appurtenances, or any books, papers or other matters, belonging to the railway administration and in the possession or custody of such railway servant at the occurrence of any such event as aforesaid, any Presidency Magistrate or Magistrate of the first class may, on application made by or on behalf of the railway administration, order any police officer, with proper assistance, to enter upon the building and remove any person found therein and take possession thereof, or to take possession of the books, papers, or other matters, and to deliver the same to the railway administration or a person appointed by the railway administration in that behalf."4. In our opinion, a close perusal of this section clearly reveals that the provision has widest amplitude and takes within its fold not only a railway servant but even a contractor who is engaged for performing services to the railway, and the termination of his contract by the Railway amounts to his discharge, as mentioned in Section 138. As the provision is in public interest meant to avoid inconvenience and expense for the travelling public and gear up the efficiency of the railway administration, it must be construed liberally, broadly and meaningfully, so as to advance the object sought to be achieved by the Railway Act. Furthermore, the section only requires that an application should made by or on behalf of the railway administration. The section does not require that any particular person holding a particular post, should be authorized to file a complaint. The matter was considered by this Court in Nanik Awatrai Chainani v. Union of India ((1971) 1 SCR 650 : (1970) 2 SCC 321 : 1970 SCC (Cri) 447), where this Court pointed out, while relying on decisions of the Lahore and Calcutta High Courts that the appellant in the case was a railway servant, and an order of eviction would be passed against him. This Court relied on the definition of the railway servant as contained in Section 3(7) read with Section 148(2) of the Act. The Court approved of the decision in S. L. Kapoor v. Emperor (AIR 1937 Lah 547 : 38 Cr LJ 793) and R. L. Mazumdar v. Alfred Ernest (AIR 1959 Cal 64 : 1959 Cri LJ 37), which had taken the view that even a contractor is a railway servant within the meaning of Section 138. In this connection, this Court observed : (SCC p. 324 para 8)"The terms which govern the parties expressly reserve to the railway administration extensive power of directing and regulating the appellants work and also to an extent, of controlling the manner of doing the work. Keeping in view the purpose and object of these agreements, namely, that of affording necessary amenities to the travelling public, retention of this over-all power by the railway administration is not only appropriate but necessary. The retention of this power by the railway administration, in our view, constitutes relevant materials for sustaining the conclusion of the courts below that the appellant is a railway servant, as defined in Section 3(7) read with Section 148(2), Indian Railways Act, against whom action can be taken under Section 138 of the said Act."This Court went to the extent of holding that such a servant in view of the precarious contract under which he had entered in the Railway service was not governed by Article 311. In the case of S. L. Kapoor v. Emperor (supra), the following observations were made :-"The termination of his service by the railway under Clause 21 of the agreement amounts to his discharge within the meaning of Section 138 of the Act and he is therefore liable to dispossession of the premises which he was occupying as a servant of the railway."5. As already indicated, this case was approved by this Court in the decision mentioned above. In this view of the matter, it is manifest that the High Court has taken an erroneous view of law in throwing out the complaint filed by the Deputy Chief Commercial Superintendent on the ground that he was not authorized to file the complaint. Even on the other question whether or not the respondent was a railway servant, as pointed out, the matter is no longer res integra and is concluded by the decision of this Court referred to above.6.

1[ds]All that Section 138 requires is that the application should be filed on behalf of the railway administration. There can be no doubt that the appellant was a high officer of the railway administration and, therefore, in a position to file an application for eviction on behalf of the railway administration. Section 138 runs thusa railway servant is discharged or suspended from his office or dies, absconds absents himself, and he or his wife or widow, or any of his family representatives, refuses or neglects, after notice in writing for that purpose to deliver up to the railway administration, or to a person appointed by the railway administration in this behalf, any station, dwelling-house, office or other building with its appurtenances, or any books, papers or other matters, belonging to the railway administration and in the possession or custody of such railway servant at the occurrence of any such event as aforesaid, any Presidency Magistrate or Magistrate of the first class may, on application made by or on behalf of the railway administration, order any police officer, with proper assistance, to enter upon the building and remove any person found therein and take possession thereof, or to take possession of the books, papers, or other matters, and to deliver the same to the railway administration or a person appointed by the railway administration in that behalf.In our opinion, a close perusal of this section clearly reveals that the provision has widest amplitude and takes within its fold not only a railway servant but even a contractor who is engaged for performing services to the railway, and the termination of his contract by the Railway amounts to his discharge, as mentioned in Section 138. As the provision is in public interest meant to avoid inconvenience and expense for the travelling public and gear up the efficiency of the railway administration, it must be construed liberally, broadly and meaningfully, so as to advance the object sought to be achieved by the Railway Act. Furthermore, the section only requires that an application should made by or on behalf of the railway administration. The section does not require that any particular person holding a particular post, should be authorized to file ain view the purpose and object of these agreements, namely, that of affording necessary amenities to the travelling public, retention of this over-all power by the railway administration is not only appropriate but necessary. The retention of this power by the railway administration, in our view, constitutes relevant materials for sustaining the conclusion of the courts below that the appellant is a railway servant, as defined in Section 3(7) read with Section 148(2), Indian Railways Act, against whom action can be taken under Section 138 of the saidCourt went to the extent of holding that such a servant in view of the precarious contract under which he had entered in the Railway service was not governed by Articletermination of his service by the railway under Clause 21 of the agreement amounts to his discharge within the meaning of Section 138 of the Act and he is therefore liable to dispossession of the premises which he was occupying as a servant of the railway.As already indicated, this case was approved by this Court in the decision mentioned above. In this view of the matter, it is manifest that the High Court has taken an erroneous view of law in throwing out the complaint filed by the Deputy Chief Commercial Superintendent on the ground that he was not authorized to file the complaint. Even on the other question whether or not the respondent was a railway servant, as pointed out, the matter is no longer res integra and is concluded by the decision of this Court referred to above.

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: passing an order in terms of Section 138 of the Railways Act. The magistrate accepted the application and directed the eviction of the respondent.2. The respondent thereupon filed a writ petition in the High Court, mainly on the ground that Section 138 could not be invoked as the complaint was not made by an authorized person. It was alleged in the petition before the High Court that the complaint made by the Deputy Chief Commercial Superintendent, was not maintainable, as it should have been filed by the Chief Commercial Superintendent, according to the provisions of the Railways Act. This plea appears to have found favour with the High Court which allowed the writ petition and quashed the order of eviction.3. Appearing in support of the appeal, Mr. U. R. Lalit submitted a short point before us. He argued that Section 138 does not require that the complainant should be specifically authorized by the Railways in order to make a complaint maintainable. All that Section 138 requires is that the application should be filed on behalf of the railway administration. There can be no doubt that the appellant was a high officer of the railway administration and, therefore, in a position to file an application for eviction on behalf of the railway administration. Section 138 runs thus :-"If a railway servant is discharged or suspended from his office or dies, absconds absents himself, and he or his wife or widow, or any of his family representatives, refuses or neglects, after notice in writing for that purpose to deliver up to the railway administration, or to a person appointed by the railway administration in this behalf, any station, dwelling-house, office or other building with its appurtenances, or any books, papers or other matters, belonging to the railway administration and in the possession or custody of such railway servant at the occurrence of any such event as aforesaid, any Presidency Magistrate or Magistrate of the first class may, on application made by or on behalf of the railway administration, order any police officer, with proper assistance, to enter upon the building and remove any person found therein and take possession thereof, or to take possession of the books, papers, or other matters, and to deliver the same to the railway administration or a person appointed by the railway administration in that behalf."4. In our opinion, a close perusal of this section clearly reveals that the provision has widest amplitude and takes within its fold not only a railway servant but even a contractor who is engaged for performing services to the railway, and the termination of his contract by the Railway amounts to his discharge, as mentioned in Section 138. As the provision is in public interest meant to avoid inconvenience and expense for the travelling public and gear up the efficiency of the railway administration, it must be construed liberally, broadly and meaningfully, so as to advance the object sought to be achieved by the Railway Act. Furthermore, the section only requires that an application should made by or on behalf of the railway administration. The section does not require that any particular person holding a particular post, should be authorized to file a complaint. The matter was considered by this Court in Nanik Awatrai Chainani v. Union of India ((1971) 1 SCR 650 : (1970) 2 SCC 321 : 1970 SCC (Cri) 447), where this Court pointed out, while relying on decisions of the Lahore and Calcutta High Courts that the appellant in the case was a railway servant, and an order of eviction would be passed against him. This Court relied on the definition of the railway servant as contained in Section 3(7) read with Section 148(2) of the Act. The Court approved of the decision in S. L. Kapoor v. Emperor (AIR 1937 Lah 547 : 38 Cr LJ 793) and R. L. Mazumdar v. Alfred Ernest (AIR 1959 Cal 64 : 1959 Cri LJ 37), which had taken the view that even a contractor is a railway servant within the meaning of Section 138. In this connection, this Court observed : (SCC p. 324 para 8)"The terms which govern the parties expressly reserve to the railway administration extensive power of directing and regulating the appellants work and also to an extent, of controlling the manner of doing the work. Keeping in view the purpose and object of these agreements, namely, that of affording necessary amenities to the travelling public, retention of this over-all power by the railway administration is not only appropriate but necessary. The retention of this power by the railway administration, in our view, constitutes relevant materials for sustaining the conclusion of the courts below that the appellant is a railway servant, as defined in Section 3(7) read with Section 148(2), Indian Railways Act, against whom action can be taken under Section 138 of the said Act."This Court went to the extent of holding that such a servant in view of the precarious contract under which he had entered in the Railway service was not governed by Article 311. In the case of S. L. Kapoor v. Emperor (supra), the following observations were made :-"The termination of his service by the railway under Clause 21 of the agreement amounts to his discharge within the meaning of Section 138 of the Act and he is therefore liable to dispossession of the premises which he was occupying as a servant of the railway."5. As already indicated, this case was approved by this Court in the decision mentioned above. In this view of the matter, it is manifest that the High Court has taken an erroneous view of law in throwing out the complaint filed by the Deputy Chief Commercial Superintendent on the ground that he was not authorized to file the complaint. Even on the other question whether or not the respondent was a railway servant, as pointed out, the matter is no longer res integra and is concluded by the decision of this Court referred to above.6. ### Response: 1

V.M. Shah Vs. State Of Maharashtra And Anr

The Company failed to prove that the appellant is a licensee of the suit premises. It also failed to prove that the premises were given to the appellant in lieu of his services. On the other hand, the appellant proved that he is a monthly tenant of the premises with the landlords Badami etc. Accordingly, the suit was dismissed. We are informed that an appeal has been filed before the bench of Small Causes Court and it is pending. 6. Sri Santosh Hegde, learned Senior counsel for the appellant, contended that whatever may be the findings recorded by the criminal court and affirmed by the High Court on the liability of the appellant to deliver possession to the Company by operation of Section 630(1) of the Companies Act, they are no longer tenable in view of the findings recorded by the Civil Court. Therefore, the orders passed under Section 630(1) of the Companies Act is illegal and unsustainable. Sir Maisty, learned counsel for the Company, contended that the findings of the Small Causes Court are contrary to the evidence and clearly unsustainable. In view of the concurrent findings recorded by the criminal courts for offence under Section 630(1) of the Companies Act, the order passed thereunder does not become illegal. Therefore, the appellant is liable to be ejected and needs no interference under Article 136 of the Constitution.7. In Baldev Krishna v. Shipping Corpn. of India Ltd. 1987(2) RCR 424(SC) : AIR 1987 SC 2245 , this Court considered the scope of sub-section (1) of Section 630 of Companies Act and held that an officer or an employee of a Company who obtains possession of any property of the Company during the course of his employment, to which he is not entitled but for employment, if he does not deliver possession of such property to the Company, after termination of his property to the company, he would be in wrongful possession of such property. Therefore, the existence of the relationship of employer and employee is a condition precedent of an employee. If the Company, having any property of the Company in his possession wrongfully withholds it or knowingly applies it to purposes other than those expressed or directed in the articles of Company and authorised by the Companies Act, he will be liable for the punishment under Section 630. 8. In Atul Mathur v. Atul Kalra & Anr, (1989) 4 SCC 514 , another bench of this Court, held that because of mere pendency of a suit in a civil court it cannot be said that the civil court is in seize of a bona fide dispute between the parties, and as such the criminal court should have stayed its hands when the Company filed a complaint under Section 630 of the Act. Such a view would lead to miscarriage of justice and render Section 630 ineffective. Dispute regarding claim of property between Company and its employee depends upon facts in each case. Merely because Companys claims to possession was refuted by the employee, it would not amount to bona fide dispute. The criminal court, therefore, would be entitled and competent to proceed with the enquiry on the complaint filed on behalf of the company and decide the matter according to law. 9. Gokak Patel Volkari Ltd. v. D.G. Hiremath & Ors, JT 1991(1) SC 376 is also relied on Sri Maisty. Therein, the question was whether the failure to deliver possession and the wrongful withholding of the property would be a continuing offence ? This Court held that failure to deliver possession or wrongful withholding the property would be a continuing offence and period of limitation must be counted accordingly. 10. M.S. Shariff v. State of Madras, AIR 1954 SC 397 is also pressed into service. Therein, this Court held that as between the civil Court and the criminal proceedings, the criminal matters should be given precedence. No hard and fast rule can be laid down but the possibility of conflicting decisions in the civil and criminal Courts is not a relevant consideration. Law envisages such an eventuality when it expressly refrains from making the decision of one Court binding on the other or even relevant except for certain limited purposes, such as sentence or damages. The only relevant consideration is the likelihood of embarrassment. Another relevant factor to be noted is that a civil suit often drags on for years and it is undesirable that a criminal prosecution should await till everybody concerned has forgotten all about the crime. Public interest demands that criminal justice should be swift and it should ensure that the guilty is punished while the events are still fresh in public mind and that the innocent should be absolved as early as is consistent with a fair and impartial trial. Another reason is that it is undesirable to let things slide till memories have grown too dim to trust. This, however, is not a hard and fast rule. Special considerations obtaining in any particular case may make some other course more expedient and just. Therefore, each case has to be considered on its own facts. 11. As seen that the civil court after full dressed trial recorded the finding that the appellant had not come into possession through the Company but had independent tenancy rights from the principal landlord and, therefore, the decree for eviction was negatived. Until that finding is duly considered by the appellate Court after weighing the evidence afresh and if it so warranted reversed, the findings bind the parties. The findings, recorded by the criminal court, stand superseded by the findings recorded by the civil court. Thereby, the findings of the civil court get precedence over the findings recorded by the trial court, in particular, in summary trial for offences like Section 630. The mere pendency of the appeal does not have the effect of suspending the operation of the decree of the trial court and neither the finding of the civil court gets nor the decree becomes in- operative.

1[ds]11. As seen that the civil court after full dressed trial recorded the finding that the appellant had not come into possession through the Company but had independent tenancy rights from the principal landlord and, therefore, the decree for eviction was negatived. Until that finding is duly considered by the appellate Court after weighing the evidence afresh and if it so warranted reversed, the findings bind the parties. The findings, recorded by the criminal court, stand superseded by the findings recorded by the civil court. Thereby, the findings of the civil court get precedence over the findings recorded by the trial court, in particular, in summary trial for offences like Section 630. The mere pendency of the appeal does not have the effect of suspending the operation of the decree of the trial court and neither the finding of the civil court gets nor the decree becomes in- operative.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: The Company failed to prove that the appellant is a licensee of the suit premises. It also failed to prove that the premises were given to the appellant in lieu of his services. On the other hand, the appellant proved that he is a monthly tenant of the premises with the landlords Badami etc. Accordingly, the suit was dismissed. We are informed that an appeal has been filed before the bench of Small Causes Court and it is pending. 6. Sri Santosh Hegde, learned Senior counsel for the appellant, contended that whatever may be the findings recorded by the criminal court and affirmed by the High Court on the liability of the appellant to deliver possession to the Company by operation of Section 630(1) of the Companies Act, they are no longer tenable in view of the findings recorded by the Civil Court. Therefore, the orders passed under Section 630(1) of the Companies Act is illegal and unsustainable. Sir Maisty, learned counsel for the Company, contended that the findings of the Small Causes Court are contrary to the evidence and clearly unsustainable. In view of the concurrent findings recorded by the criminal courts for offence under Section 630(1) of the Companies Act, the order passed thereunder does not become illegal. Therefore, the appellant is liable to be ejected and needs no interference under Article 136 of the Constitution.7. In Baldev Krishna v. Shipping Corpn. of India Ltd. 1987(2) RCR 424(SC) : AIR 1987 SC 2245 , this Court considered the scope of sub-section (1) of Section 630 of Companies Act and held that an officer or an employee of a Company who obtains possession of any property of the Company during the course of his employment, to which he is not entitled but for employment, if he does not deliver possession of such property to the Company, after termination of his property to the company, he would be in wrongful possession of such property. Therefore, the existence of the relationship of employer and employee is a condition precedent of an employee. If the Company, having any property of the Company in his possession wrongfully withholds it or knowingly applies it to purposes other than those expressed or directed in the articles of Company and authorised by the Companies Act, he will be liable for the punishment under Section 630. 8. In Atul Mathur v. Atul Kalra & Anr, (1989) 4 SCC 514 , another bench of this Court, held that because of mere pendency of a suit in a civil court it cannot be said that the civil court is in seize of a bona fide dispute between the parties, and as such the criminal court should have stayed its hands when the Company filed a complaint under Section 630 of the Act. Such a view would lead to miscarriage of justice and render Section 630 ineffective. Dispute regarding claim of property between Company and its employee depends upon facts in each case. Merely because Companys claims to possession was refuted by the employee, it would not amount to bona fide dispute. The criminal court, therefore, would be entitled and competent to proceed with the enquiry on the complaint filed on behalf of the company and decide the matter according to law. 9. Gokak Patel Volkari Ltd. v. D.G. Hiremath & Ors, JT 1991(1) SC 376 is also relied on Sri Maisty. Therein, the question was whether the failure to deliver possession and the wrongful withholding of the property would be a continuing offence ? This Court held that failure to deliver possession or wrongful withholding the property would be a continuing offence and period of limitation must be counted accordingly. 10. M.S. Shariff v. State of Madras, AIR 1954 SC 397 is also pressed into service. Therein, this Court held that as between the civil Court and the criminal proceedings, the criminal matters should be given precedence. No hard and fast rule can be laid down but the possibility of conflicting decisions in the civil and criminal Courts is not a relevant consideration. Law envisages such an eventuality when it expressly refrains from making the decision of one Court binding on the other or even relevant except for certain limited purposes, such as sentence or damages. The only relevant consideration is the likelihood of embarrassment. Another relevant factor to be noted is that a civil suit often drags on for years and it is undesirable that a criminal prosecution should await till everybody concerned has forgotten all about the crime. Public interest demands that criminal justice should be swift and it should ensure that the guilty is punished while the events are still fresh in public mind and that the innocent should be absolved as early as is consistent with a fair and impartial trial. Another reason is that it is undesirable to let things slide till memories have grown too dim to trust. This, however, is not a hard and fast rule. Special considerations obtaining in any particular case may make some other course more expedient and just. Therefore, each case has to be considered on its own facts. 11. As seen that the civil court after full dressed trial recorded the finding that the appellant had not come into possession through the Company but had independent tenancy rights from the principal landlord and, therefore, the decree for eviction was negatived. Until that finding is duly considered by the appellate Court after weighing the evidence afresh and if it so warranted reversed, the findings bind the parties. The findings, recorded by the criminal court, stand superseded by the findings recorded by the civil court. Thereby, the findings of the civil court get precedence over the findings recorded by the trial court, in particular, in summary trial for offences like Section 630. The mere pendency of the appeal does not have the effect of suspending the operation of the decree of the trial court and neither the finding of the civil court gets nor the decree becomes in- operative. ### Response: 1

Mukti Lal Agarwala Vs. Trustees Of The Provident Fund Ofthe Tin Plate Co. Of Ind

forfeiture and to the satisfaction of the liens, the deposit with interest was repayable to the member on his ceasing from any cause to be a member. The facts were, therefore, very different. Anandrao v. Vishwanath Watuji, 1944 Nag 144 (AIR V. 31) (I) is again a case where the money ceased to belong to the employee and the title was in the trustees. Reffering to a Karachi case reported in - Ismail Jakaria and Co. v. Burmah-Shell Provident Trust Ltd., 1942 Sind 47 (AIR V. 29) (J), Bose J. distinguished it one the ground that there the money was not vested in the trustees but was only handed over to them for the purposes of management, which was not the case before him.19. The learned counsel for the respondents strongly relied on - Biswa Nath Sao v. The Official Receiver, 1937 Pat 185 (AIR V. 14) (FB) (K) and argued that there can be no property within the meaning of the Insolvency Act unless the insolvent had a present absolute power of disposal over the same but the decision which is that of a Full Bench and which interpreted the decision of the Privy Council in - Sat Narain v. behari Lal, 1925 PC 18 (AIR V. 12) (L) does not support any such position; all that was held was that on the insolvency of a father, his power to sell the shares of his sons in the joint family property to discharge the pious obligation vests in the Official Receiver, though the shares themselves do not so vest.20. Sufficient has been stated above to show that not withstanding the rules of the Fund in the present case, the subscribers have an interest in the moneys which can vest in the Official Receiver on their adjudication. Even if we regard the deed creating the fund as a trust deed, notwithstanding that, no ownership has been transferred to the trustees and all that they have got is the right of the management and control, the subscribers, who joined the fund have undoubtedly got a beneficial interest which will vest in the Official Receiver as property liable to attachment and sale under section 60 which uses the language "whether the same be held in the name of the judgement-debtor or by another person in interest for him or in his behalf.21.The learned Judges of the High Court held that the property mentioned in the Insolvency Act must be such that the insolvent has an absolute and unconditional present disposing power over the same. With great respect, this, however, does not seem to be a correct interpretation. The word property is used in the widest possible sense which includes even property which may belong to or is vested in another but over which the insolvent has a disposing power which he may exercise for his own benefit; and as pointed out already this part of the definition has reference obviously to powers of appointment and the power of a Hindu father who is the managing member of a joint family. The fact that on the date of the adjudication the insolvent could not transfer the property does not militate against the view that he has a vested interest in the same. Reference was made to S. 56 (3) of the Provincial Insolvency Act which provides that "Where the Court appoints a receiver, it may remove the person in whose possession or custody any such property as aforesaid is from the possession or custody thereof: Provided that nothing in this section shall be deemed to authorise the court to remove from the possession or custody of property any person whom the insolvent has not a present right so to remove". This has no relevancy to the point at issue. Whenever possession and custody could be taken by the Receiver, the person in whose possession and custody the property is can be evicted. If possession or custody could not be taken, still the right of the insolvent will vest in the Official Receiver.22. Mention has been made of three accounts in the Fund called A, B and C; the first represents monies contributed by the subscriber, the second consists of monies paid by the Company and the third represents what may be roughly described as bonus which represents deferred wages. The learned counsel for the appellant confined the relief he wanted to the amounts standing to the credit of each subscriber in his A and C Accounts and conceded that the B Account monies would stand on a different footing. In fact, even in the Insolvency Court the creditor concerned himself only with the A and C Accounts.23. Mr. Isaacs contended at first that he was entitled to an order that the monies in the A and C Accounts should be brought to the Insolvency Court but later he abandoned this contention. For the respondents, it was urged that under S. 10 of the Employees Provident Funds Act, 1952, which came into force after these proceedings were instituted, there could be no attachment. This again is a question which is outside the scope of the present proceedings. Once it is held that the right, title and interest of the insolvents in the A and C Accounts with the Fund vest in the Official Receiver, it is for him under the directions of the Insolvency Court to take steps to realize the same, in whatever manner the law allow him to do.24. The learned counsel for respondents handed to us a paper showing which of the respondents was still in service and which have been discharged, their dates of appointments and of joining the posts. Mohibulla, Anjab Alli and Hasimulla, respondents insolvents in Civil Appeal No. 124, Civil Appeal No. 127 and Civil Appeal No. 126, have been shown as discharged from service. A.M. Joseph, Rasid Alli alias Tasim Alli, and Baldey Singh, respondents in Civil Appeals 135, 125 and 124, joined the Fund in 1933, 1932 and 1936 respectively and are still in service.

1[ds]14.It is reasonably clear from these rules that a subscriber has a present interest in the Fund though the moneys may become payable to him, or his nominee or heirs only in the future. Even where there is a declaration about the nominee who is to receive payment after the subscribers death, the fund would still be the property of the subscriber in the hands of the nominee for the satisfaction of his debts, as there is no present gift to take effect immediately.15.It is not easy to see how it could be maintained that the subscribers have no right, title or interest in the fund, or that such interest as they may possess is dependent upon a possible contingency which may or may not occur. The amount standing to the credit of a subscriber even if payable in future would be a debt due by the Company to him within the meaning of S. 60 of the Code and hence liable to attachment andthere is no gift over on the cesser of the donees interest, the property will revert to the donee and will vest in the Official Receiver on the donees insolvency. But a person cannot enter into any arrangement or agreement by which his own title will cease in the event of bankruptcy, for it would then be a fraud perpetrated on the Insolvencythe decision which is that of a Full Bench and which interpreted the decision of the Privy Council in - Sat Narain v. behari Lal, 1925 PC 18 (AIR V. 12) (L) does not support any such position; all that was held was that on the insolvency of a father, his power to sell the shares of his sons in the joint family property to discharge the pious obligation vests in the Official Receiver, though the shares themselves do not sohas been stated above to show that not withstanding the rules of the Fund in the present case, the subscribers have an interest in the moneys which can vest in the Official Receiver on their adjudication. Even if we regard the deed creating the fund as a trust deed, notwithstanding that, no ownership has been transferred to the trustees and all that they have got is the right of the management and control, the subscribers, who joined the fund have undoubtedly got a beneficial interest which will vest in the Official Receiver as property liable to attachment and sale under section 60 which uses the language "whether the same be held in the name of the judgement-debtor or by another person in interest for him or in his behalf.21.The learned Judges of the High Court held that the property mentioned in the Insolvency Act must be such that the insolvent has an absolute and unconditional present disposing power over the same. With great respect, this, however, does not seem to be a correct interpretation. The word property is used in the widest possible sense which includes even property which may belong to or is vested in another but over which the insolvent has a disposing power which he may exercise for his own benefit; and as pointed out already this part of the definition has reference obviously to powers of appointment and the power of a Hindu father who is the managing member of a jointhas no relevancy to the point at issue. Whenever possession and custody could be taken by the Receiver, the person in whose possession and custody the property is can be evicted. If possession or custody could not be taken, still the right of the insolvent will vest in the Officialfact, even in the Insolvency Court the creditor concerned himself only with the A and Cagain is a question which is outside the scope of the present proceedings. Once it is held that the right, title and interest of the insolvents in the A and C Accounts with the Fund vest in the Official Receiver, it is for him under the directions of the Insolvency Court to take steps to realize the same, in whatever manner the law allow him toAnjab Alli and Hasimulla, respondents insolvents in Civil Appeal No. 124, Civil Appeal No. 127 and Civil Appeal No. 126, have been shown as discharged from service. A.M. Joseph, Rasid Alli alias Tasim Alli, and Baldey Singh, respondents in Civil Appeals 135, 125 and 124, joined the Fund in 1933, 1932 and 1936 respectively and are still in service.

### Instruction: Analyze the legal arguments presented and estimate the likelihood of the court accepting (1) or rejecting (0) the petition. ### Input: forfeiture and to the satisfaction of the liens, the deposit with interest was repayable to the member on his ceasing from any cause to be a member. The facts were, therefore, very different. Anandrao v. Vishwanath Watuji, 1944 Nag 144 (AIR V. 31) (I) is again a case where the money ceased to belong to the employee and the title was in the trustees. Reffering to a Karachi case reported in - Ismail Jakaria and Co. v. Burmah-Shell Provident Trust Ltd., 1942 Sind 47 (AIR V. 29) (J), Bose J. distinguished it one the ground that there the money was not vested in the trustees but was only handed over to them for the purposes of management, which was not the case before him.19. The learned counsel for the respondents strongly relied on - Biswa Nath Sao v. The Official Receiver, 1937 Pat 185 (AIR V. 14) (FB) (K) and argued that there can be no property within the meaning of the Insolvency Act unless the insolvent had a present absolute power of disposal over the same but the decision which is that of a Full Bench and which interpreted the decision of the Privy Council in - Sat Narain v. behari Lal, 1925 PC 18 (AIR V. 12) (L) does not support any such position; all that was held was that on the insolvency of a father, his power to sell the shares of his sons in the joint family property to discharge the pious obligation vests in the Official Receiver, though the shares themselves do not so vest.20. Sufficient has been stated above to show that not withstanding the rules of the Fund in the present case, the subscribers have an interest in the moneys which can vest in the Official Receiver on their adjudication. Even if we regard the deed creating the fund as a trust deed, notwithstanding that, no ownership has been transferred to the trustees and all that they have got is the right of the management and control, the subscribers, who joined the fund have undoubtedly got a beneficial interest which will vest in the Official Receiver as property liable to attachment and sale under section 60 which uses the language "whether the same be held in the name of the judgement-debtor or by another person in interest for him or in his behalf.21.The learned Judges of the High Court held that the property mentioned in the Insolvency Act must be such that the insolvent has an absolute and unconditional present disposing power over the same. With great respect, this, however, does not seem to be a correct interpretation. The word property is used in the widest possible sense which includes even property which may belong to or is vested in another but over which the insolvent has a disposing power which he may exercise for his own benefit; and as pointed out already this part of the definition has reference obviously to powers of appointment and the power of a Hindu father who is the managing member of a joint family. The fact that on the date of the adjudication the insolvent could not transfer the property does not militate against the view that he has a vested interest in the same. Reference was made to S. 56 (3) of the Provincial Insolvency Act which provides that "Where the Court appoints a receiver, it may remove the person in whose possession or custody any such property as aforesaid is from the possession or custody thereof: Provided that nothing in this section shall be deemed to authorise the court to remove from the possession or custody of property any person whom the insolvent has not a present right so to remove". This has no relevancy to the point at issue. Whenever possession and custody could be taken by the Receiver, the person in whose possession and custody the property is can be evicted. If possession or custody could not be taken, still the right of the insolvent will vest in the Official Receiver.22. Mention has been made of three accounts in the Fund called A, B and C; the first represents monies contributed by the subscriber, the second consists of monies paid by the Company and the third represents what may be roughly described as bonus which represents deferred wages. The learned counsel for the appellant confined the relief he wanted to the amounts standing to the credit of each subscriber in his A and C Accounts and conceded that the B Account monies would stand on a different footing. In fact, even in the Insolvency Court the creditor concerned himself only with the A and C Accounts.23. Mr. Isaacs contended at first that he was entitled to an order that the monies in the A and C Accounts should be brought to the Insolvency Court but later he abandoned this contention. For the respondents, it was urged that under S. 10 of the Employees Provident Funds Act, 1952, which came into force after these proceedings were instituted, there could be no attachment. This again is a question which is outside the scope of the present proceedings. Once it is held that the right, title and interest of the insolvents in the A and C Accounts with the Fund vest in the Official Receiver, it is for him under the directions of the Insolvency Court to take steps to realize the same, in whatever manner the law allow him to do.24. The learned counsel for respondents handed to us a paper showing which of the respondents was still in service and which have been discharged, their dates of appointments and of joining the posts. Mohibulla, Anjab Alli and Hasimulla, respondents insolvents in Civil Appeal No. 124, Civil Appeal No. 127 and Civil Appeal No. 126, have been shown as discharged from service. A.M. Joseph, Rasid Alli alias Tasim Alli, and Baldey Singh, respondents in Civil Appeals 135, 125 and 124, joined the Fund in 1933, 1932 and 1936 respectively and are still in service. ### Response: 1

Municipal Corpn. of Gr. Bombay Vs. Devidayal Electronics and Wires Limited

except for a fractional loss of 1%. It is also not in dispute that there is no change in the chemical composition of the product by the process undertaken. The trial Judge, therefore, held and, in our judgment, very rightly that the process can by no stretch of imagination be treated as manufacturing activity. Shri Dalal submitted that wire bards imported by the Company admeasure 16 sq. inch rectangular pieces, each weighing about 100 Kgs. and wire rods are received in the sizes of 6 mm to 10 mm. The learned counsel urged that the process undertaken is of rolling them to smaller sizes or flattening to rectangular shapes and the process of rolling comprises of heating the wire bars in furnace and passing the same between two rolls repeatedly reducing the size at every pass till the desired size is obtained. Shri Dalal submits that this process of heating the bards in furnace must be treated as a manufacturing activity. It is impossible to accede to the submission. Every activity which demands heating of the object cannot be treated as a manufacturing activity. Take for instance, gold or silver bars which undergo heating process at hands of goldsmith for reducing the size of the bars. Can it by any stretch of imagination be suggested that a different article with distinct character and identity as known in the market has come into existence The process is only for the purpose of reducing the size of the bars into smaller bars and, in our judgment, such process cannot be treated as manufacturing activity and squarely falls within the processing activity. Shri Dalal referred to the decision of the Supreme Court reported in 1978 (2) Excise Law Times 389 (Union of India v. Hindu Undivided Family Business known as Ramlal Mansukhrai, Rewari and Another) and A. I. R. 1977 Supreme Court 90 (The South Gujarat Roofing Tiles Manufacturers Association and another v. The State of Gujarat and Another) but the reliance on these authorities is not appropriate. The question which came up before the Supreme Court for consideration has no bearing to the question falling for determination in this appeal. The issue as to whether the particular activity amounts to processing or manufacturing has to be determined with reference to the facts of each case. In our judgment the trial Judge was perfectly right in concluding on the facts and circumstances of the case that the activities of reducing size of wire bars and wire rods amount to processing and not manufacturing. It is also required to be stated that as the Corporation had not cared to file affidavit before the learned Single Judge and while denying reliefs sought by the Company, the letters written by deputy Assessor and Collector (Octroi) assign no reasons, we called upon the counsel for the company to produce for our perusal the wire bars ad wire rods which are imported for the purpose of processing and which are subsequently transported to the factory after reducing the size. The learned counsel produced the wire bars and wire rods which were reduced in size and also the photographs of the original wire bars and wire rods. The original wires and bars could not be produced because of its huge size. Shri Dalal for the Corporation did not dispute that the articles produced by the respondents are those which were imported within the limits of the corporation and subsequently exported. On perusal of the articles, we have no hesitation in concluding that the activities undertaken within the limits of the Corporation are purely of processing and not manufacturing. It hardly requires to be stated that the right to recover octroi duty arises when the article is imported for the purposes of use, sale or consumption and processing activity cannot be considered as use of the article.( 7 ) SHRI Dalal then submitted that even assuming that the activities undertaken by the Company within the local limits of the Corporation are merely one of processing, still the advantage of rule 7 is not available. The learned counsel referred to sub-rule 6 (b) (1) and claimed that the activities set out under this sub-rule are the only activities which fall within expression "processing" while considering grant of exemption under Rule 7. The learned counsel while advancing this submission overlooks the provisions of sub-rule (4) of Rule 7 and sub-rule 6 (b) (2) which entitle the Commissioner to include any other process in the list of process set out under sub-rule (b) (1) of Rule 7. Shri Dalal submitted that as the Commissioner has rejected the claim of the Company, the decision is final in accordance with sub- rule (6) (b) (2 ). The submission overlooks that the decision is final as far as the Corporation is concerned and cannot bind the Court exercising powers under Article 226 of the Constitution of India. There is one more aspect of the matter which cannot be overlooked. The decision was communicated to the company by Deputy Assessor and Collector (Octroi) and who is not the Commissioner. Even assuming that the decision was communicated by Deputy Assessor and Collector in pursuance of the orders issued by the Commissioner, still two letters do not set out any reasons for denying the relief to the appellants. Shri Dalal also referred to the list of process which was approved by the commissioner for granting exemption and urged that the process undertaken by the Company does not fall within any of the 29 categories. The submission is not correct because Item 6 refers to heat treatment and even assuming that the list prepared by the Commissioner does not include the process referred to by the Company, still taking into consideration the provisions of sub-rule (4) of Rule 7, we are unable to appreciate why the advantage of Rule 7 should be denied to the company. In these circumstances we do not find any infirmity in the reasons and conclusions recorded by the trial Judge and the appeal must fail.

0[ds]( 6 ) THE first question which requires answer is whether the process employed in the case of bars and rods is a process which can be treated as a manufacturing activity as claimed by the corporation. It is nowby catena of decisions that the expression manufacture implies change, but every change is not manufacture. Before an activity can be considered as manufacture, what is necessary is not merely a change as a result of treatment, labour or manipulation but a transformation and a new and different article must emerge having a distinct name, character, or use. The trail Judge found that wire bars and wire rods are sent by the company to processing units located in Greater Bombay with the object to reduce the thickness of wire bars. The wire bars of which thickness is reduced are ultimately used by the Company in the factory for manufacture of various articles. The process undertaken within the limits of municipal Corporation of Greater Bombay is only to reduce the thickness of the wire bards or wire rods. It is not in dispute that by reduction of thickness, wire bars and wire rods do not lose its weight except for a fractional loss of 1%. It is also not in dispute that there is no change in the chemical composition of the product by the process undertaken. The trial Judge, therefore, held and, in our judgment, very rightly that the process can by no stretch of imagination be treated as manufacturing activity. Shri Dalal submitted that wire bards imported by the Company admeasure 16 sq. inch rectangular pieces, each weighing about 100 Kgs. and wire rods are received in the sizes of 6 mm to 10 mm.The learned counsel urged that the process undertaken is of rolling them to smaller sizes or flattening to rectangular shapes and the process of rolling comprises of heating the wire bars in furnace and passing the same between two rolls repeatedly reducing the size at every pass till the desired size is obtained. Shri Dalal submits that this process of heating the bards in furnace must be treated as a manufacturingactivity. It is impossible to accede to the submission. Every activity which demands heating of the object cannot be treated as a manufacturing activity. Take for instance, gold or silver bars which undergo heating process at hands of goldsmith for reducing the size of the bars. Can it by any stretch of imagination be suggested that a different article with distinct character and identity as known in the market has come into existence The process is only for the purpose of reducing the size of the bars into smaller bars and, in our judgment, such process cannot be treated as manufacturing activity and squarely falls within the processing activity. Shri Dalal referred to the decision of the Supreme Court reported in 1978 (2) Excise Law Times 389 (Union of India v. Hindu Undivided Family Business known as Ramlal Mansukhrai, Rewari and Another) and A. I. R. 1977 Supreme Court 90 (The South Gujarat Roofing Tiles Manufacturers Association and another v. The State of Gujarat and Another) but the reliance on these authorities is not appropriate. The question which came up before the Supreme Court for consideration has no bearing to the question falling for determination in this appeal. The issue as to whether the particular activity amounts to processing or manufacturing has to be determined with reference to the facts of each case. In our judgment the trial Judge was perfectly right in concluding on the facts and circumstances of the case that the activities of reducing size of wire bars and wire rods amount to processing and not manufacturing. It is also required to be stated that as the Corporation had not cared to file affidavit before the learned Single Judge and while denying reliefs sought by the Company, the letters written by deputy Assessor and Collector (Octroi) assign no reasons, we called upon the counsel for the company to produce for our perusal the wire bars ad wire rods which are imported for the purpose of processing and which are subsequently transported to the factory after reducing the size. The learned counsel produced the wire bars and wire rods which were reduced in size and also the photographs of the original wire bars and wire rods. The original wires and bars could not be produced because of its huge size. Shri Dalal for the Corporation did not dispute that the articles produced by the respondents are those which were imported within the limits of the corporation and subsequently exported. On perusal of the articles, we have no hesitation in concluding that the activities undertaken within the limits of the Corporation are purely of processing and not manufacturing. It hardly requires to be stated that the right to recover octroi duty arises when the article is imported for the purposes of use, sale or consumption and processing activity cannot be considered as use of thelearned counsel while advancing this submission overlooks the provisions of(4) of Rule 7 and6 (b) (2) which entitle the Commissioner to include any other process in the list of process set out under(b) (1) of Rulesubmission overlooks that the decision is final as far as the Corporation is concerned and cannot bind the Court exercising powers under Article 226 of the Constitution of India. There is one more aspect of the matter which cannot be overlooked. The decision was communicated to the company by Deputy Assessor and Collector (Octroi) and who is not the Commissioner. Even assuming that the decision was communicated by Deputy Assessor and Collector in pursuance of the orders issued by the Commissioner, still two letters do not set out any reasons for denying the relief to the appellants. Shri Dalal also referred to the list of process which was approved by the commissioner for granting exemption and urged that the process undertaken by the Company does not fall within any of the 29 categories. The submission is not correct because Item 6 refers to heat treatment and even assuming that the list prepared by the Commissioner does not include the process referred to by the Company, still taking into consideration the provisions of(4) of Rule 7, we are unable to appreciate why the advantage of Rule 7 should be denied to the company. In these circumstances we do not find any infirmity in the reasons and conclusions recorded by the trial Judge and the appeal must fail.

### Instruction: Delve into the case proceeding and predict the outcome: is the judgment expected to be in support (1) or in denial (0) of the appeal? ### Input: except for a fractional loss of 1%. It is also not in dispute that there is no change in the chemical composition of the product by the process undertaken. The trial Judge, therefore, held and, in our judgment, very rightly that the process can by no stretch of imagination be treated as manufacturing activity. Shri Dalal submitted that wire bards imported by the Company admeasure 16 sq. inch rectangular pieces, each weighing about 100 Kgs. and wire rods are received in the sizes of 6 mm to 10 mm. The learned counsel urged that the process undertaken is of rolling them to smaller sizes or flattening to rectangular shapes and the process of rolling comprises of heating the wire bars in furnace and passing the same between two rolls repeatedly reducing the size at every pass till the desired size is obtained. Shri Dalal submits that this process of heating the bards in furnace must be treated as a manufacturing activity. It is impossible to accede to the submission. Every activity which demands heating of the object cannot be treated as a manufacturing activity. Take for instance, gold or silver bars which undergo heating process at hands of goldsmith for reducing the size of the bars. Can it by any stretch of imagination be suggested that a different article with distinct character and identity as known in the market has come into existence The process is only for the purpose of reducing the size of the bars into smaller bars and, in our judgment, such process cannot be treated as manufacturing activity and squarely falls within the processing activity. Shri Dalal referred to the decision of the Supreme Court reported in 1978 (2) Excise Law Times 389 (Union of India v. Hindu Undivided Family Business known as Ramlal Mansukhrai, Rewari and Another) and A. I. R. 1977 Supreme Court 90 (The South Gujarat Roofing Tiles Manufacturers Association and another v. The State of Gujarat and Another) but the reliance on these authorities is not appropriate. The question which came up before the Supreme Court for consideration has no bearing to the question falling for determination in this appeal. The issue as to whether the particular activity amounts to processing or manufacturing has to be determined with reference to the facts of each case. In our judgment the trial Judge was perfectly right in concluding on the facts and circumstances of the case that the activities of reducing size of wire bars and wire rods amount to processing and not manufacturing. It is also required to be stated that as the Corporation had not cared to file affidavit before the learned Single Judge and while denying reliefs sought by the Company, the letters written by deputy Assessor and Collector (Octroi) assign no reasons, we called upon the counsel for the company to produce for our perusal the wire bars ad wire rods which are imported for the purpose of processing and which are subsequently transported to the factory after reducing the size. The learned counsel produced the wire bars and wire rods which were reduced in size and also the photographs of the original wire bars and wire rods. The original wires and bars could not be produced because of its huge size. Shri Dalal for the Corporation did not dispute that the articles produced by the respondents are those which were imported within the limits of the corporation and subsequently exported. On perusal of the articles, we have no hesitation in concluding that the activities undertaken within the limits of the Corporation are purely of processing and not manufacturing. It hardly requires to be stated that the right to recover octroi duty arises when the article is imported for the purposes of use, sale or consumption and processing activity cannot be considered as use of the article.( 7 ) SHRI Dalal then submitted that even assuming that the activities undertaken by the Company within the local limits of the Corporation are merely one of processing, still the advantage of rule 7 is not available. The learned counsel referred to sub-rule 6 (b) (1) and claimed that the activities set out under this sub-rule are the only activities which fall within expression "processing" while considering grant of exemption under Rule 7. The learned counsel while advancing this submission overlooks the provisions of sub-rule (4) of Rule 7 and sub-rule 6 (b) (2) which entitle the Commissioner to include any other process in the list of process set out under sub-rule (b) (1) of Rule 7. Shri Dalal submitted that as the Commissioner has rejected the claim of the Company, the decision is final in accordance with sub- rule (6) (b) (2 ). The submission overlooks that the decision is final as far as the Corporation is concerned and cannot bind the Court exercising powers under Article 226 of the Constitution of India. There is one more aspect of the matter which cannot be overlooked. The decision was communicated to the company by Deputy Assessor and Collector (Octroi) and who is not the Commissioner. Even assuming that the decision was communicated by Deputy Assessor and Collector in pursuance of the orders issued by the Commissioner, still two letters do not set out any reasons for denying the relief to the appellants. Shri Dalal also referred to the list of process which was approved by the commissioner for granting exemption and urged that the process undertaken by the Company does not fall within any of the 29 categories. The submission is not correct because Item 6 refers to heat treatment and even assuming that the list prepared by the Commissioner does not include the process referred to by the Company, still taking into consideration the provisions of sub-rule (4) of Rule 7, we are unable to appreciate why the advantage of Rule 7 should be denied to the company. In these circumstances we do not find any infirmity in the reasons and conclusions recorded by the trial Judge and the appeal must fail. ### Response: 0

M/s. K.K. Ploycolor India Ltd. & Others Vs. Global Trade Finance Ltd. & Another

T.S. Thakur, J. 1. Leave granted. 2. These appeals arise out of an order dated 15th September, 2010 passed by the High Court of Judicature at Bombay whereby Crl. Application Nos.1491, 2759 and 2760 of 2010 have been allowed and the orders passed by the Magistrate set aside and the matter remitted back to the Magistrate with the direction that the criminal complaints filed by the complainants-respondents herein shall be disposed of expeditiously. 3. Complaints under Section 138 of the Negotiable Instrument Act, 1880 appear to have been filed by the respondent-company in the Court of Metropolitan Magistrate, Bandra which were entertained by the Magistrate and process issued against the accused persons. Revision applications were then filed before the Court of Sessions at Bombay challenging the jurisdiction of the Magistrate to entertain the complaints. The Revisional Court relying upon Harman Electronics Private Limited and Anr. v. National Panasonic India Private Limited (2009) 1 SCC 720 held that the Magistrate did not have the jurisdiction to entertain the complaints. The orders passed by the Magistrate were set aside and the complaints directed to be returned for presentation before the competent Court. Aggrieved by the said orders the complainant preferred Criminal Applications No.1491, 2759 and 2760 of 2010 before the High Court who relying upon the decision of this Court in K. Bhaskaran v. Sankaran Vaidhyan Balan (1999) 7 SCC 510 and three other decisions of the Bombay High Court held that the Magistrate had the jurisdiction to entertain the complaint as the cheque had been presented before a bank at Bombay which fact was, according to the High Court, sufficient to confer jurisdiction upon the Magistrate to entertain the complaints and try the cases. The orders passed by the Revisional Court were accordingly set aside and the Magistrate directed to proceed with the trial of the cases expeditiously as already noticed. The present special leave petitions have been filed by the accused persons assailing the view taken by the High Court. 4. A plain reading of the orders passed by the High Court would show that the judgment proceeds entirely on the authority of the decision of this Court in K. Bhaskarans case (supra). That decision has been reversed by this Court in Dashrath Rupsingh Rathod v. State of Maharashtra and Anr. (2014) 9 SCALE 97. This Court has, on an elaborate consideration of the provision of Section 138 and the law on the subject, held that presentation of a cheque for collection on the drawee bank or issue of a notice from a place of the choice of the complainant would not by themselves confer jurisdiction upon the Courts where cheque is presented for collection or the default notice issued demanding payment from the drawer of the cheque. Following the said decision we have no hesitation in holding that the High Court was wrong in interfering with the order passed by the Sessions Judge.

1[ds]4. A plain reading of the orders passed by the High Court would show that the judgment proceeds entirely on the authority of the decision of this Court in K. Bhaskarans case (supra). That decision has been reversed by this Court in Dashrath Rupsingh Rathod v. State of Maharashtra and Anr. (2014) 9 SCALE 97. This Court has, on an elaborate consideration of the provision of Section 138 and the law on the subject, held that presentation of a cheque for collection on the drawee bank or issue of a notice from a place of the choice of the complainant would not by themselves confer jurisdiction upon the Courts where cheque is presented for collection or the default notice issued demanding payment from the drawer of the cheque. Following the said decision we have no hesitation in holding that the High Court was wrong in interfering with the order passed by the Sessions Judge.

### Instruction: Examine the details of the case proceeding and forecast if the appeal/petition stands a chance of being upheld (1) or dismissed (0). ### Input: T.S. Thakur, J. 1. Leave granted. 2. These appeals arise out of an order dated 15th September, 2010 passed by the High Court of Judicature at Bombay whereby Crl. Application Nos.1491, 2759 and 2760 of 2010 have been allowed and the orders passed by the Magistrate set aside and the matter remitted back to the Magistrate with the direction that the criminal complaints filed by the complainants-respondents herein shall be disposed of expeditiously. 3. Complaints under Section 138 of the Negotiable Instrument Act, 1880 appear to have been filed by the respondent-company in the Court of Metropolitan Magistrate, Bandra which were entertained by the Magistrate and process issued against the accused persons. Revision applications were then filed before the Court of Sessions at Bombay challenging the jurisdiction of the Magistrate to entertain the complaints. The Revisional Court relying upon Harman Electronics Private Limited and Anr. v. National Panasonic India Private Limited (2009) 1 SCC 720 held that the Magistrate did not have the jurisdiction to entertain the complaints. The orders passed by the Magistrate were set aside and the complaints directed to be returned for presentation before the competent Court. Aggrieved by the said orders the complainant preferred Criminal Applications No.1491, 2759 and 2760 of 2010 before the High Court who relying upon the decision of this Court in K. Bhaskaran v. Sankaran Vaidhyan Balan (1999) 7 SCC 510 and three other decisions of the Bombay High Court held that the Magistrate had the jurisdiction to entertain the complaint as the cheque had been presented before a bank at Bombay which fact was, according to the High Court, sufficient to confer jurisdiction upon the Magistrate to entertain the complaints and try the cases. The orders passed by the Revisional Court were accordingly set aside and the Magistrate directed to proceed with the trial of the cases expeditiously as already noticed. The present special leave petitions have been filed by the accused persons assailing the view taken by the High Court. 4. A plain reading of the orders passed by the High Court would show that the judgment proceeds entirely on the authority of the decision of this Court in K. Bhaskarans case (supra). That decision has been reversed by this Court in Dashrath Rupsingh Rathod v. State of Maharashtra and Anr. (2014) 9 SCALE 97. This Court has, on an elaborate consideration of the provision of Section 138 and the law on the subject, held that presentation of a cheque for collection on the drawee bank or issue of a notice from a place of the choice of the complainant would not by themselves confer jurisdiction upon the Courts where cheque is presented for collection or the default notice issued demanding payment from the drawer of the cheque. Following the said decision we have no hesitation in holding that the High Court was wrong in interfering with the order passed by the Sessions Judge. ### Response: 1

Trimbak Gangadhar Telang and Another Vs. Ramchandra Ganesh Bhide and Others

rent during the years in question at the rate of Rs. 20 per bigha was Rs. 320 per year which was payable by the three tenants (respondents); that as the reasonable rent could not be in excess of the agreed rent and the respondent had not claimed that the agreed rent was in excess of the reasonable rent, the agreed rent was the reasonable rent. Proceeding on the basis that the agreed and reasonable rent was Rs, 320 per year, the Mamlatdar found that far from committing default in the payment of rent, the respondents had made over payment to the extent of Rs. 100. The Mamlatdar further held that respondents 1 to 3 were independent and not joint tenants of the aforesaid three parcels of land. On these findings he dismissed Vasudeo Balwant Telangs application for possession of the three parcels of land in dispute as also his application for declaration that respondents 1 to 3 were joint tenants of the said plots of land and declared that the responsible rent of the entire land was Rs. 320 per year. Aggrieved by the decision of the Mamlatdar, Miraj Taluka, Vasudeo Balwant Telang filed three separate appeals before the special Deputy Collector, Tenancy Appeal, Sangli who allowed the same holding that respondents 2 and 3 continued to be the sub-tenants of respondent 1 even after they were declared to be protected tenants and that the notice of termination of the tenancy served by Vasudeo Balwant Telang on respondent 1 was valid. The Special Deputy Collector further held that it had not been proved that the agreed rent was Rs. 320 per year. The Special Deputy Collector further held that the tenancy created vide Kabuliyat dated July 14, 1948 executed by respondent 1 was to last for a period of ten years in accordance with Section 5 of the 1948 Act as it originally stood but the term regarding the payment of Rs. 700 as rent could not, as a result of that section, extend beyond the period specified in the rent note. The special Deputy Collector concluded by observing that there was no agreed rent in respect of the years in question. On these findings, the Special Deputy Collector remanded the aforesaid application for possession as well as the reference for determination of reasonable rent to the Mamlatdar, Miraj Taluka, directing the latter to determine afresh the question of reasonable rent under Section 12 of the 1948 Act and also to decide whether respondent 1 had committed default in payment of rent and was liable to be dispossessed of all the plots of land in dispute. The matter was then taken in revision by both the parties to the Bombay Revenue Tribunal which set aside the order of the Special Deputy Collector and restored that of the Mamlatdar in all the three proceedings holding that respondent 1 to 3 were separate tenants of Vasudeo Balwant Telang in respect of the areas of the land in their separate possession and the notice terminating the tenancy was invalid. The Revenue Tribunal also held that the reasonable rent of the land was rightly fixed by the Mamlatdar at Rs. 320 per year. Aggrieved by this decision of the Revenue Tribunal, the appellants filed the aforesaid Special Civil Applications in the High Court of Judicature at Bombay which, as already sated, dismissed the same by its judgment and order dated September 15, 1967/September 19, 1967. It is against this judgment and order that the present appeals have been preferred. 3. As would be apparent from the above narrative, the instant case does not involve any substantial question of law of general or public importance. Although counsel for the appellants has strenuously assailed the correctness of the findings of the Revenue Tribunal and of the High Court, we are unable to accede to his contention. We have not, despite careful consideration of the judgments and objections submitted to us, been able to discern any legal infirmity or error either in the decision of the Revenue Tribunal or of the High Court. It is a well settled rule of practice of this Court not to interfere with exercise of discretionary power under Articles 226 and 227 of the Constitution merely because two views are possible on the facts of a case. It is also well established that it is only when an order of a Tribunal is violative of the fundamental basic principles of justice and fair play or where a patent or flagrant error in procedure or law has crept in or where the order passed results in manifest injustice, that a court can justifiably intervene under Article 227 of the Constitution. In the instant case, we have not been able to find any such flaw. The finding of the Revenue Tribunal that the respondents were independent tenants of separate parts of the land in dispute under Vasudeo Balwant Telang, the predecessor-in-interest of the appellants, which has been affirmed by the High Court, appears to be well founded in view of the following proved facts and circumstances : 1. The entry made in the record of rights after due enquiry according to law about the status of the respondents 2 and 3 as protected tenants in respect of the portions of the land in dispute in their possession. 2. Separate payment of the rent by the respondents and acceptance thereof by Vasudeo Balwant Telang. 3. Application by Vasudeo Balwant Telang for declaration that respondents were jointly and severally responsible for payment of rent of the land in dispute. 4. Notices by Vasudeo Balwant Telang to the respondents terminating their tenancies on the ground that he required the portions of the land in their respective possession for personal cultivation. 5. Application filed by Vasudeo Balwant Telang against the respondents under Section 31 of the 1948 Act averring that he bonafide required the land for his personal cultivation. 4. In view of the foregoing, there is hardly any justification to interfere with the impugned judgment and order.

0[ds]3. As would be apparent from the above narrative, the instant case does not involve any substantial question of law of general or public importance. Although counsel for the appellants has strenuously assailed the correctness of the findings of the Revenue Tribunal and of the High Court, we are unable to accede to his contention. We have not, despite careful consideration of the judgments and objections submitted to us, been able to discern any legal infirmity or error either in the decision of the Revenue Tribunal or of the High Court. It is a well settled rule of practice of this Court not to interfere with exercise of discretionary power under Articles 226 and 227 of the Constitution merely because two views are possible on the facts of a case. It is also well established that it is only when an order of a Tribunal is violative of the fundamental basic principles of justice and fair play or where a patent or flagrant error in procedure or law has crept in or where the order passed results in manifest injustice, that a court can justifiably intervene under Article 227 of the Constitution. In the instant case, we have not been able to find any such flaw. The finding of the Revenue Tribunal that the respondents were independent tenants of separate parts of the land in dispute under Vasudeo Balwant Telang, thet of the appellants, which has been affirmed by the High Court, appears to be well foundedin view of the following proved facts and circumstances :1. The entry made in the record of rights after due enquiry according to law about the status of the respondents 2 and 3 as protected tenants in respect of the portions of the land in dispute in their possession2. Separate payment of the rent by the respondents and acceptance thereof by Vasudeo Balwant Telang3. Application by Vasudeo Balwant Telang for declaration that respondents were jointly and severally responsible for payment of rent of the land in dispute4. Notices by Vasudeo Balwant Telang to the respondents terminating their tenancies on the ground that he required the portions of the land in their respective possession for personal cultivation5. Application filed by Vasudeo Balwant Telang against the respondents under Section 31 of the 1948 Act averring that he bonafide required the land for his personal cultivation4. In view of the foregoing, there is hardly any justification to interfere with the impugned judgment and order.

### Instruction: Examine the details of the case proceeding and forecast if the appeal/petition stands a chance of being upheld (1) or dismissed (0). ### Input: rent during the years in question at the rate of Rs. 20 per bigha was Rs. 320 per year which was payable by the three tenants (respondents); that as the reasonable rent could not be in excess of the agreed rent and the respondent had not claimed that the agreed rent was in excess of the reasonable rent, the agreed rent was the reasonable rent. Proceeding on the basis that the agreed and reasonable rent was Rs, 320 per year, the Mamlatdar found that far from committing default in the payment of rent, the respondents had made over payment to the extent of Rs. 100. The Mamlatdar further held that respondents 1 to 3 were independent and not joint tenants of the aforesaid three parcels of land. On these findings he dismissed Vasudeo Balwant Telangs application for possession of the three parcels of land in dispute as also his application for declaration that respondents 1 to 3 were joint tenants of the said plots of land and declared that the responsible rent of the entire land was Rs. 320 per year. Aggrieved by the decision of the Mamlatdar, Miraj Taluka, Vasudeo Balwant Telang filed three separate appeals before the special Deputy Collector, Tenancy Appeal, Sangli who allowed the same holding that respondents 2 and 3 continued to be the sub-tenants of respondent 1 even after they were declared to be protected tenants and that the notice of termination of the tenancy served by Vasudeo Balwant Telang on respondent 1 was valid. The Special Deputy Collector further held that it had not been proved that the agreed rent was Rs. 320 per year. The Special Deputy Collector further held that the tenancy created vide Kabuliyat dated July 14, 1948 executed by respondent 1 was to last for a period of ten years in accordance with Section 5 of the 1948 Act as it originally stood but the term regarding the payment of Rs. 700 as rent could not, as a result of that section, extend beyond the period specified in the rent note. The special Deputy Collector concluded by observing that there was no agreed rent in respect of the years in question. On these findings, the Special Deputy Collector remanded the aforesaid application for possession as well as the reference for determination of reasonable rent to the Mamlatdar, Miraj Taluka, directing the latter to determine afresh the question of reasonable rent under Section 12 of the 1948 Act and also to decide whether respondent 1 had committed default in payment of rent and was liable to be dispossessed of all the plots of land in dispute. The matter was then taken in revision by both the parties to the Bombay Revenue Tribunal which set aside the order of the Special Deputy Collector and restored that of the Mamlatdar in all the three proceedings holding that respondent 1 to 3 were separate tenants of Vasudeo Balwant Telang in respect of the areas of the land in their separate possession and the notice terminating the tenancy was invalid. The Revenue Tribunal also held that the reasonable rent of the land was rightly fixed by the Mamlatdar at Rs. 320 per year. Aggrieved by this decision of the Revenue Tribunal, the appellants filed the aforesaid Special Civil Applications in the High Court of Judicature at Bombay which, as already sated, dismissed the same by its judgment and order dated September 15, 1967/September 19, 1967. It is against this judgment and order that the present appeals have been preferred. 3. As would be apparent from the above narrative, the instant case does not involve any substantial question of law of general or public importance. Although counsel for the appellants has strenuously assailed the correctness of the findings of the Revenue Tribunal and of the High Court, we are unable to accede to his contention. We have not, despite careful consideration of the judgments and objections submitted to us, been able to discern any legal infirmity or error either in the decision of the Revenue Tribunal or of the High Court. It is a well settled rule of practice of this Court not to interfere with exercise of discretionary power under Articles 226 and 227 of the Constitution merely because two views are possible on the facts of a case. It is also well established that it is only when an order of a Tribunal is violative of the fundamental basic principles of justice and fair play or where a patent or flagrant error in procedure or law has crept in or where the order passed results in manifest injustice, that a court can justifiably intervene under Article 227 of the Constitution. In the instant case, we have not been able to find any such flaw. The finding of the Revenue Tribunal that the respondents were independent tenants of separate parts of the land in dispute under Vasudeo Balwant Telang, the predecessor-in-interest of the appellants, which has been affirmed by the High Court, appears to be well founded in view of the following proved facts and circumstances : 1. The entry made in the record of rights after due enquiry according to law about the status of the respondents 2 and 3 as protected tenants in respect of the portions of the land in dispute in their possession. 2. Separate payment of the rent by the respondents and acceptance thereof by Vasudeo Balwant Telang. 3. Application by Vasudeo Balwant Telang for declaration that respondents were jointly and severally responsible for payment of rent of the land in dispute. 4. Notices by Vasudeo Balwant Telang to the respondents terminating their tenancies on the ground that he required the portions of the land in their respective possession for personal cultivation. 5. Application filed by Vasudeo Balwant Telang against the respondents under Section 31 of the 1948 Act averring that he bonafide required the land for his personal cultivation. 4. In view of the foregoing, there is hardly any justification to interfere with the impugned judgment and order. ### Response: 0

Bhola and Another Vs. Murthi Mandir Shri Jai Narayanji and Another

KRISHNA IYER, J.1. This is an appeal by special leave by a tenant who lost in the High Court although he had succeeded before the Board of Revenue and the Revenue Appellate Authority. The subject-matter of the litigation stems from a suit for a declaration by the plaintiff (who is the appellant before us) to the effect that he is a tenant of the lands covered by the suit. The landlord-respondent is the deity of Shri Jai Narayanji represented by the shebait. The trial Court (the revenue Court at the floor level) dismissed the suit. But in appeal the plaintiff-appellant was held to be a khatedar tenant under Section 19 of the Rajasthan Tenancy Act. When a second appeal was carried to the Board of Revenue the appellants position as a khatedar tenant was maintained but rested on Section 15 of the Act. When the matter reached the High Court at the instance of the landlord, the decision earlier rendered by the revenue authority was reversed on grounds which we find difficult to follow to put it mildly.2. After a full debate of the case, it became fairly plain that whether the version of the plaintiff or of the defendant were true on fact, the plaintiff was entitled to the status of khatedar tenant. However at the end of the arguments, Shri Tarkunde appearing for the appellants stated that now that he was sure of being treated as a tenant under the statue by virtue of Amendment Act 7 of 1959 to Section 19 of the parent Act, he was willing by way of concession to pay compensation computed on the basis prescribed in Section 19(4) of the Act without prejudice to such contentions as may be raised under Section 15. This gesture is acceptable to the respondent in view of the fundamental flaws in his case as emerged during the debate.

1[ds]2. After a full debate of the case, it became fairly plain that whether the version of the plaintiff or of the defendant were true on fact, the plaintiff was entitled to the status of khatedar tenant. However at the end of the arguments, Shri Tarkunde appearing for the appellants stated that now that he was sure of being treated as a tenant under the statue by virtue of Amendment Act 7 of 1959 to Section 19 of the parent Act, he was willing by way of concession to pay compensation computed on the basis prescribed in Section 19(4) of the Act without prejudice to such contentions as may be raised under Section 15. This gesture is acceptable to the respondent in view of the fundamental flaws in his case as emerged during the debate.

### Instruction: Examine the case narrative and anticipate the court's decision: will it result in an approval (1) or disapproval (0) of the appeal? ### Input: KRISHNA IYER, J.1. This is an appeal by special leave by a tenant who lost in the High Court although he had succeeded before the Board of Revenue and the Revenue Appellate Authority. The subject-matter of the litigation stems from a suit for a declaration by the plaintiff (who is the appellant before us) to the effect that he is a tenant of the lands covered by the suit. The landlord-respondent is the deity of Shri Jai Narayanji represented by the shebait. The trial Court (the revenue Court at the floor level) dismissed the suit. But in appeal the plaintiff-appellant was held to be a khatedar tenant under Section 19 of the Rajasthan Tenancy Act. When a second appeal was carried to the Board of Revenue the appellants position as a khatedar tenant was maintained but rested on Section 15 of the Act. When the matter reached the High Court at the instance of the landlord, the decision earlier rendered by the revenue authority was reversed on grounds which we find difficult to follow to put it mildly.2. After a full debate of the case, it became fairly plain that whether the version of the plaintiff or of the defendant were true on fact, the plaintiff was entitled to the status of khatedar tenant. However at the end of the arguments, Shri Tarkunde appearing for the appellants stated that now that he was sure of being treated as a tenant under the statue by virtue of Amendment Act 7 of 1959 to Section 19 of the parent Act, he was willing by way of concession to pay compensation computed on the basis prescribed in Section 19(4) of the Act without prejudice to such contentions as may be raised under Section 15. This gesture is acceptable to the respondent in view of the fundamental flaws in his case as emerged during the debate. ### Response: 1

B.S. Yadav & Anr Vs. Chief Manager, Central Bank Of India & Ors

the Bank and the government found that it would be unjust and unfair to reduce the age of superannuation from 60 years in the case of such employees and, therefore, did not alter the said condition of service. In the absence of any alteration they were entitled to continue to be in service till they attained 60 years of age even after nationalisation by virtue of sub-section (2) of Section 12 of the Act. The officers and employees other than (sic including) the award staff recruited after the nationalisation of the banks were required to retire on completion of 58 years of age which was the age of superannuation genially prevailing in the services of all public sector corporations, Central Government and many of the State Governments. It was urged that since the employees recruited prior to July 19, 1969 belonged to a different class altogether, it could not be said that there had been violation of Articles 14 and 16 of the Constitution, and the difference in the ages of retirement of the two classes of officers was due to historical reasons. 15. It is no doubt true that the order of appointment in the case of petitioner 1 stated that he would be governed by the terms and conditions which were applicable to other officers of the Bank. That condition, however, did not prevent the Bank from making a regulation which was applicable exclusively to the officers recruited after July 19, 1969. In case of officers falling under Rules 1 and 2 of the Rules for Age of Retirement no extra benefit was conferred on them. They were only permitted to carry the benefit of the Rules for Age of Retirement which was prevailing in the former banking company which was taken over by the government on nationalisation. We are of the view that there was good reason to make a distinction between the employees who had entered service prior to nationalisation and those who joined thereafter. At the time of nationalisation the corresponding new banks did not have their own employees to run the vast business taken over under the Act. There was, therefore, necessity to secure the services of the employees of the former banking companies without causing much dissatisfaction to them. There was also need for standardising the conditions of service of all such employees belonging to the 14 banks. The Government of India took the advice of the Pillai Committee and the Study Group of Bankers and after due deliberation evolved a uniform pattern of conditions for the transferred employees keeping in view the conditions of service of the employees prevailing in the majority of the banking companies which were nationalised. Insofar as the employees recruited after nationalisation were concerned the government applied the rules generally applicable to all its employees in other spheres of Government service. 16. We have given detailed reasons in our judgment in LIC v. S. S. Srivastava decided on May 5, 1987 justifying the existence of a rule fixing different ages of retirement to different classes of employees of the Life Insurance Corporation of India in the circumstances existing there. The circumstances prevailing in this case are almost the same. Those reasons are equally applicable to the present case too. In Goivindarajulu v. Management of the Union Bank of India (Writ Petition No. 5486 of 1980, decided on November 21, 1986, in the High Court of Madras) decided on November 21, 1986 the High Court or Madras has rejected the contentions similar to those which are raised before us. In that case a regulation framed by the Union Bank of India which was similar to the one in this case was upheld. That decision has been approved by us in LIC v. S. S. Srivastava. In Dr. Nikhil Bhushan Chandra v. Union of India (1983 Lab NOC 109 (Cal)) similar regulations framed by the United Commercial Bank which was also nationalised under the Act came up for consideration before the High Court of Calcutta. The High Court rejected the theory of discrimination put forward on the basis that fixing 60 years as age of retirement for those who were recruited prior to July 19, 1969 and 58 years of age who joined after that date lacked an intelligible differential. The Calcutta High Court points out that the terms and conditions of the service of the employees of the banks which were taken over under the Act had been protected by the Act and it was not possible to hold that there had been any hostile discrimination against the petitioner in that case. We are of the view that the decisions of the Madras High Court and the Calcutta High Court referred to above, lay down the correct principle. It is true that if the nationalised banks wanted to reduce the age of retirement of the transferred employees they could have done so. But they have tried to standardise their conditions of service and to bring about some uniformity without giving room for much discontent or dissatisfaction. The question involved in this matter is not one of mere competence. It involves justice and fairness too. Having regard to all aspects of the matter, the nationalised banks have tried to be fair and just insofar as the question of age of retirement is concerned. We cannot say in the circumstances that the Banks attitude is unreasonable, particularly when the age of retirement of the new entrants is quite consistent with the conditions prevailing in almost all the sectors of public employment. 17. We are of the view that the classification of the employees into two categories, i.e., those falling under Rules 1 and 2 of the Rules for Age of Retirement and those falling under rule 3 thereof satisfies the tests of a valid classification laid down under Articles 14 and 16 of the Constitution. We do not, therefore, find any ground to declare Rule 3 of the Rules for Age of Retirement, which is impugned in this case, as unconstitutional.

0[ds]14. On the Regulations coming into force in 1979 petitioner 1 was served with a notice dated February 25, 1980 issued by the chief Manager of the Bank stating that he would be treated as finally retired from the Banks service after the close of business on February 29, 1980 on completion of 58 years of age. The above writ petitions were filed in April 1980 questioning the order of retirement issued in the case of petitioner 1 and praying inter alia for a declaration, as mentioned above, that all officers including petitioner 1 should be permitted to continue in service till the completion of 60 years of age as in the case of officers falling under Rules 1 and 2 of the Rules for Age of Retirement. The principal grounds urged in support of the writ petitions were that there could not be two different ages of retirement in the case of officers of the Bank and that since Rule 3 of the Rules for Age of Retirement required the officers, who were recruited subsequent to July 19, 1969, to retire on completion of 58 years of age while others falling under Rules 1 and 2 of the said rules could continue till 60 years of age, Rule 3 was liable to be struck down as being violative of Articles 14 and 16 of the Constitution. The petitions were opposed by the Bank and the Union of India. It was pleaded by them that since the employees whose services were transferred to the Bank under sub-section (2) of Section 12 of the Act were entitled to continue in service till 60 years of age by virtue of the conditions of service prevailing in the Central Bank of India Ltd. prior to nationalisation of banks, the Bank and the government found that it would be unjust and unfair to reduce the age of superannuation from 60 years in the case of such employees and, therefore, did not alter the said condition of service. In the absence of any alteration they were entitled to continue to be in service till they attained 60 years of age even after nationalisation by virtue of sub-section (2) of Section 12 of the Act. The officers and employees other than (sic including) the award staff recruited after the nationalisation of the banks were required to retire on completion of 58 years of age which was the age of superannuation genially prevailing in the services of all public sector corporations, Central Government and many of the State Governments. It was urged that since the employees recruited prior to July 19, 1969 belonged to a different class altogether, it could not be said that there had been violation of Articles 14 and 16 of the Constitution, and the difference in the ages of retirement of the two classes of officers was due to historicalIt is no doubt true that the order of appointment in the case of petitioner 1 stated that he would be governed by the terms and conditions which were applicable to other officers of the Bank. That condition, however, did not prevent the Bank from making a regulation which was applicable exclusively to the officers recruited after July 19, 1969. In case of officers falling under Rules 1 and 2 of the Rules for Age of Retirement no extra benefit was conferred on them. They were only permitted to carry the benefit of the Rules for Age of Retirement which was prevailing in the former banking company which was taken over by the government on nationalisation. We are of the view that there was good reason to make a distinction between the employees who had entered service prior to nationalisation and those who joined thereafter. At the time of nationalisation the corresponding new banks did not have their own employees to run the vast business taken over under the Act. There was, therefore, necessity to secure the services of the employees of the former banking companies without causing much dissatisfaction to them. There was also need for standardising the conditions of service of all such employees belonging to the 14 banks. The Government of India took the advice of the Pillai Committee and the Study Group of Bankers and after due deliberation evolved a uniform pattern of conditions for the transferred employees keeping in view the conditions of service of the employees prevailing in the majority of the banking companies which were nationalised. Insofar as the employees recruited after nationalisation were concerned the government applied the rules generally applicable to all its employees in other spheres of GovernmentWe have given detailed reasons in our judgment in LIC v. S. S. Srivastava decided on May 5, 1987 justifying the existence of a rule fixing different ages of retirement to different classes of employees of the Life Insurance Corporation of India in the circumstances existing there. The circumstances prevailing in this case are almost the same. Those reasons are equally applicable to the present case too. In Goivindarajulu v. Management of the Union Bank of India (Writ Petition No. 5486 of 1980, decided on November 21, 1986, in the High Court of Madras) decided on November 21, 1986 the High Court or Madras has rejected the contentions similar to those which are raised before us. In that case a regulation framed by the Union Bank of India which was similar to the one in this case was upheld. That decision has been approved by us in LIC v. S. S. Srivastava. In Dr. Nikhil Bhushan Chandra v. Union of India (1983 Lab NOC 109 (Cal)) similar regulations framed by the United Commercial Bank which was also nationalised under the Act came up for consideration before the High Court of Calcutta. The High Court rejected the theory of discrimination put forward on the basis that fixing 60 years as age of retirement for those who were recruited prior to July 19, 1969 and 58 years of age who joined after that date lacked an intelligible differential. The Calcutta High Court points out that the terms and conditions of the service of the employees of the banks which were taken over under the Act had been protected by the Act and it was not possible to hold that there had been any hostile discrimination against the petitioner in that case. We are of the view that the decisions of the Madras High Court and the Calcutta High Court referred to above, lay down the correct principle. It is true that if the nationalised banks wanted to reduce the age of retirement of the transferred employees they could have done so. But they have tried to standardise their conditions of service and to bring about some uniformity without giving room for much discontent or dissatisfaction. The question involved in this matter is not one of mere competence. It involves justice and fairness too. Having regard to all aspects of the matter, the nationalised banks have tried to be fair and just insofar as the question of age of retirement is concerned. We cannot say in the circumstances that the Banks attitude is unreasonable, particularly when the age of retirement of the new entrants is quite consistent with the conditions prevailing in almost all the sectors of publicWe are of the view that the classification of the employees into two categories, i.e., those falling under Rules 1 and 2 of the Rules for Age of Retirement and those falling under rule 3 thereof satisfies the tests of a valid classification laid down under Articles 14 and 16 of the Constitution. We do not, therefore, find any ground to declare Rule 3 of the Rules for Age of Retirement, which is impugned in this case, as unconstitutional

### Instruction: Examine the case narrative and anticipate the court's decision: will it result in an approval (1) or disapproval (0) of the appeal? ### Input: the Bank and the government found that it would be unjust and unfair to reduce the age of superannuation from 60 years in the case of such employees and, therefore, did not alter the said condition of service. In the absence of any alteration they were entitled to continue to be in service till they attained 60 years of age even after nationalisation by virtue of sub-section (2) of Section 12 of the Act. The officers and employees other than (sic including) the award staff recruited after the nationalisation of the banks were required to retire on completion of 58 years of age which was the age of superannuation genially prevailing in the services of all public sector corporations, Central Government and many of the State Governments. It was urged that since the employees recruited prior to July 19, 1969 belonged to a different class altogether, it could not be said that there had been violation of Articles 14 and 16 of the Constitution, and the difference in the ages of retirement of the two classes of officers was due to historical reasons. 15. It is no doubt true that the order of appointment in the case of petitioner 1 stated that he would be governed by the terms and conditions which were applicable to other officers of the Bank. That condition, however, did not prevent the Bank from making a regulation which was applicable exclusively to the officers recruited after July 19, 1969. In case of officers falling under Rules 1 and 2 of the Rules for Age of Retirement no extra benefit was conferred on them. They were only permitted to carry the benefit of the Rules for Age of Retirement which was prevailing in the former banking company which was taken over by the government on nationalisation. We are of the view that there was good reason to make a distinction between the employees who had entered service prior to nationalisation and those who joined thereafter. At the time of nationalisation the corresponding new banks did not have their own employees to run the vast business taken over under the Act. There was, therefore, necessity to secure the services of the employees of the former banking companies without causing much dissatisfaction to them. There was also need for standardising the conditions of service of all such employees belonging to the 14 banks. The Government of India took the advice of the Pillai Committee and the Study Group of Bankers and after due deliberation evolved a uniform pattern of conditions for the transferred employees keeping in view the conditions of service of the employees prevailing in the majority of the banking companies which were nationalised. Insofar as the employees recruited after nationalisation were concerned the government applied the rules generally applicable to all its employees in other spheres of Government service. 16. We have given detailed reasons in our judgment in LIC v. S. S. Srivastava decided on May 5, 1987 justifying the existence of a rule fixing different ages of retirement to different classes of employees of the Life Insurance Corporation of India in the circumstances existing there. The circumstances prevailing in this case are almost the same. Those reasons are equally applicable to the present case too. In Goivindarajulu v. Management of the Union Bank of India (Writ Petition No. 5486 of 1980, decided on November 21, 1986, in the High Court of Madras) decided on November 21, 1986 the High Court or Madras has rejected the contentions similar to those which are raised before us. In that case a regulation framed by the Union Bank of India which was similar to the one in this case was upheld. That decision has been approved by us in LIC v. S. S. Srivastava. In Dr. Nikhil Bhushan Chandra v. Union of India (1983 Lab NOC 109 (Cal)) similar regulations framed by the United Commercial Bank which was also nationalised under the Act came up for consideration before the High Court of Calcutta. The High Court rejected the theory of discrimination put forward on the basis that fixing 60 years as age of retirement for those who were recruited prior to July 19, 1969 and 58 years of age who joined after that date lacked an intelligible differential. The Calcutta High Court points out that the terms and conditions of the service of the employees of the banks which were taken over under the Act had been protected by the Act and it was not possible to hold that there had been any hostile discrimination against the petitioner in that case. We are of the view that the decisions of the Madras High Court and the Calcutta High Court referred to above, lay down the correct principle. It is true that if the nationalised banks wanted to reduce the age of retirement of the transferred employees they could have done so. But they have tried to standardise their conditions of service and to bring about some uniformity without giving room for much discontent or dissatisfaction. The question involved in this matter is not one of mere competence. It involves justice and fairness too. Having regard to all aspects of the matter, the nationalised banks have tried to be fair and just insofar as the question of age of retirement is concerned. We cannot say in the circumstances that the Banks attitude is unreasonable, particularly when the age of retirement of the new entrants is quite consistent with the conditions prevailing in almost all the sectors of public employment. 17. We are of the view that the classification of the employees into two categories, i.e., those falling under Rules 1 and 2 of the Rules for Age of Retirement and those falling under rule 3 thereof satisfies the tests of a valid classification laid down under Articles 14 and 16 of the Constitution. We do not, therefore, find any ground to declare Rule 3 of the Rules for Age of Retirement, which is impugned in this case, as unconstitutional. ### Response: 0

Vajesingh Salambhai Naik & Ors Vs. State Of Gujarat & Anr

the Tribunal, the disposal by the Tribunal, or a bench thereof, of any proceedings before it notwithstanding that in the course thereof there has been a change in the persons sitting as members of the Tribunal or bench; and generally for the effective exercise of its powers and discharge of its functions under this Act. Where any members sit singly or where any benches are constituted, such member or bench shall exercise and discharge all the powers and functions of the Tribunal. (2) The regulations made under this section shall be published in the Official Gazette." 9. Regulation 19 deals with procedure to be followed by the Tribunal in case of non-appearance of parties. Regulation 19 is to the following effect:"19. (1) If on the date fixed for hearing or any other subsequent day to which the hearing may be adjourned, the appellant or applicant does not appear either in person or through his agent or lawyer when the appeal or application is called for hearing, the Tribunal may dismiss the appeal or application or may decide it on merits, after hearing the respondent or his agent or lawyer, if present (2) If on the date fixed for hearing or on any other subsequent day to which the hearing may be adjourned, the respondent or opponent, as the case may be, does not appear in person or through his agent or lawyer when the appeal or application is called for hearing, the Tribunal may decide be same on merits, after hearing the appellant or applicant or his agent or lawyer. ......................................................................................." 10. Regulation 20 provides for restoration of an appeal or application and reads as follows :"20. If any of the parties was absent on the date of the hearing, either preliminary or final, and the appeal or application was heard and decided ex parte, the party concerned may apply for restoration of the appeal or application, as the case may be, and If the party satisfies the Tribunal that he had no notice of the date of the hearing or that he was prevented by sufficient cause from appearing when the appeal or application was called for hearing, the Tribunal may restore the appeal or application to its file, provided that where tire other party had appeared in the appeal or application such party shall be given notice and an opportunity of being heard before the order for restoration of the appeal or application is made." Regulation 21 is to the following effect :"21. (l) An application for restoration of an appeal or application made under Regulation 20 shall be filed within thirty days from the date of the receipt of the order or dismissal of the appeal or application and shall be accompanied by (a) a certified copy of the Tribunals order; (b) the decision or order (either in original or a certified copy thereof) in respect of which appeal or application sought to be restored is made; (c) if the decision or order referred to in clause (b) is itself made in appeal against any decision or order, then also such latter decision or order either in original or a certified copy thereof: and (d) as many copies of the restoration application as there are respondents or opponents. ................................................." 11. Regulation 55 states that in any matter not provided for in the Regulations the Tribunal shall follow the procedure, as far as it is applicable laid down in the Code of Civil Procedure, 1908. 12. From the scheme of the Regulations it is apparent that under Regulation l9 (1) it is open to the Tribunal to dismiss an appeal for non-prosecution in a case where the appellant does not appear either in person or through his agent or lawyer. It is also open to the Tribunal in such a case to hear the respondent to the appeal and decide it on merits. Regulation 19(2) contemplates a case where the respondent fails to appear and even so it is open to the Tribunal to hear the appellant and then decide the case on merits. Regulation 20 which provides for restoration of the appeal is a consequential regulation to Regulation 19. One of the conditions for invoking the provisions of restoration under Regulation 20 is that "the appeal or application was heard and decided ex parte". On behalf of the respondent it is contended by Mr. Asoke Sen that Regulation 20 only applies to cases contemplated by the latter part of Regulation 19 (1) and 19 (2) and not to cases of dismissal for want of prosecution under the first part of Regulation 19(1). We are unable to accept this submission as correct. In our opinion, the language of Regulation 20, on its true interpretation, applies not only to a case where the appeal has been decided on merits but also to a case where the appeal has been dismissed for want of prosecution under Regulation 19 (l).The reason is that in Regns. 19 (1) and 19 (2) the legislative authority uses the words "decide it on merits" but in Regn. 20 the expression used is "decided ex parte" and we see no reason, either in the language or context of Regulation 20, why it should not include in its scope and ambit an application for restoration of an appeal dismissed for non-prosecution as also an application for restoration of appeal decided on merits under Regulation 19 (1). If the view that we have taken as to the interpretation of Regulation 20 is correct, it follows that Regulation 21 applies to the present case and the period of limitation prescribed by that Regulation being 30 days from the date of receipt of the order of dismissal of the appeal, the applications for restoration made by the appellants in all the four cases were well within the period of limitation prescribed by Regulation 21. It follows, therefore, that the Tribunal committed an error of law in dismissing the applications of restoration made by the appellants in all the four appeals.

1[ds]On a consideration of the language of Section 17 (1) of the Jagirs Abolition Act and in the context of S. 20 of the Jagirs Abolition Act we are of the opinion that it is obligatory on the part of the Tribunal to decide an appeal on merits even though there is default in the appearance of the appellants and to record its decision regarding the merits of the appeal. If an appeal is dismissed for want of prosecution it cannot be said that the Tribunal has decided the appeal and recorded its decision within the meaning of S. 17 of the Jagirs Abolition Act. It cannot be supposed that the legislature intended by the word decide in S. 17 (1) to mean dispose of the appeal or to put an end to the appeal. It is important to notice that S. 20 of the Jagirs Abolition Act makes a decision of the Tribunal in appeal as final and conclusive and not to be questioned in any suit or proceeding in any Court. In the context of S. 20 and in view of the express language of S 17 (1) of the Jagirs Abolition Act we are of opinion that the Tribunal has no power to dismiss an appeal for non-prosecution but it is obligatory on its part to decide the appeal on merits and to record its decision even though there is default on the part of the appellant to appear in the appeal11. Regulation 55 states that in any matter not provided for in the Regulations the Tribunal shall follow the procedure, as far as it is applicable laid down in the Code of Civil Procedure, 190812. From the scheme of the Regulations it is apparent that under Regulation l9 (1) it is open to the Tribunal to dismiss an appeal for non-prosecution in a case where the appellant does not appear either in person or through his agent or lawyerIt is also open to the Tribunal in such a case to hear the respondent to the appeal and decide it on merits. Regulation 19(2) contemplates a case where the respondent fails to appear and even so it is open to the Tribunal to hear the appellant and then decide the case on merits. Regulation 20 which provides for restoration of the appeal is a consequential regulation to Regulation 19. One of the conditions for invoking the provisions of restoration under Regulation 20 is that "the appeal or application was heard and decided ex parte". On behalf of the respondent it is contended by Mr. Asoke Sen that Regulation 20 only applies to cases contemplated by the latter part of Regulation 19 (1) and 19 (2) and not to cases of dismissal for want of prosecution under the first part of Regulation 19(1). We are unable to accept this submission as correct. In our opinion, the language of Regulation 20, on its true interpretation, applies not only to a case where the appeal has been decided on merits but also to a case where the appeal has been dismissed for want of prosecution under Regulation 19 (l).The reason is that in Regns. 19 (1) and 19 (2) the legislative authority uses the words "decide it on merits" but in Regn. 20 the expression used is "decided ex parte" and we see no reason, either in the language or context of Regulation 20, why it should not include in its scope and ambit an application for restoration of an appeal dismissed for non-prosecution as also an application for restoration of appeal decided on merits under Regulation 19 (1). If the view that we have taken as to the interpretation of Regulation 20 is correct, it follows that Regulation 21 applies to the present case and the period of limitation prescribed by that Regulation being 30 days from the date of receipt of the order of dismissal of the appeal, the applications for restoration made by the appellants in all the four cases were well within the period of limitation prescribed by Regulation 21. It follows, therefore, that the Tribunal committed an error of law in dismissing the applications of restoration made by the appellants in all the four appeals4. In our opinion, the contention put forward by the appellants is well founded and must be accepted as correct. Section 13 of the Jagirs Abolition Act provides that any jagirdar entitled to compensation under S. 11 or 12 shall, on or before the 3lst day of July 1958 apply in writing to the Collector for determining the amount of compensation payable to him under the said section. Section 13 (2) states that on receipt of an application under. (1), the Collector shall, after making formal enquiry in the manner provided by the Code, make an award determining the amount of compensation.

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: the Tribunal, the disposal by the Tribunal, or a bench thereof, of any proceedings before it notwithstanding that in the course thereof there has been a change in the persons sitting as members of the Tribunal or bench; and generally for the effective exercise of its powers and discharge of its functions under this Act. Where any members sit singly or where any benches are constituted, such member or bench shall exercise and discharge all the powers and functions of the Tribunal. (2) The regulations made under this section shall be published in the Official Gazette." 9. Regulation 19 deals with procedure to be followed by the Tribunal in case of non-appearance of parties. Regulation 19 is to the following effect:"19. (1) If on the date fixed for hearing or any other subsequent day to which the hearing may be adjourned, the appellant or applicant does not appear either in person or through his agent or lawyer when the appeal or application is called for hearing, the Tribunal may dismiss the appeal or application or may decide it on merits, after hearing the respondent or his agent or lawyer, if present (2) If on the date fixed for hearing or on any other subsequent day to which the hearing may be adjourned, the respondent or opponent, as the case may be, does not appear in person or through his agent or lawyer when the appeal or application is called for hearing, the Tribunal may decide be same on merits, after hearing the appellant or applicant or his agent or lawyer. ......................................................................................." 10. Regulation 20 provides for restoration of an appeal or application and reads as follows :"20. If any of the parties was absent on the date of the hearing, either preliminary or final, and the appeal or application was heard and decided ex parte, the party concerned may apply for restoration of the appeal or application, as the case may be, and If the party satisfies the Tribunal that he had no notice of the date of the hearing or that he was prevented by sufficient cause from appearing when the appeal or application was called for hearing, the Tribunal may restore the appeal or application to its file, provided that where tire other party had appeared in the appeal or application such party shall be given notice and an opportunity of being heard before the order for restoration of the appeal or application is made." Regulation 21 is to the following effect :"21. (l) An application for restoration of an appeal or application made under Regulation 20 shall be filed within thirty days from the date of the receipt of the order or dismissal of the appeal or application and shall be accompanied by (a) a certified copy of the Tribunals order; (b) the decision or order (either in original or a certified copy thereof) in respect of which appeal or application sought to be restored is made; (c) if the decision or order referred to in clause (b) is itself made in appeal against any decision or order, then also such latter decision or order either in original or a certified copy thereof: and (d) as many copies of the restoration application as there are respondents or opponents. ................................................." 11. Regulation 55 states that in any matter not provided for in the Regulations the Tribunal shall follow the procedure, as far as it is applicable laid down in the Code of Civil Procedure, 1908. 12. From the scheme of the Regulations it is apparent that under Regulation l9 (1) it is open to the Tribunal to dismiss an appeal for non-prosecution in a case where the appellant does not appear either in person or through his agent or lawyer. It is also open to the Tribunal in such a case to hear the respondent to the appeal and decide it on merits. Regulation 19(2) contemplates a case where the respondent fails to appear and even so it is open to the Tribunal to hear the appellant and then decide the case on merits. Regulation 20 which provides for restoration of the appeal is a consequential regulation to Regulation 19. One of the conditions for invoking the provisions of restoration under Regulation 20 is that "the appeal or application was heard and decided ex parte". On behalf of the respondent it is contended by Mr. Asoke Sen that Regulation 20 only applies to cases contemplated by the latter part of Regulation 19 (1) and 19 (2) and not to cases of dismissal for want of prosecution under the first part of Regulation 19(1). We are unable to accept this submission as correct. In our opinion, the language of Regulation 20, on its true interpretation, applies not only to a case where the appeal has been decided on merits but also to a case where the appeal has been dismissed for want of prosecution under Regulation 19 (l).The reason is that in Regns. 19 (1) and 19 (2) the legislative authority uses the words "decide it on merits" but in Regn. 20 the expression used is "decided ex parte" and we see no reason, either in the language or context of Regulation 20, why it should not include in its scope and ambit an application for restoration of an appeal dismissed for non-prosecution as also an application for restoration of appeal decided on merits under Regulation 19 (1). If the view that we have taken as to the interpretation of Regulation 20 is correct, it follows that Regulation 21 applies to the present case and the period of limitation prescribed by that Regulation being 30 days from the date of receipt of the order of dismissal of the appeal, the applications for restoration made by the appellants in all the four cases were well within the period of limitation prescribed by Regulation 21. It follows, therefore, that the Tribunal committed an error of law in dismissing the applications of restoration made by the appellants in all the four appeals. ### Response: 1

DEPUTY COMMISSIONER OF INCOME TAX, CHENNAI Vs. T. JAYACHANDRAN

a broker or agent to the Indian Bank and the order of the High Court was well within the parameters of law and requires no interference. 9. We have heard learned counsel for both the parties and perused the factual matrix of the case. Discussion:- 10. The answer to the short question whether the alleged interest payable to the PSUs can be assessed as an income of the Respondent depends on the determination of true nature of relationship between the Indian Bank and the Respondent with regard to the transactions in question and the capacity in which he held the amount of 14,73,91,000/-. Now, coming to the question of relationship between the Indian Bank and the Respondent, the normal settlement process in Government securities is that during transaction banks make payments and deliver the securities directly to each other. The brokers only function is to bring the buyer and seller together and help them to negotiate the terms for which he earns a commission from both the parties. He does not handle either cash or securities. In this respect, the broker functions like the broker in the inter bank foreign exchange market. The conduct of the Respondent in the transaction in question cannot be termed to be strictly within the normal course of business and the irregularities can be noticed from the manner in which the whole transactions were conducted. However, the same cannot be basis for holding the Respondent liable for tax with regard to the sum in question and what is required to be seen is whether there accrued any real income to the Respondent or not. 11. It is required to be seen in what capacity the Respondent held the said amount-independently or on behalf of the Indian Bank. The Assessing Officer, while passing order dated 25.01.1996, has held that there exists no agreement between the Respondent and the Indian Bank about the payment of additional interest to the PSUs and there was no overriding title in respect of the additional interest for the PSUs. However, the position in this regard is very much settled that an agreement need not be in writing but can be oral also and the same can be inferred from the conduct of the parties. 12. Further, while considering the claim of the Respondent and the view of the Assessing Officer, how the bank itself had treated the Respondent, is a matter of relevance. At the outset, learned counsel appearing on behalf of the Revenue contended that the proceedings under the Income Tax Act are independent proceedings and the High Court committed a grave error in relying on the findings of the criminal Court. We do not find any force in the contention of the appellant herein as the High Court has not held that the findings of the criminal court are binding on the Revenue authorities. Rather the High Court was of the view that the findings arrived at by the criminal court can be taken into consideration while deciding the question as to the relationship between the parties to the case. When the findings are arrived by a criminal court on the evidence and the material placed on record then in absence of anything shown to the contrary, there seems to be no reason as to why these duly proved evidence should not be relied upon by the Court. The High Court has specifically appraised the findings given by the CBI Court in this regard. The relationship between the Indian Bank and the Respondent is very much clear by the evidence led during the criminal proceedings. The Executive Director of the Bank has specifically spoken about the role of the Respondent as a broker specifically engaged by the Bank for the purchase of securities and that the Bank has included the interest money too in the consideration paid, for the purpose of taking demand drafts in favour of PSUs. Further, the evidence led by other bank officials points out that the price of securities itself were fixed by the bank authorities and as per their directions the Respondent had purchased the securities at the market price and the differential amount was directed to be used for taking demand drafts from the bank itself for paying additional interest to the PSUs. Further, the letter dated 25.03.1994 by the Bank wherein the Bank had acknowledged the receipt of Demand Drafts taken by the Respondent gives an unblurred picture about the capacity of the Respondent in holding the amount in question. Consequently, the conduct of the parties, as is recorded in the criminal proceedings showing the receipt of amount by the broker, the purpose of receipt and the demand drafts taken by the broker at the instance of the bank are sufficient to prove the fact that the Respondent acted as a broker to the Bank and, hence, the additional interest payable to the PSUs could not be held to be his property or income. 13. The income that has actually accrued to the Respondent is taxable. What income has really occurred to be decided, not by reference to physical receipt of income, but by the receipt of income in reality. Given the fact that the Respondent had acted only as a broker and could not claim any ownership on the sum of Rs. 14,73,91,000/- and that the receipt of money was only for the purpose of taking demand drafts for the payment of the differential interest payable by Indian Bank and that the Respondent had actually handed over the said money to the Bank itself, we have no hesitation in holding that the Respondent held the said amount in trust to be paid to the public sector units on behalf of the Indian Bank based on prior understanding reached with the bank at the time of sale of securities and, hence, the said sum of Rs. 14,73,91,000/- cannot be termed as the income of the Respondent. In view of the above discussion, the decision rendered by the High Court requires no interference

0[ds]10. The answer to the short question whether the alleged interest payable to the PSUs can be assessed as an income of the Respondent depends on the determination of true nature of relationship between the Indian Bank and the Respondent with regard to the transactions in question and the capacity in which he held the amount of 14,73,91,000/-.Now, coming to the question of relationship between the Indian Bank and the Respondent, the normal settlement process in Government securities is that during transaction banks make payments and deliver the securities directly to each other. The brokers only function is to bring the buyer and seller together and help them to negotiate the terms for which he earns a commission from both the parties. He does not handle either cash or securities. In this respect, the broker functions like the broker in the inter bank foreign exchange market. The conduct of the Respondent in the transaction in question cannot be termed to be strictly within the normal course of business and the irregularities can be noticed from the manner in which the whole transactions were conducted. However, the same cannot be basis for holding the Respondent liable for tax with regard to the sum in question and what is required to be seen is whether there accrued any real income to the Respondent or not., coming to the question of relationship between the Indian Bank and the Respondent, the normal settlement process in Government securities is that during transaction banks make payments and deliver the securities directly to each other. The brokers only function is to bring the buyer and seller together and help them to negotiate the terms for which he earns a commission from both the parties. He does not handle either cash or securities. In this respect, the broker functions like the broker in the inter bank foreign exchange market. The conduct of the Respondent in the transaction in question cannot be termed to be strictly within the normal course of business and the irregularities can be noticed from the manner in which the whole transactions were conducted. However, the same cannot be basis for holding the Respondent liable for tax with regard to the sum in question and what is required to be seen is whether there accrued any real income to the Respondent or not.. It is required to be seen in what capacity the Respondent held the said amount-independently or on behalf of the Indian Bank. The Assessing Officer, while passing order dated 25.01.1996, has held that there exists no agreement between the Respondent and the Indian Bank about the payment of additional interest to the PSUs and there was no overriding title in respect of the additional interest for the PSUs. However, the position in this regard is very much settled that an agreement need not be in writing but can be oral also and the same can be inferred from the conduct of the. Further, while considering the claim of the Respondent and the view of the Assessing Officer, how the bank itself had treated the Respondent, is a matter of relevance. At the outset, learned counsel appearing on behalf of the Revenue contended that the proceedings under the Income Tax Act are independent proceedings and the High Court committed a grave error in relying on the findings of the criminal Court. We do not find any force in the contention of the appellant herein as the High Court has not held that the findings of the criminal court are binding on the Revenue authorities. Rather the High Court was of the view that the findings arrived at by the criminal court can be taken into consideration while deciding the question as to the relationship between the parties to the case. When the findings are arrived by a criminal court on the evidence and the material placed on record then in absence of anything shown to the contrary, there seems to be no reason as to why these duly proved evidence should not be relied upon by the Court. The High Court has specifically appraised the findings given by the CBI Court in this regard. The relationship between the Indian Bank and the Respondent is very much clear by the evidence led during the criminal proceedings. The Executive Director of the Bank has specifically spoken about the role of the Respondent as a broker specifically engaged by the Bank for the purchase of securities and that the Bank has included the interest money too in the consideration paid, for the purpose of taking demand drafts in favour of PSUs. Further, the evidence led by other bank officials points out that the price of securities itself were fixed by the bank authorities and as per their directions the Respondent had purchased the securities at the market price and the differential amount was directed to be used for taking demand drafts from the bank itself for paying additional interest to the PSUs. Further, the letter dated 25.03.1994 by the Bank wherein the Bank had acknowledged the receipt of Demand Drafts taken by the Respondent gives an unblurred picture about the capacity of the Respondent in holding the amount in question. Consequently, the conduct of the parties, as is recorded in the criminal proceedings showing the receipt of amount by the broker, the purpose of receipt and the demand drafts taken by the broker at the instance of the bank are sufficient to prove the fact that the Respondent acted as a broker to the Bank and, hence, the additional interest payable to the PSUs could not be held to be his property or income.13. The income that has actually accrued to the Respondent is taxable. What income has really occurred to be decided, not by reference to physical receipt of income, but by the receipt of income in reality. Given the fact that the Respondent had acted only as a broker and could not claim any ownership on the sum of Rs. 14,73,91,000/- and that the receipt of money was only for the purpose of taking demand drafts for the payment of the differential interest payable by Indian Bank and that the Respondent had actually handed over the said money to the Bank itself, we have no hesitation in holding that the Respondent held the said amount in trust to be paid to the public sector units on behalf of the Indian Bank based on prior understanding reached with the bank at the time of sale of securities and, hence, the said sum of Rs. 14,73,91,000/- cannot be termed as the income of the Respondent. In view of the above discussion, the decision rendered by the High Court requires no interference

### Instruction: Assess the case proceedings and provide a prediction: is the court likely to rule in favor of (1) or against (0) the appellant/petitioner? ### Input: a broker or agent to the Indian Bank and the order of the High Court was well within the parameters of law and requires no interference. 9. We have heard learned counsel for both the parties and perused the factual matrix of the case. Discussion:- 10. The answer to the short question whether the alleged interest payable to the PSUs can be assessed as an income of the Respondent depends on the determination of true nature of relationship between the Indian Bank and the Respondent with regard to the transactions in question and the capacity in which he held the amount of 14,73,91,000/-. Now, coming to the question of relationship between the Indian Bank and the Respondent, the normal settlement process in Government securities is that during transaction banks make payments and deliver the securities directly to each other. The brokers only function is to bring the buyer and seller together and help them to negotiate the terms for which he earns a commission from both the parties. He does not handle either cash or securities. In this respect, the broker functions like the broker in the inter bank foreign exchange market. The conduct of the Respondent in the transaction in question cannot be termed to be strictly within the normal course of business and the irregularities can be noticed from the manner in which the whole transactions were conducted. However, the same cannot be basis for holding the Respondent liable for tax with regard to the sum in question and what is required to be seen is whether there accrued any real income to the Respondent or not. 11. It is required to be seen in what capacity the Respondent held the said amount-independently or on behalf of the Indian Bank. The Assessing Officer, while passing order dated 25.01.1996, has held that there exists no agreement between the Respondent and the Indian Bank about the payment of additional interest to the PSUs and there was no overriding title in respect of the additional interest for the PSUs. However, the position in this regard is very much settled that an agreement need not be in writing but can be oral also and the same can be inferred from the conduct of the parties. 12. Further, while considering the claim of the Respondent and the view of the Assessing Officer, how the bank itself had treated the Respondent, is a matter of relevance. At the outset, learned counsel appearing on behalf of the Revenue contended that the proceedings under the Income Tax Act are independent proceedings and the High Court committed a grave error in relying on the findings of the criminal Court. We do not find any force in the contention of the appellant herein as the High Court has not held that the findings of the criminal court are binding on the Revenue authorities. Rather the High Court was of the view that the findings arrived at by the criminal court can be taken into consideration while deciding the question as to the relationship between the parties to the case. When the findings are arrived by a criminal court on the evidence and the material placed on record then in absence of anything shown to the contrary, there seems to be no reason as to why these duly proved evidence should not be relied upon by the Court. The High Court has specifically appraised the findings given by the CBI Court in this regard. The relationship between the Indian Bank and the Respondent is very much clear by the evidence led during the criminal proceedings. The Executive Director of the Bank has specifically spoken about the role of the Respondent as a broker specifically engaged by the Bank for the purchase of securities and that the Bank has included the interest money too in the consideration paid, for the purpose of taking demand drafts in favour of PSUs. Further, the evidence led by other bank officials points out that the price of securities itself were fixed by the bank authorities and as per their directions the Respondent had purchased the securities at the market price and the differential amount was directed to be used for taking demand drafts from the bank itself for paying additional interest to the PSUs. Further, the letter dated 25.03.1994 by the Bank wherein the Bank had acknowledged the receipt of Demand Drafts taken by the Respondent gives an unblurred picture about the capacity of the Respondent in holding the amount in question. Consequently, the conduct of the parties, as is recorded in the criminal proceedings showing the receipt of amount by the broker, the purpose of receipt and the demand drafts taken by the broker at the instance of the bank are sufficient to prove the fact that the Respondent acted as a broker to the Bank and, hence, the additional interest payable to the PSUs could not be held to be his property or income. 13. The income that has actually accrued to the Respondent is taxable. What income has really occurred to be decided, not by reference to physical receipt of income, but by the receipt of income in reality. Given the fact that the Respondent had acted only as a broker and could not claim any ownership on the sum of Rs. 14,73,91,000/- and that the receipt of money was only for the purpose of taking demand drafts for the payment of the differential interest payable by Indian Bank and that the Respondent had actually handed over the said money to the Bank itself, we have no hesitation in holding that the Respondent held the said amount in trust to be paid to the public sector units on behalf of the Indian Bank based on prior understanding reached with the bank at the time of sale of securities and, hence, the said sum of Rs. 14,73,91,000/- cannot be termed as the income of the Respondent. In view of the above discussion, the decision rendered by the High Court requires no interference ### Response: 0

Sri Sarangadevar Peria Matam And Another Vs. Ramaswamy Gounder (Dead) By Legal Representatives

rights by the appointment of a receiver having authority to sue on its behalf, or by the institution of a suit in its name by a next friend appointed by the Court. With due diligence, the math or those interested in it may avoid the running of time. The running of limitation against the math under Art. 144 is not suspended by the absence of a legally appointed mathadhipathi; clearly, limitation would run against it where it is managed by a de facto mathadhipathi. See Vithalbowa v. Narayan Daji, (1893) ILR 18 Bom 507 at p. 511, and we think it would run equally if there is neither a de jure nor a de facto mathadhipathi. 7. A mathadhipathi is the manager and custodian of the institution. See Vidya Varuthi Thirtha v. Balusami Ayyar, 48 Ind App 302 at pp. 311, 315: (AIR 1922 PC 123 at pp. 126, 128).The office carries with it the right to manage and possess the endowed properties on behalf of the math and the right to sue on its behalf for the protection of those properties. During the tenure of his office, the mathadhipathi has also large beneficial interests in the math properties, see Commissioner, Hindu Religious Endowments, Madras v. Sri Lakshmindra Thirtha Swamiar of Srirur Mutt, 1954 SCR 1005 at pp. 1018-1020: (AIR 1954 SC 282 at pp. 288-289). But by virtue of his office, he can possess and enjoy only such properties as belong to the math. If the title of the math to any property is extinguished by adverse possession, the rights of all beneficiaries of the math in the property are also extinguished. On his appointment, the mathadhipathi acquires no right to recover property which no longer to the math. If before his appointment limitation under Art. 144 has commenced to run against the math, the appointment does not give either the math or the mathadhipathi a new right of suit or a fresh starting point of limitation under that Article for recovery of the property.In the instant case, the present mathadhipathi was elected in 1939 when the title of the math to the suit lands was already extinguished by adverse possession. By his election in 1939 the present mathadhipathi could not acquire the right to possess and enjoy or to recover properties which no longer belonged to the math. 8. In Jagadindra Roys case, (1904) ILT 32 Cal 129 (PC), the dispossession of the idols lands took place in April 1876. The only shebait of the idol was then a minor, and he sued for recovery of the lands in October 1889 within three years of his attaining majority. The Privy Council held that the plaintiff being a minor at the commencement of the period of limitation was entitled to the benefit of S. 7 of the Indian Limitation Act, 1877 (Act XV of 1877) corresponding to S. 6 of the Indian Limitation Act, 1908, and was entitled to institute the suit within three years of his coming of age. This decision created an anomaly, for, as pointed out by Page, J. in ILR 51 Cal 953 at p. 958: (AIR 1925 Cal 140 at pp. 142-143), in giving the benefit of S. 7 of the Indian Limitation Act, 1877 to the shebait, the Privy Council proceeded on the footing that the right to sue for possession is to be divorced from the proprietary right to the property which is vested in the idol. We do not express any opinion one way or the other on the correctness of Jagadindra Nath Roys case, (1904) ILR 32 Cal 129 (PC). For the purposes of this case, it is sufficient to say that we are not inclined to extend the principle of that case. In that case, at the commencement of the period of limitation there was a shebait in existence entitled to sue on behalf of the idol, and on the institution of the suit he successfully claimed that as the person entitled to institute the suit at the time from which the period is to be reckoned, he should get the benefit of S. 7 of the Indian Limitation Act, 1877. In the present case, there was no mathadhipathi in existence in 1915 when limitation commenced to run. Nor is there any question of the minority of a mathadhipathi entitled to sue in 1915 or of applying S. 6 of the Indian Limitation Act, 1908. 9. For these reasons, we hold that the time under Art. 144 of the Indian Limitation Act, 1908 commenced to run in 1915 on the death of the mathadhipathi, who granted the lease, and the absence of a legally appointed mathadhipathi did not prevent the running of time under Art. 144.We therefore, agree with the answer given by the majority of the Judges to the third question referred to the Full Bench of the Madras High Court in Venkateswaras case, ILR (1941) Mad 599 at pp. 614-615, 633-634: (AIR 1941 Mad 449 at pp. 455-456, 461). We express no opinion on the interpretation of Art. 134-B of the Indian Limitation Act, 1908 or Art. 96 of the Indian Limitation Act, 1963.Under Art. 96 of the Indian Limitation Act, 1963, the starting point of limitation in such a case would be the date of the appointment of the plaintiff as manager of the endowment, but this Article cannot be considered to be a legislative recognition of the law existing before 1929. 10. We hold that by the operation of Art. 144 read with S. 28 of the Indian Limitation Act, 1908 the title of the math to the suit lands became extinguished in 1927, and the plaintiff acquired title to the lands by prescription. He continued in possession of the lands until January, 1950. It has been found that in January, 1950 he voluntarily delivered possession of the lands to the math, such delivery of possession did not transfer any title to the math. The suit was instituted in 1954 and is well within time.

0[ds]6. We are inclined to accept the respondents contention. Under Art. 144 of the Indian Limitation Act, 1908, limitation for a suit by a math or by any person representing it for possession of immovable properties belonging to it runs from the time when the possession of the defendant becomes adverse to the plaintiff. The math is the owner of the endowed property. Like an idol, the math is a juristic person having the power of acquiring owning and possessing properties and having the capacity of suing and being sued. Being an ideal person, it must of necessity act in relation to its temporal affairs through human agency. See Babajirao v. Luxmandas, (1904) ILR 28 Bom 215 (223). It may acquire property by prescription and may likewise lose property by adverse possession. If the math while in possession of its property is dispossessed to if the possession of a stranger becomes adverse, it suffers an injury and has the right to sue for the recovery of the property. If there is a legally appointed mathadhipathi, he may institute the suit on its behalf; if not, the de facto mathadhipathi may do so, see Mahadeo Prasad Singh v. Karia Bharti, 62 Ind App 47 at p. 51: (AIR 1925 PC 44 at p. 46), and where, necessary, a disciple or other beneficiary of the math may take steps for vindicating its legal rights by the appointment of a receiver having authority to sue on its behalf, or by the institution of a suit in its name by a next friend appointed by the Court. With due diligence, the math or those interested in it may avoid the running of time. The running of limitation against the math under Art. 144 is not suspended by the absence of a legally appointed mathadhipathi; clearly, limitation would run against it where it is managed by a de facto mathadhipathi. See Vithalbowa v. Narayan Daji, (1893) ILR 18 Bom 507 at p. 511, and we think it would run equally if there is neither a de jure nor a de facto mathadhipathi7. A mathadhipathi is the manager and custodian of the institution. See Vidya Varuthi Thirtha v. Balusami Ayyar, 48 Ind App 302 at pp. 311, 315: (AIR 1922 PC 123 at pp. 126, 128).The office carries with it the right to manage and possess the endowed properties on behalf of the math and the right to sue on its behalf for the protection of those properties. During the tenure of his office, the mathadhipathi has also large beneficial interests in the math properties, see Commissioner, Hindu Religious Endowments, Madras v. Sri Lakshmindra Thirtha Swamiar of Srirur Mutt, 1954 SCR 1005 at pp. 1018-1020: (AIR 1954 SC 282 at pp. 288-289). But by virtue of his office, he can possess and enjoy only such properties as belong to the math. If the title of the math to any property is extinguished by adverse possession, the rights of all beneficiaries of the math in the property are also extinguished. On his appointment, the mathadhipathi acquires no right to recover property which no longer to the math. If before his appointment limitation under Art. 144 has commenced to run against the math, the appointment does not give either the math or the mathadhipathi a new right of suit or a fresh starting point of limitation under that Article for recovery of the property.In the instant case, the present mathadhipathi was elected in 1939 when the title of the math to the suit lands was already extinguished by adverse possession. By his election in 1939 the present mathadhipathi could not acquire the right to possess and enjoy or to recover properties which no longer belonged to the math8. In Jagadindra Roys case, (1904) ILT 32 Cal 129 (PC), the dispossession of the idols lands took place in April 1876. The only shebait of the idol was then a minor, and he sued for recovery of the lands in October 1889 within three years of his attaining majority. The Privy Council held that the plaintiff being a minor at the commencement of the period of limitation was entitled to the benefit of S. 7 of the Indian Limitation Act, 1877 (Act XV of 1877) corresponding to S. 6 of the Indian Limitation Act, 1908, and was entitled to institute the suit within three years of his coming of age. This decision created an anomaly, for, as pointed out by Page, J. in ILR 51 Cal 953 at p. 958: (AIR 1925 Cal 140 at pp. 142-143), in giving the benefit of S. 7 of the Indian Limitation Act, 1877 to the shebait, the Privy Council proceeded on the footing that the right to sue for possession is to be divorced from the proprietary right to the property which is vested in the idol. We do not express any opinion one way or the other on the correctness of Jagadindra Nath Roys case, (1904) ILR 32 Cal 129 (PC). For the purposes of this case, it is sufficient to say that we are not inclined to extend the principle of that case. In that case, at the commencement of the period of limitation there was a shebait in existence entitled to sue on behalf of the idol, and on the institution of the suit he successfully claimed that as the person entitled to institute the suit at the time from which the period is to be reckoned, he should get the benefit of S. 7 of the Indian Limitation Act, 1877. In the present case, there was no mathadhipathi in existence in 1915 when limitation commenced to run. Nor is there any question of the minority of a mathadhipathi entitled to sue in 1915 or of applying S. 6 of the Indian Limitation Act, 1908.

### Instruction: Examine the details of the case proceeding and forecast if the appeal/petition stands a chance of being upheld (1) or dismissed (0). ### Input: rights by the appointment of a receiver having authority to sue on its behalf, or by the institution of a suit in its name by a next friend appointed by the Court. With due diligence, the math or those interested in it may avoid the running of time. The running of limitation against the math under Art. 144 is not suspended by the absence of a legally appointed mathadhipathi; clearly, limitation would run against it where it is managed by a de facto mathadhipathi. See Vithalbowa v. Narayan Daji, (1893) ILR 18 Bom 507 at p. 511, and we think it would run equally if there is neither a de jure nor a de facto mathadhipathi. 7. A mathadhipathi is the manager and custodian of the institution. See Vidya Varuthi Thirtha v. Balusami Ayyar, 48 Ind App 302 at pp. 311, 315: (AIR 1922 PC 123 at pp. 126, 128).The office carries with it the right to manage and possess the endowed properties on behalf of the math and the right to sue on its behalf for the protection of those properties. During the tenure of his office, the mathadhipathi has also large beneficial interests in the math properties, see Commissioner, Hindu Religious Endowments, Madras v. Sri Lakshmindra Thirtha Swamiar of Srirur Mutt, 1954 SCR 1005 at pp. 1018-1020: (AIR 1954 SC 282 at pp. 288-289). But by virtue of his office, he can possess and enjoy only such properties as belong to the math. If the title of the math to any property is extinguished by adverse possession, the rights of all beneficiaries of the math in the property are also extinguished. On his appointment, the mathadhipathi acquires no right to recover property which no longer to the math. If before his appointment limitation under Art. 144 has commenced to run against the math, the appointment does not give either the math or the mathadhipathi a new right of suit or a fresh starting point of limitation under that Article for recovery of the property.In the instant case, the present mathadhipathi was elected in 1939 when the title of the math to the suit lands was already extinguished by adverse possession. By his election in 1939 the present mathadhipathi could not acquire the right to possess and enjoy or to recover properties which no longer belonged to the math. 8. In Jagadindra Roys case, (1904) ILT 32 Cal 129 (PC), the dispossession of the idols lands took place in April 1876. The only shebait of the idol was then a minor, and he sued for recovery of the lands in October 1889 within three years of his attaining majority. The Privy Council held that the plaintiff being a minor at the commencement of the period of limitation was entitled to the benefit of S. 7 of the Indian Limitation Act, 1877 (Act XV of 1877) corresponding to S. 6 of the Indian Limitation Act, 1908, and was entitled to institute the suit within three years of his coming of age. This decision created an anomaly, for, as pointed out by Page, J. in ILR 51 Cal 953 at p. 958: (AIR 1925 Cal 140 at pp. 142-143), in giving the benefit of S. 7 of the Indian Limitation Act, 1877 to the shebait, the Privy Council proceeded on the footing that the right to sue for possession is to be divorced from the proprietary right to the property which is vested in the idol. We do not express any opinion one way or the other on the correctness of Jagadindra Nath Roys case, (1904) ILR 32 Cal 129 (PC). For the purposes of this case, it is sufficient to say that we are not inclined to extend the principle of that case. In that case, at the commencement of the period of limitation there was a shebait in existence entitled to sue on behalf of the idol, and on the institution of the suit he successfully claimed that as the person entitled to institute the suit at the time from which the period is to be reckoned, he should get the benefit of S. 7 of the Indian Limitation Act, 1877. In the present case, there was no mathadhipathi in existence in 1915 when limitation commenced to run. Nor is there any question of the minority of a mathadhipathi entitled to sue in 1915 or of applying S. 6 of the Indian Limitation Act, 1908. 9. For these reasons, we hold that the time under Art. 144 of the Indian Limitation Act, 1908 commenced to run in 1915 on the death of the mathadhipathi, who granted the lease, and the absence of a legally appointed mathadhipathi did not prevent the running of time under Art. 144.We therefore, agree with the answer given by the majority of the Judges to the third question referred to the Full Bench of the Madras High Court in Venkateswaras case, ILR (1941) Mad 599 at pp. 614-615, 633-634: (AIR 1941 Mad 449 at pp. 455-456, 461). We express no opinion on the interpretation of Art. 134-B of the Indian Limitation Act, 1908 or Art. 96 of the Indian Limitation Act, 1963.Under Art. 96 of the Indian Limitation Act, 1963, the starting point of limitation in such a case would be the date of the appointment of the plaintiff as manager of the endowment, but this Article cannot be considered to be a legislative recognition of the law existing before 1929. 10. We hold that by the operation of Art. 144 read with S. 28 of the Indian Limitation Act, 1908 the title of the math to the suit lands became extinguished in 1927, and the plaintiff acquired title to the lands by prescription. He continued in possession of the lands until January, 1950. It has been found that in January, 1950 he voluntarily delivered possession of the lands to the math, such delivery of possession did not transfer any title to the math. The suit was instituted in 1954 and is well within time. ### Response: 0

Narendra Vs. K.Meena

any reason to justify the said view of the High Court. As stated hereinabove, in a Hindu society, it is a pious obligation of the son to maintain the parents. If a wife makes an attempt to deviate from the normal practice and normal custom of the society, she must have some justifiable reason for that and in this case, we do not find any justifiable reason, except monetary consideration of the Respondent wife. In our opinion, normally, no husband would tolerate this and no son would like to be separated from his old parents and other family members, who are also dependent upon his income. The persistent effort of the Respondent wife to constrain the Appellant to be separated from the family would be torturous for the husband and in our opinion, the trial Court was right when it came to the conclusion that this constitutes an act of ‘cruelty’.12. With regard to the allegations about an extra-marital affair with maid named Kamla, the re-appreciation of the evidence by the High Court does not appear to be correct. There is sufficient evidence to the effect that there was no maid named Kamla working at the residence of the Appellant. Some averment with regard to some relative has been relied upon by the High Court to come to a conclusion that there was a lady named Kamla but the High Court has ignored the fact that the Respondent wife had leveled allegations with regard to an extra-marital affair of the Appellant with the maid and not with someone else. Even if there was some relative named Kamla, who might have visited the Appellant, there is nothing to substantiate the allegations levelled by the Respondent with regard to an extra-marital affair. True, it is very difficult to establish such allegations but at the same time, it is equally true that to suffer an allegation pertaining to one’s character of having an extra-marital affair is quite torturous for any person – be it a husband or a wife. We have carefully gone through the evidence but we could not find any reliable evidence to show that the Appellant had an extra-marital affair with someone. Except for the baseless and reckless allegations, there is not even the slightest evidence that would suggest that there was something like an affair of the Appellant with the maid named by the Respondent. We consider levelling of absolutely false allegations and that too, with regard to an extra-marital life to be quite serious and that can surely be a cause for metal cruelty.13. This Court, in the case of Vijaykumar Ramchandra Bhate v. Neela Vijaykumar Bhate, 2003 (6) SCC 334 has held as under:-“7. The question that requires to be answered first is as to whether the averments, accusations and character assassination of the wife by the appellant husband in the written statement constitutes mental cruelty for sustaining the claim for divorce under Section 13(1)(i-a) of the Act. The position of law in this regard has come to be well settled and declared that levelling disgusting accusations of unchastity and indecent familiarity with a person outside wedlock and allegations of extramarital relationship is a grave assault on the character, honour, reputation, status as well as the health of the wife. Such aspersions of perfidiousness attributed to the wife, viewed in the context of an educated Indian wife and judged by Indian conditions and standards would amount to worst form of insult and cruelty, sufficient by itself to substantiate cruelty in law, warranting the claim of the wife being allowed. That such allegations made in the written statement or suggested in the course of examination and by way of cross-examination satisfy the requirement of law has also come to be firmly laid down by this Court. On going through the relevant portions of such allegations, we find that no exception could be taken to the findings recorded by the Family Court as well as the High Court. We find that they are of such quality, magnitude and consequence as to cause mental pain, agony and suffering amounting to the reformulated concept of cruelty in matrimonial law causing profound and lasting disruption and driving the wife to feel deeply hurt and reasonably apprehend that it would be dangerous for her to live with a husband who was taunting her like that and rendered the maintenance of matrimonial home impossible.”14. Applying the said ratio to the facts of this case, we are inclined to hold that the unsubstantiated allegations levelled by the Respondent wife and the threats and attempt to commit suicide by her amounted to mental cruelty and therefore, the marriage deserves to be dissolved by a decree of divorce on the ground stated in Section 13(1)(ia) of the Act.15. Taking an overall view of the entire evidence and the judgment delivered by the trial Court, we firmly believe that there was no need to take a different view than the one taken by the trial Court. The behaviour of the Respondent wife appears to be terrifying and horrible. One would find it difficult to live with such a person with tranquility and peace of mind. Such torture would adversely affect the life of the husband. It is also not in dispute that the Respondent wife had left the matrimonial house on 12th July, 1995 i.e. more than 20 years back. Though not on record, the learned counsel submitted that till today, the Respondent wife is not staying with the Appellant. The daughter of the Appellant and Respondent has also grown up and according to the learned counsel, she is working in an IT company. We have no reason to disbelieve the aforestated facts because with the passage of time, the daughter must have grown up and the separation of the Appellant and the wife must have also become normal for her and therefore, at this juncture it would not be proper to bring them together, especially when the Appellant husband was treated so cruelly by the Respondent wife.

1[ds]The constant persuasion by the Respondent for getting separated from the family members of the Appellant and constraining the Appellant to live separately and only with her was also not considered to be of any importance by the High Court. No importance was given to the incident with regard to an attempt to commit suicide made by the Respondent wife. On the contrary, it appears that the High Court found some justification in the request made by the Respondent to live separately from the family of the Appellant husband. According to the High Court, the trial Court did not appreciate the evidence properly. For the aforestated reasons, the High Court reversed the findings arrived at by the learned Family Court and set aside the decree of divorce.9. We do not agree with the manner in which the High Court hasthe evidence and has come to a different conclusion.10. With regard to the allegations of cruelty levelled by the Appellant, we are in agreement with the findings of the trial Court. First of all, let us look at the incident with regard to an attempt to commit suicide by the Respondent. Upon perusal of the evidence of the witnesses, the findings arrived at by the trial Court to the effect that the Respondent wife had locked herself in the bathroom and had poured kerosene on herself so as to commit suicide, are not in dispute. Fortunately for the Appellant, because of the noise and disturbance, even the neighbours of the Appellant rushed to help and the door of the bathroom was broken open and the Respondent was saved. Had she been successful in her attempt to commit suicide, then one can foresee the consequences and the plight of the Appellant because in that event the Appellant would have been put to immense difficulties because of the legal provisions. We feel that there was no fault on the part of the Appellant nor was there any reason for the Respondent wife to make an attempt to commit suicide. No husband would ever be comfortable with or tolerate such an act by his wife and if the wife succeeds in committing suicide, then one can imagine how a poor husband would get entangled into the clutches of law, which would virtually ruin his sanity, peace of mind, career and probably his entire life. The mere idea with regard to facing legal consequences would put a husband under tremendous stress. The thought itself is distressing. Such a mental cruelty could not have been taken lightly by the High Court. In our opinion, only this one event was sufficient for the Appellant husband to get a decree of divorce on the ground of cruelty. It is needless to add that such threats or acts constitute cruelty.cruelty.11. The Respondent wife wanted the Appellant to get separated from his family. The evidence shows that the family was virtually maintained from the income of the Appellant husband. It is not a common practice or desirable culture for a Hindu son in India to get separated from the parents upon getting married at the instance of the wife, especially when the son is the only earning member in the family. A son, brought up and given education by his parents, has a moral and legal obligation to take care and maintain the parents, when they become old and when they have either no income or have a meagrethe instant case, upon appreciation of the evidence, the trial Court came to the conclusion that merely for monetary considerations, the Respondent wife wanted to get her husband separated from his family. The averment of the Respondent was to the effect that the income of the Appellant was also spent for maintaining his family. The said grievance of the Respondent is absolutelythe opinion of the High Court, the wife had a legitimate expectation to see that the income of her husband is used for her and not for the family members of the Respondent husband. We do not see any reason to justify the said view of the High Court. As stated hereinabove, in a Hindu society, it is a pious obligation of the son to maintain theWith regard to the allegations about anaffair with maid named Kamla, theof the evidence by the High Court does not appear to be correct. There is sufficient evidence to the effect that there was no maid named Kamla working at the residence of the Appellant. Some averment with regard to some relative has been relied upon by the High Court to come to a conclusion that there was a lady named Kamla but the High Court has ignored the fact that the Respondent wife had leveled allegations with regard to anaffair of the Appellant with the maid and not with someone else. Even if there was some relative named Kamla, who might have visited the Appellant, there is nothing to substantiate the allegations levelled by the Respondent with regard to anaffair. True, it is very difficult to establish such allegations but at the same time, it is equally true that to suffer an allegation pertaining tocharacter of having anaffair is quite torturous for any person – be it a husband or a wife. We have carefully gone through the evidence but we could not find any reliable evidence to show that the Appellant had anaffair with someone. Except for the baseless and reckless allegations, there is not even the slightest evidence that would suggest that there was something like an affair of the Appellant with the maid named by the Respondent. We consider levelling of absolutely false allegations and that too, with regard to anlife to be quite serious and that can surely be a cause for metal cruelty.13. This Court, in the case of Vijaykumar Ramchandra Bhate v. Neela Vijaykumar Bhate, 2003 (6) SCC 334 has held asThe question that requires to be answered first is as to whether the averments, accusations and character assassination of the wife by the appellant husband in the written statement constitutes mental cruelty for sustaining the claim for divorce under Section13(1)(ia) of the Act.The position of law in this regard has come to be well settled and declared that levelling disgusting accusations of unchastity and indecent familiarity with a person outside wedlock and allegations of extramarital relationship is a grave assault on the character, honour, reputation, status as well as the health of the wife. Such aspersions of perfidiousness attributed to the wife, viewed in the context of an educated Indian wife and judged by Indian conditions and standards would amount to worst form of insult and cruelty, sufficient by itself to substantiate cruelty in law, warranting the claim of the wife being allowed. That such allegations made in the written statement or suggested in the course of examination and by way ofsatisfy the requirement of law has also come to be firmly laid down by this Court. On going through the relevant portions of such allegations, we find that no exception could be taken to the findings recorded by the Family Court as well as the High Court. We find that they are of such quality, magnitude and consequence as to cause mental pain, agony and suffering amounting to the reformulated concept of cruelty in matrimonial law causing profound and lasting disruption and driving the wife to feel deeply hurt and reasonably apprehend that it would be dangerous for her to live with a husband who was taunting her like that and rendered the maintenance of matrimonial home impossible.Applying the said ratio to the facts of this case, we are inclined to hold that the unsubstantiated allegations levelled by the Respondent wife and the threats and attempt to commit suicide by her amounted to mental cruelty and therefore, the marriage deserves to be dissolved by a decree of divorce on the ground stated in Section13(1)(ia) of the Act.Taking an overall view of the entire evidence and the judgment delivered by the trial Court, we firmly believe that there was no need to take a different view than the one taken by the trial Court. The behaviour of the Respondent wife appears to be terrifying and horrible. One would find it difficult to live with such a person with tranquility and peace of mind. Such torture would adversely affect the life of the husband. It is also not in dispute that the Respondent wife had left the matrimonial house on 12th July, 1995 i.e. more than 20 years back. Though not on record, the learned counsel submitted that till today, the Respondent wife is not staying with the Appellant. The daughter of the Appellant and Respondent has also grown up and according to the learned counsel, she is working in an IT company. We have no reason to disbelieve the aforestated facts because with the passage of time, the daughter must have grown up and the separation of the Appellant and the wife must have also become normal for her and therefore, at this juncture it would not be proper to bring them together, especially when the Appellant husband was treated so cruelly by the Respondent wife.

### Instruction: Scrutinize the evidence and arguments in the case proceeding to predict the court's decision: will the appeal be granted (1) or denied (0)? ### Input: any reason to justify the said view of the High Court. As stated hereinabove, in a Hindu society, it is a pious obligation of the son to maintain the parents. If a wife makes an attempt to deviate from the normal practice and normal custom of the society, she must have some justifiable reason for that and in this case, we do not find any justifiable reason, except monetary consideration of the Respondent wife. In our opinion, normally, no husband would tolerate this and no son would like to be separated from his old parents and other family members, who are also dependent upon his income. The persistent effort of the Respondent wife to constrain the Appellant to be separated from the family would be torturous for the husband and in our opinion, the trial Court was right when it came to the conclusion that this constitutes an act of ‘cruelty’.12. With regard to the allegations about an extra-marital affair with maid named Kamla, the re-appreciation of the evidence by the High Court does not appear to be correct. There is sufficient evidence to the effect that there was no maid named Kamla working at the residence of the Appellant. Some averment with regard to some relative has been relied upon by the High Court to come to a conclusion that there was a lady named Kamla but the High Court has ignored the fact that the Respondent wife had leveled allegations with regard to an extra-marital affair of the Appellant with the maid and not with someone else. Even if there was some relative named Kamla, who might have visited the Appellant, there is nothing to substantiate the allegations levelled by the Respondent with regard to an extra-marital affair. True, it is very difficult to establish such allegations but at the same time, it is equally true that to suffer an allegation pertaining to one’s character of having an extra-marital affair is quite torturous for any person – be it a husband or a wife. We have carefully gone through the evidence but we could not find any reliable evidence to show that the Appellant had an extra-marital affair with someone. Except for the baseless and reckless allegations, there is not even the slightest evidence that would suggest that there was something like an affair of the Appellant with the maid named by the Respondent. We consider levelling of absolutely false allegations and that too, with regard to an extra-marital life to be quite serious and that can surely be a cause for metal cruelty.13. This Court, in the case of Vijaykumar Ramchandra Bhate v. Neela Vijaykumar Bhate, 2003 (6) SCC 334 has held as under:-“7. The question that requires to be answered first is as to whether the averments, accusations and character assassination of the wife by the appellant husband in the written statement constitutes mental cruelty for sustaining the claim for divorce under Section 13(1)(i-a) of the Act. The position of law in this regard has come to be well settled and declared that levelling disgusting accusations of unchastity and indecent familiarity with a person outside wedlock and allegations of extramarital relationship is a grave assault on the character, honour, reputation, status as well as the health of the wife. Such aspersions of perfidiousness attributed to the wife, viewed in the context of an educated Indian wife and judged by Indian conditions and standards would amount to worst form of insult and cruelty, sufficient by itself to substantiate cruelty in law, warranting the claim of the wife being allowed. That such allegations made in the written statement or suggested in the course of examination and by way of cross-examination satisfy the requirement of law has also come to be firmly laid down by this Court. On going through the relevant portions of such allegations, we find that no exception could be taken to the findings recorded by the Family Court as well as the High Court. We find that they are of such quality, magnitude and consequence as to cause mental pain, agony and suffering amounting to the reformulated concept of cruelty in matrimonial law causing profound and lasting disruption and driving the wife to feel deeply hurt and reasonably apprehend that it would be dangerous for her to live with a husband who was taunting her like that and rendered the maintenance of matrimonial home impossible.”14. Applying the said ratio to the facts of this case, we are inclined to hold that the unsubstantiated allegations levelled by the Respondent wife and the threats and attempt to commit suicide by her amounted to mental cruelty and therefore, the marriage deserves to be dissolved by a decree of divorce on the ground stated in Section 13(1)(ia) of the Act.15. Taking an overall view of the entire evidence and the judgment delivered by the trial Court, we firmly believe that there was no need to take a different view than the one taken by the trial Court. The behaviour of the Respondent wife appears to be terrifying and horrible. One would find it difficult to live with such a person with tranquility and peace of mind. Such torture would adversely affect the life of the husband. It is also not in dispute that the Respondent wife had left the matrimonial house on 12th July, 1995 i.e. more than 20 years back. Though not on record, the learned counsel submitted that till today, the Respondent wife is not staying with the Appellant. The daughter of the Appellant and Respondent has also grown up and according to the learned counsel, she is working in an IT company. We have no reason to disbelieve the aforestated facts because with the passage of time, the daughter must have grown up and the separation of the Appellant and the wife must have also become normal for her and therefore, at this juncture it would not be proper to bring them together, especially when the Appellant husband was treated so cruelly by the Respondent wife. ### Response: 1

Begulla Bapi Raju Etc Vs. State of Andhra Pradesh Etc

defined in s.3 (i) of the Andhra Pradesh Act. It reads:"3(i) holding means the entire land held by a person, -(i) as an owner;(ii) as a limited owner;(iii)as a usufructuary mortgage;(iv) as a tenant;(v) who is in possession by virtue of a mortgage by conditional sale or through part performance of a contract for the sale of land or otherwise, or in one or more of such capacities;and the expression to hold land shall be construed accordingly.Explanation:-Where the same land is held by one person in one capacity and by another person in any other capacity, such land shall be included in the holding of both such persons."Dealing with the expressions held the Court observed:"The word held is not defined in the Act. We have, therefore, to go by the dictionary meaning of the term. According to Oxford Dictionary held means: to possess to be the owner or holder or tenant of; keep possession of; occupy. Thus, held connotes both ownership as well as possession . And in the context of the definition it is not possible to interpret the term held only in the sense of possession. For example, if a land is held by an owner and also by a tenant or by a person in possession pursuant to a contract for sale, the holding will be taken to be the holding of all such persons. It obviously means that an owner who is not an actual possession will also be taken to be a holder of the land. If there was any doubt in this behalf, the same has been dispelled by the explanation attached to the definition of the term holding. The explanation clearly contemplates that the same land can be the holding of two different persons holding the land in two different capacities. The respondent in view of the definition certainly is holding as an owner, although he is not in possession."Shri Phadke, however, contends that s. 3(i) of the Andhra Pradesh Act being unreasonable is ultra vires because the same land cannot be the land of the transferor as well as of the transferee and that Mohd. Ashrafuddins case (supra) requires reconsideration. That case has taken into consideration the various relevant provisions of the Act and the Court came to the conclusion the same land can be the land of the transferor as well as the transferee in view of the definition of the term holding in s. 3(i) of the Andhra Pradesh Act and in our opinion the view taken in that case is fully warranted by the provisions of the Act. We are not persuaded to accept the contention that the case requires re-consideration.This leads us to the last point but not the least in importance, in that the petitioners have bee n deprived of a substantial portion of their holding in the form of surplus land and thereby they have been deprived of their livelihood affecting their right to live, which is violative of Art. 21 of the Constitution. In support of this contention strong reliance was placed on the case of Maneka Gandhi v. Union of India(1) which has given a new dimension to Art. 21 of the Constitution. It was held in that case that right to live is not merely confined to physical existence, but it includes within its ambit the right to live with basic human dignity and the State cannot deprive anyone of this valuable right. It was further submitted that s. 3(f) of the Andhra Pradesh Act with the explanation added to it is destructive of Art. 21 and, therefore, violative of the basic structure of the Constitution. This point is also covered by two decisions of this Court. In re Sant Ram(2) dealing with Art. 21 of the Constitution a Bench of Five Judges of this Court held:"The argument that the word "life" in Art. 21 of the Constitution includes "livelihood" has only to be stated to be rejected.""The same view was reiterated by a Bench of three Judges in A. V. Nachane v. Union of India(3). In that case the validity of the Life Insurance Corporation (Amendment) Act, 1981 (I of 1981) and the Life Insurance Corporation of India Class III and Class IV Employees (Bonus and Dearness Allowance) Rules, 1981, were challenged on several grounds including Art. 21 of the Constitution and the Court dealing with this aspect of the matter quoted with approval the case of Sant Ram (supra) in the following words:"As regards Article 21, the first premise of the argument that the word life in that Article includes livelihood was considered and rejected in In re Sant Ram."15. Shri Phadke, however, brushed these cases aside on the simple ground that they are not relevant for the decision of the question whether the right to live includes the right to live with human dignity, and the decision on Maneka Gandhis case (supra) must be deemed to be the correct exposition of the law on the subject. The contention that life includes livelihood within the meaning of Art. 21 of the Constitution was repel led in these two cases and Maneka Gandhis case did not take into consideration the case of Sant Ram (supra). These cases, therefore, still hold the field.16. Besides, the petitioners have been deprived of their holding in the form of surplus land but it was only for the purpose of giving relief to the downtrodden and the poor agricultural labourers. The surplus land would vest in the State and the State in its turn would give it to the poor and the downtrodden and thus such a deprivation will be protected under Art. 39 of Directive Principles. The case of Maneka Gandhi (supra), in our opinion, is not relevant for the decision of the point under consideration.The counsel for the petitioners in other cases adopted the same argument of Shri Phadke.17. Having given our best consideration to the questions involved in the cases we find no infirmity in any of the provisions of the Andhra Pradesh Act.Fo

0[ds]It will thus be clear that the ceiling area in case of an individual who is not a member of the family unit is equivalent to one standard holding and so also in the case of a family unit with not more than five members the ceiling area is the same. But if the family unit consisted of more than five members the ceiling area would stand increased by one-fifth of one standard holding for every additional member of the family unit, subject, however, to the maximum limit of two standard holdings. In view of the explanation added to s. 4 the land held by all the members of the family unit shall be aggregated for the purpose of computing the holding of the family unit. Obviously, therefore, where a family unit consisted of father, mother, and minor sons or daughters the land held by all these persons would have to be clubbed together and then ceiling area limit applied to the aggregate holding. No distinction has been made in the definition of a family unit between a divided minor son an undivided minor son. Both stand on the same footing and a divided minor son is as much a member of the family unit as an undivided minor son. Family unit is not to be confused with joint family.The contention of Shri Phadke is that the definition of various terms as given in s. 3 of the Andhra Pradesh Act opens with the words."In this Act, unless the context otherwise requires."According to the learned counsel the context otherwise requires that the word minor in s. 3 (f) cannot include a divided minor son. Section 4 (2), argued the learned counsel, deals with the ceiling area of a family unit and s. 4 (3) deals with the ceiling area of an individual who is not a member of a family unit. A divided minor son, submits the counsel, is an individual and is no longer a member of the family unit in as much as a partition has not only the effect of division of the property but a complete severance from membership of the joint family. Thus a minor who is separated under a partition deed cannot be a member of the family unit but becomes anorder to attract the provisions of cl. (iv) of s. 5 the petitioners have to establish that the Government by notification has declared a particular area to be a drought prone-area. The petitioners were given an opportunity to pro duce the notification which they have failed to do and now the petitioners seek that they should be given an opportunity to produce the specific notification as and when they are able to procure the same. We are not inclined to give such a blank-cheque to the petitioners to produce the required notification as and when they like. Indeed they should have raised a contention to that effect before the High Court and should have produced the necessary notification but that they did not do. Even before this Court they have not been able to produce the specific notification issued by the Government. Under the circumstances they cannot be allowed to urge this point for want to necessary foundation for the argument. We also decline to accede to their request that they may be allowed to produce the required Government notification according to their sweet will and as and when they are able to produce thenow take up the third ground that the definition of family unit under s. 3 (f), as interpreted by the High Court is violative of Art. 14 of the Constitution. This point is also covered by a decision of this Court in Seth Nand Lal &Anr. v. State of Haryana &Ors.(1) and the Court repelled the argument firstly on the ground that it was saved by the protective umbrella under Art. 31A and Art. 31B of the Constitution and also on other considerations as will be evident from the followinghas be en pointed out that adopting family as a unit as against an individual was considered necessary as that would reduce the scope for evasion of law by effecting mala fide partitions and transfers since such transactions are usually made in favour of family members that normally in rural agricultural set up in our country the family is the operative unit and all the lands of a family constitute a single operational holding and that therefore ceiling should be related to the capacity of a family to cultivate the lands personally. It has been pointed out that keeping all these aspects in view the concept of family was artificially defined and double standard for fixing ceiling, one for the primary unit and other for the adult son living with the family was adopted In fact, a provision like s. 4(3) which makes for the augmentation of the permissible area for a family when the adult so ns do not own or hold lands of their own but are living with the family has one virtue, that it ensures such augmentation in the case of every family irrespective of by what personal law it is governed and no discrimination is made between major sons governed by different systems of personal laws. So far as an adult son living separately from the family is concerned, he is rightly regarded as a separate unit who will have to file a separate declaration in respect of his holding under s. 9 of the Act and since he is living separately and would not be contributing his capacity to the family to cultivate the family lands personally, there is no justification for increasing the permissible area of the primary unit of the family. The case of an unmarried daughter or daughters living with the family, counsel pointed out, was probably considered to be a rare case and it was presume d that daughters would in normal course get married and would become members of their husbands units and that is why no separate provision was made for giving additional land for every unmarried major daughter living with the family. On the materials placed and the initial presumption of constitutionality, we find considerable force in this submission. It is, therefore, not possible to strike down an enactment particularly the enactment dealing with agrarian reform which has been put on the Statutes Book with the avowed purpose of bringing about equality or rather reducing the inequality between the haves and the have-nots, as being violative of Art. 14 of the Constitution simply because it has failed to make a provision for what was regarded as an exceptional case or a rare contingency. In our view, the material furnished on behalf of the State Government by way of justification for adopting an artificial definition of family and a double standard for fixing ceiling is sufficient to rebel the attack on these provisions under Art.fully concur with the view of thePhadke, however, brushed these cases aside on the simple ground that they are not relevant for the decision of the questionwhether the right to live includes the right to live with human dignity, and the decision on Maneka Gandhis case (supra) must be deemed to be the correct exposition of the law on the subject.The contention that life includes livelihood within the meaning of Art. 21 of the Constitution was repel led in these two cases and Maneka Gandhis case did not take into consideration the case of Sant Ram (supra). These cases, therefore, still hold thethe petitioners have been deprived of their holding in the form of surplus land but it was only for the purpose of giving relief to the downtrodden and the poor agricultural labourers. The surplus land would vest in the State and the State in its turn would give it to the poor and the downtrodden and thus such a deprivation will be protected under Art. 39 of Directive Principles. The case of Maneka Gandhi (supra), in our opinion, is not relevant for the decision of the point under consideration.The counsel for the petitioners in other cases adopted the same argument of Shrigiven our best consideration to the questions involved in the cases we find no infirmity in any of the provisions of the Andhra Pradesh Act.

### Instruction: Interpret the case information and speculate on the court's decision: acceptance (1) or rejection (0) of the presented appeal. ### Input: defined in s.3 (i) of the Andhra Pradesh Act. It reads:"3(i) holding means the entire land held by a person, -(i) as an owner;(ii) as a limited owner;(iii)as a usufructuary mortgage;(iv) as a tenant;(v) who is in possession by virtue of a mortgage by conditional sale or through part performance of a contract for the sale of land or otherwise, or in one or more of such capacities;and the expression to hold land shall be construed accordingly.Explanation:-Where the same land is held by one person in one capacity and by another person in any other capacity, such land shall be included in the holding of both such persons."Dealing with the expressions held the Court observed:"The word held is not defined in the Act. We have, therefore, to go by the dictionary meaning of the term. According to Oxford Dictionary held means: to possess to be the owner or holder or tenant of; keep possession of; occupy. Thus, held connotes both ownership as well as possession . And in the context of the definition it is not possible to interpret the term held only in the sense of possession. For example, if a land is held by an owner and also by a tenant or by a person in possession pursuant to a contract for sale, the holding will be taken to be the holding of all such persons. It obviously means that an owner who is not an actual possession will also be taken to be a holder of the land. If there was any doubt in this behalf, the same has been dispelled by the explanation attached to the definition of the term holding. The explanation clearly contemplates that the same land can be the holding of two different persons holding the land in two different capacities. The respondent in view of the definition certainly is holding as an owner, although he is not in possession."Shri Phadke, however, contends that s. 3(i) of the Andhra Pradesh Act being unreasonable is ultra vires because the same land cannot be the land of the transferor as well as of the transferee and that Mohd. Ashrafuddins case (supra) requires reconsideration. That case has taken into consideration the various relevant provisions of the Act and the Court came to the conclusion the same land can be the land of the transferor as well as the transferee in view of the definition of the term holding in s. 3(i) of the Andhra Pradesh Act and in our opinion the view taken in that case is fully warranted by the provisions of the Act. We are not persuaded to accept the contention that the case requires re-consideration.This leads us to the last point but not the least in importance, in that the petitioners have bee n deprived of a substantial portion of their holding in the form of surplus land and thereby they have been deprived of their livelihood affecting their right to live, which is violative of Art. 21 of the Constitution. In support of this contention strong reliance was placed on the case of Maneka Gandhi v. Union of India(1) which has given a new dimension to Art. 21 of the Constitution. It was held in that case that right to live is not merely confined to physical existence, but it includes within its ambit the right to live with basic human dignity and the State cannot deprive anyone of this valuable right. It was further submitted that s. 3(f) of the Andhra Pradesh Act with the explanation added to it is destructive of Art. 21 and, therefore, violative of the basic structure of the Constitution. This point is also covered by two decisions of this Court. In re Sant Ram(2) dealing with Art. 21 of the Constitution a Bench of Five Judges of this Court held:"The argument that the word "life" in Art. 21 of the Constitution includes "livelihood" has only to be stated to be rejected.""The same view was reiterated by a Bench of three Judges in A. V. Nachane v. Union of India(3). In that case the validity of the Life Insurance Corporation (Amendment) Act, 1981 (I of 1981) and the Life Insurance Corporation of India Class III and Class IV Employees (Bonus and Dearness Allowance) Rules, 1981, were challenged on several grounds including Art. 21 of the Constitution and the Court dealing with this aspect of the matter quoted with approval the case of Sant Ram (supra) in the following words:"As regards Article 21, the first premise of the argument that the word life in that Article includes livelihood was considered and rejected in In re Sant Ram."15. Shri Phadke, however, brushed these cases aside on the simple ground that they are not relevant for the decision of the question whether the right to live includes the right to live with human dignity, and the decision on Maneka Gandhis case (supra) must be deemed to be the correct exposition of the law on the subject. The contention that life includes livelihood within the meaning of Art. 21 of the Constitution was repel led in these two cases and Maneka Gandhis case did not take into consideration the case of Sant Ram (supra). These cases, therefore, still hold the field.16. Besides, the petitioners have been deprived of their holding in the form of surplus land but it was only for the purpose of giving relief to the downtrodden and the poor agricultural labourers. The surplus land would vest in the State and the State in its turn would give it to the poor and the downtrodden and thus such a deprivation will be protected under Art. 39 of Directive Principles. The case of Maneka Gandhi (supra), in our opinion, is not relevant for the decision of the point under consideration.The counsel for the petitioners in other cases adopted the same argument of Shri Phadke.17. Having given our best consideration to the questions involved in the cases we find no infirmity in any of the provisions of the Andhra Pradesh Act.Fo ### Response: 0

Central Bank of India Vs. State of Kerala and Ors.

therefore, to say that the rights of the borrower would be defeated without adjudication would be erroneous. Rule 8 of the Security Interest (Enforcement) Rules, 2002 (2002 Rules) deals with the stage anterior to the issuance of sale certificate and delivery of possession under Rule 9. Till the time of issuance of sale certificate, the authorised officer is like a Court Receiver under Order 40 Rule 1 CPC. The Court Receiver can take symbolic possession and in appropriate cases where the Court Receiver finds that a third-party interest is likely to be created overnight, he can take actual possession even prior to the decree. The authorised officer under Rule 8 has greater powers than even a Court Receiver as security interest in the property is already created in favour of the banks/FIs. That interest needs to be protected. therefore, Rule 8 provides that till issuance of the sale certificate under Rule 9, the authorised officer shall take such steps as he deems fit to preserve the secured asset. It is well settled that third-party interests are created overnight and in very many cases those third parties take up the defence of being a bona fide purchaser for value without notice. It is these types of disputes which are sought to be avoided by Rule 8 read with Rule 9 of the 2002 Rules. In the circumstances, the drawing of dichotomy between symbolic and actual possession does not find place in the scheme of the NPA Act read with the 2002 Rules. The Court then considered three provisos inserted in Section 19(1) of the DRT Act by amending Act No. 30 of 2004 and held that withdrawal of the OA pending before Tribunal under the DRT Act is not a condition precedent for taking recourse to the Securitisation Act. 46. In Union of India v. SICOM Limited and Anr. (supra), this Court was called upon to decide whether realization of the duty under the Central Excise Act will have priority over the secured debts in terms of the SFC Act. The facts of that case were that respondent No. 2 borrowed a sum of Rs. 51 lakhs from the first respondent by an indenture of mortgage executed on 22.12.1986. Respondent No. 2 also owed Rs. 19 lakhs by way of central excise duty for the period April 1983 to May 1988. By a notification issued under Section 46(1) of the SFC Act, the Government extended the provisions of Sections 27, 29, 30, 31, 32A to 32F, 41 and 41A of the SFC Act in favour of the first respondent. Since respondent No. 2 defaulted in repayment of loan given by the first respondent, the latter invoked Section 29 of the SFC Act and took physical possession of the mortgaged assets. When the department expressed its intention to attach and seize the properties of respondent No. 2, the first respondent informed that it had first charge over the mortgaged properties. In August 2000, the first respondent issued a legal notice to the appellant and then filed a writ petition under Article 226 of the Constitution of India in the Aurangabad Bench of the Bombay High Court. The High Court considered the provisions of Rule 213(2) of the Central Excise Rules read with Section 32(g) and Section 151 of the Maharashtra Land Revenue Code, 1966 and held that as security of the corporation was prior in point of time, the dues claimed by it will have priority over the dues of customs. A two-Judge Bench of this Court referred to the non obstante clause contained in Section 46B of the SFC Act and provisions of priority contained in Section 529A of the Companies Act as also the provisions of EPF Act and the Employees State Insurance Act, the judgments in Builders Supply Corporation v. Union of India (supra), Bank of Bihar v. State of Bihar AIR1971SC1210 , Dena Bank v. Bhikhabhai Prabhudas Parekh & Co. (supra), Central Bank of India v. Siriguppa Sugars & Chemicals Ltd. AIR2007SC2804 , State Bank of Bikaner & Jaipur v. National Iron & Steel Rolling Corporation and Ors. (supra), ICICI Bank Ltd. v. SIDCO Leathers Ltd. and Ors. (supra) and approved the view taken by the High Court. 47. In none of the afore-mentioned judgments this Court held that by virtue of the provisions contained in the DRT Act or Securitization Act, first charge has been created in favour of banks, financial institutions etc. Not only this, the Court was neither called upon nor it decided competing priorities of statutory first charge created under Central legislation(s) on the one hand and State legislation(s) on the other nor it ruled that statutory first charge created under a State legislation is subservient to the dues of banks, financial institutions etc. even though statutory first charge has not been created in their favour. The ratio of the judgment in Allahabad Banks case (supra) is that jurisdiction of adjudicatory mechanism established under the DRT Act is exclusive and no other court or authority created under any other law can interfere with the proceedings initiated by banks and financial institutions for recovery of their dues. The other proposition laid down in that case which appear to have been diluted by a co-ordinate bench in ICICI Banks case is that while distributing the money recovered by a bank or a financial institution, priority given to the workers dues in terms of Section 529A must be respected. Section 11 of the Central Excise Act, which was considered by the two-Judge Bench in SICOMs case, does not contain a provision similar to those in Central legislations like Section 14A of the Workmens Compensation Act, 1923, Section 11 of the EPF Act, Section 74(1) of the Estate Duty Act, 1953, Section 25(2) of the Mines and Minerals (Development and Regulation) Act, 1957, Section 30 of the Gift Tax Act, 1958 and Section 529A of the Companies Act, 1956, under which statutory first charge has been created in respect of the dues of workmen or gift tax etc.

0[ds]14. The ratio of the above noted judgments is that Article 254 gets attracted only when both Central and State legislations have been enacted on any of the matters enumerated in List III in Seventh Schedule and there is conflict between two legislations. Though in State of West Bengal v. Kesoram Industries Ltd. (supra) some observations appear to have been made suggesting that Article 254 gets attracted even though legislations may have been enacted in different entries in Lists I and II, but the same have to be read in consonance with the plain language of the said Article and other judgments including the three-Judge Bench judgment in Hoechst Pharmaceuticals Ltd. and Ors. v. State of Bihar and Ors. (supra), which has been expressly approved by the Constitution Bench.15. Undisputedly, the DRT Act and Securitisation Act have been enacted by Parliament under Entry 45 in List I in the Seventh Schedule whereas Bombay and Kerala Acts have been enacted by the concerned State legislatures under Entry 54 in List II in the Seventh Schedule. To put it differently, two sets of legislations have been enacted with reference to entries in different lists in the Seventh Schedule. therefore, Article 254 cannot be invoked per se for striking down State legislations on the ground that the same are in conflict with the Central legislations. That apart, as will be seen hereafter, there is no ostensible overlapping between two sets of legislations. therefore, even if the observations contained in Kesoram Industries case (supra) are treated as law declared under Article 141 of the Constitution, the State legislations cannot be struck down on the ground that the same are in conflict with Central legislations.22. An analysis of the above noted provisions makes it clear that the primary object of the DRT Act was to facilitate creation of special machinery for speedy recovery of the dues of banks and financial institutions. This is the reason why the DRT Act not only provides for establishment of the Tribunals and Appellate Tribunals with the jurisdiction, powers and authority to make summary adjudication of applications made by banks or financial institutions and specifies the modes of recovery of the amount determined by the Tribunal or Appellate Tribunal but also bars the jurisdiction of all courts except the Supreme Court and High Courts in relation to the matters specified in Section 17. The Tribunals and Appellate Tribunals have also been freed from the shackles of procedure contained in the Code of civil Procedure. To put it differently, the DRT Act has not only brought into existence special procedural mechanism for speedy recovery of the dues of banks and financial institutions, but also made provision for ensuring that defaulting borrowers are not able to invoke the jurisdiction of civil courts for frustrating the proceedings initiated by the banks and financial institutions.23. The enactment of the Securitisation Act can be treated as one of the most radical legislative measures taken by the Government for ensuring that dues of secured creditors including banks, financial institutions are recovered from the defaulting borrowers without any obstruction. For the first time, the secured creditors have been empowered to take measures for recovery of their dues without the intervention of the Courts or Tribunals. The Securitisation Act has also brought into existence a new dispensation for registration and regulation of securitisation companies or reconstruction companies, facilitating securitisation of financial assets of banks and financial institutions, easy transferability of financial assets by the securitisation company or reconstruction company to acquire financial assets of banks and financial institutions by issue of debentures or bonds or any other security in the nature of debenture, empowering the securitisation companies or reconstruction companies to raise funds by issue of security receipts to qualified institutional buyers, facilitating reconstruction of financial assets acquired by exercising power of enforcement of securities or change of management, declaration of any securitisation company or reconstruction company as a public financial institution for the purpose of Section 4A of the Companies Act, defining `security interest as any type of security including mortgage and charge on immovable properties given for due payment of any financial assistance given by any bank or financial institution, classification of borrowers account as non-performing asset and above all empowering banks and financial institutions to take possession of securities given for financial assistance and sale or lease the same or take over management.25. As a prelude to the consideration of question relating to conflict between Central and State legislations and priority, if any, given to the dues of banks, financial institutions and other secured creditors under the DRT Act and Securitisation Act, it will be useful to notice some rules of interpretation of statutes, one of which is the rule of contextual interpretation. This rule requires that the court should examine every word of a statute in its context. In doing so, the Court has to keep in view preamble of the statute, other provisions thereof, pari materia statutes, if any, and the mischief intended to be remedied. Context often provides the key to the meaning of the word and the sense it carries. Its setting gives colour to it and provides a cue to the intention of the legislature in using it.39. If the provisions of the DRT Act and Securitisation Act are interpreted keeping in view the background and context in which these legislations were enacted and the purpose sought to be achieved by their enactment, it becomes clear that the two legislations, are intended to create a new dispensation for expeditious recovery of dues of banks, financial institutions and secured creditors and adjudication of the grievance made by any aggrieved person qua the procedure adopted by the banks, financial institutions and other secured creditors, but the provisions contained therein cannot be read as creating first charge in favour of banks, etc. If Parliament intended to give priority to the dues of banks, financial institutions and other secured creditors over the first charge created under State legislations then provisions similar to those contained in Section 14A of the Workmens Compensation Act, 1923, Section 11(2) of the EPF Act, Section 74(1) of the Estate Duty Act, 1953, Section 25(2) of the Mines and Minerals (Development and Regulation) Act, 1957, Section 30 of the Gift- Tax Act, and Section 529A of the Companies Act, 1956 would have been incorporated in the DRT Act and Securitisation Act. Undisputedly, the two enactments do not contain provision similar to Workmens Compensation Act, etc. In the absence of any specific provision to that effect, it is not possible to read any conflict or inconsistency or overlapping between the provisions of the DRT Act and Securitisation Act on the one hand and Section 38C of the Bombay Act and Section 26B of the Kerala Act on the other and the non obstante clauses contained in Section 34(1) of the DRT Act and Section 35 of the Securitisation Act cannot be invoked for declaring that the first charge created under the State legislation will not operate qua or affect the proceedings initiated by banks, financial institutions and other secured creditors for recovery of their dues or enforcement of security interest, as the case may be. The Court could have given effect to the non obstante clauses contained in Section 34(1) of the DRT Act and Section 35 of the Securitisation Act vis a vis Section 38C of the Bombay Act and Section 26B of the Kerala Act and similar other State legislations only if there was a specific provision in the two enactments creating first charge in favour of the banks, financial institutions and other secured creditors but as the Parliament has not made any such provision in either of the enactments, the first charge created by the State legislations on the property of the dealer or any other person, liable to pay sales tax etc., cannot be destroyed by implication or inference, notwithstanding the fact that banks, etc. fall in the category of secured creditors.The object of the amendment was to provide an appropriate remedy to expedite proceedings in court. That object must be borne in mind by adopting a purposive construction of the amended provisions. The legislative intention being the speedy disposal of cases with a view to relieving the litigants and the courts alike of the burden of mounting arrears, the word `parties must be so construed as to yield a beneficent result, so as to eliminate the mischief the legislature had in mind.There is no reason to assume that the legislature intended to curtail the implied authority of counsel, engaged in the thick of proceedings in court, to compromise or agree on matters relating to the parties, even if such matters exceed the subject matter of the suit. The relationship of counsel and his party or the recognised agent and his principal is a matter of contract; and with the freedom of contract generally, the legislature does not interfere except when warranted by public policy, and the legislative intent is expressly made manifest. There is no such declaration of policy or indication of intent in the present case. The legislature has not evinced any intention to change the well recognised and universally acclaimed common law tradition of an ever alert, independent and active bar with freedom to maneuver with force and drive for quick action in a battle of wits typical of the adversarial system of oral hearing which is in sharp contrast to the inquisitorial traditions of the `civil law of France and other European and Latin American countries where written submissions have the pride of place and oral arguments are considered relatively insignificant. (See Rene David, English Law and French LawTagore Law Lectures, 1980). `The civil law is indeed equally efficacious and even older, but it is the product of a different tradition, culture and language; and there is no indication, whatever, that Parliament was addressing itself to the task of assimilating or incorporating the rules and practices of that system into our own system of judicial administration.`The civil law is indeed equally efficacious and even older, but it is the product of a different tradition, culture and language; and there is no indication, whatever, that Parliament was addressing itself to the task of assimilating or incorporating the rules and practices of that system into our own system of judicial administration.So long as the system of judicial administration in India continues unaltered, and so long as Parliament has not evinced an intention to change its basic character, there is no reason to assume that Parliament has, though not expressly, but impliedly reduced counsels role or capacity to represent his client as effectively as in the past. On a matter of such vital importance, it is most unlikely that Parliament would have resorted to implied legislative alteration of counsels capacity or status or effectiveness.47. In none of the afore-mentioned judgments this Court held that by virtue of the provisions contained in the DRT Act or Securitization Act, first charge has been created in favour of banks, financial institutions etc. Not only this, the Court was neither called upon nor it decided competing priorities of statutory first charge created under Central legislation(s) on the one hand and State legislation(s) on the other nor it ruled that statutory first charge created under a State legislation is subservient to the dues of banks, financial institutions etc. even though statutory first charge has not been created in their favour. The ratio of the judgment in Allahabad Banks case (supra) is that jurisdiction of adjudicatory mechanism established under the DRT Act is exclusive and no other court or authority created under any other law can interfere with the proceedings initiated by banks and financial institutions for recovery of their dues. The other proposition laid down in that case which appear to have been diluted by a co-ordinate bench in ICICI Banks case is that while distributing the money recovered by a bank or a financial institution, priority given to the workers dues in terms of Section 529A must be respected. Section 11 of the Central Excise Act, which was considered by the two-Judge Bench in SICOMs case, does not contain a provision similar to those in Central legislations like Section 14A of the Workmens Compensation Act, 1923, Section 11 of the EPF Act, Section 74(1) of the Estate Duty Act, 1953, Section 25(2) of the Mines and Minerals (Development and Regulation) Act, 1957, Section 30 of the Gift Tax Act, 1958 and Section 529A of the Companies Act, 1956, under which statutory first charge has been created in respect of the dues of workmen or gift tax etc.51. We shall first refer to the judgment in Dattatreyas case. In that case, the three-Judge Bench considered the question of priority between a charge created by a decree and a subsequent simple mortgage. The appellants in that case filed suit for recovery of Rs. 1,34,000/- with interest from respondent Nos. 1 to 7. On March 31, 1941, a compromise decree was passed under which a charge was created for the decretal amount on three pieces of property belonging to respondent Nos. 1 to 7. The decree was registered on April 7, 1941, but due to inadvertence the charge on Kakakuva Mansion at Poona was not shown in the index of registration. On June 27, 1949, respondent Nos. 1 to 7 mortgaged Kakakuva Mansion to plaintiff-respondent No. 14 for a sum of Rs. 1,00,000/-. They also created a further charge on September 13, 1949 in favour of plaintiff-respondent No. 14 for Rs. 50,000/-. On July 7, 1951, a charge was created by a decree in favour of respondent No. 15 for a sum of Rs. 59,521/11/-. In the meantime, the appellants recovered some amount by execution of the decree. They sold the property at Shukrawar Peth at Poona and the chawl at Kalyan. Thereafter, they filed a darkhast in the Court of the 3rd Joint civil Judge, Senior Division, Poona for sale of Kakakuva Mansion. Notices were issued under Order 21 Rule 66 CPC to respondent No. 14 and others. Later on, the executing court held that presence of plaintiff-respondent No. 14 was not necessary. The latter challenged that order in First Appeal No. 668 of 1957 filed before the High Court of Bombay. He also filed a civil suit in the Court of Joint civil Judge, Senior Division, Poona for recovery of Rs. 2,18,564/- allegedly due to him under the two mortgages. During the pendency of that suit, the property was put up for sale on the darkhast of the appellants, who themselves purchased the property with the leave of the Court. As a sequel to this, respondent No. 14 impleaded the appellants as parties in suit No. 57 of 1958. The appellants contested the suit on the ground that they had a prior charge and the mortgage of respondent No. 14 was subject to that charge. The trial Judge decreed the suit in favour of respondent No. 14. In appeal, the High Court modified the decree of the trial Judge holding that as the mortgage in favour of the respondent was protected under proviso to Section 100, it is free from the charge created in favour of the appellants. The High Court also gave priority to respondent No. 15 for its dues, though it had not filed any appeal. The majority judgment of the Court was delivered by Jaganmohan Reddy, J. who, after noticing various provisions of the Transfer of Property Act, observed:A charge not being a transfer or a transfer of interest in property nonetheless creates a form of security in respect of immovable property. So far as mortgage is concerned, it being a transfer of interest in property the mortgagee has always a security in the property itself. Whether the mortgage is with possession or a simple mortgage, the interest in the property enures to the mortgagee so that any subsequent mortgage or sale always preserves the rights of the mortgagee whether the subsequent dealings in the property are with or without notice. The obvious reason for this is that in a mortgage there is always an equity of redemption vested in the owner so that the subsequent mortgagees or transferees will have, if they are not careful and cautious in examining the title before entering into a transaction, only the interest which the owner has at the time of the transaction.Insofar as competing mortgagees are concerned, Section 48 of the Act gives priority to the first in point of time in whose favour transfer of an interest in respect of the same immovable property is created, if the interest which he has taken and the interest acquired subsequently by other persons cannot all exist or be exercised to their full extent together. This section speaks of a person who purports to create by transfer at different times rights in or over the same immovable property, and since charge is not a transfer of an interest in or over the immovable property he gets no security as against mortgagees of the same property unless he can show that the subsequent mortgagee or mortgagees had notice of the existence of his prior charge.52. In State Bank of Bikaner & Jaipur v. National Iron & Steel Rolling Corporation and Ors. (supra), another Bench of three Judges considered the effect of Section 11-AAAA of the Rajasthan Sales Tax Act, 1954 by which first charge was created on the property of the dealer in lieu of the amount of tax, penalty etc. on an existing mortgage on the property of the dealer. It is borne out from the judgment that the appellant-bank had given cash credit facility to respondent No. 1. For securing repayment, respondent No. 1 mortgaged the factory premises in favour of the bank. In 1986, the appellant filed suit for recovery of Rs. 3,79,672/- with interest. In that suit, Commercial Taxes Officer got himself impleaded as party by asserting that State had a prior claim for recovery of Rs. 1,19,122/- as dues of sales tax. The mortgaged property was sold by auction under the orders of the Court. The Commercial Taxes Officer pleaded that the dues of sales tax should be paid first out of the sale proceeds and the claim of the bank could be satisfied only out of the balance amount. The trial Court upheld the claim of the Commercial Taxes Officer. The revision filed by the bank was dismissed by the High Court. Before this Court it was argued that the banks claim will have precedence over the claim of the sales tax authorities because mortgage in their favour was prior in point of time. After noticing Section 11-AAAA of the Rajasthan Sales Tax Act which is pari materia to Section 38C of the Bombay Act and Section 26B of the Kerala Act as also Section 100 of the Transfer of Property Act and the judgment in Dattatreyas case , the Court observed:Section 100 of the Transfer of Property Act deals with charges on an Immovable property which can be created either by an act of parties or by operation of law. It provides that where Immovable property of one person is made security for the payment of money to another, and the transaction does not amount to a mortgage, a charge is created on the property and all the provisions in the Transfer of Property Act which apply to a simple mortgage shall, so far as may be, apply to such charge. A mortgage on the other hand, is defined under Section 58 of the Transfer of Property Act as a transfer of an interest in specific Immovable property for the purpose of securing the payment of money advanced or to be advanced as set out therein. The distinction between a mortgage and a charge was considered by this Court in the case of Dattatreya Shanker Mote v. Anand Chintaman Datar [1975]2SCR224 . The Court has observed (at pages 806-807) that a charge is a wider term as it includes also a mortgage, in that, every mortgage is a charge, but every charge is not a mortgage. The Court has then considered the application of the second part of Section 100 of the Transfer of Property Act which inter alia deals with a charge not being enforceable against a bona fide transferee of the property for value without notice of the charge. It has held that the phrase transferee of property refers to the transferee of entire interest in the property and it does not cover the transfer of only an interest in the property by way of a mortgage.The Court then considered the argument made on behalf of the bank that its dues will have priority because at the time when the statutory first charge came into existence, there was already a mortgage in respect of the same property and held:The argument though ingenious, will have to be rejected. Where a mortgage is created in respect of any property, undoubtedly, an interest in the property is carved out in favour of the mortgagee. The mortgagor is entitled to redeem his property on payment of the mortgage dues. This does not, however, mean that the property ceases to be the property of the mortgagor. The title to the property remains with the mortgagor. therefore, when a statutory first charge is created on the property of the dealer, the property subjected to the first charge is the entire property of the dealer. The interest of the mortgagee is not excluded from the first charge. The first charge, therefore, which is created under Section 11-AAAA of the Rajasthan Sales Tax Act will operate on the property as a whole and not only on the equity of redemption as urged by Mr. Tarkunde.In the present case, the section creates a first charge on the property, thus clearly giving priority to the statutory charge over all other charges on the property including a mortgage. The submission, therefore, that the statutory first charge created under Section 11-AAAA of the Rajasthan Sales Tax Act can operate only over the equity of redemption, cannot be accepted. The charge operates on the entire property of the dealer including the interest of the mortgagee therein.Looked at a little differently, the statute has created a first charge on the property of the dealer. What is meant by a first charge? Does it have precedence over earlier mortgage? Now, as set out in Dattatreya Shankar Mote case a charge is a wider term than a mortgage. It would cover within its ambit a mortgage also. therefore, when a first charge is created by operation of law over any property, that charge will have precedence over an existing mortgage.(Emphasis added)53. In R.M. Arunachalam v. Commissioner of Income Tax, Madras (supra), the Court reiterated the distinction between a charge and a mortgage in the context of the provisions contained in Sections 53(1) and 74(1) of the Estate Duty Act, 1953, referred to the judgments in Dattatreyas case , State Bank of Bikaner & Jaipur v. National Iron & Steel Rolling Corporation and Ors. (supra) and observed:A charge differs from a mortgage in the sense that in a mortgage there is transfer of interest in the property mortgaged while in a charge no interest is created in the property charged so as to reduce the full ownership to a limited ownership. The creation of a charge under Section 74(1) of the Estate Duty Act cannot, therefore, be construed as creation of an interest in property that is the subject-matter of the charge. The creation of the charge under Section 74(1) only means that in the matter of recovery of estate duty from the property which is the subject-matter of the charge the amount recoverable by way of estate duty would have priority over the liabilities of the accountable person. In that sense the claim in respect of estate duty would have precedence over the claim of the mortgagee because a mortgage is also a charge. The High Court has, therefore, rightly held that as a result of the charge created under Section 74(1) of the Estate Duty Act, it could not be said that title of the assessee to the immovable properties received by him from Smt Umayal Achi was incomplete and imperfect in any way. In the context of the facts, the High Court has found that the assessee had admittedly become the full owner of the assets even before the payment of estate duty and on payment of the same he had not acquired a new right, tangible or intangible, in the assets. It cannot, therefore, be said that the amount proportionate to estate duty paid by the assessee on the properties that were transferred should be treated as cost of acquisition of the assets under Sections 48 and 49 read with Section 55(2) of the IT Act. Since the title of the assessee to the immovable properties acquired was not incomplete and imperfect in any way, it cannot also be said that as a result of the payment of the estate duty by the assessee there was an improvement in the title of the assessee and the said payment could be regarded as cost of improvement under Section 48 read with Section 55(1)(b) of the Act.54. In our opinion, the judgments in State Bank of Bikaner & Jaipur v. National Iron & Steel Rolling Corporation and Ors. (supra) and R.M. Arunachalam v. Commissioner of Income Tax, Madras (supra) are based on a correct reading of the ratio of the Dattatreyas case and the propositions laid down therein do not call for reconsideration. At the cost of repetition, we consider it appropriate to observe that in Dattatreyas case the Court was not dealing with the statutory first charge created in favour of the State.55. The argument of learned Counsel for the appellants that the State legislations creating first charge cannot be given retrospective effect deserves to be negatived in view of the judgment in State of M.P. and Anr. v. State Bank of Indore (supra). In that case, it was held that the charge created in favour of the State under Section 33C of the Madhya Pradesh General Sales Tax Act, 1958 in respect of the sales tax dues prevail over the charge created in favour of the bank in respect of the loan taken by 2nd respondent and the amendment made in the State operates in respect of charges that are in force on the date of introduction of Section 33C.57. C.A. No. 95/2005 Central Bank of India v. State of Kerala and Ors. (2009)4SCC94The facts of the case have been set out in the earlier part of the judgment. A recapitulation thereof shows that suit filed by the appellant bank in 1996 for recovery of its dues was, later on, transferred to the Tribunal and decreed on 1.12.2000. Before that the Tehsildar, Mavelikara had attached the properties of the borrower on 2.2.2000 and again on 4.9.2000 for recovery of the arrears of sales tax. The bank challenged the notice issued by Tehsildar for recovery of the arrears of sales tax but could not persuade the learned Single Judge who held that in view of Section 26B of the Kerala Act, dues of the State will have priority. The order of the learned Single Judge was approved by the Division Bench. In our opinion, the view taken by Kerala High Court is in consonance with what we have held in the earlier part of the judgment regarding primacy of the States first charge over the dues of banks, financial institutions and secured creditors. therefore, the impugned orders do not call for any interference.The Thane Janata Sahakari Bank Ltd. v. The Commissioner of Sales Tax and Ors. 2006(6)BomCR186 - In this case the bank had taken possession of the mortgaged assets on 15.2.2005 and sold the same. On 11.7.2005, the officers of the Commercial Tax Department informed the bank about outstanding dues of sales tax amounting to Rs. 3,62,82,768/-. The Assistant Commissioner issued notice under Section 39 of the Bombay Act for recovery of Rs. 48,48,614/-. The High Court negatived the banks claim of priority and held that Section 35 of the Securitisation Act does not have overriding effect over Section 33C of the Bombay Act. The view taken by the High Court is unexceptional and calls for no interference.59. C.A. No. 3549/2006 -60. The suit for injunction filed by the bank was dismissed by Sub Judge, Ottapalam vide judgment dated 21.12.1999. The trial Court held that the plaintiff has not produced any evidence to show that it had got a mortgage from defendant No. 3 and on that premise the banks plea for injunction was negated. Appeal Suit No. 177/2000 filed by the bank was dismissed by the learned Single Judge of the High Court vide judgment dated January 19, 2005. Further appeal preferred by the bank was dismissed by the Division Bench of the High Court on 12.7.2005 by relying upon the judgment of the Full Bench of the High Court in Kesava Pillai v. State of Kerala AIR2004Ker111 by observing that the appeal is not maintainable. In our opinion, the bank cannot claim priority over the dues of sales tax because statutory first charge had been created in favour of the State by Section 26B which was inserted in the Kerala Act with effect from 1.4.1999 and the courts below did not commit any error by refusing to decree the suit for injunction filed by the bank.61. C.A. No. 3973 of 2006Writ Appeal No. 538/2006 was dismissed by the Division Bench by placing reliance upon the judgment in South Indian Bank Limited v. State of Kerala 2006(1)KLT65 in which the following view was expressed:Right of the State to have priority in the matter of recovery of sales tax from the defaulters over the equitable mortgages created by them in favour of Banks and Financial Institutions is no more res integra. Dealing with the provisions parallel to Section 26B of the Kerala General Sales Tax Act by the various Sales Tax Laws of other States, Supreme Court has already recognized the statutory first charge in respect of sales tax arrears. Reference may be made to the decisions of the Apex Court in State Bank of Bikaner & Jaipur v. National Iron & Steel Rolling Corporation and Ors. (1995) 96 STC 612 , Delhi Auto and General Finance Pvt. Ltd. v. Tax Recovery Officer and Ors. [1999]236ITR325(SC) , Dattatreya Shanker Mote v. Anand Chintaman Datar, Dena Bank v. Bhikhabhai Prabhudas Prakash Co. and various other decisions. We may refer to the latest decision of the Apex Court in State of M.P. v. State Bank of Indore, wherein the court examined the charge created under Section 33C of the M.P. General Sales Tax Act, 1958 and held that Section 33C creates a statutory first charge that prevails over any charge that may be in existence. The Court held that the charge thereby created in favour of the State in respect of the sales tax dues of the second respondent prevailed over the charge created in favour of the Bank. Judicial pronouncements settled the law once for all stating that State has got priority in the matter of recovery of debts due and the specific statutory charge created under the Sales Tax Act notwithstanding the equitable mortgages created by the defaulters in favour of the Banks prior to the liability in favour of the State. A Division Bench of this Court in Sherry Jacob v. Canara Bank, held that revenue recovery authorities shall have the liberty to proceed against the property of the company under the Revenue Recovery Act on the strength of the first charge created over the property by virtue of Section 26B of the Kerala General Sales Tax Act. The Court held that the statutory first charge would prevail over any charge or right in favour of a mortgage or secured creditors and would get precedence over an existing mortgage right.We are in this case concerned with the question as to whether Section 26B of the K.G.S.T. Act would take away the efficacy of a decree passed by the civil court prior to the introduction of said section. We are of the view till the decree is executed through executing court title of the mortgaged property remains with the mortgagor. Decree passed by the civil court is the formal expression of an adjudication which conclusively determines the rights of parties, but unless and until the decree is executed the Bank would not procure the property and the States overriding rights would have precedence over that of the Bank. When a first charge created by the operation of law over any property, that charge will have precedence over an existing mortgage and the decree obtained by the bank against the mortgagor will not affect the State since State was not a party to the suit. Decree has only conclusively determined the rights between the mortgagor and mortgagee which would not affect the statutory rights of the State. The expression rights of parties used in Section 2(2) means rights of parties to the suit. State which has got a statutory first charge under Section 26B of the K.G.S.T. Act would prevail over the rights created in favour of the Bank by an unexecuted decree. We therefore hold that the decree obtained by the Bank will not have any precedence over the first charge created in favour of the State under Section 26B of the K.G.S.T. Act.In our opinion, the High Court has rightly held that the first charge created by Section 26B of the Kerala Act will have primacy over the banks dues.In our view, the High Court did not commit any illegality by nullifying the auction conducted by the recovery officer of the Tribunal, who, as per admitted factual matrix of the case, did not give notice to the revenue officer despite the fact that the property had been attached under Section 36 of the Kerala Revenue Recovery Act and the bank had challenged the notice issued under Section 49(2) of that Act in Writ Petition No. 8845 of 2001 and succeeded in persuading the High Court to stay that notice.63. C.A. No. 4909 of 2006 - Central Bank of India v. The Deputy Tehsildar and Ors. -The petitioner-bank extended financial facilities to the private respondents, who mortgaged immovable properties for securing repayment. In 1994, the bank filed suits for recovery of its dues. On establishment of the bench of the Tribunal at Ernakulam, all the suits were transferred to the Tribunal which passed decree dated 31.3.2000 in T.A. No. 1032/1997, 25.7.2001 in T.A. No. 1009/1997 and 9.8.2001 in T.A. No. 1015/1997. The bank also issued recovery certificate dated 1.12.2003. However, before the bank could execute the decrees, Tehsildar (Revenue Recovery), Kollam, initiated proceedings under the Kerala Revenue Recovery Act for sale of the mortgaged properties which was attached for recovery of the arrears of sales tax. The petitioner challenged the sale notices issued by Tehsildar in Writ Petition No. 13425 of 2004. The learned Single Judge by relying on the judgment of this Court in Dena Bank v. Bhikabhai Prabhudas Parekh & Co. (supra) and of the Division Bench of the High Court in Sherry Jacob v. Canara Bank AIR2005Ker50 dismissed the writ petition. The Division Bench dismissed the writ appeal. In our opinion, the High Court rightly held that the Tehsildar was entitled to give effect to the primacy of statutory first charge created on the property of the dealer under Section 26B of the Kerala Act.64. C.A. No. 1288 of 2007 -Writ appeal filed by the appellant-bank against the interim order was disposed of by the Division Bench with the following observations:Since the revenue authorities have already attached the property this Court will not be justified in directing respondents 2 and 3 to hand over possession of the property to the Bank. All the same it is entirely for the State and its officers to decide whether possession should be handed over to the Bank for taking further proceedings under the Securitisation Act. We leave it to the State to take a decision in this matter in accordance with law. Needless to say, since State has got prior charge it is open to the State to proceed in accordance with law. Let a decision be taken by the district Collector within one month from the date of receipt of a copy of this judgment. The appeal and the writ petition are disposed of as above. I.A. No. 14420 of 2005 would stand dismissed.Since we have already expressed the view that in terms of Section 26B of the Kerala Act, the State has got prior charge over the property of the dealer and the facts of the case show that the revenue authorities had already attached the property, there is no valid ground to interfere with the order passed by the Division Bench.65. C.A. No. 1318 of 2009 [arising out of S.L.P. (C) No. 24767 of 2005]Writ appeal filed by the bank was dismissed by the Division Bench making observations which have been extracted hereinabove.66. We are in complete agreement with the Division Bench that statutory first charge created in favour of the State under Section 26B of the Kerala Act has primacy over the right of the bank to recover its dues.

### Instruction: Examine the details of the case proceeding and forecast if the appeal/petition stands a chance of being upheld (1) or dismissed (0). ### Input: therefore, to say that the rights of the borrower would be defeated without adjudication would be erroneous. Rule 8 of the Security Interest (Enforcement) Rules, 2002 (2002 Rules) deals with the stage anterior to the issuance of sale certificate and delivery of possession under Rule 9. Till the time of issuance of sale certificate, the authorised officer is like a Court Receiver under Order 40 Rule 1 CPC. The Court Receiver can take symbolic possession and in appropriate cases where the Court Receiver finds that a third-party interest is likely to be created overnight, he can take actual possession even prior to the decree. The authorised officer under Rule 8 has greater powers than even a Court Receiver as security interest in the property is already created in favour of the banks/FIs. That interest needs to be protected. therefore, Rule 8 provides that till issuance of the sale certificate under Rule 9, the authorised officer shall take such steps as he deems fit to preserve the secured asset. It is well settled that third-party interests are created overnight and in very many cases those third parties take up the defence of being a bona fide purchaser for value without notice. It is these types of disputes which are sought to be avoided by Rule 8 read with Rule 9 of the 2002 Rules. In the circumstances, the drawing of dichotomy between symbolic and actual possession does not find place in the scheme of the NPA Act read with the 2002 Rules. The Court then considered three provisos inserted in Section 19(1) of the DRT Act by amending Act No. 30 of 2004 and held that withdrawal of the OA pending before Tribunal under the DRT Act is not a condition precedent for taking recourse to the Securitisation Act. 46. In Union of India v. SICOM Limited and Anr. (supra), this Court was called upon to decide whether realization of the duty under the Central Excise Act will have priority over the secured debts in terms of the SFC Act. The facts of that case were that respondent No. 2 borrowed a sum of Rs. 51 lakhs from the first respondent by an indenture of mortgage executed on 22.12.1986. Respondent No. 2 also owed Rs. 19 lakhs by way of central excise duty for the period April 1983 to May 1988. By a notification issued under Section 46(1) of the SFC Act, the Government extended the provisions of Sections 27, 29, 30, 31, 32A to 32F, 41 and 41A of the SFC Act in favour of the first respondent. Since respondent No. 2 defaulted in repayment of loan given by the first respondent, the latter invoked Section 29 of the SFC Act and took physical possession of the mortgaged assets. When the department expressed its intention to attach and seize the properties of respondent No. 2, the first respondent informed that it had first charge over the mortgaged properties. In August 2000, the first respondent issued a legal notice to the appellant and then filed a writ petition under Article 226 of the Constitution of India in the Aurangabad Bench of the Bombay High Court. The High Court considered the provisions of Rule 213(2) of the Central Excise Rules read with Section 32(g) and Section 151 of the Maharashtra Land Revenue Code, 1966 and held that as security of the corporation was prior in point of time, the dues claimed by it will have priority over the dues of customs. A two-Judge Bench of this Court referred to the non obstante clause contained in Section 46B of the SFC Act and provisions of priority contained in Section 529A of the Companies Act as also the provisions of EPF Act and the Employees State Insurance Act, the judgments in Builders Supply Corporation v. Union of India (supra), Bank of Bihar v. State of Bihar AIR1971SC1210 , Dena Bank v. Bhikhabhai Prabhudas Parekh & Co. (supra), Central Bank of India v. Siriguppa Sugars & Chemicals Ltd. AIR2007SC2804 , State Bank of Bikaner & Jaipur v. National Iron & Steel Rolling Corporation and Ors. (supra), ICICI Bank Ltd. v. SIDCO Leathers Ltd. and Ors. (supra) and approved the view taken by the High Court. 47. In none of the afore-mentioned judgments this Court held that by virtue of the provisions contained in the DRT Act or Securitization Act, first charge has been created in favour of banks, financial institutions etc. Not only this, the Court was neither called upon nor it decided competing priorities of statutory first charge created under Central legislation(s) on the one hand and State legislation(s) on the other nor it ruled that statutory first charge created under a State legislation is subservient to the dues of banks, financial institutions etc. even though statutory first charge has not been created in their favour. The ratio of the judgment in Allahabad Banks case (supra) is that jurisdiction of adjudicatory mechanism established under the DRT Act is exclusive and no other court or authority created under any other law can interfere with the proceedings initiated by banks and financial institutions for recovery of their dues. The other proposition laid down in that case which appear to have been diluted by a co-ordinate bench in ICICI Banks case is that while distributing the money recovered by a bank or a financial institution, priority given to the workers dues in terms of Section 529A must be respected. Section 11 of the Central Excise Act, which was considered by the two-Judge Bench in SICOMs case, does not contain a provision similar to those in Central legislations like Section 14A of the Workmens Compensation Act, 1923, Section 11 of the EPF Act, Section 74(1) of the Estate Duty Act, 1953, Section 25(2) of the Mines and Minerals (Development and Regulation) Act, 1957, Section 30 of the Gift Tax Act, 1958 and Section 529A of the Companies Act, 1956, under which statutory first charge has been created in respect of the dues of workmen or gift tax etc. ### Response: 0

Carona Shoe Co. Ltd. And Anr Vs. K.C. Bhaskaran Nair

1 SCC 424 : (1974) 2 SCR 629 ). The observations are that the definitions of landlord and tenant might apply even if the contractual tenancy has come to an end. But that is not the situation here in the instant case. In the said case, Bhagwati, J. as the Chief Justice then was, in his judgment at page 439 of the report observed that sub-section (1) of Section 4 of the Act in question i.e., Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 contemplated that an application for fixation of fair rent of a building might be made by the tenant or the landlord. The definition of tenant, it was observed, included contractual tenant as well as tenant remaining in possession of the building after determination of the contractual tenancy, i.e. statutory tenant, and both contractual tenant and statutory tenant could, therefore, apply. It was, therefore, submitted in this case that on the analogy of the contractual tenant, the appellants were entitled to the protection of the Act. We are unable to agree. It is not a question of a contractual tenancy coming to an end. The limited estate created in favour of the mortgages having disappeared all rights emanating from that limited estate disappear and the superior right of the mortgagor comes not in place of the mortgagee bus as a result of an independent title, and as such the mortgagor cannot be bound by any act created or any relationship contracted between the mortgagee and the tenant, unless it is permitted by the mortgage deed. Reliance was also placed on certain observations of this Court in V. Dhanapal Chettiar v. Yesodai Ammal ((1979) 4 SCC 214 : (1980) 1 SCR 334 ). Therein, it was held that under the State Rent Acts, the concept of contractual tenancy has lost much of its significance and force. Therefore, giving of the notice was a mere surplusage and unlike the law under the Transfer of Property Act, 1882, it does not entitle the landlord to evict the tenant. In our opinion, the observations of the said decision cannot have any assistance or significance for the purpose of the issues involved in the present controversy. 16. Our attention was also drawn to the observations of this Court in Pomal Kanji Govindji case ((1989) 1 SCC 458 ) at para 42 of page 326 and it was contended that in this case impliedly the mortgage deed specifically and categorically made an exception in favour of the tenants that they would continue in possession after the termination or redemption of the mortgage and that these leases were acts of prudent management. In this connection, reference may be made to Section 60 of the Transfer of Property Act. It is this which gives the mortgagor right to redeem after the date fixed for payment. The mortgagors right of redemption and the mortgagees right of foreclosure or sale are co-extensive. Similarly, Section 76(a) of the Transfer of Property Act which determines the liabilities of the mortgagee and imposes the obligation to manage the property as a person of ordinary prudence. In the instant case, it has been held by the High Court that the induction of the appellants as tenant was not an act of prudent management. 17. Our attention was also drawn by Sri Iyer to the observation of this court in Gian Devi Anand v. Jeevan Kumar ((1985) 2 SCC 683 : 1985 Supp 1 SCR 1) in support of this submission that in the emerging jurisprudence of tenancy legislation the distinction between statutory tenant and contractual tenant has disappeared. The said view, in our opinion, would be of no avail as the respondent is not the successor-in-interest and does not come in place of the mortgagee but by virtue of its independent title. 18. Reliance was also placed on the observations of this Court in G. Ponniah Thevar v. Nalleyam Perumal Pillai ((1977) 1 SCC 500 : (1977) 2 SCR 446 ). That decision, in our opinion, has no application. The person inducing the tenant appellant was a co-widow who had a life interest in the lands. It was observed that the terms of the statutory protection applied clearly to all tenancies governed by the Madras Cultivating Tenants Protection Act irrespective of the nature of rights of the person who leased the land so long as the lessor was entitled to create a tenancy. In our opinion, the said observations would not be applicable. The said decision deals with the right of the co-widow in the land. Reference may be made to the facts of that case at page 504, para 10. In our opinion, in view of the said facts, the decision would not apply to the facts of the instant case. On the other hand, in view of the facts and ratio of the principle of the decisions in Jadavji Purshottam ((1987) 4 SCC 223 ) and Pomalji Govindji ((1989) 1 SCC 458 ), we are of the opinion that the contentions of Sri Iyer cannot be sustained. The non obstante clause in Section 11(a) of the Act is applicable only to a decree for eviction obtained by a landlord against a tenant. The appellants were never the tenants of the respondent. 19. In the aforesaid view of the matter, we are unable to accept the submissions urged in this case and, therefore, the appeal must fail. But in view of the fact that the appellants have been carrying on the business for some time in the premises in question in order to enable them to adjust their business, we direct that the order for eviction of the appellants should not be executed up to October 31, 1989 if the appellants give an undertaking within a period of four weeks from this date to give vacant possession in peaceful manner on October 31, 1989; and also containing the usual terms of undertakings. In default of such undertaking being given within the time aforesaid, the decree will be forthwith executed.

0[ds]11. These contentions, in our opinion, are concluded by the decision of this Court in Pomal Kanji Govindji v. Vrajlal Karsandas Purohit (1989) 1 SCC 458 ), wherein it was held that except in cases where the leases specifically and categorically make exceptions in favour of the tenants that they would continue to be in possession even after the expiry or termination of the mortgage, and those leases are acts of prudent management, the tenants inducted by the mortgagee would be entitled to the protection under the Rent after redemption of mortgage and in no other cases15. But in view of the said definitions, we are of the opinion that between the appellants and the respondent, there was never any landlord or tenant relationship. The appellants were never the tenants of the respondent. Sri Iyer drew our attention to the observations of this Court in Rai Brij Raj Krishna v. S. K. Shaw & Bros. (1951) SCR 145 : AIR 1951 SC 115 ), where it was held that the non obstante clause would be applicable. Our attention was drawn to the observations Fazl Ali, J. at page 150 of the report. There, the court observed that Section 11 of the Bihar Buildings (Lease, Rent and Eviction) Control Act, 1947 was a self-contained Section, and it was wholly unnecessary to go outside the Act for determining whether a tenant was liable to be evicted or not, and under what conditions he could be evicted. But in the instant case, the appellants were not the tenants. The respondent, (sic and) the original mortgagor, would never after the redemption of the mortgage have treated the appellants to be tenants. There was no relationship ever between the appellants and the respondent. The mortgagor (sic mortgagee) had a separate and distinct interest which was wiped out on the redemption of the mortgage or expiry of the period of mortgage. The Mortgagor on redemption of mortgage gets back his own right, he is not successor-in-interest of the mortgagee. Interest, if any created by the mortgagee on the mortgagors right, must disappear on ceasing of interest of the mortgagee. In that view of the matter, in our opinion, thus the said observations would not be of any relevance to the present case. Similarly, reliance was placed on the observations of this Court by Sri Iyer in M/s. Raval & Co. v. K. G. Ramachandran ((1974) 1 SCC 424 : (1974) 2 SCR 629 ). The observations are that the definitions of landlord and tenant might apply even if the contractual tenancy has come to an end. But that is not the situation here in the instant case. In the said case, Bhagwati, J. as the Chief Justice then was, in his judgment at page 439 of the report observed that sub-section (1) of Section 4 of the Act in question i.e., Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 contemplated that an application for fixation of fair rent of a building might be made by the tenant or the landlord. The definition of tenant, it was observed, included contractual tenant as well as tenant remaining in possession of the building after determination of the contractual tenancy, i.e. statutory tenant, and both contractual tenant and statutory tenant could, therefore, apply. It was, therefore, submitted in this case that on the analogy of the contractual tenant, the appellants were entitled to the protection of the Act. We are unable to agree. It is not a question of a contractual tenancy coming to an end. The limited estate created in favour of the mortgages having disappeared all rights emanating from that limited estate disappear and the superior right of the mortgagor comes not in place of the mortgagee bus as a result of an independent title, and as such the mortgagor cannot be bound by any act created or any relationship contracted between the mortgagee and the tenant, unless it is permitted by the mortgage deed. Reliance was also placed on certain observations of this Court in V. Dhanapal Chettiar v. Yesodai Ammal ((1979) 4 SCC 214 : (1980) 1 SCR 334 ). Therein, it was held that under the State Rent Acts, the concept of contractual tenancy has lost much of its significance and force. Therefore, giving of the notice was a mere surplusage and unlike the law underthe Transfer of Property Act, 1882, it does not entitle the landlord to evict the tenant. In our opinion, the observations of the said decision cannot have any assistance or significance for the purpose of the issues involved in the present controversy16. Our attention was also drawn to the observations of this Court in Pomal Kanji Govindji case ((1989) 1 SCC 458 ) at para 42 of page 326 and it was contended that in this case impliedly the mortgage deed specifically and categorically made an exception in favour of the tenants that they would continue in possession after the termination or redemption of the mortgage and that these leases were acts of prudent management. In this connection, reference may be made to Section 60 of the Transfer of Property Act. It is this which gives the mortgagor right to redeem after the date fixed for payment. The mortgagors right of redemption and the mortgagees right of foreclosure or sale are co-extensive. Similarly, Section 76(a) of the Transfer of Property Act which determines the liabilities of the mortgagee and imposes the obligation to manage the property as a person of ordinary prudence. In the instant case, it has been held by the High Court that the induction of the appellants as tenant was not an act of prudent management17. Our attention was also drawn by Sri Iyer to the observation of this court in Gian Devi Anand v. Jeevan Kumar ((1985) 2 SCC 683 : 1985 Supp 1 SCR 1) in support of this submission that in the emerging jurisprudence of tenancy legislation the distinction between statutory tenant and contractual tenant has disappeared. The said view, in our opinion, would be of no avail as the respondent is not the successor-in-interest and does not come in place of the mortgagee but by virtue of its independent title18. Reliance was also placed on the observations of this Court in G. Ponniah Thevar v. Nalleyam Perumal Pillai ((1977) 1 SCC 500 : (1977) 2 SCR 446 ). That decision, in our opinion, has no application. The person inducing the tenant appellant was a co-widow who had a life interest in the lands. It was observed that the terms of the statutory protection applied clearly to all tenancies governed by the Madras Cultivating Tenants Protection Act irrespective of the nature of rights of the person who leased the land so long as the lessor was entitled to create a tenancy. In our opinion, the said observations would not be applicable. The said decision deals with the right of the co-widow in the land. Reference may be made to the facts of that case at page 504, para 10. In our opinion, in view of the said facts, the decision would not apply to the facts of the instant case. On the other hand, in view of the facts and ratio of the principle of the decisions in Jadavji Purshottam ((1987) 4 SCC 223 ) and Pomalji Govindji ((1989) 1 SCC 458 ), we are of the opinion that the contentions of Sri Iyer cannot be sustained. The non obstante clause in Section 11(a) of the Act is applicable only to a decree for eviction obtained by a landlord against a tenant. The appellants were never the tenants of the respondent19. In the aforesaid view of the matter, we are unable to accept the submissions urged in this case and, therefore, the appeal must fail. But in view of the fact that the appellants have been carrying on the business for some time in the premises in question in order to enable them to adjust their business, we direct that the order for eviction of the appellants should not be executed up to October 31, 1989 if the appellants give an undertaking within a period of four weeks from this date to give vacant possession in peaceful manner on October 31, 1989; and also containing the usual terms of undertakings. In default of such undertaking being given within the time aforesaid, the decree will be forthwith executedWe are, however, unable to accept or find in the correspondence any such approval or concurrence. We have referred to the mortgage deed and the sale deed as mentioned hereinbefore. Sri Iyer drew our attention to a letter dated October 7, 1977 addressed to the Rent Controller with a copy to the General Manager, Carona Shoe Co. Ltd. Therein, the respondent had negotiated or made an offer and expressed preference for the. The letter contained the following statementsUnder the circumstances, I have now finally decided to settle all the issues and start the construction of the rear portion as early as possible as I have two more offers (other than yours) for renting out the entire ground floor (about 1500 sq. ft.) which includes the space now occupied by you and portion of the first floorI am writing this letter to you because my first preference is for your company. The main reason is that you are conducting the business in the same shop for some years. Second thing is that I have already agreed to you at the discussion even though there was no written consent. In the light of the above, I give below my terms and conditions for renting out the shop with additional space annexed, if you are interested to continue the business in my building. Of course, the expenses (portion) for the same will have to be borne by you. But I will provide you with a very good show room considering your requirements. Necessary bathroom, lavatory, office cabin etc. will also be provided in consulting with your representative. I had a discussion with Mr. L. W. Baaker, A.R.I.B.A. (The British architect who is doing so many artistic modern building and show room etc. throughout India including the Chitralekha Film Studio) and the Art Director and Interior Decorator of our Studio regarding the subject

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: 1 SCC 424 : (1974) 2 SCR 629 ). The observations are that the definitions of landlord and tenant might apply even if the contractual tenancy has come to an end. But that is not the situation here in the instant case. In the said case, Bhagwati, J. as the Chief Justice then was, in his judgment at page 439 of the report observed that sub-section (1) of Section 4 of the Act in question i.e., Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 contemplated that an application for fixation of fair rent of a building might be made by the tenant or the landlord. The definition of tenant, it was observed, included contractual tenant as well as tenant remaining in possession of the building after determination of the contractual tenancy, i.e. statutory tenant, and both contractual tenant and statutory tenant could, therefore, apply. It was, therefore, submitted in this case that on the analogy of the contractual tenant, the appellants were entitled to the protection of the Act. We are unable to agree. It is not a question of a contractual tenancy coming to an end. The limited estate created in favour of the mortgages having disappeared all rights emanating from that limited estate disappear and the superior right of the mortgagor comes not in place of the mortgagee bus as a result of an independent title, and as such the mortgagor cannot be bound by any act created or any relationship contracted between the mortgagee and the tenant, unless it is permitted by the mortgage deed. Reliance was also placed on certain observations of this Court in V. Dhanapal Chettiar v. Yesodai Ammal ((1979) 4 SCC 214 : (1980) 1 SCR 334 ). Therein, it was held that under the State Rent Acts, the concept of contractual tenancy has lost much of its significance and force. Therefore, giving of the notice was a mere surplusage and unlike the law under the Transfer of Property Act, 1882, it does not entitle the landlord to evict the tenant. In our opinion, the observations of the said decision cannot have any assistance or significance for the purpose of the issues involved in the present controversy. 16. Our attention was also drawn to the observations of this Court in Pomal Kanji Govindji case ((1989) 1 SCC 458 ) at para 42 of page 326 and it was contended that in this case impliedly the mortgage deed specifically and categorically made an exception in favour of the tenants that they would continue in possession after the termination or redemption of the mortgage and that these leases were acts of prudent management. In this connection, reference may be made to Section 60 of the Transfer of Property Act. It is this which gives the mortgagor right to redeem after the date fixed for payment. The mortgagors right of redemption and the mortgagees right of foreclosure or sale are co-extensive. Similarly, Section 76(a) of the Transfer of Property Act which determines the liabilities of the mortgagee and imposes the obligation to manage the property as a person of ordinary prudence. In the instant case, it has been held by the High Court that the induction of the appellants as tenant was not an act of prudent management. 17. Our attention was also drawn by Sri Iyer to the observation of this court in Gian Devi Anand v. Jeevan Kumar ((1985) 2 SCC 683 : 1985 Supp 1 SCR 1) in support of this submission that in the emerging jurisprudence of tenancy legislation the distinction between statutory tenant and contractual tenant has disappeared. The said view, in our opinion, would be of no avail as the respondent is not the successor-in-interest and does not come in place of the mortgagee but by virtue of its independent title. 18. Reliance was also placed on the observations of this Court in G. Ponniah Thevar v. Nalleyam Perumal Pillai ((1977) 1 SCC 500 : (1977) 2 SCR 446 ). That decision, in our opinion, has no application. The person inducing the tenant appellant was a co-widow who had a life interest in the lands. It was observed that the terms of the statutory protection applied clearly to all tenancies governed by the Madras Cultivating Tenants Protection Act irrespective of the nature of rights of the person who leased the land so long as the lessor was entitled to create a tenancy. In our opinion, the said observations would not be applicable. The said decision deals with the right of the co-widow in the land. Reference may be made to the facts of that case at page 504, para 10. In our opinion, in view of the said facts, the decision would not apply to the facts of the instant case. On the other hand, in view of the facts and ratio of the principle of the decisions in Jadavji Purshottam ((1987) 4 SCC 223 ) and Pomalji Govindji ((1989) 1 SCC 458 ), we are of the opinion that the contentions of Sri Iyer cannot be sustained. The non obstante clause in Section 11(a) of the Act is applicable only to a decree for eviction obtained by a landlord against a tenant. The appellants were never the tenants of the respondent. 19. In the aforesaid view of the matter, we are unable to accept the submissions urged in this case and, therefore, the appeal must fail. But in view of the fact that the appellants have been carrying on the business for some time in the premises in question in order to enable them to adjust their business, we direct that the order for eviction of the appellants should not be executed up to October 31, 1989 if the appellants give an undertaking within a period of four weeks from this date to give vacant possession in peaceful manner on October 31, 1989; and also containing the usual terms of undertakings. In default of such undertaking being given within the time aforesaid, the decree will be forthwith executed. ### Response: 0

STATE OF U.P Vs. SUDHIR KUMAR SINGH AND OTHERS

According to him, the Writ Petition only prayed for a quashing of the cancellation order dated 26.07.2019 of the second tender. The High Court went way beyond, and not only quashed the aforesaid cancellation, but also quashed the enquiry report of the Managing Director dated 14.06.2019, as well as the order passed by the Special Secretary dated 16.07.2019, and the consequential action taken, namely, the departmental proceedings against the delinquent officers, which was never the subject matter of challenge in the Writ Petition. He went on to argue, based upon the comparison between the rates that were received in the earlier tender dated 01.04.2018 that was cancelled, and the rates in the 01.06.2018 tender, that the disparity was so great as to make it clear that the contracts for these four centres ought not to have been entered into at these rates at all. He argued that the High Court ought to have appreciated the huge financial loss that was caused as a result of awarding the contract at these rates, and ought not to have interfered with the cancellation of the tender, as it could not be characterised as arbitrary, given the huge increase in rates in such a short period for the same works. Further, he argued that the case law on natural justice showed that it was not an inflexible straitjacket, but had to be used wisely and well, and cited a number of judgments of this Court for the proposition that even though natural justice may be breached in the facts of a given case, if otherwise such breach does not result in prejudice, it would be a mere exercise in futility to set aside the order and remand it to the authorities to pass an order after hearing the affected party. He also argued that as of today, the two year term of the contract is over, and this very contractor, i.e. Respondent No.1, is doing the same work awarded at Mirzapur on 21.03.2020 at rates (139% ASOR) which are much lower than the rates tendered for previously, as is the successful tenderer Tilotama Devi on and from 31.09.2019 so far as Bhawanipur-II is concerned, which was awarded at 221% ASOR. Dr. Singhvi also argued that the writ court ought not to have interfered in contractual matters, and ought to have left Respondent No.1 to approach a civil court to file a suit for appropriate reliefs. 16. Shri Tushar Mehta, learned Solicitor General appearing on behalf of the State of U.P., argued that he had a limited role, and confined his arguments to the setting aside of the letter dated 16.07.2019 of the Special Secretary to take departmental action. He argued that this letter could not have been set aside by the High Court, as no such prayer or argument was made before it by the writ petitioner. 17. Shri Rakesh Dwivedi, learned Senior Advocate appearing on behalf of Respondent No.1, argued that the High Court judgment ought not to be interfered with, inasmuch as his client had pumped in a lot of money, and had worked the contract for a period of over one year successfully and without any complaint whatsoever from the Corporation. He reiterated the fact that nobody had challenged the award of the tender to his client, and that the cancellation of the tender was done behind his clients back. Had the authorities bothered to give his client a hearing, his client could have pointed out that in other nearby divisions, tenders were awarded at roughly the same rates, all of which contracts had been worked out, and none of which have been cancelled. Thus, he argued that his client suffered serious prejudice, in that he was able to work his contract for only one out of the two years that was awarded to him. He further argued that had a hearing been given, his client would also have demonstrated that the rates that were awarded could not be characterised as unreasonable, given the magnitude of the contract in his favour. He also argued that the award of tender at a lower rate at Mirzapur, which is currently being processed through his client, is not comparable with the tender that was awarded to his client for Bhawanipur I, because, inter alia, there was a huge difference between the volume of work awarded in the two contracts. He argued that it is idle to say that no prejudice has been caused, inasmuch as he has not been able to work the contract for one year, the contract period now being over, and that if the contract with his client is set aside, his client is debarred from bidding for a period of three years for any other contract with the Corporation. He further argued, in support of the impugned High Court judgment, that the action of termination by the Corporation waswithout an independent application of mind, and was purely at the instruction of the Special Secretary of the Government of U.P. dated 16.07.2019. He also fairly argued that his statement may be recorded that his client is not going to claim damages for the period of the agreement post cancellation, and that in fairness, the earnest money deposit and security deposit made by his client ought to be returned by the Corporation. 18. Having heard learned counsel for all the parties, one thing becomes clear. Despite the fact that the prayer in the Writ Petition filed by Respondent No.1 was set out in the very beginning of the impugned judgment, confining itself to the cancellation of the second tender, the impugned judgment went ahead and not only set aside such cancellation vide the letter dated 26.07.2019, but also went ahead and set aside the Managing Directors report dated 14.06.2019, and the Special Secretarys order of 16.07.2019, which required the taking of disciplinary action and recovery of financial loss from those who are responsible. Shri Rakesh Dwivedi also fairly conceded that his client had not asked for any relief qua the delinquent officers.

1[ds]18. Having heard learned counsel for all the parties, one thing becomes clear. Despite the fact that the prayer in the Writ Petition filed by Respondent No.1 was set out in the very beginning of the impugned judgment, confining itself to the cancellation of the second tender, the impugned judgment went ahead and not only set aside such cancellation vide the letter dated 26.07.2019, but also went ahead and set aside the Managing Directors report dated 14.06.2019, and the Special Secretarys order of 16.07.2019, which required the taking of disciplinary action and recovery of financial loss from those who are responsible.19. Dr. Singhvis preliminary objection as to Respondent No.1 having to approach a civil court, and not a writ court, for actions that pertain to breach of contract, need not detain us. In ABL International Ltd. and Anr. vs. Export Credit Guarantee Corporation of India Ltd. and Ors. (2004) 3 SCC 553, this Court held that it was no longer res integra that a writ petition under Article 226 of the Constitution is maintainable at the instance of an aggrieved party to enforce a contractual obligation of the State or its instrumentality when the State acts in an arbitrary manner, as follows:8. As could be seen from the arguments addressed in this appeal and as also from the divergent views of the two courts below, one of the questions that falls for our consideration is whether a writ petition under Article 226 of the Constitution of India is maintainable to enforce a contractual obligation of the State or its instrumentality, by an aggrieved party.9. In our opinion this question is no more res integra and is settled by a large number of judicial pronouncements of this Court. In K.N. Guruswamy vs. State of Mysore [(1955) 1 SCR 305] this Court held:20. The next question is whether the appellant can complain of this by way of a writ. In our opinion, he could have done so in an ordinary case. The appellant is interested in these contracts and has a right under the laws of the State to receive the same treatment and be given the same chance as anybody else. ...We would therefore in the ordinary course have given the appellant the writ he seeks. But, owing to the time which this matter has taken to reach us (a consequence for which the appellant is in no way to blame, for he has done all he could to have an early hearing), there is barely a fortnight of the contract left to go...A writ would therefore be ineffective and as it is not our practice to issue meaningless writs we must dismiss this appeal and leave the appellant content with an enunciation of the law.10. It is clear from the above observations of this Court in the said case, though a writ was not issued on the facts of that case, this Court has held that on a given set of facts if a State acts in an arbitrary manner even in a matter of contract, an aggrieved party can approach the court by way of writ under Article 226 of the Constitution and the court depending on facts of the said case is empowered to grant the relief. This judgment in K.N. Guruswamy vs. State of Mysore was followed subsequently by this Court in the case of D.F.O. vs. Ram Sanehi Singh [(1971) 3 SCC 864] wherein this Court held:By that order he has deprived the respondent of a valuable right. We are unable to hold that merely because the source of the right which the respondent claims was initially in a contract, for obtaining relief against any arbitrary and unlawful action on the part of a public authority he must resort to a suit and not to a petition by way of a writ. In view of the judgment of this Court in K.N. Guruswamy case there can be no doubt that the petition was maintainable, even if the right to relief arose out of an alleged breach of contract, where the action challenged was of a public authority invested with statutory power.11. In the case of Gujarat State Financial Corpn. vs. Lotus Hotels (P) Ltd. [(1983) 3 SCC 379] this Court following an earlier judgment in Ramana Dayaram Shetty vs. International Airport Authority of India [(1979) 3 SCC 489] held:The instrumentality of the State which would be other authority under Article 12 cannot commit breach of a solemn undertaking to the prejudice of the other party which acted on that undertaking or promise and put itself in a disadvantageous position. The appellant Corporation, created under the State Financial Corporations Act, falls within the expression of other authority in Article 12 and if it backs out from such a promise, it cannot be said that the only remedy for the aggrieved party would be suing for damages for breach and that it could not compel the Corporation for specific performance of the contract under Article 226.12. The learned counsel appearing for the first respondent, however, submitted that this Court has taken a different view in the case of LIC of India vs. Escorts Ltd. [(1986) 1 SCC 264] wherein this Court held: (SCC p. 344, para 102)If the action of the State is related to contractual obligations or obligations arising out of the tort, the court may not ordinarily examine it unless the action has some public law character attached to it. Broadly speaking, the court will examine actions of State if they pertain to the public law domain and refrain from examining them if they pertain to the private law field. The difficulty will lie in demarcating the frontier between the public law domain and the private law field. It is impossible to draw the line with precision and we do not want to attempt it. The question must be decided in each case with reference to the particular action, the activity in which the State or the instrumentality of the State is engaged when performing the action, the public law or private law character of the action and a host of other relevant circumstances. When the State or an instrumentality of the State ventures into the corporate world and purchases the shares of a company, it assumes to itself the ordinary role of a shareholder, and dons the robes of a shareholder, with all the rights available to such a shareholder. There is no reason why the State as a shareholder should be expected to state its reasons when it seeks to change the management, by a resolution of the company, like any other shareholder.13. We do not think this Court in the above case has, in any manner, departed from the view expressed in the earlier judgments in the case cited hereinabove. This Court in the case of LIC of India proceeded on the facts of that case and held that a relief by way of a writ petition may not ordinarily be an appropriate remedy. This judgment does not lay down that as a rule in matters of contract the courts jurisdiction under Article 226 of the Constitution is ousted. On the contrary, the use of the words court may not ordinarily examine it unless the action has some public law character attached to it itself indicates that in a given case, on the existence of the required factual matrix a remedy under Article 226 of the Constitution will be available. The learned counsel then relied on another judgment of this Court in the case of State of U.P. vs. Bridge & Roof Co. (India) Ltd. [(1996) 6 SCC 22] wherein this Court held:Further, the contract in question contains a clause providing inter alia for settlement of disputes by reference to arbitration. The arbitrators can decide both questions of fact as well as questions of law. When the contract itself provides for a mode of settlement of disputes arising from the contract, there is no reason why the parties should not follow and adopt that remedy and invoke the extraordinary jurisdiction of the High Court under Article 226. The existence of an effective alternative remedy - in this case, provided in the contract itself- is a good ground for the court to decline to exercise its extraordinary jurisdiction under Article 226.14. This judgment again, in our opinion, does not help the first respondent in the argument advanced on its behalf that in contractual matters remedy under Article 226 of the Constitution does not lie. It is seen from the above extract that in that case because of an arbitration clause in the contract, the Court refused to invoke the remedy under Article 226 of the Constitution. We have specifically inquired from the parties to the present appeal before us and we have been told that there is no such arbitration clause in the contract in question. It is well known that if the parties to a dispute had agreed to settle their dispute by arbitration and if there is an agreement in that regard, the courts will not permit recourse to any other remedy without invoking the remedy by way of arbitration, unless of course both the parties to the dispute agree on another mode of dispute resolution. Since that is not the case in the instant appeal, the observations of this Court in the said case of Bridge & Roof Co. [(1996) 6 SCC 22] are of no assistance to the first respondent in its contention that in contractual matters, writ petition is not maintainable.20. This principle has been consistently upheld by this Court in Noble Resources vs. State of Orissa and Anr. (2006) 10 SCC 236 ( at paragraph 15); Food Corp. of India and Anr. vs. SEIL Ltd. and Ors. (2008) 3 SCC 440 ( at paragraph 16); Central Bank of India vs. Devi Ispat Ltd. and Ors. (2010) 11 SCC 186 ( at paragraph 28); and Surya Constructions vs. State of U.P. and Ors. (2019) 16 SCC 794 ( at paragraph 3).21. The judgments cited by Dr. Singhvi do not in any manner detract from the aforesaid principle. Radhakrishna Agarwal and Ors. vs. State of Bihar and Ors. (1977) 3 SCC 457 was a judgment in which a writ petition against the State Governments revision of the rates of royalty payable to it under a lease, and the cancellation of the said lease, was held to be governed by contract between the parties, no unreasonableness being made out by way of State action so as to attract the provisions of Article 14 of the Constitution of India. The broad proposition that all such questions are to be settled by civil courts, and not by writ petitions, has been expressly dissented from, as much water has flown since this judgment, which was delivered during the emergency when the fundamental rights of persons were suspended. Thus, in Verigamto Naveen vs. Govt. of A.P. and Ors. (2001) 8 SCC 344 , this Court stated:21. On the question that the relief as sought for and granted by the High Court arises purely in the contractual field and, therefore, the High Court ought not to have exercised its power under Article 226 of the Constitution placed very heavy reliance on the decision of the Andhra Pradesh High Court in Y.S. Raja Reddy vs. A.R Mining Corpn. Ltd. [(1988) 2 An LT 722] and the decisions of this Court in Har Shankar vs. Dy. Excise & Taxation Commr. [(1975) 1 SCC 737] , Radhakrishna Agarwal vs. State of Bihar [(1977) 3 SCC 457] , Ramlal & Sons vs. State of Rajasthan [(1976) 1 SCC 112] , Shiv Shankar Dal Mills vs. State of Haryana [(1980) 2 SCC 437] , Ramana Dayaram Shetty vs. International Airport Authority of India [(1979) 3 SCC 489] and Basheshar Nath vs. CIT [AI R 1959 SC 149] . Though there is one set of cases rendered by this Court of the type arising in Radhakrishna Agarwal case [(1977) 3 SCC 457] much water has flown in the stream of judicial review in contractual field. In cases where the decision-making authority exceeded its statutory power or committed breach of rules or principles of natural justice in exercise of such power or its decision is perverse or passed an irrational order, this Court has interceded even after the contract was entered into between the parties and the Government and its agencies. We may advert to three decisions of this Court in Dwarkadas Marfatia & Sons vs. Board of Trustees of the Port of Bombay [(1989) 3 SCC 293] , Mahabir Auto Stores vs. Indian Oil Corpn. [(1990) 3 SCC 752] and Shrilekha Vidyarthi (Kumari) vs. State of U.P. [(1991) 1 SCC 212] . Where the breach of contract involves breach of statutory obligation when the order complained of was made in exercise of statutory power by a statutory authority, though cause of action arises out of or pertains to contract, brings it within the sphere of public law because the power exercised is apart from contract. The freedom of the Government to enter into business with anybody it likes is subject to the condition of reasonableness and fair play as well as public interest. After entering into a contract, in cancelling the contract which is subject to terms of the statutory provisions, as in the present case, it cannot be said that the matter falls purely in a contractual field. Therefore, we do not think it would be appropriate to suggest that the case on hand is a matter arising purely out of a contract and, therefore, interference under Article 226 of the Constitution is not called for. This contention also stands rejected.23. It may be added that every case in which a citizen/person knocks at the doors of the writ court for breach of his or its fundamental rights is a matter which contains a public law element, as opposed to a case which is concerned only with breach of contract and damages flowing therefrom. Whenever a plea of breach of natural justice is made against the State, the said plea, if found sustainable, sounds in constitutional law as arbitrary State action, which attracts the provisions of Article 14 of the Constitution of India - see Nawabkhan Abbaskhan vs. State of Gujarat (1974) 2 SCC 121 at paragraph 7. The present case is, therefore, a case which involves a public law element in that the petitioner (Respondent No.1 before us) who knocked at the doors of the writ court alleged breach of the audi alteram partem rule, as the entire proceedings leading to cancellation of the tender, together with the cancellation itself, were done on an ex pane appraisal of the facts behind his back.24. The other judgments cited by Dr. Singhvi in his Written Submissions are distinguishable on facts, as all of them deal with either Public-Interest Litigations or tender applicants who have been turned down, who approach the writ court under Article 226 and ask for stay orders against a proposed project, which may then be considerably delayed and escalate cost, this being contrary to public interest. It is in these situations that observations have been made that before entertaining such writ petitions and passing interim orders, the writ court must be very careful to weigh conflicting public interests, and should intervene only when there is an overwhelming public interest in entertaining the writ petition. This is what was held in Raunaq International Ltd. vs. I.V.R. Construction Ltd. and Ors. (1999) 1 SCC 492 at paragraphs 11 to 13, 24 and 25. To similar effect is the judgment in Jagdish Mandal vs. State of Orissa and Ors. (2007) 14 SCC 517 at paragraph 22.33. What is important to note is that it is the Court or Tribunal which must determine whether or not prejudice has been caused, and not the authority on an ex pane appraisal of the facts. This has been well-explained in a later judgment, namely Dharampal Satyapal Ltd. vs. Dy. Comm. Of Central Excise, Gauhati and Ors. (2015) 8 SCC 519 , in which, after setting out a number of judgments, this Court concluded:38. But that is not the end of the matter. While the law on the principle of audi alteram partem has progressed in the manner mentioned above, at the same time, the courts have also repeatedly remarked that the principles of natural justice are very flexible principles. They cannot be applied in any straitjacket formula. It all depends upon the kind of functions performed and to the extent to which a person is likely to be affected. For this reason, certain exceptions to the aforesaid principles have been invoked under certain circumstances. For example, the courts have held that it would be sufficient to allow a person to make a representation and oral hearing may not be necessary in all cases, though in some matters, depending upon the nature of the case, not only full-fledged oral hearing but even cross-examination of witnesses is treated as a necessary concomitant of the principles of natural justice. Likewise, in service matters relating to major punishment by way of disciplinary action, the requirement is very strict and full-fledged opportunity is envisaged under the statutory rules as well. On the other hand, in those cases where there is an admission of charge, even when no such formal inquiry is held, the punishment based on such admission is upheld. It is for this reason, in certain circumstances, even post-decisional hearing is held to be permissible. Further, the courts have held that under certain circumstances principles of natural justice may even be excluded by reason of diverse factors like time, place, the apprehended danger and so on.39. We are not concerned with these aspects in the present case as the issue relates to giving of notice before taking action. While emphasising that the principles of natural justice cannot be applied in straitjacket formula, the aforesaid instances are given. We have highlighted the jurisprudential basis of adhering to the principles of natural justice which are grounded on the doctrine of procedural fairness, accuracy of outcome leading to general social goals, etc. Nevertheless, there may be situations wherein for some reason-perhaps because the evidence against the individual is thought to be utterly compelling-it is felt that a fair hearing would make no difference-meaning that a hearing would not change the ultimate conclusion reached by the decision-maker-then no legal duty to supply a hearing arises. Such an approach was endorsed by Lord Wilberforce in Malloch vs. Aberdeen Corpn. [(1971) 1 WLR 1578], who said that: (WLR p. 1595)... A breach of procedure ... cannot give [rise to] a remedy in the courts, unless behind it there is something of substance which has been lost by the failure. The court does not act in vain.Relying on these comments, Brandon L.J. opined in Cinnamond vs. British Airports Authority [(1980) 1 WLR 582] that: (WLR p. 593)... no one can complain of not being given an opportunity to make representations if such an opportunity would have availed him nothing.In such situations, fair procedures appear to serve no purpose since the right result can be secured without according such treatment to the individual.40. In this behalf, we need to notice one other exception which has been carved out to the aforesaid principle by the courts. Even if it is found by the court that there is a violation of principles of natural justice, the courts have held that it may not be necessary to strike down the action and refer the matter back to the authorities to take fresh decision after complying with the procedural requirement in those cases where non-grant of hearing has not caused any prejudice to the person against whom the action is taken. Therefore, every violation of a facet of natural justice may not lead to the conclusion that the order passed is always null and void. The validity of the order has to be decided on the touchstone of prejudice. The ultimate test is always the same viz. the test of prejudice or the test of fair hearing.xxx xxx xxx42. So far so good. However, an important question posed by Mr Sorabjee is as to whether it is open to the authority, which has to take a decision, to dispense with the requirement of the principles of natural justice on the ground that affording such an opportunity will not make any difference? To put it otherwise, can the administrative authority dispense with the requirement of issuing notice by itself deciding that no prejudice will be caused to the person against whom the action is contemplated? Answer has to be in the negative. It is not permissible for the authority to jump over the compliance of the principles of natural justice on the ground that even if hearing had been provided it would have served no useful purpose. The opportunity of hearing will serve the purpose or not has to be considered at a later stage and such things cannot be presumed by the authority. This was so held by the English Court way back in the year 1943 in General Medical Council vs. Spackman [1943 AC 627]. This Court also spoke in the same language in Board of High School and Intermediate Education vs. Chitra Srivastava [(1970) 1 SCC 121] , as is apparent from the following words: (SCC p. 123, para 7)7. The learned counsel for the appellant, Mr C.B. Agarwala, contends that the facts are not in dispute and it is further clear that no useful purpose would have been served if the Board had served a show-cause notice on the petitioner. He says that in view of these circumstances it was not necessary for the Board to have issued a show-cause notice. We are unable to accept this contention. Whether a duty arises in a particular case to issue a show-cause notice before inflicting a penalty does not depend on the authoritys satisfaction that the person to be penalised has no defence but on the nature of the order proposed to be passed.43. In view of the aforesaid enunciation of law. Mr Sorabjee may also be right in his submission that it was not open for the authority to dispense with the requirement of principles of natural justice on the presumption that no prejudice is going to be caused to the appellant since the judgment in R.C. Tobacco [(2005) 7 SCC 725] had closed all the windows for the appellant.44. At the same time, it cannot be denied that as far as courts are concerned, they are empowered to consider as to whether any purpose would be served in remanding the case keeping in mind whether any prejudice is caused to the person against whom the action is taken. This was so clarified in ECIL itself in the following words: (SCC p. 758, para 31)31. Hence, in all cases where the enquiry officers report is not furnished to the delinquent employee in the disciplinary proceedings, the courts and tribunals should cause the copy of the report to be furnished to the aggrieved employee if he has not already secured it before coming to the court/tribunal and given the employee an opportunity to show how his or her case was prejudiced because of the non-supply of the report. If after hearing the parties, the court/tribunal comes to the conclusion that the non-supply of the report would have made no difference to the ultimate findings and the punishment given, the court/tribunal should not interfere with the order of punishment. The court/tribunal should not mechanically set aside the order of punishment on the ground that the report was not furnished as is regrettably being done at present. The courts should avoid resorting to short cuts. Since it is the courts/tribunals which will apply their judicial mind to the question and give their reasons for setting aside or not setting aside the order of punishment, (and not any internal appellate or revisional authority), there would be neither a breach of the principles of natural justice nor a denial of the reasonable opportunity. It is only if the court/tribunal finds that the furnishing of the report would have made a difference to the result in the case that it should set aside the order of punishment.45. Keeping in view the aforesaid principles in mind, even when we find that there is an infraction of principles of natural justice, we have to address a further question as to whether any purpose would be served in remitting the case to the authority to make fresh demand of amount recoverable, only after issuing notice to show cause to the appellant. In the facts of the present case, we find that such an exercise would be totally futile having regard to the law laid down by this Court in R.C. Tobacco [(2005) 7 SCC 725] .39. An analysis of the aforesaid judgments thus reveals:(1) Natural justice is a flexible tool in the hands of the judiciary to reach out in fit cases to remedy injustice. The breach of the audi alteram partem rule cannot by itself, without more, lead to the conclusion that prejudice is thereby caused.(2) Where procedural and/or substantive provisions of law embody the principles of natural justice, their infraction per se does not lead to invalidity of the orders passed. Here again, prejudice must be caused to the litigant, except in the case of a mandatory provision of law which is conceived not only in individual interest, but also in public interest.(3) No prejudice is caused to the person complaining of the breach of natural justice where such person does not dispute the case against him or it. This can happen by reason of estoppel, acquiescence, waiver and by way of non-challenge or non-denial or admission of facts, in cases in which the Court finds on facts that no real prejudice can therefore be said to have been caused to the person complaining of the breach of natural justice.(4) In cases where facts can be stated to be admitted or indisputable, and only one conclusion is possible, the Court does not pass futile orders of setting aside or remand when there is, in fact, no prejudice caused. This conclusion must be drawn by the Court on an appraisal of the facts of a case, and not by the authority who denies natural justice to a person.(5) The prejudice exception must be more than a mere apprehension or even a reasonable suspicion of a litigant. It should exist as a matter offact, or be based upon a definite inference of likelihood of prejudice flowing from the non-observance of natural justice.40. Judged by the touchstone of these tests, it is clear that Respondent No.1 has been completely in the dark so far as the cancellation of the award of tender in his favour is concerned, the audi alteram partem rule having been breached in its entirety. As has been correctly argued by Shri Rakesh Dwivedi, prejudice has indeed been caused to his client, not only from the fact that one year of the contract period has been taken away, but also that, if the impugned High Court judgment is to be set aside today, his client will be debarred from bidding for any of the Corporations tenders for a period of three years. Undoubtedly, prima facie, the rates at which contracts have been awarded pursuant to the tender dated 01.06.2018 are way above the rates that were awarded of the same division, and for exactly the same amount of work awarded vide the earlier tender advertisement dated 01.04.2018. Shri Dwivedis argument that in the neighbouring regions the rates tendered were also high, and nothing has yet been done to nullify these tenders and the financial loss caused, does carry some weight. That a huge financial loss to the Corporation has also taken place is something for the Corporation to probe, and take remedial action against the persons responsible.44. Insofar as the appeal arising out of SLP (C) No. 7364 of 2020 is concerned, the facts therein are distinct from the other two connected appeals before us only to the extent that Respondent No.1 therein, M/s Dharam Raj Singh, was the successful bidder for the Tendu (Sonbhadra) region, which award of tender was also cancelled by the Corporations order dated 26.07.2019. The judgment impugned in this appeal, dated 07.01.2020 of the High Court of Judicature of Allahabad (Lucknow Bench), allowed M/s Dharam Raj Singhs writ petition challenging the cancellation order, stating that it was to be governed by the judgment of the High Court of Judicature at Allahabad dated 11.12.2019.

### Instruction: Based on the legal narrative and evidentiary details in the case proceeding, predict the court's stance: favorable (1) or unfavorable (0) to the appellant. ### Input: According to him, the Writ Petition only prayed for a quashing of the cancellation order dated 26.07.2019 of the second tender. The High Court went way beyond, and not only quashed the aforesaid cancellation, but also quashed the enquiry report of the Managing Director dated 14.06.2019, as well as the order passed by the Special Secretary dated 16.07.2019, and the consequential action taken, namely, the departmental proceedings against the delinquent officers, which was never the subject matter of challenge in the Writ Petition. He went on to argue, based upon the comparison between the rates that were received in the earlier tender dated 01.04.2018 that was cancelled, and the rates in the 01.06.2018 tender, that the disparity was so great as to make it clear that the contracts for these four centres ought not to have been entered into at these rates at all. He argued that the High Court ought to have appreciated the huge financial loss that was caused as a result of awarding the contract at these rates, and ought not to have interfered with the cancellation of the tender, as it could not be characterised as arbitrary, given the huge increase in rates in such a short period for the same works. Further, he argued that the case law on natural justice showed that it was not an inflexible straitjacket, but had to be used wisely and well, and cited a number of judgments of this Court for the proposition that even though natural justice may be breached in the facts of a given case, if otherwise such breach does not result in prejudice, it would be a mere exercise in futility to set aside the order and remand it to the authorities to pass an order after hearing the affected party. He also argued that as of today, the two year term of the contract is over, and this very contractor, i.e. Respondent No.1, is doing the same work awarded at Mirzapur on 21.03.2020 at rates (139% ASOR) which are much lower than the rates tendered for previously, as is the successful tenderer Tilotama Devi on and from 31.09.2019 so far as Bhawanipur-II is concerned, which was awarded at 221% ASOR. Dr. Singhvi also argued that the writ court ought not to have interfered in contractual matters, and ought to have left Respondent No.1 to approach a civil court to file a suit for appropriate reliefs. 16. Shri Tushar Mehta, learned Solicitor General appearing on behalf of the State of U.P., argued that he had a limited role, and confined his arguments to the setting aside of the letter dated 16.07.2019 of the Special Secretary to take departmental action. He argued that this letter could not have been set aside by the High Court, as no such prayer or argument was made before it by the writ petitioner. 17. Shri Rakesh Dwivedi, learned Senior Advocate appearing on behalf of Respondent No.1, argued that the High Court judgment ought not to be interfered with, inasmuch as his client had pumped in a lot of money, and had worked the contract for a period of over one year successfully and without any complaint whatsoever from the Corporation. He reiterated the fact that nobody had challenged the award of the tender to his client, and that the cancellation of the tender was done behind his clients back. Had the authorities bothered to give his client a hearing, his client could have pointed out that in other nearby divisions, tenders were awarded at roughly the same rates, all of which contracts had been worked out, and none of which have been cancelled. Thus, he argued that his client suffered serious prejudice, in that he was able to work his contract for only one out of the two years that was awarded to him. He further argued that had a hearing been given, his client would also have demonstrated that the rates that were awarded could not be characterised as unreasonable, given the magnitude of the contract in his favour. He also argued that the award of tender at a lower rate at Mirzapur, which is currently being processed through his client, is not comparable with the tender that was awarded to his client for Bhawanipur I, because, inter alia, there was a huge difference between the volume of work awarded in the two contracts. He argued that it is idle to say that no prejudice has been caused, inasmuch as he has not been able to work the contract for one year, the contract period now being over, and that if the contract with his client is set aside, his client is debarred from bidding for a period of three years for any other contract with the Corporation. He further argued, in support of the impugned High Court judgment, that the action of termination by the Corporation waswithout an independent application of mind, and was purely at the instruction of the Special Secretary of the Government of U.P. dated 16.07.2019. He also fairly argued that his statement may be recorded that his client is not going to claim damages for the period of the agreement post cancellation, and that in fairness, the earnest money deposit and security deposit made by his client ought to be returned by the Corporation. 18. Having heard learned counsel for all the parties, one thing becomes clear. Despite the fact that the prayer in the Writ Petition filed by Respondent No.1 was set out in the very beginning of the impugned judgment, confining itself to the cancellation of the second tender, the impugned judgment went ahead and not only set aside such cancellation vide the letter dated 26.07.2019, but also went ahead and set aside the Managing Directors report dated 14.06.2019, and the Special Secretarys order of 16.07.2019, which required the taking of disciplinary action and recovery of financial loss from those who are responsible. Shri Rakesh Dwivedi also fairly conceded that his client had not asked for any relief qua the delinquent officers. ### Response: 1

GARGI Vs. STATE OF HARYANA

this regard, it gets perforce reiterated that the prosecution has not produced any evidence which could displace the statement of DW-3 that he indeed informed the police at the asking of the appellant at about 9.30 p.m. on 01.05.1997 and did also inform the brother of the deceased. As noticed, PW-9 ASI Amar Singh did not specify as to how the information was received by him. Moreover, the person said to have divulged the information to the witness PW-7 was never examined. Given such omissions in the prosecution case, we find no reason to discard the testimony of DW-3. Once his testimony is accepted, several blocks of the prosecution story are knocked to the ground.Effect of the acquittal of co-accused persons31. There is yet another lacuna in the prosecution case that has magnified itself with acquittal of the co-accused, brothers of the appellant. It cannot be denied that if the appellant had been the killer, she, by herself, could not have hanged the dead body by the ceiling fan; and the act had definitely been performed by more than one person. That being the position, the Trial Court readily accepted the case against the brothers of the appellant as conspirators without cogent and convincing evidence. The High Court rightly acquitted them for want of evidence and even observed that the prosecution had failed to book the real culprit in place of the brothers of the appellant. However, the High Court yet considered it proper to maintain the conviction of the appellant as the principal culprit while failing to consider that an important link in the prosecution story was snapped as soon as brothers of the appellant were acquitted.31.1. We would hasten to observe that merely for the reason of acquittal of co-accused, another accused in a criminal case may not be acquitted if cogent evidence against him is available and his case could be segregated from the case against the acquitted co-accused. However, on the basic facts of the present case, it is evident that the gruesome act in question had not been the handiwork of one person and it would be rather preposterous to assume that the appellant hanged the dead body by ceiling fan all by herself. In the given circumstances, when the alleged collaborators of the appellant are acquitted, the already existing clouds of doubts on the prosecution story get congealed. The High Court has proceeded with over- simplification of the matter by leaving the missing link as merely a fault of the investigating agency. In our view, as soon as the brothers of the appellant were acquitted, the High Court ought to have examined the consequence of such acquittal that an important link in the prosecution theory was snapped and it was difficult to conclude that the prosecution has established its case against the appellant beyond all reasonable doubts.The prosecution case not established beyond reasonable doubt32. Thus, as regards the circumstances relied upon by the prosecution, the position obtainable from the material placed on record and the surrounding factors is that (a) the death of deceased Tirloki Nath was homicidal in nature and had not been suicidal though it was sought to be projected as suicide by the culprits by hanging the dead body from a ceiling fan in his room; (b) there is no cogent and convincing evidence on record to come to a definite conclusion that the relations of the deceased and the appellant were strained or that the appellant was indulgent in illicit relations or she was insisting for transfer of property in her name; (c) it is also difficult to come to a definite conclusion that the deceased had expressed imminent danger to his life at the hands of the appellant; and (d) even if the deceased was last seen alive in the company of the appellant, the time gap between such last seen and finding of his dead body had been of about 2 to 3 days.33. Apart from the factors above, there are several other loopholes whereby the alleged circumstances sought to be relied upon by the prosecution lose their worth and force. As noticed, the investigating agency and the prosecution had not been forthright. The relevant aspects pertaining to the crime in question were not properly investigated and even the relevant witnesses were not examined. Moreover, as noticed, the prosecution case was framed in the manner that the appellant committed the crime with the help of her brothers who have been acquitted.33.1. In the given circumstances, the fact that the staircase from the ground floor was directly leading to the room in question where the dead body was found, acquires immense significance. Even if it be assumed that the deceased was putting up in the said room, some person or persons reaching there directly from the ground floor and carrying out the crime is not ruled out. In the alternative, some person or persons having executed the crime at some other place and then having brought the dead body and hanged it in the room in question is also the possibility which cannot be brushed aside as entirely improbable.34. In the given circumstances, when the prosecution has not been able to remove the aforesaid doubts and the motive as imputed on the appellant does not appear existing, the benefit of doubt, obviously, goes to the appellant.CONCLUSION35. For what has been discussed hereinabove, we are clearly of the view that the Trial Court and the High Court have approached the case from an altogether wrong angle and have overlooked the major flaws and shortcomings in the prosecution case. In the given set of facts and circumstances, even if the prosecution has been able to create some suspicion against the appellant, it would be unsafe to accept that the implicating circumstances have been established by cogent evidence and such circumstances form a complete chain that rules out any other hypothesis except guilt of appellant. Hence, the conviction of the appellant cannot be sustained; she is entitled to the benefit of doubt.

1[ds]10. Having given anxious consideration to the rival submissions and having scanned through the entire record with reference to law applicable, we are impelled to say at the outset of discussion that in this matter, several fundamental shortcomings in the investigation and several loopholes in the prosecution propositions got overlooked by the Trial Court as also by the High Court. In an overall comprehension of the matter, we are clearly of the view that it would not be safe to accept the projected propositions of the prosecution and to convict the appellant for the offence of murder of her husband.The manner of dealing with this case by the investigating agency, right at the inception, has left a few serious questions unanswered i.e., as to when did the police receive information about dead body of the husband of the appellant, by what mode, and through whom? PW-9 in his testimony before the Court conveniently stated that such an information was received through ?telephonic message? but did not state the particulars of such informant. No entry in the roznamcha or general diary has been produced to show that such an information was duly entered in the record before proceeding for investigation. Significantly, in the first note drawn up in the matter at 5.30 a.m. on 02.05.1997 (EX. PH/1), PW-9 only stated that ‘the information was received at the police station?. The fact that it had been a telephonic information is conspicuously missing in Ex.PH/1. This aspect has got a material bearing in the matter because the defence witness DW-3 specifically testified to the fact that he was the first person informed by the appellant about the demise of Tirloki Nath; and that he went to the police station at about 9.30 p.m. on 01.05.1997 and divulged the information. He further asserted having accompanied the police to the site and having conveyed the information to PW-7.15.2. It is also noteworthy that as per PW-7, he got the information from one T.R. Malhotra at about 11.30 p.m. who, in turn, had received the information on telephone from a colleague of the deceased. Neither any enquiry was made from the said T.R. Malhotra nor any other effort was made to find out the colleague of the deceased who had telephoned him.15.3. In the face of such a gap in the prosecution evidence, there appears no reason to disbelieve the testimony of DW-3 Surinder Kumar Bhat as regards the time of information to police and himself being the informant. In such a scenario, it remains absolutely inexplicable as to why the information given by DW-3 was not reduced in writing and the proceedings were not conducted on that basis. This question magnifies itself to tougher questions for the prosecution as to the time when PW-9 ASI Amar Singh reached the site and with whom. From the evidence on record and surrounding facts, it appears that the said ASI had reached the site at around 10.30 p.m. accompanied by DW-3 Surinder Kumar Bhat. The toughness of these questions further amplifies into the harder, and unanswered, question for the investigating agency as to why for a long period of about 4 to 5 hours at the site, the ASI (PW-9) did not carry out any investigation and did not record any statement.15.4. It is not the case of prosecution that the ASI (PW-9) was prevented by any reason to immediately attend on his duties after reaching the site. It is also not the case that he attempted to make any enquiry from any person until arrival of the complainant and other family members of the deceased. Even if it be assumed that the other family members of the deceased were on the way and the ASI knew about this fact, nothing had prevented him from attending on his duties of investigation. Strangely enough, even the first panchnama was prepared only after reaching of the complainant. It is also not clear as to why the statements of the children of the deceased were not taken when his daughter, 16 years of age, was very much present at the site. It is also not explained as to why in this kind of matter, carrying suspicious overtones, PW-9 did not make any enquiry from any of the neighbours, who were available at the site; and from the tenant, who was residing at the ground floor of the same building and whose washroom was allegedly being used by the deceased (as per the assertion of PW-8)? It is difficult to say that the conduct of this Investigating Officer (PW-9) had been totally free from doubt.15.5. Apart from the above-noted omissions at the very initial stage, we find absolutely no reason that the Investigating Officer PW-10, even after allegedly making enquiries in the locality regarding the character of the appellant from 5-10 persons, neither mentioned this fact in the investigation report nor recorded the statement of anyone of them. This Investigating Officer further stated to have joined the children of the appellant in the investigation but did not record their statements either. This Officer also did not bother to take the statement of the tenant, whose testimony would have been of immense significance, looking to the nature of accusations as also the factors related with the building in question.15.6. Moreover, in this matter, where it was prima facie appearing that the clues available at the site might play a significant role in reaching to the real culprits, it is also intriguing to notice that the Investigating Officer did not take even elementary care to obtain fingerprints from the material objects and to get them analysed properly. The Investigating Officer (PW-10) has stated, rather with impunity, that he did not take any fingerprints at all, even while admitting that the fingerprint expert did visit the site. It is not stated that the so-called expert expressed inability to collect such prints for any reason. It is left only for one to wonder as to for what purpose did the so-called fingerprint expert visit the site, if no prints were to be taken at all!15.7. The above-mentioned unexplained shortcomings, perforce, indicate that in this case, the investigation was carried out either with pre-conceived notions or with a particular result in view. It is difficult to accept that the investigation in this case had been fair and impartial. From another viewpoint, on the facts and in the circumstances of this case, the omissions on the part of investigating agency cannot be ignored as mere oversight. These omissions, perforce, give rise to adverse inferences against the prosecution.16. In this case, it is also interesting to notice that though the prosecution had cited the other relations of the deceased as witnesses, including his mother and brother-in-law (husband of PW-8 - who had otherwise signed the inquest report) but did not examine them before the Court. Withholding of relevant witnesses could only lead to further adverse inference that if examined, they would not have supported the prosecution case. This is apart from the fact that the investigating agency avoided to include any independent witness in the investigation and did not carry out necessary enquires from the persons other than in-laws of the appellant.17. Hereinabove, we have only indicated a few broad aspects of shortcomings and lacunae in the prosecution case which is otherwise resting on circumstantial evidence and on the theory propounded by the brother of deceased (PW-7), as supported by his sister (PW-8). The upshot of the discussion foregoing is that the propositions projected by the prosecution require deeper scrutiny to find if the case against the appellant is established beyond reasonable doubt; and if the elements of adverse inferences do not materially affect the prosecutionTrial Court as also the High Court have returned concurrent findings that it had been a matter of homicidal death. Both the Courts came to this conclusion essentially with reference to the medical opinion that the cause of death was asphyxia due to strangulation; and also with reference to some of the surrounding factors that the feet of the hanging dead body were touching the floor; the knees were bent; the slippers were not removed; and the room in question was wide open. Assailing such findings, it is contended on behalf of the appellant that as per medical jurisprudence, scratches, abrasions, bruises etc. are usually present and hyoid bone would be usually found broken in case of strangulation but, in the present case, there were no such marks nor hyoid bone was broken.18.1. We have closely examined the testimony of PW-1 Dr. Usha Bansal, who was one of members of the board that had conducted post-mortem. We have also taken into account the features noticeable from the site plan, the inquest report and the photographs placed on record. Having examined the relevant material, we find nothing of infirmity in the findings of the Trial Court and the High Court that it had been a case of strangulation, as could be seen from the post-mortem report that the dead body carried?well defined depressed ligature mark measuring 3 cm. wide seen encircling the neck around thyroid cartilage with a knot present on left side of neck and this ligature mark was anti-mortem inThe other ligature mark was on the left side of the neck measuring 1.5 cm wide and that was post-mortem in nature. The board had undoubtedly been of the opinion that the cause of death was ?asphyxia due to strangulation?. With such categorical medical opinion coupled with all the relevant features surrounding the suspended dead body in the room in question, it is difficult to say that it had been a case of suicide merely because hyoid bone was not broken or because the marks of resistance like abrasions/scratches were not reported. The presence of marks of resistance would depend on a variety of factors, including the method and manner of execution of the act of strangulation by the culprits; and mere want of such marks cannot be decisive of the matter. Equally, it is not laid down as an absolute rule in medical jurisprudence that in all cases of strangulation, hyoid bone would invariably be fractured. On the contrary, medical jurisprudence suggests that only in a fraction of such cases, a fracture of hyoid bone isother words, absence of fracture of hyoid bone would not lead to the conclusion that the deceased did not die of strangulation.18.2. For what has been discussed in preceding paragraphs, we have no hesitation in affirming the findings in the impugned judgments that the deceased Tirloki Nath was done to death by strangulation and thereafter, his dead body was hanged from the ceiling fan in the room.Before examining the circumstances brought on record by the prosecution, we may observe in the passing that the Trial Court as also the High Court have proceeded on the lines that once it was established that the deceased Tirloki Nath was killed by way of strangulation and the killer/s suspended his dead body from the fan so as to mislead; and since the dead body was found in the very house he was residing with the appellant who could not explain the reason of his death, she was to be held responsible for the crime. In other words, the Trial Court and the High Court have assumed that as soon as the conclusion about the homicidal death of Tirloki Nath in his own room is reached, all other aspects of the prosecution story about so-called strained relations of the deceased and the appellant, and the alleged threat perception of the appellant ipso facto come into operation; and the finding on homicidal death itself has been taken as the answer to other question as to whether homicide was to be imputed on the appellant or not. In our view, while examining the question as to whether the death in question was homicidal or suicidal, there was no justification to mix up the other circumstances projected by the prosecution, which indeed required separate assessment and analysis. Be that as it may, appropriate now it would be to examine the circumstances put forth in this case to find if the prosecution has been able to bring home the guilt of the appellant beyond reasonable doubt.Alleged last statement of deceased and motive of appellant21. The main plank of prosecution case against appellant has been that the relations between the deceased and the appellant were too strained; the appellant was having illicit relations and was ill-treating the deceased; the deceased had expressed even threat to his life at the hands of the appellant; and the deceased was all set to move out of the company of the appellant. These factors, imputing motive on the appellant to kill her husband (and even deceased perceiving threat to his life at the hands of the appellant), have been held proved by the Trial Court and the High Court with reference to the testimony of PW-7 Brij Bhushan (brother of the deceased) and PW-8 Radha Puri (sister of the deceased). As noticed, the Trial Court as also the High Court have relied upon these two witnesses and have accepted their assertions in toto. However, a close look at the testimony of these witnesses and the assessment of their evidence with reference of other factors on record bring forth several doubts, which have not been dispelled and which do operate against the prosecution.22. Though learned counsel of the appellant has attempted to suggest, with reference to additional documents placed on record, that PW-7 carried questionable antecedents and had been a proclaimed offender but we are ignoring such submissions for the reason that these aspects were not specifically put to the witness in his cross- examination. However, the question is as to whether his testimony inspires such confidence that all the facts and the circumstances suggested by him, and all his assertions, be accepted on their face value? In our view, the answer to this question could only be in the negative.A combined look at the testimony of PW-7 and PW-8 brings to the fore one of the significant facts that there had been an ancestral house belonging to the family that was sold by PW-7 alone and the sale proceeds were utilised by him to open a grocery shop, one of the multiple ventures he had tried, mostly resulting in closure or failure. The appellant had been categoric in her assertion that the property and money had been at the root of discord in the family and the same had been the cause for the family of the deceased implicating her. DW-3 has also testified to the effect that the deceased had his tense moments because of money demands of his brother i.e., PW-7. Unfortunately, the Trial Court as also the High Court have totally overlooked these factors and features hovering over the prosecution story.25. Going further deep into the prosecution story, it is clear that there is no direct and cogent evidence on record that the appellant was involved in illicit relations or was forcing the deceased to transfer the property. It had not been the assertion of PW-7 or PW-8 that the alleged illicit relations of the appellant and/or her pressurising the deceased to transfer the property had been the matters of their personal knowledge. No particulars of any person having illicit involvement with the appellant are to be found on record. Such assertions have been made by these witnesses on the basis of the statements allegedly made by the deceased to each of them individually and at different point of time. The High Court and the Trial Court have readily accepted the suggestions of PW-7 and PW-8 that the deceased made the statements to them as alleged; and have even labelled the statement allegedly made to PW-7 as being the dying declaration of the deceased. Strictly speaking, the alleged statement made to PW-7 could not have been taken as a ‘dying declaration? for the reason that at time of making of such statement, the deceased was not labouring under his imminent death and he was not recounting the circumstance of the transaction relating to his death. For the sake of arguments, and on the broad phraseology of the first part of Section 32 (1) of the Indian Evidence Act (32. Cases in which statement of relevant fact by a person who is dead or cannot be found, etc., is relevant.-Statements, written or verbal, of relevant facts made by a person who is dead, or who cannot be found, or who has become incapable of giving evidence, or whose attendance cannot be procured without an amount of delay or expense, which, under the circumstances of the case, appears to the Court unreasonable, are themselves relevant facts in the following cases:- (1) when it relates to cause of death.- When the statement is made by a person as to the cause of his death, or as to any of the circumstances of the transaction which resulted in his death, in cases in which the cause of that persons death comes into question ) , even if it be assumed that the statement made by the deceased, before the cause of death had arisen, or before he had any reason to anticipate his killing, may also be taken as admissible (Vide Pakala Narayana Swami v. The King-Emperor: AIR 1939 PC 47 ) , such an alleged statement cannot be directly acted upon without concrete corroboration. In the present case, what to say of corroboration, even making of such statement by the deceased appears to be doubtful.For what has been discussed hereinabove, strong elements of doubts surface on record as regards reliability of these two witnesses PW-7 and PW-8. In the given circumstances, it is difficult to accept that the prosecution has been able to establish by cogent and reliable evidence that the appellant was involved in illicit relations or was pressurising the deceased to transfer the property in her name and that there had been strong acrimony between the deceased and the appellant. It is also difficult to accept, for want of cogent corroborative evidence, if the deceased had made any alleged statements about discord with his wife and threat perceptions to PW-7 and PW-8. In the given circumstances, the possibility of levelling of imputations on the appellant for intentions other than bringing the real culprit/s to the book is not ruled out altogether.Last seen theory: Proof and effect28.On the facts of the present case, it emerges that as per the version of PW-7, the deceased was lastly in his companywhen he allegedly expressed his dejection and fear as also his plan to return with luggage. The appellant has pointed out that the deceased was with her in the morning of 29.04.1997 when he pointed out his tour programme commencing that day with scheduled return on 03.05.1997. It is not in dispute that the deceased was regularly on tour for longer durations of about two weeks in connection with his duties. The dead body was recovered on 01.05.1997 and as per post-mortem report, the probable time that had elapsed between death and post- mortem (on 02.05.1997 at 12.30 p.m.) was 24 to 72 hours. On the basis of this opinion, it cannot be assumed by way of arithmetical calculation that the deceased might have met with his end on 29.04.1997. The possibility of it being a day later is not ruled out.28.3. In the given set of circumstances, the last seen theory cannot be operated against the appellant only because she was the wife of the deceased and was living with him. The gap between the point of time when the appellant and deceased were last seen together and when the deceased was found dead had not been that small that possibility of any other person being the author of the crime is rendered totally improbable.The Trial Court and the High Court have readily, and rather heavily, relied upon an assertion made by PW-8 in her statement that upon her reaching the site, the appellant was ‘enjoying tea? with her brothers and other relations on the first floor; and was not found stressed or perplexed or saddened. This part of the assertion on the part of PW-8 has its own shortcomings. Such an assertion was not made by her in the police statement; and is not even remotely corroborated by any other prosecution witness including PW-7. Moreover, it had been too unrealistic on the part of the Trial Court and the High Court to observe that the appellant ought to have been found sitting with the dead body. Admittedly, the corpse was emitting foul smell and DW-8 reached the spot at about 4.30 in the morning though the appellant had noticed the dead body the previous evening and had taken steps for informing the concerned through DW-3, Surinder Kumar Bhat. In the given circumstances, no fault could be foisted on the appellant if she did not remain with the dead body all through and until arrival of PW-8. The expression ‘enjoying tea? was coined by this witness PW-8 alone and for want of corroboration and for omission of such a fact in the police statement, there appears no reason to accept the same. If at all anything of subsequent conduct of appellant is to be taken into consideration, it is evident that she attended her office on 30.04.1997 and 01.05.1997. It is not the case of the prosecution that during these two days, any abnormality in her behaviour was noticed by anyone. The appellant neither concealed herself nor altered the scene of crime in any manner and there had not been any evidence about any oddity in her manners and demeanour.30. Another circumstance taken against the appellant had been that she allegedly did not send any information to the brothers and other relations of the deceased immediately after noticing his death. Such observations and findings have been recorded against the appellant while totally overlooking the statement of DW-3. In this regard, it gets perforce reiterated that the prosecution has not produced any evidence which could displace the statement of DW-3 that he indeed informed the police at the asking of the appellant at about 9.30 p.m. on 01.05.1997 and did also inform the brother of the deceased. As noticed, PW-9 ASI Amar Singh did not specify as to how the information was received by him. Moreover, the person said to have divulged the information to the witness PW-7 was never examined. Given such omissions in the prosecution case, we find no reason to discard the testimony of DW-3. Once his testimony is accepted, several blocks of the prosecution story are knocked to the ground.Effect of the acquittal of co-accused persons31.Thus, circumstantial evidence, in the context of a crime, essentially means such facts and surrounding factors which do point towards the complicity of the charged accused; and then, chain of circumstances means such unquestionable linking of the facts and the surrounding factors that they establish only the guilt of the charged accused beyond reasonable doubt, while ruling out any other theory or possibility orOn the facts of the present case, it emerges that as per the version of PW-7, the deceased was lastly in his company7 when heallegedly expressed his dejection and fear as also his plan to return with luggage. The appellant has pointed out that the deceased was with her in the morning ofted out his tour programme commencing that day with scheduled return on 03.05.1997. It is not in dispute that the deceased was regularly on tour for longer durations of about two weeks in connection with his duties. The dead body was recovered on 01.05.1997 and as per post-mortem report, the probable time that had elapsed between death and post- mortem (on 02.05.1997 at 12.30 p.m.) was 24 to 72 hours. On the basis of this opinion, it cannot be assumed by way of arithmetical calculation that the deceased might have met with his end on 29.04.1997. The possibility of it being a day later is not ruled out.There is yet another lacuna in the prosecution case that has magnified itself with acquittal of the co-accused, brothers of the appellant. It cannot be denied that if the appellant had been the killer, she, by herself, could not have hanged the dead body by the ceiling fan; and the act had definitely been performed by more than one person. That being the position, the Trial Court readily accepted the case against the brothers of the appellant as conspirators without cogent and convincing evidence. The High Court rightly acquitted them for want of evidence and even observed that the prosecution had failed to book the real culprit in place of the brothers of the appellant. However, the High Court yet considered it proper to maintain the conviction of the appellant as the principal culprit while failing to consider that an important link in the prosecution story was snapped as soon as brothers of the appellant were acquitted.31.1. We would hasten to observe that merely for the reason of acquittal of co-accused, another accused in a criminal case may not be acquitted if cogent evidence against him is available and his case could be segregated from the case against the acquitted co-accused. However, on the basic facts of the present case, it is evident that the gruesome act in question had not been the handiwork of one person and it would be rather preposterous to assume that the appellant hanged the dead body by ceiling fan all by herself. In the given circumstances, when the alleged collaborators of the appellant are acquitted, the already existing clouds of doubts on the prosecution story get congealed. The High Court has proceeded with over- simplification of the matter by leaving the missing link as merely a fault of the investigating agency. In our view, as soon as the brothers of the appellant were acquitted, the High Court ought to have examined the consequence of such acquittal that an important link in the prosecution theory was snapped and it was difficult to conclude that the prosecution has established its case against the appellant beyond all reasonable doubts.The prosecution case not established beyond reasonable doubt32. Thus, as regards the circumstances relied upon by the prosecution, the position obtainable from the material placed on record and the surrounding factors is that (a) the death of deceased Tirloki Nath was homicidal in nature and had not been suicidal though it was sought to be projected as suicide by the culprits by hanging the dead body from a ceiling fan in his room; (b) there is no cogent and convincing evidence on record to come to a definite conclusion that the relations of the deceased and the appellant were strained or that the appellant was indulgent in illicit relations or she was insisting for transfer of property in her name; (c) it is also difficult to come to a definite conclusion that the deceased had expressed imminent danger to his life at the hands of the appellant; and (d) even if the deceased was last seen alive in the company of the appellant, the time gap between such last seen and finding of his dead body had been of about 2 to 3 days.33. Apart from the factors above, there are several other loopholes whereby the alleged circumstances sought to be relied upon by the prosecution lose their worth and force. As noticed, the investigating agency and the prosecution had not been forthright. The relevant aspects pertaining to the crime in question were not properly investigated and even the relevant witnesses were not examined. Moreover, as noticed, the prosecution case was framed in the manner that the appellant committed the crime with the help of her brothers who have been acquitted.33.1. In the given circumstances, the fact that the staircase from the ground floor was directly leading to the room in question where the dead body was found, acquires immense significance. Even if it be assumed that the deceased was putting up in the said room, some person or persons reaching there directly from the ground floor and carrying out the crime is not ruled out. In the alternative, some person or persons having executed the crime at some other place and then having brought the dead body and hanged it in the room in question is also the possibility which cannot be brushed aside as entirely improbable.34. In the given circumstances, when the prosecution has not been able to remove the aforesaid doubts and the motive as imputed on the appellant does not appear existing, the benefit of doubt, obviously, goes to the appellant.CONCLUSION35. For what has been discussed hereinabove, we are clearly of the view that the Trial Court and the High Court have approached the case from an altogether wrong angle and have overlooked the major flaws and shortcomings in the prosecution case. In the given set of facts and circumstances, even if the prosecution has been able to create some suspicion against the appellant, it would be unsafe to accept that the implicating circumstances have been established by cogent evidence and such circumstances form a complete chain that rules out any other hypothesis except guilt of appellant. Hence, the conviction of the appellant cannot be sustained; she is entitled to the benefit of doubt.

### Instruction: Using the case data, forecast whether the court is likely to side with (1) or against (0) the appellant/petitioner. ### Input: this regard, it gets perforce reiterated that the prosecution has not produced any evidence which could displace the statement of DW-3 that he indeed informed the police at the asking of the appellant at about 9.30 p.m. on 01.05.1997 and did also inform the brother of the deceased. As noticed, PW-9 ASI Amar Singh did not specify as to how the information was received by him. Moreover, the person said to have divulged the information to the witness PW-7 was never examined. Given such omissions in the prosecution case, we find no reason to discard the testimony of DW-3. Once his testimony is accepted, several blocks of the prosecution story are knocked to the ground.Effect of the acquittal of co-accused persons31. There is yet another lacuna in the prosecution case that has magnified itself with acquittal of the co-accused, brothers of the appellant. It cannot be denied that if the appellant had been the killer, she, by herself, could not have hanged the dead body by the ceiling fan; and the act had definitely been performed by more than one person. That being the position, the Trial Court readily accepted the case against the brothers of the appellant as conspirators without cogent and convincing evidence. The High Court rightly acquitted them for want of evidence and even observed that the prosecution had failed to book the real culprit in place of the brothers of the appellant. However, the High Court yet considered it proper to maintain the conviction of the appellant as the principal culprit while failing to consider that an important link in the prosecution story was snapped as soon as brothers of the appellant were acquitted.31.1. We would hasten to observe that merely for the reason of acquittal of co-accused, another accused in a criminal case may not be acquitted if cogent evidence against him is available and his case could be segregated from the case against the acquitted co-accused. However, on the basic facts of the present case, it is evident that the gruesome act in question had not been the handiwork of one person and it would be rather preposterous to assume that the appellant hanged the dead body by ceiling fan all by herself. In the given circumstances, when the alleged collaborators of the appellant are acquitted, the already existing clouds of doubts on the prosecution story get congealed. The High Court has proceeded with over- simplification of the matter by leaving the missing link as merely a fault of the investigating agency. In our view, as soon as the brothers of the appellant were acquitted, the High Court ought to have examined the consequence of such acquittal that an important link in the prosecution theory was snapped and it was difficult to conclude that the prosecution has established its case against the appellant beyond all reasonable doubts.The prosecution case not established beyond reasonable doubt32. Thus, as regards the circumstances relied upon by the prosecution, the position obtainable from the material placed on record and the surrounding factors is that (a) the death of deceased Tirloki Nath was homicidal in nature and had not been suicidal though it was sought to be projected as suicide by the culprits by hanging the dead body from a ceiling fan in his room; (b) there is no cogent and convincing evidence on record to come to a definite conclusion that the relations of the deceased and the appellant were strained or that the appellant was indulgent in illicit relations or she was insisting for transfer of property in her name; (c) it is also difficult to come to a definite conclusion that the deceased had expressed imminent danger to his life at the hands of the appellant; and (d) even if the deceased was last seen alive in the company of the appellant, the time gap between such last seen and finding of his dead body had been of about 2 to 3 days.33. Apart from the factors above, there are several other loopholes whereby the alleged circumstances sought to be relied upon by the prosecution lose their worth and force. As noticed, the investigating agency and the prosecution had not been forthright. The relevant aspects pertaining to the crime in question were not properly investigated and even the relevant witnesses were not examined. Moreover, as noticed, the prosecution case was framed in the manner that the appellant committed the crime with the help of her brothers who have been acquitted.33.1. In the given circumstances, the fact that the staircase from the ground floor was directly leading to the room in question where the dead body was found, acquires immense significance. Even if it be assumed that the deceased was putting up in the said room, some person or persons reaching there directly from the ground floor and carrying out the crime is not ruled out. In the alternative, some person or persons having executed the crime at some other place and then having brought the dead body and hanged it in the room in question is also the possibility which cannot be brushed aside as entirely improbable.34. In the given circumstances, when the prosecution has not been able to remove the aforesaid doubts and the motive as imputed on the appellant does not appear existing, the benefit of doubt, obviously, goes to the appellant.CONCLUSION35. For what has been discussed hereinabove, we are clearly of the view that the Trial Court and the High Court have approached the case from an altogether wrong angle and have overlooked the major flaws and shortcomings in the prosecution case. In the given set of facts and circumstances, even if the prosecution has been able to create some suspicion against the appellant, it would be unsafe to accept that the implicating circumstances have been established by cogent evidence and such circumstances form a complete chain that rules out any other hypothesis except guilt of appellant. Hence, the conviction of the appellant cannot be sustained; she is entitled to the benefit of doubt. ### Response: 1

Associated Building Company Limited and Others Vs. Union of India and Others

instruments, machinery, equipments, automobiles and other vehicles and goods under production or in transit, cash balances, reserve funds, investments and booklets and all other rights and interests in or arising out of such property as were, immediately before the appointed day, in the ownership, possession, power or control of the textile company whether within or outside India and all books of account, registers and all other documents of whatever nature relating thereto."It was contended that the textile undertaking shall be deemed to include all assets, rights, leaseholds, powers, authorities and privileges of the textile company in relation to the said textile undertaking. Relying on this part of the sub-section, Shri Kapadia submitted that even assuming that Tata Mills Limited was occupying a portion of the Bombay House in the capacity as a licensee then even that right to occupy the premises vest in the Custodian. It is not possible to accede to the submission of the learned Counsel. Chapter VI of Indian Easements Act, 1882 deals with subject of licences and section 52 provides that where one person grants to another, a right 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 an interest in the property, then the right is called a licence. Section 56 provides that a licence cannot be transferred by the licensee or exercised by his servants or agents. Section 62 provides that the licence is deemed to be revoked where the licence is granted to the licensee for holding a particular office, employment or character, and such office, employment or character ceases to exist. It is well settled that the licence granted is a personal right and is neither heritable nor transferable. Shri Kapadia did not dispute that the licence is not transferable by act of parties but urged that licence can be transferred by operation of law. It is not possible to accede to the submission of the learned Counsel. Sub-section (2) of section 3 provides that the `Textile Undertaking shall be deemed to include rights of the textile company in relation to the textile undertaking and the expression `right must be construed as an enforceable right. It hardly requires to be stated that a transferee of licensee cannot enforce the right to remain in possession as a licensee and not being an enforceable right, the licence cannot be construed as a right to attract the provisions of sub-section (2) of section 3 of the Act. The licence granted by petitioner No. 1 is in the nature of permission to occupy a portion of the Bombay House, and that too, gratuitously. It is impossible to accede to the claim that the permission granted amounts to a right as contemplated by sub-section (2) of section 3 and therefore the Custodian has right to occupy portion of Bombay House.Shri Kapadia submitted that if it is found that the right of occupation of a licensee is not an enforceable right and therefore sub-section (2) of section 3 is not attracted, then it should be held that Tata Mills Limited had a power, authority and privilege to occupy portion of the Bombay House and therefore the Custodian can take over the portion of Bombay House under sub-section (2) of section 3. The submission is devoid of any merit. Once it is found that Tata Mills Limited had no enforceable right, then it is futile to suggest that Tata Mills Limited had a power, authority and privilege as contemplated by sub-section (2) of section 3 and therefore the Custodian can take over possession of Bombay House. Shri Kapadia then submitted that sub-section (2) also provides that the expression `Undertaking includes all properties, movable and immovable, including lands, buildings etc. and the right to occupy portion of Bombay House is an asset which vests in the Custodian. The submission has no merit because in case the contention of the respondents that occupation of portion of Bombay House gratuitously is an enforceable right is not correct, then such occupation cannot be construed as an asset of Tata Mills Limited. In our judgment, the provisions of sub-section (2) of section 3 are not atrracted and consequently, the letter written by respondents on January 16, 1984 demanding possession of undemarcated and unspecified portion of Bombay House was wholly without authority.7.Shri Kapadia referred to decision of Supreme Court reported in A.I.R. 1980 S.C. 1234, (National Textile Corporation Ltd. and others v. Sitaram Mills Ltd. and others), and observations to the following effect:-"The legislation was clearly in furtherance of the Directive Principles of State Policy in Article 39(b) and (c) of the Constitution. In interpreting such a piece of legislation, the courts cannot adopt a doctrinaire or pedantic approach. It is a well known rule of construction that in dealing with such a beneficent piece of legislation, the courts ought to adopt a construction which would subserve and carry out the purpose and object of the Act rather than defeat it."The principles laid down by the Supreme Court are well settled and there cannot be any debate that while considering a beneficent piece of legislation, the courts should adopt the liberal construction. A reference was also made to the decision reported in (1988) 1 Company Law Journal 225 (S.C.), (Doypack Systems Private Limited v. Union of India and others), to point out that the expression in relation to must be construed widely. In our judgment, the reference to the decision is not appropriate. The provisions of sub-section (2) of section 3 are wide in its ambit but it would certainly not include an unenforceable right. For example, if a person hands over his car to the textile mill for gratuitous use then it cannot be claimed that the car is an asset of the undertaking or the user of a car is a right vested in the undertaking and consequently it is open for the Custodian to take possession of the car.

1[ds]It is impossible to accede to the submission. The respondents could not produce any document or any material to indicate that Tata Mills Limited was occupying portion of the Bombay House as lessees. We repeatedly enquired from the learned Counsel for the respondents as to whether there is any document to indicate that the occupation was as a lessee and the learned counsel fairly stated that there is none. In these circumstances, it is futile to claim that Tata Mills Limited was occupying the portion of Bombay House as tenant merely because the return so claims. Both Tata Mills Limited and petitioner No. 1 who were the owners of Bombay House have stated immediately on receipt of the letter that occupation of Tata Mills Limited was gratuitous and Tata Mills Limited had no legal right to remain in occupation. It is, therefore, obvious that the first contention of Shri Kapadia that Tata Mills Limited was in occupation as lessees and right vested in Custodian is required to be turnedis not possible to accede to the submission of the learned Counsel. Chapter VI of Indian Easements Act, 1882 deals with subject of licences and section 52 provides that where one person grants to another, a right 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 an interest in the property, then the right is called a licence. Section 56 provides that a licence cannot be transferred by the licensee or exercised by his servants or agents. Section 62 provides that the licence is deemed to be revoked where the licence is granted to the licensee for holding a particular office, employment or character, and such office, employment or character ceases to exist. It is well settled that the licence granted is a personal right and is neither heritable nor transferable. Shri Kapadia did not dispute that the licence is not transferable by act of parties but urged that licence can be transferred by operation of law. It is not possible to accede to the submission of the learned Counsel.) of section3 provides that the `Textile Undertaking shall be deemed to include rights of the textile company in relation to the textile undertaking and the expression `right must be construed as an enforceable right. It hardly requires to be stated that a transferee of licensee cannot enforce the right to remain in possession as a licensee and not being an enforceable right, the licence cannot be construed as a right to attract the provisions of) of section3 of the Act. The licence granted by petitioner No. 1 is in the nature of permission to occupy a portion of the Bombay House, and that too, gratuitously. It is impossible to accede to the claim that the permission granted amounts to a right as contemplated by) of section3 and therefore the Custodian has right to occupy portion of Bombaysubmission is devoid of any merit. Once it is found that Tata Mills Limited had no enforceable right, then it is futile to suggest that Tata Mills Limited had a power, authority and privilege as contemplated by) of section3 and therefore the Custodian can take over possession of Bombay House. Shri Kapadia then submitted that(2) also provides that the expression `Undertaking includes all properties, movable and immovable, including lands, buildings etc. and the right to occupy portion of Bombay House is an asset which vests in the Custodian. The submission has no merit because in case the contention of the respondents that occupation of portion of Bombay House gratuitously is an enforceable right is not correct, then such occupation cannot be construed as an asset of Tata Mills Limited. In our judgment, the provisions of) of section3 are not atrracted and consequently, the letter written by respondents on January 16, 1984 demanding possession of undemarcated and unspecified portion of Bombay House was wholly withoutprinciples laid down by the Supreme Court are well settled and there cannot be any debate that while considering a beneficent piece of legislation, the courts should adopt the liberal construction. A reference was also made to the decision reported in (1988) 1 Company Law Journal 225 (S.C.), (Doypack Systems Private Limited v. Union of India and others), to point out that the expression in relation to must be construed widely. In our judgment, the reference to the decision is not appropriate. The provisions of) of section3 are wide in its ambit but it would certainly not include an unenforceable right. For example, if a person hands over his car to the textile mill for gratuitous use then it cannot be claimed that the car is an asset of the undertaking or the user of a car is a right vested in the undertaking and consequently it is open for the Custodian to take possession of the car.

### Instruction: Evaluate the arguments and evidence in the case and predict the verdict: is an acceptance (1) or rejection (0) of the appeal more probable? ### Input: instruments, machinery, equipments, automobiles and other vehicles and goods under production or in transit, cash balances, reserve funds, investments and booklets and all other rights and interests in or arising out of such property as were, immediately before the appointed day, in the ownership, possession, power or control of the textile company whether within or outside India and all books of account, registers and all other documents of whatever nature relating thereto."It was contended that the textile undertaking shall be deemed to include all assets, rights, leaseholds, powers, authorities and privileges of the textile company in relation to the said textile undertaking. Relying on this part of the sub-section, Shri Kapadia submitted that even assuming that Tata Mills Limited was occupying a portion of the Bombay House in the capacity as a licensee then even that right to occupy the premises vest in the Custodian. It is not possible to accede to the submission of the learned Counsel. Chapter VI of Indian Easements Act, 1882 deals with subject of licences and section 52 provides that where one person grants to another, a right 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 an interest in the property, then the right is called a licence. Section 56 provides that a licence cannot be transferred by the licensee or exercised by his servants or agents. Section 62 provides that the licence is deemed to be revoked where the licence is granted to the licensee for holding a particular office, employment or character, and such office, employment or character ceases to exist. It is well settled that the licence granted is a personal right and is neither heritable nor transferable. Shri Kapadia did not dispute that the licence is not transferable by act of parties but urged that licence can be transferred by operation of law. It is not possible to accede to the submission of the learned Counsel. Sub-section (2) of section 3 provides that the `Textile Undertaking shall be deemed to include rights of the textile company in relation to the textile undertaking and the expression `right must be construed as an enforceable right. It hardly requires to be stated that a transferee of licensee cannot enforce the right to remain in possession as a licensee and not being an enforceable right, the licence cannot be construed as a right to attract the provisions of sub-section (2) of section 3 of the Act. The licence granted by petitioner No. 1 is in the nature of permission to occupy a portion of the Bombay House, and that too, gratuitously. It is impossible to accede to the claim that the permission granted amounts to a right as contemplated by sub-section (2) of section 3 and therefore the Custodian has right to occupy portion of Bombay House.Shri Kapadia submitted that if it is found that the right of occupation of a licensee is not an enforceable right and therefore sub-section (2) of section 3 is not attracted, then it should be held that Tata Mills Limited had a power, authority and privilege to occupy portion of the Bombay House and therefore the Custodian can take over the portion of Bombay House under sub-section (2) of section 3. The submission is devoid of any merit. Once it is found that Tata Mills Limited had no enforceable right, then it is futile to suggest that Tata Mills Limited had a power, authority and privilege as contemplated by sub-section (2) of section 3 and therefore the Custodian can take over possession of Bombay House. Shri Kapadia then submitted that sub-section (2) also provides that the expression `Undertaking includes all properties, movable and immovable, including lands, buildings etc. and the right to occupy portion of Bombay House is an asset which vests in the Custodian. The submission has no merit because in case the contention of the respondents that occupation of portion of Bombay House gratuitously is an enforceable right is not correct, then such occupation cannot be construed as an asset of Tata Mills Limited. In our judgment, the provisions of sub-section (2) of section 3 are not atrracted and consequently, the letter written by respondents on January 16, 1984 demanding possession of undemarcated and unspecified portion of Bombay House was wholly without authority.7.Shri Kapadia referred to decision of Supreme Court reported in A.I.R. 1980 S.C. 1234, (National Textile Corporation Ltd. and others v. Sitaram Mills Ltd. and others), and observations to the following effect:-"The legislation was clearly in furtherance of the Directive Principles of State Policy in Article 39(b) and (c) of the Constitution. In interpreting such a piece of legislation, the courts cannot adopt a doctrinaire or pedantic approach. It is a well known rule of construction that in dealing with such a beneficent piece of legislation, the courts ought to adopt a construction which would subserve and carry out the purpose and object of the Act rather than defeat it."The principles laid down by the Supreme Court are well settled and there cannot be any debate that while considering a beneficent piece of legislation, the courts should adopt the liberal construction. A reference was also made to the decision reported in (1988) 1 Company Law Journal 225 (S.C.), (Doypack Systems Private Limited v. Union of India and others), to point out that the expression in relation to must be construed widely. In our judgment, the reference to the decision is not appropriate. The provisions of sub-section (2) of section 3 are wide in its ambit but it would certainly not include an unenforceable right. For example, if a person hands over his car to the textile mill for gratuitous use then it cannot be claimed that the car is an asset of the undertaking or the user of a car is a right vested in the undertaking and consequently it is open for the Custodian to take possession of the car. ### Response: 1